A New York court yesterday dismissed an antitrust suit filed by Pan American Satellite Corp. (Panamsat) against Washington-based Communications Satellite Corp. (Comsat), saying that the suit lacked merit.
Panamsat President Fred Landman expressed surprise at the order and said that the firm plans to appeal the decision.
The court based its ruling in part on what it said are special regulations that make Comsat immune from antitrust laws.
"Comsat has no role in many of the kinds of actions alleged to have injured Panamsat and to have been undertaken by individual foreign nations or groups of foreign nations," U.S. District Court Judge John F. Keenan of the Southern District of New York stated in his order issued last Thursday.
Panamsat of Greenwich, Conn., in 1988 became the first private player in commercial satellite communications to and from the United States.
That market was formerly the monopoly of Comsat, the U.S. representative of the 117-member International Telecommunications Satellite Organization (Intelsat).
Intelsat, whose members are mostly government-owned telephone companies around the world, was the sole provider of long-haul international satellite telecommunications until Panamsat entered the market.
In its suit, Panamsat charged that Comsat had caused it to lose $500 million in revenue by pricing services at or below cost, organizing an illegal boycott of Panamsat, and delaying its entry into markets while preparing similar services.
In a statement yesterday, Comsat pointed out that "the suit was particularly ironic" because it was Comsat that worked successfully on Panamsat's behalf to help it begin operations.
Panamsat's allegations are similar to the ones made by MCI Communications Corp. and Justice Department officials against American Telephone & Telegraph Co. in lawsuits filed in the 1970s.