2. Background and Procedural History
BRW, a Delaware corporation operating in all states except for Alaska and Hawaii, filed an application for registration as an interexchange carrier with authorization to provide resold services statewide on October 10, 2007. BRW stated in its application that the company had never been sanctioned by the Federal Communications Commission (FCC) or any state regulatory agency for failure to comply with any regulatory statute, rule, or order.
The CPSD filed a protest on November 9, 2007, on the following grounds:
· Unlawful Provision of Telecommunications Services in California after Revocation of Applicant's Prior CPCN - CPSD alleged that BRW has been unlawfully providing telecommunications services in California without operating authority from the Commission since September 23, 2004, when the Commission revoked BRW's prior CPCN pursuant to Resolution T-16875. The Commission revoked BRW's CPCN based on BRW's failure to file required reports and to pay surcharges as required by Commission decisions and the Commission's wireless registration process. CPSD further alleged that on October 16, 2007, PowerNet Global (PNG) reported that Applicant had signed a wholesale agreement to provide long distance lines with PNG on June 22, 2005 and at that time had 1121 active lines in California. However, Applicant did not re-apply for operating authority in this state until the filing of this application in October 2007.
· Violations of Rule 1.1 - CPSD alleged that Applicant attempted to mislead the Commission by falsely certifying in the application that it had not been sanctioned by a state regulatory agency for failure to comply with any regulatory statute, rule, or order, when, in 2004, this Commission had revoked BRW's CPCN pursuant to Resolution T-16875, based on the company's noncompliance with regulatory requirements. CPSD also alleged that BRW failed to disclose that in 2003, the company had settled a case involving rule violations with the Florida Public Service Commission by making a payment of $7500 to the State of Florida General Fund. According to CPSD's protest, BRW entered into this settlement with the Florida Public Service Commission because of alleged violations of Florida Public Service Commission Rule 25-24.470 (Requirement to have a CPCN) and Rule 25-4.043 (Response to Commission staff inquiries).
After the filing of CPSD's protest, this application was reassigned from Director John Leutza to Commissioner Timothy Alan Simon and Administrative Law Judge (ALJ) Myra J. Prestidge.
A prehearing conference was held on February 21, 2008. ALJ Prestidge ordered the parties to meet and confer in an effort to resolve the disputed factual and legal issues in this case. On May 16, 2008, CPSD filed the Stipulation and a motion for leave to file the stipulation under seal. On June 27, 2008, the parties filed a joint motion to adopt proposed Settlement Agreement and to file a confidential version of the Settlement Agreement under seal. On March 10, 2009, the assigned Commissioner and ALJ held a hearing to ask questions on the Settlement.
2.1. Statement of the Facts
BRW and CPSD have stipulated to the following relevant facts:
· BRW is a telephone corporation, as defined in Section 2343 and operates as a switchless reseller of inter-LATA and, to the extent authorized by Decision (D.) 94-09-065, intra LATA services in California.
· On January 30, 2001, in D.01-01-058, the Commission granted BRW a CPCN which authorized the company to provide resold interexchange services in this state. However, BRW had already been operating in California without authorization since January 1, 2000.
· On September 23, 2004, in Resolution T-16875, the Commission revoked BRW's CPCN utility ID #6484 based on the company's noncompliance with regulatory requirements, including the failure to file required reports and to remit mandatory surcharges to the Commission.
· On October 3, 2007, BRW filed Application 07-10-003 for registration as a telecommunications provider with the Commission and stated in its application that it had never been sanctioned by the FCC or any state regulatory agency for failure to comply with any regulatory statute, rule or order.
· BRW contends that its non-disclosure of the Commission's previous revocation of its CPCN and its sanctions by the Florida Public Service Commission was inadvertent. BRW claims that it believed that the California State Board of Equalization's emergency user's surcharge was the only applicable California tax that the company was required to pay, and that BRW was unaware of the Commission's previous revocation of its CPCN until being advised of the revocation by one of its vendors, PNG, in September 2007. BRW also contends that it did not believe that it had been sanctioned by the Florida Public Service Commission because the company had settled any alleged violations with the Florida Public Service Commission.
· BRW has operated continuously as a switchless reseller of long distance services in the State of Florida from April 2000 to the present.
· On September 20, 2002, the Florida Public Service Commission issued Order No. PSC-02-1285-PAA-TI, which proposed to penalize BRW a total of $35,000, including $25,000 for failure to comply with Florida Administrative Code Rule 25-24.470 (CPCN required), and $10,000 for failure to comply with FAC Rule 25-4.043 (Response to Commission staff inquiries).
· BRW responded to the above Florida Public Service Commission order with three settlement proposals, which were rejected by the Florida Public Service Commission. The Florida Public Service Commission ultimately agreed to BRW's fourth settlement proposal on February 13, 2003. The terms of the settlement required BRW to pay a penalty in the amount of $7,500 to the Florida General Revenue Fund. Under this settlement, BRW also agreed to take or had taken the following actions to remedy the alleged violations and to prevent future problems:
a. Dedication of a BRW employee as the point person for future inquiries from the Florida Public Service Commission staff and the referral of escalated inquiries from the Florida Public Service Commission staff to BRW's President, Mr. Brad Weinstock.
b. Future compliance with all Florida Public Service Commission rules.
c. The establishment of procedures and processes to handle all Florida customer complaints in accordance with the rules of the Florida Public Service Commission.
· On August 20, 2007, by Order No. PSC 07-0666-PAA-TI, the Florida Public Service Commission proposed to cancel BRW's IXC tariff and registration based on the company's failure to pay required Regulatory Assessment Fees, unless BRW paid $500 as a penalty and to cover the cost of collection, and remitted any past due Regulatory Assessment Fees, along with accrued statutory late payment charges, to the Florida Public Service Commission.
· During its investigation of this application, CPSD discovered documents from the Florida Public Service Commission which state that BRW did not respond to the above order and did not pay the penalty or the 2005 Regulatory Assessment Fees.
· On September 14, 2007, the Florida Public Service Commission cancelled BRW's tariff and IXC registration, effective September 14, 2007.
· BRW claims that the cancellation of its tariff and IXC registration by the Florida Public Service Commission was an administrative error, and that BRW has paid all fees due to the Florida Public Service Commission.
· BRW has cooperated with CPSD in its investigation of the current application pending before this Commission.
3 All Code references are to the Public Utilities Code, unless otherwise stated.
