Virgin Media accused BSkyB of strangling competition in the pay-TV market in a High Court claim for millions in damages from the satellite broadcaster.

The cable group said that its Virgin Media Television arm would lose £4 million this year as a result of it accepting a cut-price carriage agreement with BSkyB, 39.1 per cent owned by News Corporation, parent company of The Times.

Virgin Media’s claim, released yesterday, alleged that BSkyB “has formulated and implemented a strategy to stifle or substantially impair Virgin Media’s ability to compete” in consumer pay-TV. The release of the document comes the day before the Office of Fair Trading and Ofcom, the regulators, publish conclusions from their inquiries into whether Sky’s purchase of 17.9 per cent of ITV was anticompetitive. At the time ITV was the subject of a Virgin Media bid.

The cable company, formerly NTL, wants the High Court to rule that Sky has a “dominant position” in pay-TV and has “abused that dominant position”. It wants unspecified damages, and injunctions to force a “nondiscriminatory” deal.

Virgin Media’s claim gives its version of events that led to a breakdown of relations between the pay-broadcasters, after the cable group refused to pay the £48.4 million asked for by Sky for its basic channels. In 2006, Virgin had paid £23.6 million.

It paints a picture of aggressive negotiations with Sky, which on two occasions offered to pay Virgin Media nothing for its channels Living, Bravo, Challenge and Trouble. In 2006, Virgin Media had received £35.6 million. Later Virgin Media accepted an offer worth £5.1 million in 2007.

A spokesman for Sky said it would file a response, and added: “This version of events contains substantial factual inaccuracies and omissions, which we will correct in our response. No one should draw conclusions after hearing only one side of the argument.”

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