City: Time Warner Cable Operating Illegally

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A San Diego County municipality sued Time Warner Cable, alleging the operator is illegally occupying city right-of-way without a franchise.

The dispute with Carlsbad, Calif., is an outgrowth of both the transfer of the local system from Adelphia to Time Warner Cable and arguments over the terms of the state’s one-year-old state franchising law. Time Warner’s Carlsbad franchise has expired and the system can’t yet apply for state oversight under California law.

According to the suit, filed Aug. 20 in U.S. District Court for the Southern District of California, Time Warner Cable applied for a franchise transfer in June of 2005 as part of its acquisition of Adelphia. At the time, Carlsbad had already entered franchise renewal negotiations with Adelphia representatives. The Adelphia franchise expiration date was November 2006. The city approved the transfer to Time Warner in March of 2006, but only after Time Warner agreed to perform under terms of the franchise it inherited from Adelphia, according to the city suit.

But on Aug. 30, 2006, the state legislature approved AB 2987, which transferred franchising authority to the state. Under that law, cable operators can drop their local agreements in favor of state regulation, but only after Jan. 1, 2008. According to Carlsbad’s suit, city officials told Time Warner it still needed a franchise, but the operator asserts the state law extends current franchises until the Jan. 1, 2008 effective date.

The city suit asserts that because Time Warner is operating illegally on city property, Carlsbad is entitled to 100% of the operator’s gross cable revenues earned while it was without a valid local or state franchise.

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