T-Mobile Never Meant to Mislead CPUC, Says Ray
California Public Utilities Commission judges pressed T-Mobile at a Monday hearing on the reasonableness of a promise to give Dish Network six months’ notice before shutting down Sprint’s CDMA network. The virtual hearing was on the CPUC’s August order saying the carrier may have misled the agency (see 2108160021). T-Mobile Technology President Neville Ray testified he and the company didn't mean to conceal anything: "It was never our intent or my intent to mislead the commission in any way or form as to how this transaction and subsequent divestiture would unfold."
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It surprised the California commission when T-Mobile announced in July it would shutter the legacy CDMA network used by Boost Mobile customers, said Administrative Law Judge Karl Bemesderfer in opening remarks. During the CPUC’s deal review, T-Mobile pledged no former Sprint customer would suffer any service degradation after the merger, the ALJ said: "Whatever one's definition of service degradation may be, complete loss of service qualifies." Docket A.18-07-011 assigned Commissioner Cliff Rechtschaffen concurred with Bemesderfer’s opening statement.
Ray and T-Mobile “spent an incredible amount of time" before the CPUC, including hours of verbal testimony at two hearings and much written testimony, so it was “with some surprise and dismay” that Ray saw the commission’s August order, he said in response to questions by T-Mobile attorney David Gelfand of Cleary Gottlieb. Ray spoke at length about how T-Mobile was on track with its implementation and on CDMA’s inferiority to LTE until ALJ Robert Mason interrupted to ask that T-Mobile move on to more relevant issues.
Bemesderfer asked if T-Mobile could have given six months’ notice one day after signing the agreement with Dish that was negotiated with DOJ, and if that amount of notice would be reasonable from an engineering perspective. T-Mobile could have and in “certain scenarios and circumstances” it would "absolutely” be reasonable, but instead T-Mobile waited six months after the transaction closed and gave Dish 15 months’ notice, said Ray. Bemesderfer said he understands “the reasonableness criterion was in accordance with the desires of the DOJ, so while I appreciate Mr. Ray’s testimony ... I am highly skeptical that the Department of Justice would share that view.”
The notice period’s reasonableness “doesn’t inform whether a false statement was made in December 2019” or “equate to there being a promise or a guarantee that this network would absolutely be maintained for three years no matter what,” said Gelfand. Mason asked, “Isn’t there, though, a connection between the reasonable notice and Dish’s ability to migrate its subscribers to the T-Mobile network?” Dish’s circumstances probably should be considered, said Gelfand, but T-Mobile’s point is that the notice was fully disclosed.
T-Mobile made none of the allegedly misleading assertions cited in the commission’s August order, and on some points it “repeatedly said the opposite,” said Gelfand. T-Mobile never guaranteed the CPUC it would delay shutdown of Boost’s CDMA network for three years, he said: That was how long T-Mobile gave itself to complete migration, and Ray told the commission it aimed to do it sooner. T-Mobile "can only control its own actions and cannot take responsibility for Dish" obligations to provide customers with compatible devices, Gelfand said. "It would be incorrect and fundamentally unfair to find that T-Mobile somehow promised to maintain CDMA for three years so Dish could take as much time to migrate Boost customer as it wished.” Contrary to the August order’s allegations, T-Mobile said in the record that PCS spectrum was used for CDMA and it would be used for 5G, Gelfand said.
Dish was scheduled to speak at the hearing that continued after our deadline. The first part included a closed, confidential session lasting about 45 minutes.