Motricity Sues Former President After He Left for Sprint Nextel

Sprint NextelÃ's president of network operations and wholesale, Steven Elfman is being sued by his former employer - Motricity after the firm alleged that he mislead them into making a purchase. Elfman had headed up the mobile services business unit at InfoSpace which was brought by Motricity last year - and the firm claims that it only have entered into the transaction based in part on an agreement that Steven Elfman would stay with the firm for at least two years after the sale completed. Elfman left the firm in March to join Sprint Nextel.

Motricity announced the aquisition of the mobile services business unit of InfoSpace for about US$135 million in an all cash transaction in October 2007 - with completion in December. The acquisition was funded largely by Carl Icahn and Advanced Equities. The lawsuit alleges that ElfmanÃ's "duplicitous conduct" enriched himself and damaged Motricity.

Prior to his post at Sprint, Elfman most recently served as president and chief operating officer of Motricity, and before that held mobile data and technology leadership positions at Infospace, Terabeam and AT&T Wireless.

The lawsuit became public when Sprint made an SEC filing which noted that the company would cover all the legal costs incurred by Elfman in defending the action. The SEC filing noted that Sprint Nextel agreed to pay for Steven ElfmanÃ's legal fees, to the extent he is not otherwise reimbursed, in a lawsuit filed against him by his former employer, Motricity, to help mitigate distractions to the business and to protect the CompanyÃ's interests.

The lawsuit doesnÃ't accuse Sprint of any wrongdoing.

Posted to the site on 16th November 2008