Ore. Regulators File to Dismiss AT&T Suit

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Portland, Ore.-area regulators want a federal court todismiss an AT&T Corp. lawsuit against two local jurisdictions that want the company tounbundle high-speed-data service @Home Network.In a response filed in U.S. District Courtlast week, Portland and Multnomah counties claimed that AT&T was not damaged by theirattempt to have @Home opened to unaffiliated Internet-service providers.

The legal fight was precipitated by the two localitiesconditioning a transfer of their Tele-Communications Inc. cable franchises on AT&Tunbundling its cable-modem platform.

However, the two jurisdictions claimed that the court didnot need to hear the case because "neither the city nor the county has imposed anysuch condition, whether it's illegal or not."

Moreover, it argued that the transfer denial resulted fromAT&T's refusal to "unqualifiedly" accept the terms of the transfer andof its attempts to rewrite the equal-access provisions contained in the city and countyordinances.

Therefore, even without AT&T's rejection of openaccess, the transfers would have still been denied because the company "did notreturn the rest of the form without amendment."

"In other words," it concluded,"AT&T's concern about the open-access condition raises a purely hypotheticalissue."

"How could we have harmed them if we never imposed the[ISP-access] condition on them?" asked Marshall Runkel, aide to Portland citycouncilman Erik Sten. "What are they complaining about?"

Scott Morris, AT&T's vice president of externalaffairs, called the response "an extremely sophisticated defense" that wouldsend both sides back to square one by forcing the company to reapply for a transfer of thedisputed TCI franchises.

"It would be, 'Here we go again.' So how dowe get this issue resolved?" he said. "That's what we want: to get itsettled, one way or the other, so that we can move on."

Morris said AT&T plans to file a motion for summaryjudgment, which would allow the court to decide the issue based on the evidence before it.

The court has already set a March 16 hearing date on themotion to dismiss.

While Portland and Multnomah counties continue to push foropen access, sources said the two jurisdictions are now "isolated," sincevirtually all TCI franchising authorities have approved transfers to AT&T rather thanrisking costly legal fights.

Runkel said Portland and Multnomah counties will probablymake open access a requirement for expected transfer requests that would send another150,000 Paragon Cable subscribers in the area to TCI. However, it will agree not toenforce the requirement pending the outcome of its court case with AT&T.

Meanwhile, both localities hope that a settlement can befashioned before the end of 1999, when TCI's franchise requires the infrastructurefor offering @Home to be in place.

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