10. Resale

10.1. Resale 1

Issue: May MCIm resell, to another Telecommunications Carrier, services purchased from Appendix Resale?

Resale § 1.3

Positions

SBC-CA proposes no.

MCIm says it may.

Discussion

MCIm's proposed language is adopted.

As stated above (see Definition Issue 3), the Commission could not have been clearer: "We support the FAR's finding that MCIm should be permitted to purchase services from Pacific at wholesale prices for resale to other carriers." (D.01-09-054, mimeo., page 15.) No change in fact or law justifies a different outcome.

SBC-CA argues that a substantially similar result to that it seeks here was adopted in 2001, citing §§ 4.6 and 4.10 of Appendix Resale of the 2001 ICA in support. That is incorrect. To read those sections in the 2001 ICA as SBC-CA proposes would be in direct conflict with the Commission's clear statement otherwise. Rather, they are correctly read to be compatible with the Commission's order.

Thus, MCIm's proposed language is adopted.

10.2. Resale 5

Issue:

SBC-CA: Should the Commission adopt SBC-CA's Resale liability and indemnity language?

MCIm: Should the Commission adopt SBC-CA's liability and indemnity language contain in Appendix Resale?

Resale §§ 8.5.1, 8.5.1.1, 8.5.1.2, 8.5.1.3, 8.5.1.4

Positions

SBC-CA seeks specific language in the Resale Appendix limiting its liability regarding 911 service.

MCIm proposes one sentence that states liability with respect to 911 shall be governed by the provisions of the General Terms and Conditions.

Discussion

SBC-CA's proposed language is adopted.

SBC-CA correctly states that there is no overlap or inconsistency between the liability and indemnity language in the General Terms and Conditions and the proposed limitation of liability and indemnity section in Appendix Resale. For example, the liability and indemnity sections of the General Terms and Conditions are essentially focused on addressing liability as between SBC-CA and MCIm. The Appendix Resale provision operates to protect SBC-CA against liability to MCIm end users for inadvertent errors in SBC-CA's provision of Resale 911 service.

Moreover, absent SBC-CA's proposed limitation of liability provision, MCIm and its resale end users would receive a windfall in preference to the terms applicable to SBC-CA's similarly situated retail customers. This results because SBC-CA's rates to MCIm for retail services are based upon a discount from SBC-CA's regular retail rates for what are supposed to be identical services. The services applicable to MCIm and its end users, along with the related terms and conditions of service, should be the same as those applicable to SBC-CA's retail customers. This requirement applies to limitation of liability provisions as well, since the existence of SBC-CA's retail limitation of liability avoids the necessity of SBC-CA adding what amounts to an "insurance premium" for SBC-CA's potential 911 errors on top of SBC-CA's retail rates.

Further, SBC-CA's proposed language here is substantially similar to the language in the 2001 ICA (e.g., proposed §§ 8.5.1.1, 8.5.1.2 and 8.5.1.3 in the 2006 ICA Appendix Resale are substantially similar to §§ 6.3, 6.4 and 6.1 in the 2001 ICA Appendix 911, respectively). MCIm does not state a convincing reason why the replacement ICA should not model the 2001 ICA in this case.

Therefore, SBC-CA's proposed language is adopted.