AT&T: FCC Has “No Legal Or Factual Basis” To Issue Us Fine For Overcharging Schools

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Back in July, the FCC accused AT&T of badly overcharging some Florida schools for their telecom service. AT&T fired back that the FCC’s claims were meritless and that it looked forward to fighting. AT&T is in this at least as good as its word, and has filed its reply.

As Multichannel News explains, AT&T is going in for the full hat trick of counter-arguments: we didn’t do it; the way you’re accusing us of doing it is wrong; and actually, why is the FCC trying to regulate communications companies anyway.

To recap: the rules of the E-Rate program, which helps schools and libraries afford phone and broadband service, say that the companies providing that service cannot charge E-Rate entities more than they would charge for similar other commercial service. Participating providers, like AT&T, are held to a lowest corresponding price (LCP) standard: they have to price-match the lowest offer they give to someone in a similar area getting similar service.

The FCC says AT&T charged way more than the LCP to a couple of Florida school districts. But AT&T now counters that the “corresponding” prices they’re being benchmarked against aren’t actually corresponding at all. Why? Because the LCP is for entities that sign a one-year contract, and these school districts pay month-to-month.

“Contract term is a regular and routine distinction in rates, and the Commission has previously expressed the view that length of contract is a valid basis to price services differently among customers,” AT&T said. Simplified, they’re saying that it’s fair game to charge more for customers that are off-contract, period.

AT&T also challenged the FCC on procedural grounds, saying that the statute of limitations on the charges had expired before the FCC made their July filing, so it should be invalid based on that.

And last but not least, what would a corporate reply be without a complaint of the FCC wildly overstepping its bounds? In this case, AT&T calls the Notice of Apparent Liability (exactly that: a notice that basically says, “hey! it looks like you are doing shenanigans! Stop that! Here is a fine!”) a case of rulemaking through enforcement.

“The NAL should never have been issued,” AT&T said, “and there is no legal or factual basis for liability against AT&T.”

The NAL, as filed in July, looked for about $170,000 in recompense from AT&T, a company that brought in about $40.5 billion in revenue last quarter.

AT&T: FCC E-Rate NAL is Rulemaking By Enforcement [Multichannel News]

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