Metro PCS 2007 Annual Report Download - page 38

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the AWS spectrum, we could be forced to delay the launch of those markets. Delays in the launch of new
metropolitan areas, including our Auction 66 Markets, may have a material and adverse effect on our financial
results.
An economic slowdown or recession in the United States may slow our growth and materially adversely affect
our business.
A significant portion of our subscribers are in the lower half of the average income in the metropolitan areas we
serve and may be disproportionately affected by any economic downturn or recession in the United States. In
addition, a number of our subscribers work in industries which may be disproportionately affected by an economic
slowdown or recession. If our existing subscribers and potential new subscribers are unable to pay for our services,
we may experience increased churn and lower growth which would materially adversely affect our financial and
operational results.
Anti-immigration policies undertaken by federal, state or local governments may limit our growth in key
demographic segments of our customer base materially adversely affect our business.
Federal, state and local governments are considering or enacting anti-immigration policies and regulations which
may eliminate or adversely affect the ability of certain segments of the population from being able to work in the
United States. We believe that our subscriber base includes these segments of the population, especially in certain
metropolitan areas, such as Los Angeles. If these anti-immigration policies and regulations limit or adversely affect
the ability of this segment of the population to work, we may experience increased churn and lower growth which
would materially adversely affect our financial and operational results.
Our billing vendor has publicly announced that it plans to leave the telecommunications services business,
including the billing services business.
Verisign, the vendor for our existing billing system, has publicly announced that it plans to leave the
telecommunications services business, including the billing services business. We have a contract with Verisign that
will allow us to transition our billing services to a third party through mid-year 2009. We are in the process of
identifying and negotiating a new billing service agreement with a third party. If Verisign fails to continue to
provide the services it has previously provided prior to our transition to a third party system, if Verisign fails to
continue to upgrade its software and systems as we grow and change our business, or if we are unable to find a new
vendor to support our billing system on a cost effective basis or at all or we are unable to transition our billing
services to a new vendor before the end of the transition period, we may not be able to bill our customers, provide
customer care, grow our business, report financial results, or manage our business and we may have increased churn,
all of which could have a material and adverse effect on our business and financial results.
A patent infringement suit has been filed against us by Leap which could have a material adverse effect on our
business or results of operations.
On June 14, 2006, Leap and Cricket Communications, Inc., or collectively Leap, filed suit against us in the
United States District Court for the Eastern District of Texas, Marshall Division, for infringement of U.S. Patent
No. 6,813,497 “Method for Providing Wireless Communication Services and Network and System for Delivering of
Same,” or the ‘497 Patent, held by Leap. The complaint seeks both injunctive relief and monetary damages,
including treble damages, for our alleged infringement of such patent.
On September 22, 2006, Royal Street Communications filed a separate action in the United States District Court
for the Middle District of Florida, Tampa Division, Civil Action No. 8:06-CV-01754-T-23TBM, seeking a
declaratory judgment that Leap’ s ‘497 Patent is invalid and not being infringed upon by Royal Street
Communications. Leap responded to Royal Street Communications’ complaint by filing a motion to dismiss Royal
Street Communications’ complaint for lack of jurisdiction or, in the alternative, that the action be transferred to the
United States District Court for the Eastern District of Texas, Marshall Division, where Leap has brought suit
against the Company under the same patent. Royal Street Communications responded to this motion, but the Court
entered an Order transferring the action to the United States District Court for the Eastern District of Texas,
Marshall Division, where it remains pending. In February 2008, Leap answered the complaint and counterclaimed
against Royal Street Communications, claiming that Royal Street Communications’ infringes the ‘497 Patent and
seeking both injunctive relief and monetary damages, including treble damages, for Royal Street Communications’
alleged infringement by its wireless communication systems and associated services of the ‘497 patent.