Category: Lawsuits

“Telecoms Sue Over High-Speed Links”

It’s the same all over dept.

The National Law Journal carries a summary article focusing on the propensity of the incumbent telecoms to sue when a local community decides to build its own high-speed fiber network. One of our own kicks off the story:

“It’s a national playbook. The longer they [telecom companies] delay things, the better for them,” said Patrick Ottinger, general counsel for Lafayette, La.

That’s precisely right and could stand as a summary for the entire article. But reporters, being reporters it goes on for quite a bit longer. And I have to admit that it is interesting to catch up on Lafayette’s friends in other places. Even if you do have to listen to the same old groaners from those who are trying to justify their delaying tactics. Does this sound familiar:

Attorneys for telecommunications companies say the litigation is needed because municipalities with the ability to borrow money cheaply — and not hobbled by the need to return a profit — have unfair competitive advantages.

“Our position has never been that it is unlawful for cities to do this, but you can’t use your powers as a city to create an uneven playing field,” said David Goodnight in Stoel Rives’ Seattle office, who has represented Qwest Communications International Inc…

The idea that a companies like Qwest, AT&T, or Cox could ever, under the most extreme imaginable situation, ever, ever operate at a unfair competitive disadvantage to some local utility is laughable. It is not an “unfair” competitive advantage to not desire to stick it to your community…it is the way that little local phone and cable companies used to think all the time. The enormous political and economic power that vertically integrated mulitnational corporations with effective monopolies in their core products wield makes their occasional local competitors look like flies… If a community utility wins customer loyality it’s because they’re offering a better, more desireable product despite the power difference that is stacked against them.

Also covered are legal entanglements in Utah, and Monticello, Minnesota–our comrades-in-arms at the other end of the Missississippi are facing a delaying lawsuit that is reminiscent of those Lafayette had to push through.

(Tip o’ the hat to my local legal informant.)

Alexandria to Sue re New Cable Franchise Law

According to the Town Talk Alexandria city officials are intending to challenge the constitutionality of the state-wide video franchise law. Apparently Lafayette and the Louisiana Municipal Association are also planning to go to court.

The gist:

The City Council approved a resolution authorizing City Attorney Charles “Chuck” Johnson to move forward in challenging the constitutionality of the new law.

Johnson said the city is looking into where and how to file the suit. He said the state constitution gives municipalities like Alexandria, with a Home Rule Charter, the right to organize themselves and allocate different functions as they see fit….

Johnson said other municipalities, including Lafayette, and the Louisiana Municipal Association have raised the same questions and have said they will also pursue their own litigation.

It seems that Alexandria is taking the lead because their cable provider was the first to start treating the city like an powerless owner and maintenance provider for “their” rights of way. (Had the state ripped away the rights for an private owner to manage their own property we’d never hear the end of it. Consistency isn’t a big virtue of our lege.) SuddenLink, the cable provider Cox sold it’s Alex operation to a while back, had pledged to start a customer service center in Alexandria. But, the story says: “Since the law became enacted, such negotiations have stopped.”

That’s the way these laws work and are intended to work. The incumbent providers didn’t want and now don’t have any responsibilities to the communities they serve. Blanco was right to have vetoed it last time around. Jindal (who signed off on June 21st) can add signing this to his list of recent blunders.

I have no idea how successful a legal challenge will be, but even the thinnest chance of success is worth the investment for the communities effected; the state handing over control of local community property to out-of-state monopolists is just about as bad an idea as there is. Alexandria’s run in with SuddenLink is only the beginning.

Appalling: Jindal Picks BellSouth Lobbyist

Here’s an appalling bit of news: Governor-elect Bobby Jindal has chosen Tommy Williams, a recently retired BellSouth lobbyist, to be his top legislative lobbyist.

Really.

Jindal–who ran emphasizing an ethics platform—is putting a lobbyist in as his legislative director. And not just any lobbyist: The former chief lobbyist of the most legislatively powerful corporation in the state. That’s gotta be a funny man to put in charge of what Jindal has said was his first priority in the legislature: Ethics reform. My guess is that no legislator will misunderstand the obvious meaning: Ethics reform is not aimed at stopping corporations from buying our legislature. Since that is the most serious form of corruption in this state ethics reform a la Jindal must be about something else. Appointing a major lobbyist to this position is hugely symbolic: it is akin to putting the fox in charge of hen house. No doubt the Louisiana legislature breathed a collective sigh of relief. They’ve seen this game played out before. Lots of rhetoric but with the “right” people in charge nobody really has to worry.

An AP wire brief reports on Wednesday’s announcement. The bare bones report out of Baton Rouge is simple and does no more than highlight his former position. We here in Lafayette, however, have a rich history to draw on with Tommy Williams and his family.

Tommy Williams, seasoned readers may recall, is the father of the BellSouth legacy that ran BS’ operations in Lafayette during the fiber fight. John Williams was a loyal son of the company who toed the company line on both how unnecessary fiber was and on how “someday real soon” BellSouth was going to run fiber. (Contradictions never faze such folks.) Williams was the man in charge when Fiber 411’s anti-fiber petition went out on company trucks. And he was the fellow who backed down when employee resistance and popular resentment made it clear that was a bad move. He was the fella whose designed-to mislead remarks about “functional equivalence” inspired the “Slick Sam Spade” video. He had to crawfish about his company’s lying about their role in the season’s ugliest moment: the push poll that ignited a firestorm of derision.

A paragon of ethics. But the senior Williams, Tommy Williams, was the guy who carried on the battle against Lafayette at the state level with an even more impressive lack of character. Tommy was prime mover in pushing through the (Un)Fair Competition Act–the law that tried to outlaw the project, did provide avenues for delaying it for years, and which remains a knife pointed at its heart. Tommy followed up on the legislative and legal tactics by taking the battle to the Public Service Commission (PSC) and trying to convince it to institute all sorts of anti-Lafayette rules. He mostly failed but having failed he persisted in trying to at least delay the bond issue. BellSouth’s lawsuits failed–but added to the delay. That didn’t work either but it wasn’t for lack of trying. We will probably never know who funded the Naquin lawsuits that were the last to stretch out the delay—but we do know they used material from BellSouth lawsuits that weren’t yet publicly available.

Tommy Williams (with his son) has been a consistent and relentless foe of Lafayette’s aspirations. Williams balked at nothing to oppose what the people of Lafayette voted for. He was in the line of command on all the questionable tactics and had a visible hand in much of it. None of it was ethical unless you subscribe to the anything-goes-for-a-bit-of-profit school of ethics. I, and I think most Lousiana’s subscribe to that older standard that has to do with honor and character. An honorable man doesn’t do dishonorable things at anyone’s bidding.

This is the man who will be in charge of shepherding our new governor’s ethics package through the legislature. I’d watch closely.

Terry Huval of LUS, qouted in a recent IND blog item is more forgiving than I can convince myself to be. He says:

“Unless we see something otherwise,” Huval continues, “I’m going to trust that Tommy’s going to follow what the governor wants to do, and my hopes are that the governor wants to do the right things.”

That’s trusting that the man is the sort that can put aside a lifetime of carrying water for his bosses and invests a lot of hope in the idea that he is only a loyal agent of his new master. I’m afraid I can’t be so trusting. In my experience people who’ve spent most of their lives justifying something are committed to it—especially if they were required to convince others of the righteousness of that position. But even if you trust that Tommy Williams can be honestly bought he’s still got a lifetime of habits in thinking about a set of issues that matter very much to Lafayette.

Who is talking to Jindal? Who in Lafayette has a pipeline to the new governor that can act as a counter-balance to the natural inclinations the man he is relying on to pass every other element of his agenda?

I hope someone is thinking about it and developing that pipeline.

It’s not a pretty sight.

More on the Bonds

The Advocate covers the Fiber To The Home bond presentations in New York this morning. Sounds good! Apparently the visit went well and Durel and Huval returned feeling good about Lafayette’s prospects for a favorable bond rating.

Some of the recent local contretemps were frankly discussed:

Last week, attorneys for the plaintiff in that lawsuit, Elizabeth Naquin, suggested that Lafayette might be subject to further legal action should it proceed in the manner it’s planning to issue and pay back the bonds.

Durel said he thought the timing of that suggestion was an attempt to spook the bond markets into a higher rate.

Ottinger said Lafayette officials discussed with the bond market representatives the possibility — or lack thereof — of another lawsuit stalling the project.

The Louisiana Constitution prohibits further challenges to the ordinance that authorized the bonds to be issued, Ottinger said.

Good. Being upfront about the opposition is the way to go in most cases and I’m sure honesty served them well here. The bond guys have done their homework and asked the next obvious question:

The bond market representatives also wanted to know if LUS was prepared should the existing telecommunications companies in the area start practicing “predatory pricing,” in an effort to undercut the new LUS venture, Durel said.

That is, indeed, the next issue; and that for which the people of Lafayette should prepare. The incumbents tried this in Bristol and it didn’t work. I suspect that the folks in Louisiana will recognize the ploy as easily as did those in Virginia.

It’s all good so far:

“The bond rating agencies and the bond insurers were impressed with the depth of information and analysis we had as well as our passion, and the community’s support, for the project,” Huval said. “We received favorable comments about LUS’ proven track record in managing the deployment of large projects.”

Let’s get on with it!

Lafayette, LA to Wilson, NC: Fight It!

Does this sound familiar?:

Wilson, NC is getting hit with a “Local Government Fair Competition Act” written up by their local incumbents (AT&T and Comcast) that intends to keep the city from expanding its current, successful fiber optic ring to provide its citizens with a little competition to the current phone and cable monopolies and the internet duopoly.

Sounds mighty familiar. That is exactly the title of the bill that has cost the people of Lafayette millions of dollars and which has delayed Lafayette’s fiber-optic project by 3 years. Without this law Lafayette’s citizens would be using their network now; instead we are just starting after a long obstructionist battle waged by the incumbents–all of which was enabled by the “Local Government Fair Competiton Act.”

Lafayette, Louisiana to Wilson, North Carolina: FIGHT IT. No half-a-loaf compromises, no handshakes, no backing off when offered a “grandfathering” clause.

People of Wilson: You cannot expect your opposition to honor any commitment it makes in conferences. They didn’t in Louisiana and you shouldn’t expect it in North Carolina. Without such a law you are free to make your own decisions and take responsibility for them. Such a law gives the incumbents the opening they need to sue you based on a law they have drafted. The incumbents will not hesitate to return to the legislature in the very next year to further “fix” the bill to disadvantage localities. They will use the law to pursue lawsuits that they cannot win. They will use lawsuits to simply delay project and they will use lawsuits to try and pursue interpretations of the law other than those they agreed to in conference. (Things got to such a pass here that even the legislator that skirted the rules to sponsor the bill later complained that the incumbents were suing over things that had been settled in favor of the municipality during compromise discussions!) You DO NOT need the “bigger, smarter guys at the statehouse” to protect you from yourselves. DO NOT buy the line that this sort law “protects the local taxpayer” or that it “levels the playing field.” It intends to shift your control of local resources away from local citizen-owners and to a compliant state house; you can protect yourself quite well without their dubious help, I am sure. It intends to establish rules that would cripple your local utility’s ability to compete; rules that the incumbents would rage against should anyone dare suggest applying such to them.

From the Wilson Daily Times Article:

City of Wilson officials and the North Carolina League of Municipalities are seeking to kill a bill that would place what they say are undue restraints on municipalities establishing “communications services.” Wilson officials expected some legislative opposition when they started planning to provide broadband services to the city.

The bill, called the Local Government Fair Competition Act, places several obstacles in the way of local governments seeking to provide services such as broadband Internet, telephone and cable television. The bill is sponsored by state Reps. Drew Saunders, D-Mecklenburg, Hugh Holliman, D-Davidson, Harold Brubaker, R-Randolph, and Julia Howard, R-Davie. Lawmakers representing Wilson County have not sponsored the bill.

Some of its provisions include requiring two public hearings where the city’s business plan would be available, including cost analysis and four-year projections. Also, a special election would be held to allow citizens to decide if the city should establish any communications service. Such a service would also have to be self-supporting and could not be subsidized by the city’s electric fund.

“There is no good reason for this bill,” said Ellis Hankins, director of the N.C. League of Municipalities.

And

City attorney Jim Cauley said the House bill was written and supported by the telecommunications industry and is “clearly designed to protect their pocketbooks at the expense of the public good.”

“In the interest of corporate protectionism, it will create such a barrier to the construction of municipal broadband infrastructure that many citizens will not have access to high-speed fiber-optic services in the foreseeable future, thereby making our economic development efforts that much more difficult,” Cauley said.

I hope the people of North Carolina will learn from Lafayette’s experience and kill this ugly example of “corporate protectionism.”

Slime: Naquin & Attorneys try to Drive up Bond Costs

Slime. Unprincipled, low-life slime.

That is the mildest and kindest epitaph that I can manage for Elizabeth Naquin, her Plaquimines attorneys and the incumbent corporations who are pretty obviously paying them off. The only possible purpose for stirring things up right now is to drive up the costs of the bonds that are to be marketed in New York next week. And that is plain, flat, wrong.

According to Kevin Blanchard over at the Advocate the attorneys for Naquin (BS/AT&T and/or Cox?) have shot off emails — to the media — threatening to sue Lafayette at some unspecified future moment over the plan to fund the construction of Lafayette’s fiber network. That plan has already been approved by the court of last resort, the Louisiana Supreme Court, and the objections raised have already been dismissed. Further, according to the Louisiana constitution the bond ordinance becomes immune to challenge when it is validated and that immunity extends to:

“the validity of the . . . means provided for the payment of such bonds and the validity of all pledges of revenues and of all covenants and provisions contained in the instrument or proceedings authorizing or providing for the issuance of such bonds, and as to all matters adjudicated and as to all objections presented or which might have been presented in such proceeding, and shall constitute a permanent injunction against the institution by any person of any action or proceeding contesting the validity of the bonds or any other matter adjudicated or which might have been called in question in such proceedings.” [Legal citation from Ottinger’s press release]

That is pretty conclusive. Let us be very plain: No one and no “thing” can challenge a bond once it has been validated and issued. The constitution is clear; no matter how defective a bond ordinance might prove to be, it cannot be changed after it has been validated and sold. The business plan supporting it is incorporated into the ordinance and becomes a contract with the bond holders. NOTHING can be done to change it. (Even if the court hadn’t already ruled on the question.)

So this is clearly FUD–an attempt to sow Fear, Uncertainty, and Doubt. It cannot be a valid legal objection and would only result in ridicule if actually brought before a court.

The real question is: WHO are they trying to scare now? And the answer is plain: the men who will sit across the table from Lafayette’s representatives setting up the bond sale. They would like to make those men fearful, uncertain, and doubtful. They hope those men will condition the bonds in such a way as to force millions more in interest costs on the people of Lafayette.

That the “lawyers” (aka PR agents for BS/AT&T and/or Cox?) are sending reporters multiple emails with their threatening “news” the week before the Lafayette team is set be in New York setting up the bond sale makes the whole slimy thing disgustingly transparent.

———————
To this point I’ve been willing to do no more than say that Naquin and her attorneys are pretty transparently serving the interests of AT&T (nee BS) and Cox. There is no money in a successful suit for Elizabeth Naquin and very little for her ambulance-chasing “personal injury” lawyers. With the Supreme Court decision they have lost all hope of ever being paid a penny by LUS or LCG on this case. Yet still they spend money on lawyers–money that cannot bring them any return. This has been an expensive lawsuit to carry forward–backed by a team of lawyers from several law firms, none of which are noted for their charity work. Someone is paying for this. Who benefits? Cox and BS/AT&T benefit. Who is hurt? The people of Lafayette.

Naquin is a new resident in Lafayette and clearly not a woman of means. She has been unwilling to make the slightest effort toward explaining to her neighbors why she wants to stand in their way and cost them millions of dollars in extra expenses to implement a decision that the people overwhelmingly approved in an hard-fought election.

This is a case made for investigative journalism. Who is Elizabeth Naquin? Why does she not have the decency to publicly justify the cost she is imposing on her new community. What is her connection with BellSouth and or Cox. What is her work history? When exactly did she move to Lafayette and why? Who is actually paying the expense of this series of lawsuits and threats? Are corporate funds or money from anyone employed by the incumbents involved. Are public relations firms involved in passing money on to its recipients? Which ones? What about Naquin’s repentant ex-ally, Matthew Eastin? Who recruited this student? Where did he get the money to pay his “share” of the expenses while he was involved? Did he pay anything? Was he asked to? How much?

Really…these lawsuits are going to cost the citizens of the community millions of dollars. It is now past the point where there is any possible legal or ethical rationale that could justify the continued legal harassment and hence no conceivable reason to not thoroughly investigate this situation. (Recall the feeding frenzy about much less expensive irregularities at the airport commission?) There is a big story here somewhere; anyone can smell it and the people deserve to know. (ULL journalism students, anyone?)

I’d like to know more–if anyone out there can shed any light on this please let me know. Here or via email.