VII. Discussion

D. Likelihood of Success on the Merits

1. The Interconnection Agreements⁶

We first evaluate AT&T's likelihood of success. At issue are two currently valid interconnection agreements with Verizon: (1) the AT&T Communications ICA; and (2) the TCG ICA. We must determine whether the relevant sections of these agreements preclude Verizon's announced actions.⁷

The AT&T Communications ICA requires Verizon to provide AT&T Communications with access to UNEs identified in Attachment 2 to the agreement.⁸ Attachment 2 to the AT&T Communications ICA lists and defines Local Switching and Common Transport network elements as two of the network elements to which Verizon must provide AT&T access. (See Sections 60 and 63 of Attachment 2 respectively.)

The AT&T Communications ICA definition of Local Switching speaks in terms of "functionality" e.g., the functional means to accomplish the task of Local Switching. ("Local Switching is the Network Element that provides the functionality required to connect the appropriate originating lines or trunks wired to the Main Distributing Frame (MDF) or Digital Signal Cross Connect (DSX) panel to a desired terminating line or trunk. Such functionality shall include all of the features, functions, and capabilities of the GTE switch including but not limited to...") (Italics added.).

Similarly, the TCG ICA requires Verizon to provide TCG Companies with access to unbundled Local Switching and Common Transport network elements.⁹ This agreement also speaks in terms of functionality, and provides that Verizon (GTE's successor in interest) shall have the full burden of proving that access requested by [TCG] is not "technically feasible."¹⁰ Sections 7 and 8 define Local Switching and Common Transport respectively, in language similar to the AT&T Communications ICA.

2. Verizon's Obligations to Provide Local Switching
and Common Transport Elements Pursuant to the Interconnection Agreements

Based on the sections of the interconnection agreements referenced by the parties, AT&T is likely to prevail on the merits of its argument that Verizon may not unilaterally discontinue AT&T's access to the Local Switching and Common Transport elements of the UNE-P, but rather, must comply with the terms of the interconnection agreements. Based on the facts before us, the agreements do not limit Verizon's obligation based on the technology or hardware used to provide these network elements.

Verizon argues that this interpretation is contrary to the law existing at the time the interconnection agreements were entered into. Verizon states that, as early as 1996, when the FCC first established a national list of UNEs in the Local Competition Order¹¹, the FCC explicitly declined to find that incumbent local exchange carriers' packet switches should be identified as network elements subject to unbundling under the Act. According to Verizon, this contract must be interpreted in light of the laws in effect at the time it was entered into. Verizon believes the definition of "local switching" in the parties' interconnection agreements tracks the definition of "Local Switching" in FCC's Local Competition Order, and does not include packet switching within its ambit.

We respectfully disagree. In 1996, because of an insufficient record, the FCC did not finally decide the issue of whether to unbundle packet switches in the Local Competition Order, and stated it would continue to review and revise the rules. Paragraph 427 of the Local Competition Order provides:

"At this time, we decline to find, as requested by AT&T and MCI, that incumbent LECs' packet switches should be identified as network elements. Because so few parties commented on the packet switches in connection with section 251(c)(3), the record is insufficient for us to decide whether packet switches should be defined as a separate network element. We will continue to review and revise our rules, but at present, we do not adopt a national rule for the unbundling of packet switches. (Emphasis added.)"

Therefore, the law at the time the interconnection agreements at issue in this proceeding were entered into was unsettled as to whether packet switches were to be unbundled.

Next, Verizon argues that its actions comply with the interconnection agreements because both the AT&T and TCG ICAs expressly limit the network elements that must be unbundled to those offered "in accordance" with Verizon's statutory obligations, i.e., those under § 251(c)(3) of the Act, and as well as the FCC rules applicable to these obligations.¹² According to Verizon, the FCC has concluded three times that packet switches do not have to be unbundled pursuant to § 251 and the federal D.C. Circuit has now affirmed this conclusion.¹³

We need not address the issue of whether or not the FCC has finally determined that Verizon does not have to unbundle packet switches because we are not ordering Verizon to do so. Rather, we determine whether, under the terms of the interconnection agreements, Verizon may unilaterally discontinue providing certain network elements which they are obligated to provide.

In order to give effect to every part of the contract, we note other contract sections provide more detail on what network elements Verizon is to provide AT&T. For example, Section 29 of the AT&T Communications ICA states that "the specific terms and conditions that apply to the unbundled Network Elements are described below and in Attachment 2." As stated above, Attachment 2 requires Verizon to provide AT&T the functionality required to accomplish Local Switching and Common Transport network elements. Section 23.2 of the TCG ICA similarly specifically lists "local switching" as a network element Verizon is to provide TCG. Verizon's interpretation of the agreements would make these change of circumstance provisions superfluous.

Verizon also argues that the exclusion of packet switching from the interconnection agreements' unbundling obligations is clear in the definitions contained in the agreements. For example, the AT&T Communications ICA provides that Local Switching is the network element providing the functionality to connect originating lines or trunks wired to the main distributing frame to the desired terminating line or trunk. Packet switching, according to Verizon, is very different, and is defined by the FCC as "the function of routing individual data units, or `packets,' based on address or other routing information contained in the packets." However, Verizon has not stated that a packet switch cannot connect particular lines and trunks, or that there is a functional difference between a packet switch and a circuit switch for routing basic telephone service across the local network.

3. Verizon Cannot Unilaterally Discontinue These Network Elements Under the Interconnection Agreements

a) Discontinuing a Network Element

The interconnection agreements are not static. They have provisions for dealing with changed circumstances in fact and in law. Section 3.3 of the General Terms and Conditions in the AT&T Communications ICA addresses how a network change contemplated by Verizon should be handled.¹⁴ According to Section 3.3, Verizon may unilaterally discontinue an unbundled network element (such as the Local Switching and Common Transport elements) only after giving proper notice, "to the extent required by network changes or upgrades." (Emphasis added.)

Verizon has not indicated anything about the change from circuit switches to packet switches that would make Verizon unable technically to provide Local Switching or Common Transport, without providing AT&T access to the other features provided by packet switching. In fact, AT&T states that Verizon intends to use the packet switches to provide local switching for its own retail customers and Verizon did not dispute this statement. Thus, we conclude that it is likely that AT&T will prevail on its position that Verizon is not "required" by its network changes or upgrades to discontinue Local Switching and Common Transport network elements from the UNE-P.

Verizon believes that it is required to discontinue unbundling Local Switching and Common Transport network elements when it replaces the circuit switch with a packet switch because it is not longer using a circuit switch to provide these network elements. Verizon contends that it is a matter of longstanding federal law that packet switching is not subject to unbundling. Verizon believes that under the interconnection agreement, it is only required to provide AT&T with these unbundled network elements through a circuit, and not a packet switch, and thus, discontinuing unbundled circuit switching is required on this ground as well.

As stated above, the law concerning unbundling of packet switches was unsettled when the parties entered into the interconnection agreement in 1996. Thus, any subsequent change in federal law, if applicable, should be governed by the change of law provisions set forth below. Also as stated above, we are not persuaded by Verizon's argument that the hardware or technology that provides Local Switching and Common Transport determines whether Verizon must provide these services.

b) Change In Law

The interconnection agreements also provide that if a change in applicable law materially affects any material term, after proper notice, the parties may renegotiate in good faith mutually acceptable new terms. If such terms are not renegotiated within 90 days after such notice, the dispute is then tendered to alternative dispute resolution.¹⁵ In the event a final court or FCC order allows but does not require discontinuance of an unbundled network element, the interconnection agreements also provide that the parties must try to reach agreement, and if unsuccessful, either party may submit the matter to alternative dispute resolution.¹⁶

Verizon argues at length that packet switching is not subject to unbundling, citing the Local Competition Order discussed above, as well as subsequent FCC and federal court decisions.¹⁷ AT&T disputes Verizon's interpretation of federal law. However, we need not address the question of what the Triennial Review Order requires with respect to packet switching. As stated above, the law on unbundling packet switching was unsettled at the time the interconnection agreements were entered into. Any changes of law after that time, if applicable, can be addressed through the change of law provisions in the interconnection agreements. Furthermore, assuming arguendo Verizon's interpretation of the Triennial Review Order is correct, nothing forbids Verizon from providing only the Local Switching and Common Transport elements to AT&T through its packet switches (without providing AT&T with access to the other advanced services of packet switching) under the terms of the interconnection agreements. Thus, the change of law provisions do not alter our conclusion that AT&T is likely to prevail on the merits.

4. Verizon's Other Arguments

Verizon's other arguments do not affect our conclusion that AT&T is likely to prevail. Verizon believes that state commissions lack independent authority to determine which network elements should be unbundled. However, we do not determine what network elements require unbundling; rather, we restrain a likely violation of existing interconnection agreements. Verizon's other argument, that federal law on packet switching preempts any contrary state unbundling order, fails for similar reasons.

Finally, Verizon argues that granting AT&T's requested order would frustrate state telecommunications policy encouraging the rapid implementation of advanced information and communications technologies through adequate long-term investment in the necessary infrastructure. However, we do not prohibit Verizon from implementing its upgrade.

In summary, for the reasons stated above, AT&T is likely to succeed on the merits in this case.

E. Irreparable Injury to Moving Party

We next determine whether AT&T will suffer irreparable injury as a result of Verizon's actions.

5. Injury to the Ordering Process and Business Reputation

One alleged injury is in the ordering process. Before setting forth the allegations, it is helpful to understand that there are two interfaces for ordering: (1) Electronic Data Interexchange (EDI) and (2) Wholesale Internet Service Engine (WISE). EDI is the only fully-mechanized (i.e., machine-to-machine) system for order processing. WISE is a human-to-machine interface that a competitive local exchange carrier (CLEC) can access from a personal computer by internet, a dedicated or private line, or a dial-up service. Verizon states that WISE provides all the functionality the CLECs require to service end use customers via resale or UNE services. AT&T disputes this statement, describing WISE as requiring much more cumbersome and time consuming human-to- machine interface.

c) AT&T's Alleged Injury

AT&T states that it currently has no system in place to handle mechanized order processing for Verizon resale products (i.e. through EDI) for AT&T's small business and residential customers.¹⁸ Therefore, according to AT&T, its customers will suffer irreparable injury because AT&T will not be able to respond to a customer's request for changes to an existing account such as adding or removing features, disconnecting service or adding new service. The lack of mechanized ordering capability, according to AT&T, will also prevent AT&T from notifying other carriers in the industry of changes to AT&T customer accounts via the Customer Account Records Exchange (CARE) process. Because of this, AT&T will be unable to properly service customer requests by changing their accounts to obtain the services that they choose to receive from the carrier of their choice. AT&T states that upgrading its systems to do this is not a small or inexpensive undertaking, and because of a required time and cost study, the changes could be designed sometime in 2005.

AT&T also states that it will suffer injury to its reputation because customers will blame AT&T for any harm which may result from Verizon's actions. Although AT&T has stopped marketing to obtain new residential and small business local customers, it maintains that it still wishes to provide quality service to the customers it has. According to AT&T, the damage to its business reputation will be irreparable.

d) Verizon's Response

Verizon states that AT&T currently has hundreds of resold lines in service in Verizon's California service territory and so far, during the ordering process, has submitted to Verizon hundreds of Local Service Requests for resale service.¹⁹ Verizon states that AT&T is using both EDI and WISE for ordering in California, and that AT&T currently has the ability to make changes to those end-user accounts.²⁰

According to Verizon, the WISE interface provides AT&T with the ability to track order status, and that hundreds of CLECs in Verizon's footprint are using WISE to do business with Verizon. Verizon states that, in California alone, about 50 local service providers, including AT&T, are using WISE to process large volumes of resale orders. Also, according to Verizon, it is unclear whether AT&T has taken any steps to cooperate with Verizon in the change of deployment following the June 15 notification.

e) AT&T's Reply

AT&T clarified that it uses both EDI and WISE for ordering in California, but for the most part, AT&T's mechanized ordering systems are designed to support UNE-P, not resale ordering. AT&T states it cannot use EDI to order resale from Verizon to support mass-market small business and residential orders on the scale that will occur should Verizon take its contemplated action.

The resale lines for which AT&T uses WISE service large military contracts with lines located in three locations which are handled by one account representative. According to AT&T, it is not possible to have a single person responsible for all of the mass market lines, and multiple representatives may handle a single mass market customer over the course of the ordering process. Under those circumstances, according to AT&T, it is not feasible for those representatives to rely solely on WISE human to machine interface to handle all of the orders. Furthermore, AT&T states there are no processes in place at AT&T today for serving mass market customers via WISE, and this implementation would involve significant ordering and platform changes to facilitate.

f) Discussion

AT&T has sufficiently shown irreparable injury because AT&T's declarations indicate it will be unable to respond to mass market small business and residential customers' requests that AT&T make account changes so that these customers can obtain the services they have chosen. The fact that AT&T has the ability to process its unique, less labor intensive, military accounts through the WISE system does not change our determination, because this situation is not analogous to a mass market situation. Furthermore, potential damage to AT&T's business reputation also constitutes irreparable injury, because AT&T could lose current customers if it is unable to provide them the service they request in a timely manner.

F. No Substantial Harm to Other Interested Parties

Determining AT&T's irreparable harm is not the end of the inquiry. We also must determine that no substantial harm to other interested parties will occur.

6. Verizon

Verizon states that the outcome of an order maintaining the status quo would delay or prevent deployment of the new packet switches, since the only way Verizon will continue to provide unbundled switching to AT&T is to keep the circuit switches in place and to reevaluate the deployment of packet technology in California. Verizon then lists a host of problems that will occur if the deployment of this new technology is delayed. Some of these problems are a retroactive loss of value of capital investments made, and substantial confusion and harm to other carriers who may have taken steps to reroute their traffic to the new switches, including blocked or dropped calls and other customer impacts.

Verizon also states that, due to AT&T's eleventh hour request, Verizon has not engineered the required power, air conditioning, and other physical plant requirements to keep the circuit switches "live" past the conversion date (i.e. September 17). According to Verizon, without proper engineering, there is no way to ensure proper protection and operation of the circuit switches or, consequently, quality of service for California consumers.

Verizon also asserts that the Commission should not issue this order because AT&T delayed over two months in bringing this issue to the Commission's attention.

7. AT&T

AT&T asserts it is not asking the Commission to stop Verizon from deploying packet switching. Therefore, AT&T claims Verizon will suffer no harm by maintaining the status quo, and that any harm which may result from Verizon failing to deploy its change to packet switching is of its own making.

8. Discussion

As stated above, we do not prohibit Verizon from deploying packet switching. Rather, we require Verizon to continue to provide AT&T with Local Switching and Common Transport network elements regardless of the technology employed until this complaint is resolved or upon further order of the Commission. Thus, any delay in deploying packet switching would be Verizon's choice, and not a result of this ruling.

Verizon has not stated that it cannot provide AT&T with the Local Switching and Common Transport network elements through its packet switches.²¹ It has stated that it will not do so. The host of problems set forth above only occur if Verizon chooses not to deploy its packet switches as planned, and not as a basis of this ruling. Thus, we find no substantial harm to other interested parties as a result of this ruling.

Our conclusion is not affected by AT&T's timing in bringing this motion. Once AT&T received notice on June 15 of Verizon's intended actions, it tried to resolve this matter informally by letter.²² AT&T filed this motion on August 19, 2004, about two weeks after Verizon's letter rejecting AT&T's position. Under these circumstances, we do not find AT&T unreasonably delayed in bringing this motion.

G. The Public Interest

We next must determine if this ruling will harm the public interest. This ruling does not impede the deployment of new technology. We recognize that existing interconnection agreements must also be honored. Maintaining the status quo while the Commission builds a record on these issues and carefully evaluates potential outcomes will further the public interest. Thus, we conclude that this ruling will not harm the public interest.

H. Other Similarly Situated California CLECs

As stated above, Telescape Communications, Inc., Wholesale Airtime, Inc., and Blue Casa Communications filed C.04-09-001 alleging issues similar to AT&T, as well as filing a petition to intervene in this proceeding, concurring in AT&T's request. A petition to intervene by nii communications Ltd., was filed in both this proceeding and C.04-09-001. We also take official notice that by C.04-09-010, ACN Communications Services, Inc., Covad Communications Co., and Vycera Communications, Inc. have filed a similar complaint against Verizon, and also request injunctive relief similar to that requested by AT&T.²³ These carriers all allege that their respective interconnection agreements with Verizon, like AT&T's, provide these carriers with the functionality of access to the local switch network element, without regard to the technology employed.

In addition to the named CLECs, Verizon provides access to the UNE-P to many other California CLECs with interconnection agreements that may include substantially similar provisions providing for the functionality of access to the Local Switch and Common Transport network elements, without regard to technology employed. As Verizon's date to switch over service (September 17, 2004) is only two days after the date of this ruling, we lack sufficient time to review each agreement and factual circumstance. If Verizon transfers some but not all other CLECs with substantially similar provisions in their interconnection agreements to the resale platform as of September 17, the irreparable injury will be the lack of a level playing field among competitors to encourage and enable competition. To maintain the level playing field and treat all substantially similar interconnection agreements in the same way, we extend this restraint to Verizon's performance under its California interconnection agreements with substantially similar provisions concerning Verizon's obligation of providing the functionality of access to the Local Switching and Common Transport network elements.²⁴

To ensure that Verizon is made whole should it ultimately prevail in the case, we will allow Verizon to record and accrue the difference between the status quo (UNE-P) prices and the proposed (resale platform) prices for each included CLEC commencing on the date its letter to the CLEC stated it was upgrading to packet switches. Any decision resolving this complaint in Verizon's favor may include a plan for recovery of the total differential from each CLEC.

We, therefore, direct Verizon to notify all similarly situated CLECs that, should Verizon prevail, Verizon may be able to recover the recorded price differential, in addition to requiring the CLEC to purchase the higher-priced resale platform service. Verizon is directed to provide notice to all similarly situated CLECs of this potential charge within 10 business days of the date of this ruling, as well as to provide a notice of availability of this ruling to all affected CLECs, with copies to the Commission. Verizon shall confer with, and receive approval from, the Commission's Public Advisor regarding the precise content of this notification prior to mailing it. Given this determination, we defer ruling on the motions to intervene until later in this proceeding.

I. Conclusion

After weighing and balancing the above factors, we determine that the status quo should be maintained pending the outcome of this proceeding or until further order of the Commission or the undersigned. We therefore restrain Verizon from eliminating the ability of AT&T to purchase unbundled Local Switching and/or Common Transport network elements, alone and in combination with other network elements, until AT&T's complaint is resolved, or until further order of the Commission or the undersigned. We also extend this restraint to Verizon's performance under its California interconnection agreements with substantially similar language concerning Verizon's obligation of providing the functionality of access to the Local Switching and Common Transport network elements.

We will place this ruling before the Commission at its next meeting, where the full Commission will have the opportunity to consider it. We intend to proceed with this case expeditiously and to set a prehearing conference as soon as possible.

Findings of Fact

1. AT&T has two valid interconnection agreements with Verizon. Pursuant to those agreements, Verizon currently provides AT&T with unbundled Local Switching and Common Transport network elements. These two network elements are part of the UNE-P by which AT&T provides local service to may California consumers in Verizon's service territory.

2. Verizon currently provides AT&T with unbundled Local Switching and Common Transport network elements through its circuit switches. Verizon claims that it is not longer required to do so when it deploys its packet switches.

3. The AT&T interconnection agreements require Verizon to provide the functionality of access to the Local Switching and Common Transport network elements. Based on the facts before us, these interconnection agreements do not limit Verizon's obligation to provide AT&T with access to the Local Switching or Common Transport elements of the UNE-P based on the technology or hardware used to provide these network elements.

4. The interconnection agreements are not static. They have provisions for dealing with changed circumstances in fact and in law.

5. Verizon has not indicated anything about the change from circuit switches to packet switches that would make Verizon unable technically to provide Local Switching or Common Transport, without providing AT&T access to the other features provided by packet switching.

6. If this ruling does not issue, AT&T will be unable to respond to mass market and small business customers' requests that AT&T make account changes so that these customers can obtain the services they have chosen. AT&T could also suffer damage to its business reputation in losing current customers if it is unable to provide them the service they request in a timely manner.

7. This ruling does not require any delay in Verizon's deployment of packet switching.

8. Verizon provides access to the UNE-P to many other California CLECs with interconnection agreements that may include substantially similar provisions providing for the functionality of access to the Local Switch and Common Transport network elements.

9. If Verizon transfers some but not all other CLECs with substantially similar provisions in their interconnection agreements to the resale platform as of September 17, 2004, the irreparable injury will be the lack of a level playing field among competitors to encourage and enable competition.

Conclusions of Law

1. The Commission's authority to provide injunctive relief is firmly rooted in the California Constitution, the Public Utilities Code, and case law.

2. An individual Commissioner or ALJ may issue a temporary restraining order or preliminary injunction in order to preserve the status quo, pending ratification of the full Commission.

3. To obtain a temporary restraining order, the moving party must show (1) a likelihood of prevailing on the merits; (2) irreparable injury to the moving party without the order; (3) no substantial harm to other interested parties; and (4) no harm to the public interest.

4. AT&T is likely to prevail on the merits of its argument that Verizon may not unilaterally discontinue AT&T's access to the Local Switching and Common Transport elements of the UNE-P pursuant to the interconnection agreements.

5. AT&T has sufficiently shown irreparable injury if this ruling does not issue.

6. There will be no substantial harm to other interested parties as a result of this ruling.

7. This ruling will not harm the public interest.

8. This ruling maintaining the status quo should be extended to Verizon's performance under its California interconnection agreements with substantially similar provisions concerning Verizon's obligations to provide the functionality of access to the Local Switch and Common Transport network elements.

9. To ensure Verizon is made whole should it ultimately prevail in this case, Verizon should notify all similarly situated CLECs that Verizon may be able to recover the recorded price differential (the difference between the status quo (UNE-P) prices and the proposed (resale platform) prices) for each included CLEC commencing on the date its letter to the CLEC stated it was upgrading to packet switches. Verizon should provide notice of this to all similarly situated CLECs as set forth in the ruling paragraphs below.

10. This case should proceed expeditiously and a prehearing conference should be set as soon as possible.

IT IS RULED that:

1. Verizon California Inc. (Verizon) shall maintain the status quo during the pendency of this proceeding, or until further order of the Commission or the undersigned Assigned Commissioner and Administrative Law Judge. Verizon is restrained from eliminating the ability of AT&T Communications of California, Inc., TCG Los Angeles, Inc., TCG San Diego, and TCG San Francisco (collectively AT&T) to purchase unbundled Local Switching and/or Common Transport network elements, alone and in combination with other network elements, until AT&T's complaint is resolved, or until further order of the Commission or the undersigned.

2. The restraint set forth in paragraph 1 is extended to Verizon's performance under its California interconnection agreements with substantially similar provisions concerning Verizon's obligation of providing the functionality of access to the Local Switching and Common Transport network elements.

3. To ensure that Verizon is made whole should it ultimately prevail in the case, Verizon may record and accrue the difference between the status quo (uniform network elements platform) prices and the proposed (resale platform) prices for each included competitive local exchange carrier (CLEC) commencing on the date its letter to the CLEC stated it was upgrading to packet switches. Any decision resolving this complaint in Verizon's favor may include a plan for recovery of the total differential from each CLEC.

4. Verizon shall provide notice to all similarly situated CLECs that, should Verizon prevail, Verizon may be able to recover this recorded price differential, in addition to requiring the CLEC to purchase the higher-priced resale platform service. Verizon shall provide such notice within 10 business days of the date of this ruling, as well as to provide a notice of availability to all similarly situated CLECs of this ruling, with copies to the Commission. Verizon shall confer with, and receive approval from, the Commission's Public Advisor regarding the precise content of this notification prior to mailing it.

5. This ruling shall be placed before the Commission at its next meeting, where the full Commission will have the opportunity to consider it.

6. This case shall proceed expeditiously and a prehearing conference shall be set as soon as possible.

7. The Commission's Process Office shall serve this ruling on the service list of this proceeding, as well as on the service lists in Case (C.) 04-09-001 and C.04-09-010.

Dated September 15, 2004, at San Francisco, California.

/s/ GEOFFREY F. BROWN		/s/ JANET E. ECONOME
Geoffrey F. Brown Assigned Commissioner		Janet A. Econome Administrative Law Judge

CERTIFICATE OF SERVICE

I certify that I have by mail, and by electronic mail to the parties to which an electronic mail address has been provided, this day served a true copy of the original attached Assigned Commissioner and Administrative Law Judge's Ruling on AT&T's Emergency Motion for Order Maintaining the Status Quo Pending Resolution of the Complaint on all parties of record in this proceeding or their attorneys of record.

Dated September 15, 2004, at San Francisco, California.

/s/ JANET V. ALVIAR

Janet V. Alviar

NOTICE

Parties should notify the Process Office, Public Utilities Commission, 505 Van Ness Avenue, Room 2000, San Francisco, CA 94102, of any change of address to insure that they continue to receive documents. You must indicate the proceeding number on the service list on which your name appears.

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

The Commission's policy is to schedule hearings (meetings, workshops, etc.) in locations that are accessible to people with disabilities. To verify that a particular location is accessible, call: Calendar Clerk (415) 703-1203.

If specialized accommodations for the disabled are needed, e.g., sign language interpreters, those making the arrangements must call the Public Advisor at (415) 703-2074 or TTY# 1-866-836-7825 or (415) 703-5282 at least three working days in advance of the event.

⁶ On January 23, 1997, AT&T Communications entered into the Interconnection, Resale and Unbundling Agreement between GTE California Incorporated, Contel of California, Inc. and AT&T Communications of California, Inc. (AT&T Communications ICA). The Commission approved the arbitrated AT&T Communications ICA in D.97-01-022. In 1998, the TCG Companies adopted the terms of the arbitrated Interconnection Agreement between MCImetro and GTE (TCG ICA). The Commission approved the TCG ICA in Resolution T-16185. Verizon is the successor in interest to GTE and assumed GTE's obligations under these agreements.

⁷ Because the interconnection agreements are quite lengthy, we discuss the most relevant provisions in this order.

⁸ See General Terms and Conditions Section 29 and 30. Specifically, Section 29, Introduction, provides that "This Part II sets forth the unbundled Network Elements that GTE agrees to offer to AT&T in accordance with its obligations under Section 251(c)(3) of the Act and 47 CFR 51.307 to 51.321 of the FCC Rules. The specific terms and conditions that apply to the unbundled Network Elements are described below and in Attachment 2. Prices for Network Elements are set forth in Part V and Attachment 14 of this Agreement."

⁹ See Sections 23.2 and 23.5. Because the TCG Companies adopted the MCIMetro ICA, the language of the agreement that refers to MCIm should be read to refer to the TCG Companies.

¹⁰ Section 23.2 provides in relevant part that "GTE will provide to MCIm [MCIMetro] on a nondiscriminatory basis unbundled Network Elements and ancillary services, including but not limited to local loop, local switching, tandem switching/transit switching, transport, data switching, ... , and any other function or functionality associated directly or indirectly with unbundled Network Elements and ancillary services. These services, or their functional components, will contain all the same features, functions and capabilities and be provided at a level of quality at least on parity with which it provides to itself or its Affiliates. GTE shall have the full burden of proving that access requested by MCIm is not technically feasible. ... ."

¹¹ First Report and Order, Implementation of the Local Competition Provisions in the Telecommunications Act of 1996, CC Docket No. 96-98, released August 8, 1996.

¹² Verizon cites to Section 29 of the AT&T Communications ICA and to Article VI, Section 1 of the TCG ICA.

¹³ Verizon cites United States Telecom Ass'n v. FCC, 359 F.3d 554 (D.C. Cir. 2004) (USTA II).

¹⁴ "3.3 GTE will not discontinue any unbundled Network Element, Ancillary Function or Combination thereof during the term of this Agreement without AT&T's written consent which consent shall not be unreasonably withheld, except (1) to the extent required by network changes or upgrades, in which event GTE will comply with the network disclosure requirements stated in the Act and the FCC's implementing regulations; or (2) if required by a final order of the Court, the FCC or the Commission as a result of remand or appeal of the FCC's order In the Matter of Implementation of Local Competition Provisions of the Telecommunications Act of 1996, Docket 96-08. In the event such a final order allows but does not require discontinuance, GTE shall make a proposal for AT&T's approval, and if the Parties are unable to agree, either Party may submit the matter to the Alternative Dispute Resolution procedures described in Attachment 1. ..." Section 2.1 of the TCG ICA provides for a similar provision.

¹⁵ See Section 8.3 of the General Terms and Conditions of the AT&T Communications ICA and Section 12.1 of the TCG ICA.

¹⁶ See Section 3.3 of the General Terms and Conditions of the AT&T Communications ICA and Section 2.1 of the TCG ICA.

¹⁷ Verizon cites the Third Report and Order and Fourth Further Notice of Proposed Rulemaking, implementation of the Local competition provisions in the Telecommunications Act of 1996, CC Docket No. 96-98, released November 5, 1999 at ¶ 306, 313, 316 (UNE Remand Order), which had limited exceptions not applicable here; Report and Order on Remand and Further Notice of Proposed Rulemaking, Review of the Section 251 Unbundling Obligations of Incumbent Local Exchange Carriers, 18 FCC Rcd 16978, ¶ 290 and 541, released August 21, 2003 (Triennial Review Order), and USTA II.

¹⁸ AT&T offered the declaration of Corbin E. Coombs, employed by AT&T as Group Manager - Local Products Management. Coombs has worked for AT&T in product management and operations since 1998. He is responsible for managing different aspects of AT&T's consumer UNE-P products. In the past, Coombs has had responsibility for AT&T's Consumer UNE-P Customer Accounts Record Exchanges, billing, and bill establishment processes. Coombs also had full end-to-end product and process responsibility based on the Total Service Resale platform. Coombs' assertion of other enumerated injuries do not serve as the basis for this ruling. For example, Coombs states that the switch from UNE-P to resale may also affect the features and services a customer will be receiving. According to Coombs, for the transition from UNE-P to resale to be handled correctly, AT&T and Verizon would have to conduct a study before converting from UNE-P to resale to ensure that the features available via UNE-P are also available under resale, and are available in the same combinations that consumers currently purchase from AT&T. Verizon states that it is unaware of any feature or service that falls under this category and AT&T has not specified any. Similarly, we do not base our finding of injury for this ruling on AT&T's allegations of financial harm. ( See Los Angeles Memorial Coliseum Com'n v. Nat. Football, 634 F.2d at 1202 [Monetary injury alone is not normally considered irreparable.])

¹⁹ Verizon offered the declaration of Beth E. Cohen to rebut AT&T's allegations of irreparable injury. Cohen is Verizon's Director of Customer Relationship and System Management in Wholesale Markets. Employed with Verizon since 1995, Cohen has held various positions of increasing responsibility in the Information Technology and Wholesale Markets organizations. She has also provided testimony regarding Verizon's operational support systems in several states.

²⁰ Verizon also discusses the pre-ordering and maintenance and repair processes. AT&T's articulated injury does not concern either of these processes.

²¹ Again, we do not require Verizon to provide AT&T with any of the other, new features that packet switches offer.

²² AT&T sent its letter on July 20, 2004, and Verizon's response is dated August 2, 2004.

²³ Rule 73 of the Commission's Rules of Practice and Procedure permits the Commission to take official notice of such matters as may be judicially noticed by California state courts. C.04-09-010 was filed on September 7, 2004, and complainants in that case filed their motion for injunctive relief on September 9, 2004. A Chief ALJ Ruling permitted Verizon until September 14, 2004 to respond to the motion.

²⁴ While we are reluctant to extend the effect of this restraint to interconnection agreements not before us, our market concerns require we direct Verizon to treat all similarly situated agreements with competitor CLECs the same. (See Pub. Util. Code § 701. [The commission may supervise and regulate every public utility in the State and may do all things, whether specifically designated in this part or in addition thereto, which are necessary and convenient in the exercise of such power and jurisdiction.])