Litigation equals negotiation

The saga of paging operators seeking relief from LEC termination charges continues, with lawyers as hired gunfighters. But a new, unexpected sheriff is in town, urging resolution: the FCC

By now, most local operators have begun to explore their new relationship with their local exchange carrier (LEC). The reason for this exploration might be something other than curiosity. For example, your paging company may have been socked with some bills that you have to wonder about.

These bogus charges are the cost of terminating traffic on your system from the LEC. Although Congress (by changing the communications law) and the FCC (in the form of rule changes) have stated that these charges are improper, the LECs are still charging them. Why? Because it makes them more money than not charging them.

Some operators have continued to pay these charges, albeit with greater resistance. Because it is common for the LEC to threaten to shut off service (which after all, is somewhat integral to the paging business), the local operator continues topay and hope that it all gets straightened out in the long run. If the local operator makes inquiry about why the LEC is entitled to keep charging these costs, the LEC will refer to its local tariff.

If the local operator knows something about the law and asks for a new interconnection agreement under the Telecommunications Act of 1996 (a.k.a. 47 U.S.C. 251 and 252), the LEC will oblige the operator with its “standard agreement.” The standard agreement usually says, in essence, “The local operator can continue to pay under the prevalent tariff rate.” In other words- back to square one.

This merry-go-round continues until either the local operator gives up and signs an agreement that will continue the payment of bogus charges, or the local operator gets itself (Dare we say it?) a lawyer. That’s right. This is an ugly problem, and it calls for an ugly solution.

The trunk facility charges for one-way paging, or other services, should not be tolerated. Operators should not pay these charges; they should demand a refund of all monies paid to the LECs for these charges since 1996. And don’t buy the hogwash that these charges are “facilities” charges. The FCC doesn’t buy that LEC dodge, and neither should you.

Although the law and the love of God is on your side, this does not mean that the LECs are willing to roll over and “do the right thing.” Negotiations on an agreement that calls for reciprocal compensation between the paging operator and the LEC can take months to hammer out. (You haven’t seen stalling like this since the Elephant Man’s wedding night.)

So, what do you do? You sue. Not in local court. We have enormous faith in local courts, but this is one you ought to take to the FCC. Why? Because it’s quicker and frankly, the agency is on your side. After all, the agency is the one that passed the rules that the LECs are trying to avoid.

We know that appearing before the administrative law bench is often fruitless. Formal complaints sometimes age like rancid wine in the cellars of the agency. But “hail and welcome” to the new and speedier Enforcement Bureau of the FCC. A formal complaint is filed and-how about this-they actually work on it.

The Enforcement Bureau sets a time for filing pleadings, getting discovery done, articulating stipulations between the parties (like the LEC is a really big company) and actually moving the parties toward a resolution in accord with FCC rules and law. All along, the Enforcement Bureau keeps suggesting that maybe the LEC should just comply with the law and negotiate a reciprocal agreement in accord with the act, rather than have the bureau rule against it.

So, with the hammer of the Enforcement Bureau on your side, a strange thing begins to happen. The LEC now wishes to negotiate a deal. Suddenly, those terms that seemed impossible for the LEC to consider are now possible. The LEC is willing to give back the past payments and is willing to pay for future termination charges. Although there will be discussion about who pays for termination of traffic that does not originate on the LEC’s system, the complaint process has placed the local operator much closer to the promised land envisioned in the Telecommunications Act.

The FCC will encourage settlement between the parties. In this case, settlement discussions mirror the very arms-length, good-faith negotiation that is contemplated under the law. Therefore, by encouraging settlement, the FCC is putting the parties in a position where the law can work as planned.

After you settle your complaint, you will get an agreement that looks pretty much like what Congress thought it should when it created sections 251 and 252 of the Telecommunications Act. OK, so Congress did not think that it would take this long, but it thinks everything is automatic.

One thing you should notice is that your efforts will often avoid the local public utilities commission (PUC). Why? First, local PUCs are sometimes overly influenced by the largest LECs in their area. The most important reason is because most local PUCs are not entirely comfortable with the FCC’s treatment of cases under the Telecommunications Act. The PUC is likely to find more stock in the local tariff than Congress intended under the act, and if the tariff is at odds with the act, the PUC often says that the tariff will bind the parties until it is revised. We believe that this approach by some PUCs is simply: wrong.

Therefore, while the local operator is fighting for fairness in its dealings with a larger LEC, the same operator may find itself educating the local PUC by being a test case for whether a published tariff is relevant to the matter of reciprocal compensation among carriers.

If all of this seems ridiculous-it is. A local operator should not have to pay bogus charges for termination, dance around with an LEC for years regarding a proper reciprocal interconnection deal, get a lawyer who knows the difference between DID lines and DOA tariffs, bring a formal complaint before the Enforcement Bureau and then, and only then, get the LEC to sit down and discuss the kind of deal that the LEC should have offered years before. This isn’t right-or fair.

But we are not talking fairness here. We are talking about the wondrous world where telephone lines meet and tariffs are filed and traffic is terminated and interconnection abounds (in either real or virtual locations) and LATA boundaries define monopolies and where white rabbits fall down holes where DID lines run and the Mad Hatters at the FCC will follow the Queen of Hearts cry of “Off with their heads!” and the Cheshire Cat smiles on and on . No, it’s not Wonderland, it’s the telecommunications industry. n