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FairPoint disputes over-billing complaint in Maine

Mon, 01/18/2010 - 7:10am
Clarke Canfield, Associated Press Writer

PORTLAND, Maine (AP) – FairPoint Communications Inc. disputes claims by a Maine phone and Internet company that it is over-billing the company and instead says it is actually owed about $2 million, a spokesman said Friday.

Great Works Internet of Biddeford filed a petition last week asking Maine's Public Utilities Commission to investigate FairPoint's business practices.

But FairPoint spokesman Jeff Nevins said Great Works Internet owes FairPoint about $2 million in a dispute over how much GWI should pay to lease FairPoint's high-speed, high-capacity lines that connect to business and institutional customers.

Also, in the company's Thursday response filed with the commission, FairPoint says the U.S. Bankruptcy Court where it filed for Chapter 11 bankruptcy in October has jurisdiction over the claims, not the commission.

"The bottom line is they disagree with us. And we disagree with them," Nevins said. "We feel we have legal standing."

The long-running dispute goes back to 2005, when Verizon Communications owned the lines now owned by FairPoint. North Carolina-based FairPoint bought Verizon's landline telephone and Internet operations in Maine, New Hampshire and Vermont in 2008 for $2.3 billion.

In the GWI complaint with the commission, the company claimed FairPoint was overcharging it for use of the lines it leases for some of its largest business and institutional customers – but not residential customers. The company also claims FairPoint is threatening to disconnect the lines, which would result in telephone and Internet service being terminated for 14 of GWI's more lucrative customers, including colleges, universities and hospitals.

In response, FairPoint says that it charges market rates for its lines but GWI refuses to pay those rates. It says a court decision from several years ago allows it to charge market rates for the lines, rather than rates set by the Public Utilities Commission.

GWI staff attorney Eric Samp said Friday that GWI has a contract with FairPoint through March 2011 that sets out rates. FairPoint previously said GWI owed it more than $3 million, he said.

"Every time they tell us something, it's something different," he said.

Furthermore, bankruptcy court isn't the appropriate place to resolve a dispute over rates and disconnection policies, he said.

"They remain a regulated utility in Maine," Samp said. "That doesn't change in bankruptcy."

In a letter to GWI's attorney, a FairPoint lawyer wrote that if GWI and FairPoint don't have a contract agreement in place by Feb. 12 for the lines in question, then FairPoint will discontinue the existing arrangement for the lines.

More Broadband Direct 1/18/10:
•  Cox Business hooks up CityCenter in Vegas
•  Verizon adds faster upstream speed into bundle
•  Feds schedule 2nd round of broadband stimulus
•  Report: Google ads facing make-or-break year in 2010
•  AT&T responds to Verizon's pricing 
•  FCC: Curtains for 700 MHz mikes
•  FairPoint disputes over-billing complaint in Maine
•  Network flaw causes scary Web error
•  Broadband Briefs for 01/18/10 

 

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