REGIONAL— Minnesota Attorney General Keith Ellison is taking issue with a proposed settlement of a number of outstanding issues and complaints over the telecommunications service offered by …
REGIONAL— Minnesota Attorney General Keith Ellison is taking issue with a proposed settlement of a number of outstanding issues and complaints over the telecommunications service offered by Frontier Communications.
Ellison’s office, in an Aug. 21 response filed with the Minnesota Public Utilities Commission, suggests that the proposed settlement is inadequate given Frontier’s repeated violations of state law and is not in keeping with past settlement agreements reached with other telecommunications firms under similar circumstances.
Frontier and the Minnesota Department of Commerce announced the proposed settlement on Aug. 1, following several months of mediation over how to address more than 1,000 customer complaints about poor phone service, overbilling, and sluggish customer service.
Commerce Department negotiators and an administrative law judge who oversaw public hearings on the matter as well as the mediation process are recommending that the state’s Public Utilities Commission adopt the settlement terms as a means of addressing most of the complaints raised against Frontier.
The Attorney General’s office is continuing its own investigation into other complaints surrounding Frontier’s service quality and does not make a formal recommendation to approve or reject the proposed settlement over issues addressed by the Department of Commerce.
Yet the AG’s office doesn’t mince words in expressing its view of the proposal. “The proposed settlement’s remedies strike the OAG as paltry compared with Frontier’s alleged misconduct as set forth in the department report,” writes Assistant Attorney General Max Kieley, writing for Ellison. The department’s investigative report, issued last January, detailed systematic violations of as many as 35 separate laws or rules in Minnesota, notes the Attorney General.
Rather than penalizing the company, the AG’s office notes that the settlement agreement mostly requires Frontier to undertake many of the same procedures for handling customer service complaints as was previously required by its operating agreement with the state.
Ellison’s office cites a 1996 settlement of similar consumer complaints lodged against US West by its Minnesota customers. In that case, the settlement required US West to deposit $5 million in escrow to pay about $300,000 in compensation to customers, with the remainder going to expand and upgrade telecommunications service to Minnesota schools, libraries, and rural health care centers.
The AG noted that the 1996 settlement also “incentivized US West’s future compliance with such customer service performance metrics by penalizing the company either daily (ranging from $100-$500) or yearly (ranging from $250,000-$500,000) depending on the metric.”
The proposed settlement reached by the Commerce Department and Frontier includes no such financial penalties. And the AG’s office is concerned the agreement could actually make Frontier more likely to reject resolution of customer complaints.
The AG’s office notes that under the proposed settlement, the MPUC “must rely upon Frontier’s ‘good faith’ to follow Minnesota’s telecommunications laws without detailing any procedural claims process.”
AG Ellison is equally concerned that the settlement “fails to resolve any past violation by Frontier of Minnesota’s telecommunications statutes or rules.” Instead, Ellison’s office complains that the agreement, as proposed “merely ‘kicks the can down the road’ and provides a procedural claims process that authorizes Frontier to deny customer remedies and force the department (or individual customers) to mediate such disputed claims at the OAH [Office of Admnistrative Hearings] prior to any resolution by the [MPUC].”
At the same time, Ellison is concerned that the settlement sets no timeframe for addressing other unresolved issues, particularly concerns about Frontier’s Internet service.
The AG’s office had a number of more legalistic concerns as well, particularly that the settlement lacks a strong connection to the evidentiary findings in the department’s report. At the same time, the AG notes that Frontier continues to challenge the evidentiary basis for many of the complaints against the company. “The Commission should be especially cautious in finding that the proposed settlement furthers the public interest in light of Frontier’s repeated statements in the record that the department report fails to articulate substantial evidence supporting any violations of Minnesota’s telecommunications laws.
Under Minnesota law, regulatory agencies only have authority to impose settlements if it is based on “substantial evidence.”
The Department of Commerce, in reply comments issued Sept. 4, argues that its 500-plus page report, issued earlier this year, provides the evidentiary basis for the settlement.
The department’s comments did not take issue with the AG’s broader concerns about the lack of a financial penalty for past failures or a financial incentive for future improvement. But the department does ask the MPUC not to impose a timeframe for resolving the issues, like Internet service, not addressed in the proposed settlement.
Frontier, in its own comments, recommends that the MPUC take no action in response to the comments from the Attorney General.
The MPUC is expected to take up the matter later this fall.