Sprint CEO Dan Hesse and two of the company’s top executives have resigned from Clearwire’s board of directors over concerns the arrangement could violate antitrust law in the wake of a recent U.S. Supreme Court decision.
Clearwire said Sprint told it the resignations of Hesse, strategy chief Keith Cowan and network operations and wholesale president Steve Elfman were made out of an “abundance of caution to address questions raised by Clearwire regarding new developments in antitrust law.”
The company specifically cited the Supreme Court decision in American Needle vs. the National Football League (NFL), which could affect how the Clayton Act applies to Sprint’s presence on Clearwire’s board of directors.
The Clayton Act bars executives from serving as a director or officer at two or more different corporations that compete or are engaged in commerce with each other. Sprint owns a majority stake in Clearwire but the companies offer competing services under their own respective brands.
Sprint is reserving its right to nominate directors to replace the three spots vacated by Hesse, Cowan and Elfman. Clearwire has 13 board members, seven of whom can be appointed by Sprint. Sprint’s four remaining directors on Clearwire’s board remain unchanged.
The Supreme Court ruled unanimously against the NFL in May, saying the company couldn’t claim its separate teams were a separate entity, since they competed against each other not only on the field but for players, management, fans and gate receipts.
Filed Under: Industry regulations