A shareholder in US phone firm MCI has taken legal action to halt a $6.75bn (£3.6bn) buyout by telecoms giant Verizon, hoping to get a better deal.
After collapsing as Worldcom, MCI has battled back to financial health
The lawsuit was filed on Friday after Qwest Communications, which had an earlier offer for MCI rejected, said it would submit an improved bid.
MCI's directors have backed Verizon, despite it tabling less money.
They are accused of breaching their fiduciary duties by depriving MCI shareholders "of maximum value".
'Unfair, grossly inadequate'
According the legal papers filed in a Delaware court, Verizon is set to pay an ""unconscionable, unfair and grossly inadequate" sum for MCI, which was formerly known as Worldcom.
Qwest said on Wednesday that MCI had rejected a deal worth $8bn.
A number of large MCI shareholders expressed unhappiness at the decision, saying that Verizon's offer, made up of cash, shares and dividends, undervalued the company.
Friday's lawsuit argues that the Verizon offer makes no provision for future growth prospects and that consolidation in the US phone industry will put a premium on MCI's network, assets and clients.
MCI's directors have argued that Verizon is bigger than Qwest, has fewer debts and has built a successful mobile division.
Chief executive Michael Capellas spent last week meeting with shareholders in an effort to win their backing.
In 2002, investors in the then-named Worldcom lost millions when the company filed for bankruptcy following an accounting scandal.
However, the firm - now renamed MCI - has put its operations in order and emerged from bankruptcy protection last April.
It is a long-distance and corporate phone firm, and would provide the buyer with access to a global telecommunications network and a large number of business-based subscribers.
MCI shares jumped on Friday, hitting their highest level since April 2004 amid speculation that it would be the focus of a bidding war.
A takeover of MCI would be the fifth billion-dollar telecoms deal since October as companies look to cut costs and boost client bases.
Earlier this month, SBC Communications agreed to buy its former parent and phone pioneer AT&T for about $16bn.