An Ontario court has rejected a lawsuit brought by Rogers that alleged rival cable TV provider Shaw has violated a non-compete agreement, clearing the way for the two to fight it out on each other's turf.

Toronto-based Rogers sued Shaw earlier this month over the Calgary-based company's proposed $300-million purchase of Mountain Cable, a TV provider based in Hamilton, Ont. Rogers told Ontario Superior Court Justice Frank Newbould that the two companies had a nine-year-old agreement to split English Canada between them.

Rogers said that Shaw's move, which the company and industry analysts expect will be followed by more acquisitions in Ontario, would cause it "irreparable harm." Lawyers for Shaw said that no such deal existed, and that if it did it would have been illegal.

Newbould last week rejected Rogers's assertions in making his decision. "This harm is speculative in the extreme," he said.

The judge also sided with another of Shaw's arguments — that preventing it from acquiring cable providers in Rogers's territory was harmful to competition because it only gave the small companies one potential buyer.

"[The] effect will be to deprive vendors of independent cable companies of the full value of their businesses," Newbould said in his ruling.

Mountain has about 41,000 TV subscribers, 28,000 internet customers and 27,000 telephone subscribers.