CTC slaps $25K conditional fine on PTI

The Commonwealth Telecommunications Commission has imposed a conditional $25,000 fine on Pacific Telecom, Inc., which would only be enforced if the company commits another violation of its orders within one year.

The CTC partially granted Gov. Juan N. Babauta and CNMI consumer counsel Brian Caldwell’s request to impose sanction on PTI over the company’s failure to submit all financing documents to the commission at least 10 days prior to closing the telecom purchase deal with the Micronesian Telecommunications Corp.

PTI acquired all of MTC’s common stocks on Sept. 20, 2005, but submitted incomplete financing documents six days later. However, PTI assured it would work closely with the CTC regarding the submission of the required documents.

Yesterday, PTI general manager Tony Mosley said the company has already submitted all the required financing information to the commission. Mosley also viewed the CTC’s imposition of a conditional fine as fair, saying that the CTC took all underlying factors into consideration.

The CTC ruled that PTI’s late submission of the required documents was non-curable, said Caldwell. But he conceded that the commission did not find the violation a continuing one, as the governor had earlier alleged.

Babauta’s lawyer, assistant attorney general James Livingstone, earlier said the commission could impose a fine of $25,000 per day of violation or a total of $500,000 for continuing violations of its orders, citing a provision of Public Law 12-39. But he expressed belief that the appropriate fine would be $10,000 per day from Sept. 10, 2005—the 10th day prior to the telecom transaction’s closing—to Sept. 26, 2005, when PTI made submissions of financing documents to the CTC—for a total of $170,000.

Both Livingstone and Caldwell appeared satisfied with the CTC order imposing a conditional $25,000 fine on PTI, saying that they would not appeal the decision.

“We respect the CTC’s decision,” Livingstone said, noting that the CTC would hold PTI accountable if the company commits subsequent violation within one year.

The suspended sanction somehow eases regulatory and obligatory pressures on PTI, which has also been facing a lawsuit filed by the Marianas Public Lands Authority just days after the company took over Verizon’s operations.

But last Thursday, the governor assured the telecom firm’s employees that the MPLA had agreed to get back to the negotiating table in the hope of ending litigation. According to the governor, he had met with the MPLA’s board members, who agreed to a 30-day “cooling off” period to allow the agency and the telecom firm to proceed with negotiations to settle their dispute. Babauta also said the MPLA has agreed to extend the Superior Court’s deadlines for the filing of responsive pleadings related to its lawsuit to allow it and the company to focus on negotiations.

Both the MPLA and the telecom company welcomed the governor’s intervention, which Verizon’s employees asked for, while voicing out their position that political “vendetta” against the company should stop.

Although the MPLA lawsuit impleaded several causes of action, which included alleged breach of public land leases by the telecom firm, negotiations initially resulted in a deadlock after the company refused to pay some $2.1 million, which the agency had demanded as fees for public lands easement in connection with the company’s underground cables. The telecom firm has at some 800 miles of cable buried underground, but it disputed MPLA’s demand, contending that the right-of-way to bury those cables was part of its telecom franchise.