Bona Law Files Antitrust Counterclaims Against T-Mobile on Behalf of WCO Spectrum in California Federal Court
April 14, 2025
San Diego, Calif. – April 14, 2025 – Antitrust boutique Bona Law filed antitrust counterclaims against T-Mobile on behalf of WCO Spectrum in the U.S. District Court for the Central District of California. The counterclaims, filed on March 31, 2025 as part of WCO Spectrum’s answer to T-Mobile’s RICO lawsuit against WCO Spectrum, accuse T-Mobile of engaging in a multifaceted anticompetitive scheme to maintain its monopsony power in the market for Educational Broadband Service (EBS) and Broadband Radio Service (BRS) spectrum rights—known together as the 2.5 GHz spectrum—across numerous geographic service areas nationwide.
WCO Spectrum is standing up against T-Mobile’s alleged efforts to suppress competition and exclude innovative entrants like WCO Spectrum from revolutionizing the wireless spectrum market.
A Battle Over Spectrum Control
WCO Spectrum, a Delaware-based company founded in 2020, emerged in response to a pivotal Federal Communications Commission (FCC) rule change that allowed commercial entities to acquire EBS licenses previously restricted to educational institutions. With a visionary plan to enhance spectrum efficiency through dynamic sharing—mirroring the successful Citizens Broadband Radio Service (CBRS) model—WCO Spectrum aimed to acquire EBS licenses, honor existing leases, and ultimately lease spectrum back to carriers like T-Mobile, AT&T, and Verizon at competitive rates. This strategy promised to lower costs, improve network quality, and benefit consumers, aligning with the FCC’s goals of fostering innovation and competition.
According to the counterclaims, T-Mobile perceived WCO Spectrum’s entry as a threat to its dominant position, controlling approximately 90% of the 2.5 GHz spectrum through ownership and long-term leases. Rather than embracing competition, T-Mobile allegedly unleashed a three-pronged attack to preserve its monopsony—a buyer-side monopoly—over this critical mid-band spectrum, which is prized for its superior coverage, high capacity, and cost-effective deployment in 5G networks.
Allegations of Anticompetitive Conduct
The counterclaims detail T-Mobile’s alleged exclusionary tactics, which include:
1. Anticompetitive Lease Provisions: T-Mobile’s leases with EBS license holders—typically educational institutions—contain restrictive terms designed to thwart competitive bidding. These include exclusivity clauses barring lessors from negotiating with third parties like WCO Spectrum, burdensome information-sharing requirements that inflate transaction costs, and rights of first refusal (ROFRs) extending beyond lease terms, allowing T-Mobile to block sales even after ceasing to use the spectrum. These provisions, often spanning 30 years, allegedly lock in license holders and suppress prices below competitive levels.
2. Defensive License Purchases: Since the 2020 FCC rule change, T-Mobile has acquired over 500 of the roughly 2,200 EBS licenses, frequently exercising its ROFR to outbid WCO Spectrum. These purchases, the counterclaims assert, are not driven by operational needs but by a strategy to foreclose competition and reinforce T-Mobile’s market dominance.
3. Sham Litigation and Intimidation: T-Mobile is accused of waging a campaign of “lawfare” against its lessors, filing baseless lawsuits and issuing threats to deter them from selling to WCO Spectrum. High-profile examples include lawsuits against Albright College, the St. Lucie County School Board, and Lorain County Community College, all of which collapsed after the targeted transactions were abandoned due to litigation costs. T-Mobile’s threats, often accompanied by copies of prior complaints, have created a chilling effect across the educational community, stifling WCO Spectrum’s efforts to negotiate competitive deals.
The counterclaims highlight a pivotal March 2021 meeting in Chicago, where T-Mobile’s Senior Director Paul McCarthy allegedly invited WCO Spectrum’s Carl Katerndahl to collude on bid prices—an offer Katerndahl rejected. T-Mobile’s subsequent escalation, the filing contends, was a direct response to WCO Spectrum’s refusal to cartelize the market.
Defining the Market and Monopsony Power
WCO Spectrum asserts that the 2.5 GHz spectrum constitutes a distinct product market due to its unique propagation characteristics, high capacity, and cost efficiency—attributes T-Mobile itself has touted in public statements distinguishing it from other mid-band frequencies like C-band. The relevant geographic markets are the FCC-designated GSAs, where T-Mobile’s control often reaches 90–100%. High entry barriers, including FCC regulation, restricted access to lease terms, and substantial capital requirements, further entrench T-Mobile’s monopsony power, enabling it to dictate sub-competitive prices to license holders.
Harm to Competition and WCO Spectrum
EBS license holders, often underfunded schools, receive prices 2–5 times lower from T-Mobile than WCO Spectrum’s competitive offers—offers T-Mobile allegedly blocks through its exclusionary tactics. For instance, WCO Spectrum’s $16.2 million offer to Albright College dwarfed T-Mobile’s initial $4 million bid, yet T-Mobile’s litigation forced the deal’s collapse. This price suppression, coupled with WCO Spectrum’s exclusion, has cost the company lost profits, stalled its innovative business model, and raised its operational costs significantly.
The Counterclaims
WCO Spectrum’s counterclaims invoke both federal antitrust law under the Sherman Act, Sections 1 and 2, and California’s Cartwright Act. WCO Spectrum also alleges claims under California’s Unfair Competition Law and for intentional interference with prospective economic advantage. It seeks treble damages and injunctive relief for its federal antitrust claims and restitution and disgorgement under California law.
“WCO Spectrum is fighting to disconnect T-Mobile’s stranglehold on the 2.5GHz spectrum and ring in a new era of competition for educational institutions and consumers alike,” said Aaron Gott, counsel for WCO Spectrum and a partner at Bona Law. “We’re excited to dial up the pressure on T-Mobile’s anticompetitive tactics.”
Bona Law made its appearance in the case just before filing the answer and counterclaims on March 31.
The case, T-Mobile US, Inc. et al., v. WCO Spectrum LLC, et al., No. 23-cv-4347-AH-E is now pending before U.S. District Judge Anne Hwang, and had been pending before U.S. Chief District Judge Christina Snyder since June 2023, when T-Mobile filed its RICO complaint.
Bona Law attorneys Aaron Gott, Jarod Bona, and Pat Pascarella, alongside co-counsel from Mitts Law, LLC, Winnick Law, PC, and James Lynch, Esq., represent WCO Spectrum.