IV. Technical Qualifications
Applicants for NDIEC and CLC authority are required to make a reasonable showing of technical expertise in telecommunications or a related business. As part of this application, Applicant submitted biographical information on its officers.
Applicant represents that no one associated with or employed by Applicant as an affiliate, officer, director, partner, or owner of more than 10% of Applicant was previously associated with any telecommunications carrier that filed for bankruptcy, or was sanctioned by the Federal Communications Commission or any state regulatory agency for failure to comply with any regulatory statute, rule, or order, except as follows.
Applicant's management formerly managed Integrated TeleServices, Inc. (ITS). In 1998, the Florida Public Service Commission approved a settlement with ITS regarding allegations of slamming 268 customers. Pursuant to the settlement, its CPCN was cancelled, it agreed to resolve all of the complaints, and it was barred from reapplying for a CPCN until January 1, 2001. Its management and principals were barred from seeking to provide telecommunications services in Florida until January 1, 2003.
ITS used a company called TelSave to implement presubscribed interexchange carrier (PIC) changes solicited by ITS's telemarketing subsidiary. Applicant represents that the subsidiary complied with all applicable requirements. However, TelSave delayed implementing the customer approved switches, in some cases up to 18 months. Applicant says the allegations of slamming were due to the long interval between when the customer agreed to the switch, and when it occurred. By the time the change appeared on the customer's bill, the customer didn't remember making the switch, had changed his or her mind, or had switched to another carrier. In addition, TelSave, in some cases, submitted the same PIC change request several times resulting in multiple PIC change charges to customers for the same PIC change. Applicant alleges that TelSave's actions affected other carriers as well. Applicant says that ITS had very few customers in Florida, and did not anticipate expanding its customer base due to the financial difficulties it was having at the time. As a result, ITS agreed to the settlement rather than incur the costs involved in opposing the allegations.
Applicant represents that in late 1999, ITS determined that it could not operate profitably under its underlying carrier contracts. After attempts at renegotiation, ITS decided to file for bankruptcy. It filed for bankruptcy on January 10, 2000, in the United States Bankruptcy Court, Eastern District of California, Fresno Division. ITS continued to operate, and its assets were sold to ECI Communications, Inc. (ECI).4 Applicant's management provided consultant services to ECI until February of 2003.
Applicant's management managed ITS from its inception until it was sold to ECI in 2001. ITS received a CPCN to resell interexchange services by D.95 01-005. By D.00-05-013, the Commission granted it authority to resell local exchange services. Our records show that our Consumer Affairs Branch received very few complaints between 1998 and 2001, all of which were resolved. Given the above record, we conclude that ITS provided adequate service to its California customers when it was run by Applicant's management. Therefore, we find that Applicant has sufficient expertise and knowledge to operate as a telecommunications carrier in California. However, we caution Applicant that we expect its full compliance with all applicable rules, regulations, and Commission decisions.
