BURLINGTON, Vt. (AP) -FairPoint Communications is being sued by a Vermont company that says FairPoint misled it and tried to steal its customers.

The suit, by Caleidoscope Communications Inc. of Burlington, says FairPoint tried to use Caleidoscope’s confidential information after initially promising to expand the company’s contract work.

FairPoint, which disputes the claims, says it severed its relationship with Caleidoscope after the contractor sought to negotiate a more favorable contract. The suit, filed in December in U.S. District Court in Burlington, says FairPoint engaged in “misrepresentations, deceptive conduct and unfair trade practices to intentionally abuse its contractual and business relationship with the plaintiff.”

It seeks a court injunction to stop what Caleidoscope says are ongoing efforts by FairPoint to use Caleidoscopes’ confidential information to steal customers.

FairPoint, which is asking that the lawsuit be dismissed, said in court filings that Caleidoscope tried to pressure FairPoint to enter a too-costly agreement. For years, Caleidoscope did sales work and provided technical assistance work to Verizon Communications Inc., which sold its northern New England landline business to FairPoint last year. The transfer has been less than seamless.

The Charlotte, N.C.,-based company, which recently posted a $76.1 million fourth-quarter loss, suffered a 12 percent loss of its residential and business lines in Maine, New Hampshire and Vermont in 2008.

It has also suspended divided payments to investors and asked regulators for permission to postpone an $11.25 million debt payment.

Beth Fastiggi, a FairPoint spokeswoman, says FairPoint decided after buying the Verizon business not to use independent sales agents – like Caleidoscope – anymore.

“We believe that our own local employees can better serve our local markets and, given the appropriate resources, will have the commitment and ability to increase our share of the local business market,” she said.

Information from: The Burlington Free Press, http://www.burlingtonfreepress.com

AP-ES-03-15-09 1338EDT

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