The leadership situation at Sprint took an unusual turn
this weekend with BellSouth moving to court to block
its vice chairman, Gary Forsee, from accepting an offer to be Sprint’s CEO.
Sprint broke the silence on reports of management
changes, announcing the CEO position was offered to BellSouth’s Forsee, but
the Kansas City-based firm’s public statement was trumped by an Atlanta
judge granting a temporary restraining order preventing Forsee from
accepting the Sprint job.
Atlanta’s Bellsouth filed for the temporary restraining order in
Superior Court of Fulton County, Georgia after failing to convince Forsee to
ignore the Sprint advances. Sprint said Sunday that a court hearing would
be held “within a few days” to determine whether Forsee’s non-compete clause
bars him from working for a competing telecommunications firm.
Sprint and BellSouth compete in the long-distance and wireless markets
and the non-compete clause in Forsee’s contract is at the heart of the
dispute. BellSouth believes Forsee’s contract bars him from working for a
close competitor within 18 months of leaving.
Sprint said chairman and CEO William Esrey and chief operating officer
Ronald LeMay would remain in their current posts until the legal battle is
straightened out. Esrey is undergoing treatment for lymphatic cancer and
Sprint’s board of directors was hoping to snag BellSouth’s Forsee to take
over the top job.
Sprint did not address reports that LeMay would also leave the firm.
The potential leadership crisis at Sprint comes in the midst of a
struggle to keep pace with AT&T, WorldCom and Verizon in the U.S. long
distance market. Last December, the company cut
1,200 jobs in a company-wide restructuring move that hit the global
markets, local telephone and corporate divisions.
Those cuts accounted for about 3 percent of Sprint’s workforce and was
done to “eliminate overlaps and redundancies” and maintain competitive cost
structure, the company explained.