Court Rejects BT Attempt to Sue Virgin Mobile Over Migrations UPDATE

The High Court has thrown out a “fanciful” legal challenge by EE (BT) against Virgin Media (VMO2), which last year (here) accused the UK operator of having migrated customers away from their then EE powered Mobile Virtual Network Operator (MVNO) platform – Virgin Mobile – before the agreement had been concluded.

Just to recap. At the end of 2019 Virgin Media signed a 5-year deal with Vodafone to run their MVNO platform, which effectively ended their long-running supplier deal with EE (here). Under the plan, Virgin Mobile’s services – back then reflecting c.3 million customers – would start to transition to Vodafone’s platform from the end of 2021, although some 5G (mobile broadband) services were introduced before that.

Since then, both Virgin Media and O2 have merged into VMO2, with the new company having already cancelled the Vodafone MVNO agreement in order to fully harness O2’s platform. But that’s another story, and we’re today focused on the prior MVNO deal to use EE’s national mobile network.

In short, BT / EE appeared to be accusing VMO2 of having breached the terms of their MVNO agreement by allowing non-5G customers (i.e. 4G and older users) to be migrated away from EE’s network and on to O2 and Vodafone based platforms before its contract had formally expired. BT says it warned Virgin about this on multiple occasions, but the operator allegedly refused to carry out any checks. BT was reportedly seeking £24.6m in compensation.

High Court Judgment

The judge, Justice Joanna Smith DBE, has now ruled in Virgin Media’s favour as part of a summary judgment applied for by Virgin Media following EE’s original legal claim against Virgin Mobile relating to their former MVNO agreement with BT (meaning EE’s claim fell at the first hurdle). The judge described EE’s legal claim against Virgin Mobile as being “fanciful” and of having “no real prospect of succeeding“.

The summary judgment focused on a specific element of EE’s claim, with Justice Smith ruling that EE had “not advanced a consistent case” and noting that key evidence presented by one of EE’s lead negotiators “really does no more than suggest that ‘something might turn up’ at trial“. She described it as “fanciful” to suggest the evidence presented “provides a real prospect of success“.

VMO2 said that its former agreement with BT/EE provided that if EE launched 5G services to its own customers, and could not reach a commercial agreement with VM with regard to 5G services within a specified period (which it didn’t), then VM was permitted to procure 5G services from an alternative supplier (hence Virgin’s agreement with Vodafone in 2019). The agreement also allowed those customers provided with 5G services to be provided with 2G-4G services on the alternative supplier’s network.

A Virgin Media spokesperson said:

“We’ve always been very clear that we fully honoured our former mobile agreement with BT while giving our customers access to 5G as soon as possible. We’re pleased that the court has ruled in our favour and summarily dismissed EE’s claim against us.”

At the time of writing, it remains unclear whether BT / EE will attempt to appeal the decision, and we are currently awaiting their response to our comment request.

UPDATE 11:04am

We’ve had a short comment from BT.

A BT spokesperson said:

“We are disappointed by the court’s judgment and will now carefully review the findings before considering next steps.”