Dish, T-Mobile Grill Each Other at CPUC on DOJ Pact
T-Mobile and Dish Network executives clashed at a California Public Utilities Commission hearing Monday (see 2109200065) on how long T-Mobile agreed to keep its CDMA network, in the Boost Mobile divestiture agreement brokered with DOJ. The partly virtual hearing on the CPUC’s August order saying the carrier may have misled the agency (see 2108160021) started at 10 a.m. PDT and went overtime, with the lights at the state commission’s headquarters automatically turning off before it ended after 6 p.m. PDT.
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Commissioner Cliff Rechtschaffen asked if T-Mobile knew how long migration would take, when it testified last year. From its experience acquiring MetroPCS, T-Mobile knew it could take “well within a three-year period, hopefully within a two-year period, and Dish was hopeful of the same thing,” said T-Mobile Technology President Neville Ray. “Nobody wanted to strand these customers on low-quality, poor-quality legacy 3G.”
Rechtschaffen asked if T-Mobile ever “flagged for the commission” the possibility that it could shut down CDMA before Dish customers stopped using it. Ray responded, “How could we have done that? That was never the plan from both parties.” A small number of customers always get disconnected in a legacy network shutdown; companies do their best to reach out and provide compatible equipment, Ray said. “We're doing it at T-Mobile,” but Dish is responsible for providing devices to Boost customers, he said. “I'm troubled that Dish is not doing the required work.”
Dish attorney Anita Taff-Rice of iCommLaw grilled Ray on the migration timeline, including a “safety valve” in the T-Mobile/Dish agreement that gave T-Mobile the option of adding two more years if migration wasn’t done in three years. “This was a leaseback option,” explained Ray. “We had a three-year agreement whereby Dish will purchase the 800 MHz spectrum ... and we agreed with Dish that a contingency would be allowed to extend 4 MHz of that 14 MHz for a period of two years.” T-Mobile never promised to maintain CDMA “for three years, let alone five years,” he said: The agreement required that T-Mobile give Dish only six months’ notice.
It was always Dish’s understanding that T-Mobile would keep CDMA operational for three years, and possibly as long as five due to the carrier demanding the lease-back contingency, said Dish Executive Vice President-External and Legislative Affairs Jeffrey Blum: They never discussed a migration shorter than three years, he said.
T-Mobile should be “entitled to the benefit of the doubt” for any ambiguous statements it made where one interpretation is incorrect and the other is considered truthful, said Cleary Gottlieb’s David Gelfand. The carrier’s attorney asked Blum if a three-year migration period is stated anywhere in the agreement DOJ negotiated between T-Mobile and Dish. “That expressed term doesn’t,” agreed Blum, but it’s Dish’s “interpretation” based on two sections saying Dish can’t purchase 800 MHz spectrum for three years and that T-Mobile must keep the spectrum in good standing with the FCC, said Blum. “If they shut off the spectrum prior to the sale,” after six months the license would be forfeited to the FCC “and we wouldn’t be able to acquire those licenses.”
Gelfand twice deemed Dish’s questioning a waste of time. The T-Mobile lawyer objected to many of Taff-Rice’s questions but Administrative Law Judge Robert Mason mostly overruled those objections. ALJ Karl Bemesderfer asked T-Mobile to file a post-hearing brief by Oct. 15 and Dish to reply by Oct. 29.