Millennium's Bid Catches the Wrong Wave
By Mike Farrell -- Multichannel News, 4/16/2007
WaveDivision Holdings CEO Steve Weed's months-long battle to acquire Millennium Digital Holdings hit a snag late last month, after a judge in Washington dismissed the case because it was filed in the wrong jurisdiction. But Wave's lawsuit against Millennium will continue, only this time in a Delaware state court instead of King County (Wash.) Superior Court.
“The bottom line is that the case is still progressing along,” Weed said. “Millennium contested the jurisdiction we selected. They've won that argument which just changes the venue.”
In a terse order issued March 30, King County Superior Court Judge Dean Lum granted Millennium's request for dismissal without prejudice.
Wave sued Millennium in October, claiming the cable operator reneged on a deal to sell about 70,000 subscribers in Washington, Oregon and Michigan to Wave for $157 million.
According to the original suit, Wave first began negotiating with Millennium in 2005, reaching a deal on Feb. 8, 2006. But soon after that deal was signed, Wave claimed that Millennium began dragging its feet, failing to seek immediate approval of the transaction.
Wave said the reason behind the delay was that holders of Millennium's high-yield bonds had begun talks with Millennium to either acquire the assets Wave had agreed to buy, or sell them to a third party.
While the bondholders were not identified in the suit, executives in the cable investment community have said in the past they were believed to be New York hedge fund Trimaran Capital Partners and Stamford, Conn.-based distressed-debt investor Black Diamond Commercial Finance.
Wave had asked the court to either approve the original sale or allow it to overbuild Millennium systems in the three states.
In a somewhat-puzzling move, Millennium also sought to block an overbuild of its systems by Wave, claiming that it violates the sale agreement which it also argues does not exist.
According to a deposition filed in December by Millennium chairman Kelvin Westbrook, Millennium had originally included a provision in the contract that all disputes would be settled according to New York state law. Wave countered that the deal should be subject to the laws of Washington state. In a compromise, the two parties agreed to try the case in Delaware.
