Crown Castle has become the latest tower company to file a lawsuit against EchoStar’s Dish Wireless.

This comes as Dish seeks to exit leasing contracts with Crown Castle following EchoStar’s recent decision to sell $40 billion of spectrum to AT&T and SpaceX.

Crown Castle is the second tower company to file a lawsuit against Dish over leasing agreements in recent months, following American Tower’s decision to sue Dish for trying to get out of its long-term contract.

In late August, AT&T announced it would pay $23 billion to EchoStar to acquire approximately 30 MHz of nationwide 3.45 GHz mid-band spectrum and roughly 20 MHz of nationwide 600 MHz low-band spectrum for around $23bn in an all-cash transaction.

Just two weeks later, Elon Musk’s SpaceX struck a $17 billion deal to snap up EchoStar’s AWS-4 (Advanced Wireless Spectrum) and H-block spectrum licenses.

Force majeure?

Dish sent two notices last month to Crown Castle informing the tower company that the sale of spectrum means its Master Leasing Agreement (MLA) and Master Product Agreement (MPA) held with the company “constituted force majeure.”

Dish and Crown Castle signed an MLA back in 2020. giving Dish access to lease space on 20,000 of Crown Castle’s cell towers as part of EchoStar’s plans to build out a 5G network to cover 70 percent of the US population.

However, increased pressure on EchoStar to free up spectrum from the Federal Communications Commission (FCC) led EchoStar to sell spectrum to AT&T and SpaceX.

EchoStar stated that the sales were made to appease the FCC, something that Crown Castle calls “baseless.”

“Faced with long-term payment commitments to Crown Castle, and with no longer any apparent need for the cell towers and fiber that Crown Castle provides, Dish has invented an excuse to try to avoid its contractual commitments: that EchoStar was forced by the US government to dispose of its spectrum. That excuse is a feeble one: the FCC has issued no order requiring EchoStar to sell any of its spectrum,” noted Crown Castle.

“Dish further asserted that the spectrum sales were the result of ‘unforeseeable actions by the FCC taken outside of Dish Wireless’s control,’ but the FCC had taken no action against EchoStar with respect to its spectrum, and EchoStar freely entered into these sales with AT&T and SpaceX.”

The company disputes Dish’s claims around force majeure, noting that there have been no unforeseeable events that would excuse the company from fulfilling its contractual obligations to Crown Castle. “The only basis asserted for invocation of force majeure—that the FCC “compelled” EchoStar to sell its spectrum—is demonstrably untrue,” added Crown Castle.

In the filing, Crown Castle said it “seeks a judgment that force majeure has not occurred under agreement, that Dish is not excused from its obligations, the agreements remain in full force, and that Dish remains obligated to perform all of its obligations thereunder.”

EchoStar previously batted away concerns around American Tower’s lawsuit, noting them as “at odds with reality.” DCD has contacted EchoStar for comment.