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Scollag,
Thanks for posting those links. I can't believe how close my musings were to the current events.

As for the law in these franchise agreements, I don't think that they have been tested in court. Just because there is a contract between the city and TCI, in the form a franchise agreement, does not mean that the terms of the agreement meet the letter of the law. I don't think there is much case law on these agreements, and certaintly the stakes are so high that these cases could eventually make it to the Supreme Court. I'm not an attorney, so maybe some of our Lawyer Fools can comment or give us some links to recent case rulings.

Certainly the recent FCC ruling is a plus for Cable operators everywhere. The market sure liked it with respect to ATHM ;-).

Good Luck,
LuxSit
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Luxsit, you're right again. This is an unprecedented situation, regardless how many spats there have been in the past.

Fortunately, I don't think Seattle Council has yet grasped the extent to which the stakes have risen (unless they read TMF? :-)).

Interestingly, Pepper and Corrazini's discussion of the changes made by the 1996 Act to the sale of cable systems seems to refer to situations in which the franchise is sold or transferred (for example, I saw some reports within the last couple of days of some transfers of franchises between MSOs - basically swaps, although I didn't pay close attention to them). In TCI's case, the company itself, not just the franchise, is being bought. This could be argued to be a different situation to that anticipated by the provisions of the franchise agreement, although of course we would have to see that to be sure, in which case the authority's right to approve might not be valid.

Always good to see firm upward movement. I expect all that short interest will help at some point.

Now then, is there anyone from Portland in the house tonight?
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Scollag, Luxsit, et al,

I discovered the website of a Washington DC law firm that specializes in telecommunications issues. http://www.millervaneaton.com/

Check out the "past features." There you'll see articles discussing legal issues relating to "The TCI-AT&T Transfer" (note: click on "more" to read the full article; the title's internal link is not working), "Cable Franchise Transfers" and more. Poke around the site and you'll find other articles of interest. For instance, there's one on "Mt. Hood & AT&T/TCI."

OFP


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Scollag, Luxsit and others,

Here's another site that might be worth monitoring:
http://brp.com/

Telecommunications Reports writes on Legal and Regulatory Information and Analysis.

For instance, at this time, if you scroll down you'll see an article relating to "AT&T and TCI Challenge Portland Rule in Court."

For what it's worth...

OFP
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Thanks OFP. This is Foolishness at its best.
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Thanks OFP. This is Foolishness at its best.

Let me second that Scollag!

LuxSit
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It seems that Portland and Multnoma County bit off a bit more than they wanted to chew. They stated in their letter accompanying the refusal to renew that this refusal need not end up in litigation. They tipped their hand pretty early that they are in no mood for litigation.

Inviting negotiation, but only on their terms, open access to the plant. What a joke. So AT&T will engineer and provide a plant that everyone can use? I think that the recent FCC ruling pretty well puts the Kabash on open access requirements. I expect that the courts will find that open access as a condition of a franchise renewal is in direct conflict with Federal Laws and that open access is in no way implied by the franchise agreement. I wish we could get a copy of the franchise agreement to read to verify that.

The real losers in the court battle will be the citizens of the Portland area. If the city and county prevail they will lose out on a first class communication plant, If city and County lose they get saddled with a lot of legal expenses. Hopefully they will wise up soon.

LuxSit
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LuxSit, spot on again.

I ploughed through most of the material, and agree with your assessment.

Clause 3 (in the draft Letter of Acceptance attached to Ordinance 172955) stands out like a sore thumb, and led me to think about how it could be countered. Here goes with a late-night ramble...

The status quo before the merger approval was sought was that TCI held the franchise (albeit with service problems), and had the right, prior to the proposal, to implement cable internet. So far as I am aware there had been NO complaints of exclusivity or requests for competitive access prior to the announcement of the merger (and I would expect to see it mentioned in the Commission's ordinance if this had ever been discussed earlier, to establish the precedent. This would actually have provided strong support for the commission's case, so if it hasn't been mentioned it can't have happened).

The only thing that has changed in the situation under approval is the ownership/control of the franchise. Why does competition suddenly become an issue at this stage, when it wasn't before?

Answer: it isn't. The commission is simply pushing its toys out of the pram because it remembers AT&T of old, and because TCI has experienced performance difficulties. Did you see that complaint about the rights of way? It seemed pretty ridiculous. This may be less about TCI being taken over than about WHO is doing it.

Interesting too that the commission tied its recommendations to the FCC case - covering their own backs, I suspect, in case things went wrong.

And they have. The Awkward Cities are now isolated, without FCC support.

As you say,
The real losers in the court battle will be the citizens of the Portland area. If the city and county prevail they will lose out on a first class communication plant, If city and County lose they get saddled with a lot of legal expenses. Hopefully they will wise up soon.

I sincerely hope they have left themselves room to back down. It would be no disgrace, and they would have got a good deal from AT&T. Actually, they would have done quite well on behalf of their constituents.
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Did you see that complaint about the rights of way? It seemed pretty ridiculous.

I read that part but it was stuffed chocka block with so many acronyms it was hard to follow. Maybe you could elaborate on it.

By the way are you an Attorney?

Fool On!
LuxSit
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LuxSit,

I don't think they are even sure there has been an infringement over the rights of way. The ordinance looks deliberately vague. It looks as if AT&T may have jumped the gun in some way, but I don't know what the TCG affiliate does. I'm reasonably sure that this is a non-issue.

The other really interesting argument against the Council/commission is that by invoking a requirement for competition, they have gone far beyond a review of the "technical, legal, and financial qualifications" of the transferee. Clause 3 of the ordinance defines the scope of the terms and conditions upon which the City may condition a transfer, and this does not provide for the resolution of commercial or competitive issues.

The quotes about AT&T's legal challenge indicate that this will be the basis of their case in court - if it ever gets there.

Here's hoping it won't.

BTW, not an Attorney. I'm a project manager in IT, and I do a lot a crawling through contracts and drafts in different countries.
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Scollag and LuxSit,

Glad you found those links helpful. Here's another one relating to municpal regulation (Denver area). This one's much lighter reading:

http://insidedenver.com/business/0127cabl3.shtml

Looks like other communities don't want to end up in a Portland-like situation. Rather than take on AT&T themselves, they'll let Portland serve as a test case.

OFP
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