TCT loses bid to recoup legal bills from suit

Though local telecommunications provider TCT defeated a long-running class action lawsuit in 2023, the victory apparently came at a high cost.

TCT, or Tri County Telephone Association Inc., said in court filings that it spent more than $4 million defending the suit, and the company’s attempt to recoup that money recently came up short. Though TCT is currently challenging the ruling, a federal judge determined last month that the company’s insurer doesn’t have to cover any of the expenses related to the decade-old lawsuit.

The litigation stemmed from TCT’s switch from a member-owned cooperative to a private, for-profit company in early 2015. Coop members around the Big Horn Basin overwhelmingly approved a sale to Meeteetse businessman Neil Schlenker, but former TCT board member Joe Campbell, who’d opposed the deal, joined with his wife and filed a 119-page class action lawsuit later that year. The Campbells contended that TCT’s members had effectively been the victims of a broad conspiracy that resulted in them selling the coop for far less than it was really worth.

The suit was eventually dismissed in 2022, when District Court Judge Jason Conder found that the plaintiffs didn’t have the evidence to back up their allegations against TCT. The Wyoming Supreme Court affirmed Conder’s ruling in 2023, and the eight-plus years of litigation finally came to an end in early 2024.

The class representatives — the estate of Joe Campbell, who died in 2020, his wife Barbara Campbell and former coop board member Bill Loveland — were ordered to pay about $42,600 worth of TCT’s costs. However, that was just a fraction of TCT’s legal bills. In later court filings, TCT indicated that it had spent “in excess of $4 million” defending the class action — a sum the company called “substantial” but “necessary to the defense (and livelihood) of TCT.”

Court records indicate a significant chunk of the defense was funded by a $4 million pot of money that had been set aside during the sale for “any undisclosed liabilities,” but TCT believed its then-insurer should have covered the legal bills.

In a 2024 suit filed in Wyoming’s U.S. District Court, TCT argued that Twin City Fire Insurance Company was obligated to defend the company from the suit and was wrong to deny coverage.

However, Twin City’s policy contained a clause that generally excluded “insured versus insured” claims — such as suits brought by former company managers like Joe Campbell. After combing through the fine print and the arguments of the parties, U.S. Chief District Judge Kelly Rankin ultimately concluded that Twin City was not obligated to defend TCT from the class action. The judge issued a judgment in the insurer’s favor and against TCT on January 12.

As for the plaintiffs in the class action, court records indicate they also incurred substantial costs. By late 2021, the plaintiffs’ attorneys reported that they’d spent over $400,000 on costs — a figure that didn’t include the many hours put in by their attorneys or costs from the final years of the litigation.

The plaintiffs did recoup $100,000 from a 2021 settlement they secured from TCT’s former legal counsel, which was one of the defendants in the class action. The remainder of that $200,000 settlement — roughly $94,000 — was distributed to 720 former members of the TCT coop.

Coop members collectively received $29 million from the 2015 sale.

TCT’s attorneys filed notice on Monday that they’re appealing Rankin’s ruling to the Tenth Circuit Court of Appeals, a process that will take months.