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Virginia Politics
Posted at 05:02 PM ET, 10/10/2012

OpenBand files $50 million lawsuit against Loudoun board, homeowners associations

Broadband telecommunications provider OpenBand filed a $50 million lawsuit Tuesday against over a dozen defendants in Loudoun County alleging that the county supervisors acted beyond their authority in their efforts to negotiate a deal between the Dulles-based company and the communities it serves.

The lawsuit, filed in Loudoun County Circuit Court, is the latest development in a years-long, litigious drama involving OpenBand, its customers and the Loudoun Board of Supervisors. Defendants include the Board of Supervisors, two individual members of the board and two homeowners associations.

In September, the county board voted to deny OpenBand’s application to renew its franchise agreement with the county, citing unresolved customer concerns as well as two pending federal lawsuits against the company. It was the second time that the franchise had been denied; the previous board rejected an earlier version of the agreement in November.

In the lawsuit filed Tuesday, OpenBand seeks to appeal the board’s decision to deny the franchise, requesting $50 million in damages for actions by the board and HOAs that caused “reputational and monetary harm” to the company, the complaint said.

Residents of communities served by OpenBand have long complained of the company’s poor customer service and unreliable cable quality. They’ve also argued that exclusive property easements established in OpenBand’s contracts with the communities’ developers resulted in an illegal monopoly. Last year, the Southern Walk and Lansdowne on the Potomac HOAs filed separate federal complaints against OpenBand, alleging that the exclusive easements violated federal telecommunications law.

OpenBand’s lawsuit, which names Supervisors Shawn Williams (R-Broad Run) and Ralph Buona (R-Ashburn) as individual defendants, claims that the two supervisors’ efforts to help negotiate a compromise between the company and two homeowners associations “crossed the line …  into direct manipulation of the franchise process.”

The Lansdowne on the Potomac and Southern Walk HOAs “conspired” with the board members, the complaint alleges, resulting in a “standard-less process” wherein OpenBand and its parent company, M.C. Dean, were “coerced to relinquish their private contract and real property rights and to make direct cash payments to the HOAs.”

Buona and Williams “spearheaded this unlawful behavior,” violating a state constitutional ban on government interference with private contracts, according to the lawsuit.

“The Board’s egregious actions amounted to extortion,” the complaint said.

Ben Young, spokesman for OpenBand, said the company was reluctant to file the lawsuit but was left with no alternative.

“We’d rather be investing in system upgrades, which we’ve said many, many times,” he said. “But it’s the only option we were given.”

Anna Nissinen, spokeswoman for Loudoun County, said the county could not comment on pending litigation.

Erika Cotti, president of the Southern Walk HOA, said that the association had not yet been served with the lawsuit. The Lansdowne on the Potomac HOA did not immediately respond to requests for comment.

By  |  05:02 PM ET, 10/10/2012

 
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