2. Background

On September 18, 2002, Pacific filed an application for arbitration with Vycera pursuant to the Commission's Rules relating to Section 252(i) of the 1996 Telecommunications Act (Act). On August 30, 2002, Vycera filed Advice Letter No. 57 requesting to adopt the interconnection agreement between Pacific and AT&T Communications of California Inc. (AT&T Agreement).

Pacific filed for arbitration for two reasons. First, because at the time of the request Vycera had not obtained limited facilities-based certification as a Competitive Local Exchange Carrier (CLEC), it could only legally exercise the resale portion of the AT&T Agreement. Second, Vycera did not agree with Pacific that a CLEC may not opt into provisions relating to reciprocal compensation (and legitimately related terms in an existing ICA) after the Federal Communications Commission's (FCC) ISP Remand Order.¹

On October 8, 2002, Vycera filed its Response to Pacific's application.

In the period between Pacific's Response and the filing of post-hearing briefs, one issue was settled. At the time that Vycera filed its Advice Letter asking to opt into the AT&T Agreement, Vycera had not yet obtained limited facilities-based certification as a CLEC. Pacific acknowledges that Vycera obtained limited facilities-based certification on October 3, 2002 so that issue is moot.

The only issue to be resolved is whether Vycera may opt into provisions relating to reciprocal compensation (and legitimately related terms) in an existing ICA after the FCC's ISP Remand Order.

An informal telephonic Initial Arbitration Meeting was held on October 17, 2002. In the conference call, parties acknowledged that there were no disputed factual issues, so arbitration hearings would not be necessary. Parties agreed to a schedule for the remainder of the proceeding. Concurrent briefs were filed and served on October 25, 2002. The Draft Arbitrator's Report (DAR) was filed on November 12, 2002 disposing of the contested issue. Comments on the DAR were filed on November 22, 2002, by Pacific and Vycera. The Final Arbitrator's Report (FAR) was filed and served on December 9, 2002.

The Pacific/Vycera conformed agreement was filed with the Commission on December 18, 2002. Both Pacific and Vycera filed statements on December 18, 2002, regarding whether the Commission should adopt or reject the conformed agreement.

On January 15, 2003, just two days before the Commission meeting at which we were to consider this arbitration and nearly a month after the December 19, 2002 date on which Pacific and Vycera filed their statements on whether the filed ICA should be approved or rejected by the Commission, Pacific sent a letter to the arbitrator and assigned Commissioner which challenged the contents of some of Vycera's statement contending that it contained new facts. Vycera responded on January 28,2003.

We note that the technical standard for submissions following the release of a final arbitrator's report is for parities to submit an ICA in conformance with the final arbitrator's report and a statement which (a) identifies the criteria in the Act and the Commission's Rules by which the arbitrated portions of the Agreement must be testes; (b) states whether the arbitrated portions pass or fail those tests; and (c) states whether or not the Agreement should be approved or rejected by the Commission. Both Pacific and Vycera went somewhat beyond this explicitly narrow focus and advised us of errors of law or fact they perceived in the final arbitrator's report for which there is no specific comment opportunity, but presumably offered to assist us in addressing the concerns raised.

In preparing the order adopting the final arbitrator's report, these concerns of both Pacific and Vycera were, as appropriate, considered. Arbitrations are, by their nature, very time sensitive.

We believe that the issues raised by both Pacific and Vycera are reasonably addressed. We note for both parties that filings with this Commission are made in conformance with Rule 1 of the Commission's Rules of Practice and Procedure and, to the extent, there has been any false statement of law or fact, remedies may be pursued to address that.