An amici curiae brief filed July 25 by 6 CLECs at the U.S. Suprem...
An amici curiae brief filed July 25 by 6 CLECs at the U.S. Supreme Court in the pending Trinko v. Bell Atlantic case raises “compelling” arguments that indicate Bell companies could face “substantial antitrust risk,” Kaufman Bros. analysts said…
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in a report Mon. The case, related to Goldwasser v. Ameritech, is the latest in a continuing legal debate on whether Telecom Act interconnection violations can be addressed through antitrust suits. The brief, filed by Allegiance Telecom, ATX Communications, Focal Communications, ICG Communications, Pac-West Telecom and U.S. LEC, argued that courts did have authority to establish antitrust remedies of Telecom Act violations. “Congress expressly directed that the antitrust laws continue to govern local telephone markets by including an antitrust savings clause in the ‘96 Act,” the brief said. The CLECs also argued that: (1) “The conduct alleged in this case is not simply a passive refusal to deal, but affirmative activity by a monopolist creating a public misperception that its competitors’ service is technically deficient.” (2) “Verizon lacks a legitimate business justification for its conduct.” The Trinko case stems from a 2nd U.S. Appeals Court, N.Y., decision last year that was one of few that upheld CLEC efforts to gain antitrust remedies for Telecom Act violations. The 2nd Circuit reversed a lower court’s dismissal of antitrust claims against Verizon’s predecessor Bell Atlantic. The plaintiff, the Law Office of Curtis Trinko, alleged that Verizon’s denial of access to competitors hurt the plaintiff and other consumers. The Kaufman Bros. report said antitrust risk wasn’t properly factored into consensus views of the Bells’ financial situation: “We continue to recommend investors avoid the Bells, in part due to this budding issue which could represent billions of dollars of off-balance- sheet exposure.”