Babauta to PTI, Verizon: Withdraw threat

Gov. Juan N. Babauta lamented Wednesday the threat of Verizon local operator Micronesian Telecommunications Commission and prospective purchaser Pacific Telecoms Inc. to ask the courts to approve the sale, saying this constitutes a bad faith repudiation of the settlement agreement reached through negotiations facilitated by the Commonwealth Telecommunications Commission.

Babauta, through lawyer James Livingstone, and CNMI consumer counsel Brian Caldwell want MTC and PTI to withdraw their June 15 letter to CTC, which contained the lawsuit threat.

If not, Livingstone and Caldwell said they would be forced to ask the CTC to impose sanctions against MTC and PTI on top of requesting the commission to expunge the letter from the records.

“The joint applicants [MTC and PTI] falsely represent in their letter to the Commission that ‘the intervenors [Babauta and Caldwell] continue to make additional, unreasonable demands which are beyond the scope of this proceeding.’ Our clients have taken no such action,” Livingstone and Caldwell said.

The government lawyers mentioned these statements in a letter to lawyer Marcia Schultz, who represents the two companies.

Livingstone and Caldwell said the companies recognized during settlement negotiations that there remained some aspects of the agreement that have yet to be ironed out.

These points include:

*an independent audit by Deloitte & Touche of the finances of the company;

*a determination of what bonding company would [be] necessary for the new company to provide;

*a determination of what enforcement mechanisms would be included;

*a determination of whether it is in the public interest for Verizon to transfer as a monopoly the one inter-island cable upon which almost all communications in the Commonwealth depend.

The government lawyers pointed out that the issues were among the unresolved issues in the Final Negotiation Settlement Report released by CTC settlement officer Sean Frink.

They said the companies could not seek judicial review because the CTC has yet to render a final decision on the application for approval of the Verizon deal.

“As we all discussed on Monday, we are ready to work with you to complete CTC’s order and then brief the inter-island cable issue. We expect that your clients will cooperate in this process and live up to their commitments,” they said.

They also expressed disappointment over the failure of PTI to disclose the identities and resumes of prospective board members, the submission deadline of which fell on May 15. The government lawyers said the failure constitutes a violation of the settlement agreement.

MTC general manager Anthony S. Mosley and PTI vice president Jovino G. Lorenzo Jr., supported by Verizon International chief financial officer John N. Doherty, asked the CTC to conclude the settlement proceedings and approve the application.

“We respectfully object to the Commission’s proposal for an extensive and drawn out process of briefing and evidence-gathering with respect to the cable issue,” Mosley and Lorenzo said. “We call upon the Commission to expeditiously and summarily reject the remaining demands of the intervenors with regard to performance bonding, special enforcement provisions and cable divestiture/ regulation, and to act promptly on the application.”

“If the Commission continues to entertain intervenors’ further demands, we will have no choice but seek immediate judicial review of the commission’s actions,” they said. “If we are forced to proceed in that manner, we will not consider ourselves bound in any way by any of the conditional concessions outlined in the settlement report.”