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NYC Threatens To Sue Verizon Over FiOS Shortfalls (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: New York City officials yesterday notified Verizon that the company is in default of an agreement to bring fiber connections to all households in the city and could file a lawsuit against the company. The road to a potential lawsuit has been a long one. In June 2015, New York released an audit that found Verizon failed to meet a commitment to extend FiOS to every household in the five boroughs by June 2014. City officials and Verizon have been trying to resolve the matter since then with no success, as Verizon says that it hasn't actually broken the agreement. The default letter (full text) sent yesterday by the city Department of Information Technology and Telecommunications (DoITT) says Verizon has failed to pass all residential buildings in the city with fiber. As of October 2015, there were at least 38,551 addresses where Verizon hadn't fulfilled installation service requests that were more than a year old, the letter said. "Moreover, Verizon improperly reduced, from $50 million to $15 million, the performance bond required [by] the Agreement on the basis of Verizon's incorrect representations that Verizon had met the prescribed deployment schedule, when in fact it had not," the letter said. City officials demanded that Verizon restore the bond and wants a response within 30 days. The default letter also accuses Verizon of failing to make records related to its provision of cable service available to the city during its audit. "Officials say they could sue Verizon unless the carrier shows clear plans for stepping up installations," and that the notice is the first step in that process, The Wall Street Journal reported. The citywide fiber agreement lets NYC seek monetary damages from Verizon if it fails to deliver on the fiber promises.
somebody in the government bureaucracy didn't get paid (enough.)
ELOI, ELOI, LAMA SABACHTHANI!?
Back up the threat by repossessing and auctioning off their fiber
Verizon claimed they'd met standards that would allow the reduction of the $50 million to the $15 million and give them $35 million back. Apparently NYC agreed to it without doing any actual audit that the standard was met.
In fact, it seems they didn't do an audit to determine whether "every household in the 5 boroughs" was able to get Fios service until a year after that was supposed to be complete, and from there it took another 15 months to call them on it. And this is probably someone's full time job.
Given that I (and noone else discussing this here) has actually read the contract, there's no way to say for certain.
That said, I infer that the contract reduces that performance bond when certain milestones are met. Verizon thinks it met them, NYC disagrees.
Who is right? Well, most likely the party with the best lawyers. Because this case is going to be about specific words in specific places in the contract. And without being a lawyer, none of us are even going to understand the arguments....
"I do not agree with what you say, but I will defend to the death your right to say it"
"And this is probably someone's full time job."
But do you understand how long it took for that person to go to every residence in NYC to check?
"National Security is the chief cause of national insecurity." - Celine's First Law
End Franchise agreements. Confiscate the existing Fiber plant, and install Municipal funded fiber plant, back to a COLO facility and offer all service proivders a seat at THAT (COLO) table. You'll see lots of creative solutions to problems you didn't even know you had..
Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
Given that I (and noone else discussing this here) has actually read the contract, there's no way to say for certain
There's a link to the contract in the summary, reposted here. (That copy doesn't include the appendices, which are here.)
That said, I infer that the contract reduces that performance bond when certain milestones are met.
Correct. The bond reduction schedule is on page 42 of the contract, and references performance benchmarks in Appendix F.
Interestingly, it says the bond was to be reduced to $15 million after meeting the 2011 performance numbers. It lists three more step-downs after that ($10 million, $5 million, and $1 million) that Verizon apparently didn't claim.
So a few things: First, this has been brewing for several years, and probably just boils down to whether Verizon met the 2011 benchmarks, not any of the earlier step-downs. Thus, if they didn't meet the 2011 benchmarks, the bond theoretically would only go back up to the 2010 level, $25 million, not the full $50 million. And the letter only claims 38k addresses in NYC are without service. That's a vanishingly low percentage, and according to Appendix F they only had to provide 66% coverage across NYC in 2011.
Given all that, this default letter strikes me as more of a media ploy than a reasonable expectation of legal recourse.
Apparently Verizon's strategy for laying fiber and building the next generation of Internet infrastructure for US consumers is to lay fiber buried underneath their street or sidewalk. Because you see, consumers don't actually want to CONNECT to the fiber; they're perfectly content with just the idea of it passing down the street in front of their house.
And for this, let's collect many billions of dollars in taxpayer money and funnel it to this corporation. I'm sure this will pay huge dividends for our GDP as our consumers become more connected to the global economy... through their $10/GB 4G LTE connection.
Fuck Verizon.
Yeah, confiscating their assets is a great way to show what happens to companies that don't fulfill their contractual obligations!