[00:00:02] Speaker 00:
Case number 15-1080 at L. New Star, Inc.

[00:00:06] Speaker 00:
Petitioner versus Federal Communications Commission at L. Mr. Shanmugan for the petitioner, Mr. Gossett for the respondents, and Mr. Carranza for association interveners.

[00:00:50] Speaker 03:
No, we can go ahead, right?

[00:00:51] Speaker 03:
No, because I don't know.

[00:00:52] Speaker 03:
They just say he's on the way, but we don't know where.

[00:00:56] Speaker 02:
Oh, they say he is on the way?

[00:00:57] Speaker 03:
That's what I'm looking for.

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Let's just keep going.

[00:01:01] Speaker 02:
Yeah.

[00:01:01] Speaker 02:
I think we should keep going.

[00:01:02] Speaker 02:
Yeah.

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Yeah, OK.

[00:01:06] Speaker 02:
OK, go ahead.

[00:01:08] Speaker 06:
Thank you, Judge Tatel, Ken, and Shannon McGann of Williams and Connolly for Petitioner News Star.

[00:01:13] Speaker 06:
May it please the Court, in the Telecommunications Act of 1996, Congress ordered the FCC to select one or more entities to serve as numbering administrators.

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The sole statutory criterion for selection was that an administrator be an impartial entity.

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That is, that the administrator not be aligned with any particular industry segment or participant.

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That requirement was designed to serve the Telecommunications Act's overarching purpose of promoting competition by preventing the actuality or even the perception of preferential treatment by numbering administrators.

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In selecting Telecordia as the next local number portability administrator, the Commission improperly determined that Telecordia was an impartial entity, despite the undisputed fact that Telecordia's 100% owner, Ericsson, is aligned with the wireless segment of the telecommunications industry and is itself a network equipment manufacturer.

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In its haste to move forward, the commission dispensed with the requirements of notice and comment rulemaking, even though it underwent rulemaking when it selected New Star's corporate predecessor as one of the initial administrators.

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And in selecting telecordia as the purportedly lower cost option, the commission relied on an unsupported assumption concerning the cost of the transition to telecordia and arbitrarily refused to consider New Star's lowest offer.

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This was a flawed process with a seriously flawed result, and the commission's order selecting telecordia should therefore be vacated.

[00:02:47] Speaker 06:
I'd like to start with the argument about neutrality.

[00:02:50] Speaker 02:
Can I just ask you a technical question?

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The administrator makes sure that if someone shifts cell phone providers, they get to keep their number, right?

[00:03:01] Speaker 06:
Yes.

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That's what this is all about.

[00:03:04] Speaker 06:
Yes, so the administrator does more than that.

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The administrator is also effectively responsible for routing calls, because it is the administrator's database that is used for that purpose.

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So this is a vitally important function.

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As this court is aware, there are a number of different administrators.

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The administrator routes calls.

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So if I call you on my cell phone, it's the administrator that routes that call?

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The administrator maintains a database which is used.

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I'm just curious.

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My simple question is, why is this such a big deal?

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Well, it is a big deal for both of those reasons.

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The administrator is, of course, the one who is responsible if you were to switch providers for ensuring that that switch takes place.

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But the administrator, therefore... That doesn't seem like such a huge technological task that costs billions of dollars.

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simplify this perhaps grossly.

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The administrator is essentially responsible for linking your phone number to a particular carrier such that if you were to call my house, the administrator's database would be used to establish that my house is served by Verizon and therefore to ensure that the call goes through.

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And I think that this is actually important in one very specific.

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It's not legally relevant.

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I'm just curious.

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Well, it does go to the first argument here.

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And I think the premise of the first part of our argument on neutrality is that this issue of alignment, whether an aligned entity can serve as an administrator, is in fact a freestanding requirement.

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I think there's some back and forth in the briefs concerning the neutrality criteria that are set out in the regulations.

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And those are the criteria set out

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Section 5212A1 in Romanettes 1, 2, and 3.

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And the innovators in particular seem to suggest those criteria are the whole ballgame.

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But quite to the contrary, the regulations, and in particular the regulations specific to the local number portability administrator, require that the administrator not be aligned with any particular telecommunications industry segment.

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And the commission itself has indicated that that is a freestanding requirement.

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And our first argument, as the court is aware, is that that requirement is plainly failed here.

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The commission itself did not dispute, and indeed, it seemingly acknowledged at points in its order, that Erickson, Telfordia's parent, is aligned with the wireless segment of the industry because it earns billions of dollars from contracts to manage the networks of and to sell network equipment to the major American wireless providers.

[00:05:34] Speaker 06:
Where the commission went wrong, and we believe that this is a sufficient ground for vacating the commission's order, is in paragraph 172 when the commission said, quote, Telcordia is a separate company with a separate independent board of directors, each of whom owes fiduciary duties to Telcordia.

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Does your argument mean to suggest that if you're in a situation where there's a parent and a wholly owned subsidiary, it can never pass the statutory test?

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Well, our submission is a much more modest one, Judge Edwards.

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It is simply that in that circumstance, where you have a wholly owned subsidiary, you have to look to the affiliations of the parent in assessing whether the subsidiary is, in fact, an impartial entity for purposes of the statute.

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So you're saying the alleged error here is the FCC's failure to even think about it, other than to say that someone promised not to do anything wrong.

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That is correct with regard to the alignment argument.

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And just to be clear why we're talking about Delaware law here.

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We're talking about Delaware law because Talcordia is a Delaware company.

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And so its relationship with its parent, Erickson, is naturally governed by Delaware law.

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And we think that the commission in the paragraph I've just mentioned, paragraph 172, simply got Delaware law

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wrong, where you have a wholly owned subsidiary, the duties of the directors in fact run to the parent as the sole shareholder.

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That is the Anadarko case and the other subsequent Delaware cases.

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Your argument is there's a complete unity of interest under Delaware law.

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There is, and of course that's the broader principle, Judge Edwards, from which the specific principle that the duties of the directors of the subsidiary run to the parent

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Flows.

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The broader principle is that where you have a wholly owned subsidiary, there's a unity of interest between the parent and the subsidiary.

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And if you look at footnote 593, which is attached to paragraph 172, this is page 1951 of the Joint Appendix, the commission goes on to say, even to the extent that Erickson is aligned with the wireless industry, as that term is understood in our neutrality rules, it does not follow that Talcordia is so aligned.

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And so this error of Delaware law, which I would note parenthetically, was induced by an opinion letter from Talcordia's counsel, which mischaracterized where the duties run, pages 855 to 856 of the Joint Appendix.

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That error was really the source of the problems with the commission's analysis.

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So does your entire argument depend on us agreeing with you that

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the commission misunderstood Delaware law?

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Suppose we don't agree with that.

[00:08:03] Speaker 06:
Well, if you don't agree with us, we have the other arguments on impartiality.

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But I just want to be clear, Judge Tata, we are relying both on the specific principle of Delaware law regarding the duties of the directors of the city.

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If I didn't agree with you about that, then what's your argument about why we would overturn the commission's judgment about

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its view of the effectiveness of these criteria for impartiality.

[00:08:30] Speaker 06:
So first, Judge Tatel, just to be clear, to the extent that the commission is relying on these reported safeguards.

[00:08:37] Speaker 02:
Well, they call them safeguards.

[00:08:39] Speaker 06:
Well, I'm happy to call them safeguards for purposes of this colloquy.

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We don't believe that safeguards can address a problem with the alignment requirement.

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And the commission, in its order, was really relying on the safeguards to address a separate problem

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under Romanet 3 of the regulation I mentioned earlier, namely that there is a specific requirement that an administrator not be subject to undue influence by parties with a vested interest.

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Now, leaving aside for the moment whether those safeguards were sufficient, and as the Court is aware, we have a separate argument

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that the commission acted arbitrarily and capriciously by failing sufficiently to investigate Erickson's business relationships in concluding that the safeguard was sufficient.

[00:09:22] Speaker 02:
The commission points us to the language in the regulation which says

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Notwithstanding these criteria, that is the ones you're talking about, the commission may determine that a party is not subject to undue influence.

[00:09:36] Speaker 06:
But Judge Tatel, that solely goes to the question of the interplay between Romanet 3 and Romanets 1 and 2.

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The commission has consistently taken the view, and I don't really read their brief to suggest otherwise, that this requirement concerning alignment is a threshold requirement.

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And just to be clear, that is a requirement for selection.

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It doesn't merely govern your conduct after you are selected.

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In order to be selected as the administrator, you have to not be aligned with a particular segment of the industry.

[00:10:07] Speaker 06:
And the Commission has never, never said that safeguards can cure a problem with alignment.

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This goes to the question of whether a particular entity is eligible to be selected.

[00:10:19] Speaker 06:
Now, to be sure, if after this court were to vacate the commission's order, if Talcordia were to come back and say, we have reconstituted ourselves, we are no longer wholly owned by Erickson, then yes, sure, the analysis for whether they are eligible to serve as the administrator would be different.

[00:10:37] Speaker 06:
But our submission here is really a straightforward one.

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It is, first, that alignment is, in fact, a distinct, discrete requirement, which has always been the commission's view.

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And second, that that is a problem that cannot be cured by safeguards.

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And again, the commission has never taken a contrary view.

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And the only other thing I would add on this, and this is a little bit down in the weeds if we're not down in the weeds already, is that this alignment requirement is actually the only requirement in the regulations

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that by its terms applies to the local number portability administrator with the exception of the requirement concerning network equipment manufacturers, which I'm going to get to with the court sleeve in a second.

[00:11:19] Speaker 06:
That requirement, the alignment requirement is in 5221K.

[00:11:23] Speaker 06:
The three Romanettes in 5212, by their terms, only apply to the North American numbering plan administrator.

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And in the order, the commission unilaterally said, we're now going to apply those to the local number portability administrator as well.

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And I would note parenthetically that that is yet another reason why this should have all gone through notice and comment rulemaking.

[00:11:43] Speaker 06:
The commission effectively amended the regulation to apply to local number portability administrators as well.

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For present purposes, my point is simply that, again,

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alignment is a separate and threshold requirement.

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Now, if you disagree with our submission on that point, Judge Tatel, I would revert to my second argument on impartiality, my argument concerning the network equipment manufacturer requirement.

[00:12:03] Speaker 06:
That is a requirement that in our view is incorporated through Section 5226A, which is a provision that applies specifically to the local number portability administrator, and it by the Commission's

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own concession incorporates the recommendations of the selection working group report.

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Now the interveners deride our argument as a connect the dots argument, but with all due respect to the interveners, there are not really a lot of dots to connect here.

[00:12:29] Speaker 06:
Our submission is quite straightforward.

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It is that in Section 5226A, the Commission carved out certain recommendations that are not incorporated, and to the extent that the Commission makes the argument that the requirement concerning network equipment manufacturers is not in fact a recommendation, I would respectfully submit that that is belied not only by Section 4 of the Selection Working Group Report, but also by Section 6.

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which recommends adoption of the process for selecting the administrator.

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And the commission itself, in the second report and order, made clear that the report's quote, recommendations on number portability administration, end quote, included recommendations regarding quote, how the administrator should be selected.

[00:13:13] Speaker 06:
So to use your phrase, Judge Tatel, to the extent that this is a triple cushion shot because we're relying on the fact that there are, in fact, three relevant provisions here, the regulation, section six of the report, and section four of the report, the fact remains that as a matter of ineluctable logic, the requirements of section four have to be incorporated.

[00:13:32] Speaker 06:
And quite frankly, I think that that is a straightforward and independent basis on which to vacate the commission's order.

[00:13:38] Speaker 06:
I know that my time is short.

[00:13:40] Speaker 02:
Would you go on to notice and comment?

[00:13:41] Speaker 02:
I took up some of your time with my question about technology.

[00:13:44] Speaker 02:
So would you say something about notice and comment?

[00:13:47] Speaker 02:
And I guess in particular, is it your view that if a regulation is required to be issued pursuant to notice and comment, that any action implementing that regulation must also be?

[00:14:03] Speaker 02:
Notice and comment.

[00:14:04] Speaker 06:
No, Judge, I don't think that that's our submission.

[00:14:07] Speaker 02:
What is your precise argument?

[00:14:08] Speaker 06:
I think our precise argument is that what took place here was effectively an amendment of the prior selection.

[00:14:15] Speaker 06:
And let me explain why that's so, because I think that the interveners dispute that proposition.

[00:14:21] Speaker 06:
Our view is first that the initial selection of the administrators did, in fact, occur through notice and comment rulemaking based on the same regulation to which I adverted just a minute ago, Section 5226A.

[00:14:33] Speaker 06:
And indeed, the commission's own actions at the time of that initial selection confirmed that the commission itself thought, contrary to the commission's suggestion now that there was an adjudicatory component, that in fact the very selection of the new administrators was a part of the notice and comment rulemaking

[00:14:49] Speaker 02:
But since then, it's selected administrators without notice and comment, hasn't it?

[00:14:54] Speaker 06:
Well, I don't think that that's quite true, Judge Tatel.

[00:14:56] Speaker 06:
I think that what the commission did in the Warburg order was essentially to confirm the propriety of the successor, in fact, of the original administrator continuing to serve as the administrator.

[00:15:10] Speaker 06:
And I think that's somewhat different from the selection of an entirely new administrator.

[00:15:14] Speaker 06:
Now, the interveners suggest that because there was effectively a time limit on the selection of the initial administrators, that what's going on here is not really an amendment.

[00:15:23] Speaker 06:
But I think that the problem with that, and it gets back to my answer a few minutes ago, is that what the commission is doing in this process

[00:15:30] Speaker 06:
is determining eligibility and propriety to serve as the administrator.

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The issue of the term of the contract is a matter for negotiation.

[00:15:40] Speaker 06:
And the commission, of course, is sometimes aware of that and sometimes confirms that.

[00:15:44] Speaker 06:
But ultimately, all that the commission did in its initial order was to say, here are two entities that can serve as the administrator.

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And what the commission did this time around was to say, we are going to say that this other entity is going to be allowed to serve as an administrator subject to the execution of an appropriate contract.

[00:16:03] Speaker 06:
And of course, our argument here doesn't rest solely on the argument that there was an amendment of the prior rulemaking.

[00:16:09] Speaker 06:
Our argument is also that the agency was exercising legislative authority here.

[00:16:14] Speaker 06:
It was exercising its authority under Section 251.

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An authority that the Supreme Court itself has recognized is an authority that has to be exercised through regulation.

[00:16:26] Speaker 06:
And our argument is also, as the court is aware, that this decision was one that had solely future effect.

[00:16:34] Speaker 06:
It did affect thousands of parties, thousands of providers who are beholden to the administrator and subject to the administrator's requirements.

[00:16:43] Speaker 02:
OK, thanks.

[00:16:43] Speaker 02:
We'll hear from the commission.

[00:16:54] Speaker 05:
Thank you, Your Honor.

[00:16:56] Speaker 05:
It's David Gossett for the Federal Communications Commission.

[00:17:00] Speaker 05:
The commission reasonably approved the advisory committee's determination that Telecordia should be the next administrator of the number portability system.

[00:17:09] Speaker 05:
The analysis was conducted under the three-part test in section 52.12 of the regulations.

[00:17:15] Speaker 05:
And as the commission noted, since those regulations were created in 1997, that's how the commission has analyzed the neutrality of every administrator, the number portability or otherwise.

[00:17:27] Speaker 05:
That's in paragraph 160 of the order.

[00:17:29] Speaker 05:
The commission went through the three parts of that analysis and determined that teleporting was appropriately neutral and impartial.

[00:17:37] Speaker 05:
Section 52.21, which Mr. Shanmugam points to, is not a separate test.

[00:17:43] Speaker 05:
That provision

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It uses the same language as 52.12 to set forth the basic principle of neutrality.

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That's what the impartiality language is.

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And if you look at the language of section 52.12, it links that introductory clause to the word accordingly.

[00:18:02] Speaker 05:
In analyzing the neutrality of a given potential administrator, we look at these three factors, whether it's affiliated with the telecommunications service provider, whether it issues a majority of its debt or obtains a majority of its income from a TSP, and the general notwithstanding whether

[00:18:21] Speaker 05:
an entity fits under one of those two, is it appropriately neutral?

[00:18:26] Speaker 05:
That's how the commission analyzes this question.

[00:18:28] Speaker 05:
And that's what the commission did here.

[00:18:30] Speaker 03:
Beyond that, the commission has... Let me give you my concern.

[00:18:36] Speaker 03:
You know, whether we can quibble over the preciseness of the corporate law that may or may not be in play here really is not an unknown notion that a parent and its wholly owned subsidiary have complete unity of interest.

[00:18:50] Speaker 03:
And the Commission here seems to suggest, well, corporate law has no place, except the Commission, as I read your papers, did indulge in notions of corporate law principles, and this is one of them, and your explanation falls flat here.

[00:19:08] Speaker 03:
There's no analysis of Erickson that I can see, and how Erickson being whom it is, or what it is,

[00:19:17] Speaker 03:
would affect the impartiality that's required.

[00:19:22] Speaker 03:
I mean, merely to say that the board of directors of the person or the group that got the award promises to be good is to say nothing as far as I can see.

[00:19:33] Speaker 05:
Well, what the commission said in paragraph 172 is that given the conditions imposed in this order, we thought the telecordia.

[00:19:41] Speaker 03:
One of the conditions that address what I think is a valid concern that a parent and a wholly owned subsidiary have complete unity of interest in the board of the subsidiary has to be faithful to the parent.

[00:19:54] Speaker 05:
Let me answer that question in two fashions.

[00:19:56] Speaker 05:
First, let's talk about Delaware corporate law for a second.

[00:19:59] Speaker 05:
I mean, I do think this is a question of federal law, it's a question of whether they're impartial, but as to Delaware corporate law, the Trenwick decision that's cited in the briefs discusses how a subsidiary's board is entitled to support a parent's business strategy unless it believes pursuit of that strategy will cause the subsidiary to violate its legal obligations.

[00:20:17] Speaker 05:
Here, and that's at 906 A second 174.

[00:20:21] Speaker 05:
Here,

[00:20:23] Speaker 05:
Telcordia has specific legal obligations to ensure that it is neutral in engaging in the administration of the number portability system.

[00:20:33] Speaker 05:
It's part of the code of conduct.

[00:20:34] Speaker 05:
It's part of the obligations imposed by this order.

[00:20:37] Speaker 05:
But let's then talk about the various conditions, because as the commission explains, the commission has never looked

[00:20:45] Speaker 05:
at the question of the neutrality of a given administrator in the abstract.

[00:20:49] Speaker 05:
It has looked at it in light of all the facts and circumstances and in light of the conditions imposed.

[00:20:55] Speaker 02:
There's never been a situation like this.

[00:20:59] Speaker 05:
Respectfully, Your Honor, there has.

[00:21:01] Speaker 03:
But even assuming that's true, don't you have to then analyze Erickson, what it does, what it's about, and the nature of the relationship between Erickson and Telecordia?

[00:21:13] Speaker 03:
I mean, you're wanting to override a corporate principle by saying, well, but the subsidiary has legal obligations, and we're reading that to say they promise to be good.

[00:21:26] Speaker 03:
They promise not to cause any problems with respect to neutrality.

[00:21:30] Speaker 03:
This doesn't seem to make sense if you've not analyzed the relationship between Erickson and Delacordia, and you didn't hear.

[00:21:37] Speaker 05:
We did.

[00:21:37] Speaker 05:
We acknowledged that they were wholly-owned subsidiary, but we insisted on the creation of an independent board.

[00:21:42] Speaker 05:
We insisted on a voting trust to appoint the independent board of directors.

[00:21:47] Speaker 05:
We insisted on a code of conduct.

[00:21:49] Speaker 05:
We insisted on a neutrality audit every six months to ensure the compliance of- Did that negate their- Good morning, Your Honor.

[00:21:59] Speaker 04:
My apologies.

[00:22:01] Speaker 04:
where construction went out on the road and got caught in terrible traffic.

[00:22:06] Speaker 04:
I should have allowed for it and I apologize.

[00:22:10] Speaker 03:
I'm sorry, Your Honor.

[00:22:11] Speaker 03:
I'm glad you're safe here.

[00:22:12] Speaker 03:
Does that negate the legal obligations that otherwise exist with respect to what the subsidiary owes to the parent?

[00:22:22] Speaker 05:
And how could it?

[00:22:23] Speaker 05:
The subsidiary owes a corporate obligation, as I explained from the Trenwick decision, to operate in the interests of the parent, but that is not an obligation to trump other legal obligations, such as the obligation to, in this case, administer the system impartially.

[00:22:42] Speaker 05:
There's a legal obligation to maximize a corporation, the parent's profit, just as there's a legal obligation to maximize the profit of any corporate, whoever the shareholders of a corporation are.

[00:22:53] Speaker 05:
But that's a separate question from whether it is reasonable for the commission to conclude under 5212 that this administrator will be adequately impartial among telecommunication service providers.

[00:23:06] Speaker 05:
That's the real question.

[00:23:07] Speaker 05:
I also do want to point out that this is not the first time that the Commission has dealt with a situation where there is a wholly owned subsidiary.

[00:23:16] Speaker 05:
In fact, the Commission ordered the creation of a wholly owned subsidiary to administer the billing and collection agent.

[00:23:23] Speaker 05:
That's at JA444 to 445.

[00:23:27] Speaker 05:
There was a situation where

[00:23:29] Speaker 05:
The parent corporation was determined to be impartial, to be partial.

[00:23:34] Speaker 05:
It was biased in favor of incumbent local exchange carriers.

[00:23:39] Speaker 05:
And the commission's solution to that was to say, let's insist that you create a wholly-owned subsidiary with an independent board.

[00:23:46] Speaker 05:
That's the way the commission has always analyzed these questions, is to look at the specifics of the circumstance.

[00:23:53] Speaker 05:
That's why 52.12A13 has this loosey-goosey, notwithstanding language, because these are factual questions.

[00:24:03] Speaker 05:
This is a determination of, do we, as the expert in this area, believe this company will be impartial?

[00:24:11] Speaker 05:
It's also, therefore, important to note that the way this process worked is that the advisory committee, which is made up of representatives of wireless carriers, wireline carriers, Voigt providers, consumer representatives, they recommended the selection of Talcordia as the administrator.

[00:24:31] Speaker 05:
This is not a recommendation that the commission invented out of whole cloth.

[00:24:35] Speaker 05:
And so it's not the case that any specific

[00:24:39] Speaker 05:
portion of the industry is here before the court today saying, we think this is a biased provider.

[00:24:45] Speaker 05:
We endorse that.

[00:24:46] Speaker 05:
And in fact, as the priests point out, in the course of this process, in the course of the request for proposal process,

[00:24:55] Speaker 05:
News Star specifically said, that's a great way for you, I didn't use those words, but that's an appropriate way for you to determine neutrality because the advisory committee and this consortium that will have the contract, they're the people who pay for this contract.

[00:25:09] Speaker 05:
They're the people who therefore are appropriately situated to determine whether this potential administrator is appropriately neutral.

[00:25:20] Speaker 05:
Turning, if there are,

[00:25:22] Speaker 05:
No further questions on the neutrality.

[00:25:25] Speaker 05:
Well, one other

[00:25:27] Speaker 05:
If there are further questions on that, I do want to talk briefly about the rulemaking issue that Judge Tatel raised.

[00:25:35] Speaker 05:
First, I think it's important to stress that the commission believes this argument is untimely.

[00:25:41] Speaker 05:
The May 2011 order that laid out the process did not state that there would be a rulemaking.

[00:25:47] Speaker 02:
It didn't say anything.

[00:25:49] Speaker 02:
It just said the commission will act, right?

[00:25:52] Speaker 02:
Either the Bureau.

[00:25:54] Speaker 02:
Why?

[00:25:55] Speaker 02:
Yes.

[00:25:56] Speaker 02:
Right?

[00:25:56] Speaker 02:
That's all it said.

[00:25:58] Speaker 02:
It didn't say the commission wouldn't do notice in time.

[00:26:01] Speaker 02:
It just said it would act appropriately.

[00:26:03] Speaker 05:
Yes, Your Honor.

[00:26:04] Speaker 02:
So why were they obligated to say anything at that point?

[00:26:07] Speaker 05:
Sorry.

[00:26:09] Speaker 05:
The draft request for proposals that followed shortly thereafter that order, which the commission released for public notice, provided for no more than six weeks between a recommendation from the advisory committee to the FCC and the FCC's announcement of the decision of who should be the administrator.

[00:26:27] Speaker 05:
And that's at JA 670.

[00:26:29] Speaker 05:
Newstore affirmatively supported that process.

[00:26:31] Speaker 05:
The final RFP, again, had a six week

[00:26:33] Speaker 02:
Because of that, that there wouldn't have been time for another.

[00:26:36] Speaker 05:
I think it's, this court is well aware that it's essentially impossible to have a notice in common rulemaking in a six week period.

[00:26:42] Speaker 05:
I see, I see.

[00:26:43] Speaker 05:
So my point is not that, my point is simply that New Star was well aware until it reached the situation where it was concerned about the outcome of this, that there was not going to be a rulemaking.

[00:26:56] Speaker 05:
This is an argument created ex post, and that's what the reason we think it's untimely.

[00:27:00] Speaker 05:
Beyond that, it was entirely reasonable for the commission to

[00:27:03] Speaker 05:
conclude that this should be done via an adjudication.

[00:27:07] Speaker 05:
It's the sort of decision that is inherently in the discretion of an agency, and it was just like it's reasonable to award a license in order, not through noticing how it will making.

[00:27:20] Speaker 05:
So too, it's reasonable to say, you're going to administer this process, not the other person.

[00:27:25] Speaker 05:
So on that point also,

[00:27:33] Speaker 05:
In its brief, New Star makes the argument that all adjudications must have retroactive effect.

[00:27:40] Speaker 05:
This court's conference group decision that's cited in the briefs is inconsistent with that.

[00:27:44] Speaker 05:
In that circumstance, the FCC specifically determined that an adjudicatory decision would be entirely prospective, and the court affirmed that.

[00:27:56] Speaker 05:
In my remaining 50 seconds, I just want to make one more point on the neutrality point.

[00:28:03] Speaker 05:
The commission here created an extensive series of conditions.

[00:28:10] Speaker 05:
Some were proposed by Teleportius.

[00:28:11] Speaker 05:
Some were imposed by the commission to ensure the impartiality and neutrality of this administrator.

[00:28:18] Speaker 05:
Mr. Shanmugam, as far as I can tell, thinks that no set of conditions could possibly have sufficed to ensure the impartiality of this administrator.

[00:28:28] Speaker 04:
He's not the party.

[00:28:30] Speaker 04:
I'm sorry.

[00:28:30] Speaker 04:
New Star.

[00:28:31] Speaker 04:
Call counsel by name.

[00:28:34] Speaker 04:
He's not the party.

[00:28:38] Speaker 05:
I've known Mr. Shannon for a long time.

[00:28:39] Speaker 05:
I did not mean in any way for it to be an assertion against him.

[00:28:43] Speaker 05:
We were summer associates together 20 years ago.

[00:28:46] Speaker 05:
But my point is that New Star

[00:28:51] Speaker 05:
It seems to be taking the position that there's no set of conditions that could possibly create impartiality.

[00:28:57] Speaker 05:
And that's just simply not the way the commission has ever understood this process.

[00:29:01] Speaker 05:
Every time it has looked at the impartiality of a, at the question of the neutrality of an administrator, any one of the

[00:29:07] Speaker 05:
five or six separate administrators we've had, we've looked at the specifics of the circumstances, the conditions created, and an analysis of the risks and of possible bias in that process.

[00:29:22] Speaker 05:
And that's exactly what we did here.

[00:29:23] Speaker 03:
Now, you said at one point in your argument that there's nothing to indicate that they're, in fact, biased.

[00:29:28] Speaker 03:
That can't be the test.

[00:29:31] Speaker 03:
We're talking about a threat of bias, not actual bias, right?

[00:29:35] Speaker 05:
Yes, of course.

[00:29:36] Speaker 05:
I didn't mean to imply that.

[00:29:37] Speaker 05:
This is why the Commission assumed for the sake of argument that Erickson might be biased in paragraph 172.

[00:29:47] Speaker 05:
It did not find it.

[00:29:48] Speaker 03:
It pointed out that there were questions as to that.

[00:29:50] Speaker 03:
The Commission probably assumed that there were some concerns about neutrality.

[00:29:54] Speaker 03:
Commission assumed that their significant concerns, they ought to, I think that's what I'm reading here, they assumed their concerns about neutrality because you have a wholly owned subsidiary.

[00:30:04] Speaker 03:
Well, the Commission... And you understand that normally we don't expect complete neutrality in that circumstance.

[00:30:13] Speaker 05:
Respectfully, I disagree.

[00:30:14] Speaker 05:
The Commission assumed for sake of argument.

[00:30:15] Speaker 04:
I mean, when Lockheed Martin became... Would you disagree with the proposition that for you have the wholly owned subsidiary

[00:30:25] Speaker 03:
I'm not understanding that.

[00:30:34] Speaker 03:
The commission assumed there was clearly a problem with neutrality.

[00:30:41] Speaker 03:
And you seem to be saying, no, not at all.

[00:30:44] Speaker 03:
And I don't get it.

[00:30:45] Speaker 03:
Were the wholly owned subsidiary and the parent is in the business that we're talking about?

[00:30:50] Speaker 05:
Respectfully, my point was actually that the parent is not directly in the business.

[00:30:54] Speaker 05:
I mean, under 52.12, if the parent were a telecommunication service provider, that would be a fairly strict ban under subpart one of that test.

[00:31:06] Speaker 05:
Here, the arguments are that they're aligned with the wireless segment, they're an equipment manufacturer.

[00:31:11] Speaker 05:
Those are all a step removed from actually apparent.

[00:31:13] Speaker 05:
And of course, when the commission selected Lockheed Martin as the New Star's corporate predecessor as the administrator, it determined that Lockheed Martin actually was a telecommunication service provider, but said it was not enough of a bias that it was going to allow it nonetheless under subpart three of the test.

[00:31:33] Speaker 05:
Here, what the commission did was say, look, New Star is making arguments about Ericsson, about the corporate parent, assuming for the sake of argument that this equipment manufacturer relationship or an alleged bias towards the wireless industry were sufficient to create a question as to Ericsson.

[00:31:54] Speaker 05:
Here, we think telcordia is sufficiently insulated from that connection by the lengthy set of protections that we've created.

[00:32:06] Speaker 05:
I would point the court to the appendix to the order, Jane, 1963-64.

[00:32:11] Speaker 05:
where the commission went through all of these separate conditions that were imposed.

[00:32:17] Speaker 05:
I mean, not only is it the independent board and the voting trust and the neutrality audit, it's also requirements of legal obligations to be neutral.

[00:32:27] Speaker 05:
requirements not to share information, requirements not to share employees.

[00:32:32] Speaker 05:
It's a lengthy series of protections precisely because even assuming that there might be a general, even acknowledging that the corporations are one of the wholly unsubstantiated or the other, here it's

[00:32:47] Speaker 05:
isolated from that protection.

[00:32:49] Speaker 05:
I mean, under Delaware law, it's not the case that a corporation always has, a wholly owned subsidiary always has sole obligations to the corporate parent.

[00:32:59] Speaker 05:
That's why cases have said that, for example, in the case of bankruptcy, they might have other obligations.

[00:33:06] Speaker 05:
And here too, so if there's a circumstance where there are another source of

[00:33:12] Speaker 05:
reason to think that the wholly-onsubsidiary would have separate obligations, like, for example, bankruptcy, then you can look beyond the general principle that a wholly-onsubsidiary exists to do the business of the parent.

[00:33:25] Speaker 05:
Here, the order here, the legal obligations created here are separate legal obligations that help isolate it.

[00:33:34] Speaker 04:
I don't understand why you were auditioning at that point.

[00:33:37] Speaker 04:
Do you really think you can win?

[00:33:39] Speaker 04:
You can have us write an account.

[00:33:44] Speaker 04:
not have a duty to its parent?

[00:33:46] Speaker 05:
I was not making that as my principal argument, Your Honor.

[00:33:51] Speaker 05:
My point is that what the Commission concluded was that given the, and this is the end of paragraph 172, the paragraph which addresses fiduciary duty, we reject the claim that here there is undue influence, particularly when considered in conjunction with the conditions imposed on the court.

[00:34:09] Speaker 04:
It doesn't have to be undue influence to create a conflict or an apparent conflict.

[00:34:14] Speaker 04:
and you seem to be trying to defend something that's not the proposition that you're going to win on.

[00:34:20] Speaker 04:
I don't understand why you're making that such an important part of your argument.

[00:34:24] Speaker 04:
I mean, I came late to the party, but that's most of what I've heard, is you trying to say that a subsidiary, a whole other subsidiary, doesn't have a duty to its parent.

[00:34:34] Speaker 03:
It is coming across that way half the time, at least.

[00:34:39] Speaker 03:
And that's why I'm trying to listen to you carefully.

[00:34:41] Speaker 03:
If your argument is, look,

[00:34:44] Speaker 03:
I thought you were going to say, look, the commission understood.

[00:34:46] Speaker 03:
There's a question of neutrality here.

[00:34:48] Speaker 03:
Any doubt about that?

[00:34:50] Speaker 03:
There's a possibility, a possible question of neutrality.

[00:34:53] Speaker 03:
And we attempted to deal with it.

[00:34:55] Speaker 03:
And here are all the conditions.

[00:34:56] Speaker 03:
And we think that addresses it.

[00:34:58] Speaker 03:
But you seem to be fighting the notion.

[00:35:01] Speaker 03:
You're not listening to yourself.

[00:35:02] Speaker 03:
We're listening to you.

[00:35:04] Speaker 03:
I realize that.

[00:35:04] Speaker 03:
Maybe you don't mean to say.

[00:35:05] Speaker 03:
I don't mean to be fighting that notion.

[00:35:07] Speaker 05:
I mean to be making the prior point.

[00:35:09] Speaker 05:
It clearly is a question of neutrality.

[00:35:11] Speaker 03:
Of course.

[00:35:13] Speaker 05:
There's a question of neutrality every time we've looked at any administrator.

[00:35:17] Speaker 03:
Every time we've looked at any administrator, there are these sorts of questions.

[00:35:21] Speaker 03:
Yeah, we accept that claim, but we've nullified it with conditions that we think work.

[00:35:28] Speaker 05:
I'm sorry, I thought that's why I was pointing to the last sentence of Paragraph 172.

[00:35:31] Speaker 05:
That's exactly my point.

[00:35:32] Speaker 05:
You're saying it more clearly than I am, obviously, but that was my point, is that we've looked at it.

[00:35:37] Speaker 05:
If one takes a step back, of course the parties that are going to be qualified to operate this contract are going to have all sorts of connections into the telecommunications industry.

[00:35:49] Speaker 05:
I mean, it's a very complicated contract, and the parties that are going to be technically qualified to handle it are going to have all sorts of business relationships.

[00:35:58] Speaker 05:
We're not likely to find a new party that's never done anything in this sphere.

[00:36:03] Speaker 04:
Right there and saying therefore the Commission realized there was a possibility of an appearance at least of non-neutrality and they dealt with it.

[00:36:12] Speaker 04:
That's exactly right.

[00:36:13] Speaker 04:
They tried to tell us that there wasn't any problem.

[00:36:16] Speaker 05:
Can I adopt that as my final sentence?

[00:36:19] Speaker 04:
I would hope so.

[00:36:22] Speaker 04:
Instead of a continuation telling us why it's not your position.

[00:36:26] Speaker 04:
Thank you, Your Honor.

[00:36:26] Speaker 02:
You see, the clarity of Judge Edwards and Judge Santel is why we get paid so much.

[00:36:32] Speaker 05:
Thank you, Your Honors.

[00:36:34] Speaker 02:
Shall we hear from the intervener?

[00:36:39] Speaker 01:
May I please record my name is Peter Carongi for the interveners.

[00:36:42] Speaker 01:
First, I'd just like to reiterate, we completely agree with that reading of what the Commission did here.

[00:36:47] Speaker 01:
And remind us just for background, the interveners are... So I'm here representing CTIA and U.S.

[00:36:53] Speaker 01:
Telecom.

[00:36:54] Speaker 01:
It's a very broad cross-section of the industry.

[00:36:56] Speaker 01:
And I think in that regard, Your Honor, it's helpful to recall, at bottom, these rules are all about protecting the industry as a whole.

[00:37:03] Speaker 01:
from bias or favoritism on the part of the LNPA.

[00:37:07] Speaker 01:
That's a point New Star itself recognized early in the process.

[00:37:11] Speaker 01:
New Star wrote a letter to the FCC, for example, back in October 2012, and it said, the judgment about whether the LNPA is sufficiently neutral to satisfy the demands of the industry is a judgment the industry should make subject to commission review for satisfaction of the commission's rules.

[00:37:29] Speaker 01:
That's a JA719.

[00:37:31] Speaker 01:
And Your Honor, we submit the industry has made that judgment.

[00:37:33] Speaker 01:
If you think who really has skin in the game here, it's the industry.

[00:37:37] Speaker 01:
It's all of these carriers.

[00:37:38] Speaker 01:
Together, my two clients, the associations, represent almost 200 different carriers and suppliers.

[00:37:45] Speaker 01:
They're not just wireless companies.

[00:37:47] Speaker 01:
They're wireline companies.

[00:37:48] Speaker 01:
They're ISPs.

[00:37:49] Speaker 01:
They're large carriers.

[00:37:50] Speaker 01:
They're small carriers.

[00:37:51] Speaker 01:
And they all have, as represented by the associations, lined up behind the FCC saying, we don't see a neutrality problem here.

[00:37:59] Speaker 01:
Now, I'm not saying that's per se the legal analysis, but I think it should inform the legal analysis because at the end of the day, the Commission created these rules for the industry and actually wrote into the regulations an unusual role for the industry.

[00:38:16] Speaker 01:
That's why the Numbering Council was created.

[00:38:18] Speaker 01:
It was created to give the industry a particular voice here.

[00:38:23] Speaker 01:
And I think that's an important part to recall when looking at these types of questions, because they aren't necessarily predictive, and they require judgment calls, as I think Judge Edge would put it quite rightly.

[00:38:34] Speaker 01:
that this is about anticipating basically a risk of bias, and that's a judgment call, it's predictive, and it calls for a lot of expertise.

[00:38:43] Speaker 01:
You really have to understand how the numbering system works.

[00:38:46] Speaker 01:
Now I do want to say one thing about the Delaware Law.

[00:38:48] Speaker 01:
We'll be prepared to say, for the sake of argument, we'll assume that New Star's correct.

[00:38:54] Speaker 01:
As a general matter, a director of a subsidiary owes fiduciary obligations to the parent.

[00:38:59] Speaker 01:
Okay.

[00:39:00] Speaker 04:
did we take an opposite position your honor

[00:39:11] Speaker 01:
I think the only quibble we have, Your Honour, is we maintain that there are obligations owed to both the subsidiary itself and the parent, and Newstar says no, it's just the parent.

[00:39:32] Speaker 01:
I don't think that happens.

[00:39:33] Speaker 04:
Well, if it's wholly owned, then I'm not sure how you can make that distinction and why you bother crying.

[00:39:39] Speaker 01:
I understand, Your Honor.

[00:39:40] Speaker 01:
I mean, the one reason is one court pointed out, if you had just one other minority shareholder, it would be a bizarre proposition to say you could essentially have a director engaging in corporate waste or some other bad act and owe no fiduciary duty whatsoever to the corporation whose board that director sits on.

[00:40:02] Speaker 01:
So we say, look, there are obligations running both ways.

[00:40:05] Speaker 01:
But I think the key point is in Trenic America, which my friend Mr. Gossett pointed to, and I'm just going to quote from that opinion.

[00:40:11] Speaker 01:
It was written by the Delaware Vice Chancellor, who is now the Delaware Chief Justice.

[00:40:16] Speaker 01:
The Delaware Supreme Court affirmed on his opinion, and he said this, a subsidiary board is entitled to support a parent's business strategy

[00:40:25] Speaker 01:
unless it believes pursuit of that strategy will call the subsidiary to violate its legal obligations.

[00:40:31] Speaker 01:
I'll give you one more quote.

[00:40:33] Speaker 01:
Delaware law does not embrace the concept that a director of a wholly owned subsidiary owes a duty to second guess the business judgment of its parent corporation.

[00:40:44] Speaker 01:
As Judge Edwards quite aptly put it, I think what the Commission was really saying is, look, we get this whole argument about subpoena on subsidiary.

[00:40:53] Speaker 01:
We think these protections are sufficient.

[00:40:56] Speaker 01:
And they include Erickson itself saying to the Commission, we will do whatever it takes to get neutrality.

[00:41:04] Speaker 01:
We stand by this code of conduct.

[00:41:06] Speaker 01:
So for a Telecordia Director,

[00:41:08] Speaker 01:
to say, I am going to rely on my own notion of what's in Erickson's interests and violate that code of conduct.

[00:41:16] Speaker 01:
That would not only be an act of disloyalty to the parent, it would be an act of open defiance of what the parent itself has said.

[00:41:25] Speaker 01:
no reasonable director could exert his or her fiduciary duties and violate that code of conduct which Erickson has imposed.

[00:41:34] Speaker 01:
And I think under those circumstances, those particular facts, the code of conduct, the voting trust, everything else, the separation of businesses, business operations, I think we have to look not at this abstract level of what some general fiduciary obligation is, but what are the protections in this case, and we submit the commission,

[00:41:54] Speaker 01:
did a sufficient job putting protections in place and explaining that those protections would work.

[00:42:00] Speaker 01:
Thank you.

[00:42:03] Speaker 02:
Did council have any remaining time?

[00:42:07] Speaker 02:
Okay you can take two minutes.

[00:42:08] Speaker 06:
Thank you, Judge Tatel.

[00:42:09] Speaker 06:
In its brief, the Commission primarily argued that to the extent that there is an alignment requirement, that requirement is in fact satisfied in this case, because the Commission in fact expressed a differing view of Delaware law.

[00:42:22] Speaker 06:
And we are content to rest on our briefs.

[00:42:25] Speaker 02:
What's your response to the intervener's argument that, well, this consortium is the telecommunications industry, and this is the arrangement that satisfies them?

[00:42:35] Speaker 06:
with respect that those consortia are dominated by the very large wireless carriers that in our view give rise to the appearance at a minimum of bias.

[00:42:46] Speaker 06:
And a variety of smaller carriers, in fact, raised objections before the commission.

[00:42:52] Speaker 06:
So I think with all due respect... They're not here though, are they?

[00:42:54] Speaker 06:
They are not here, and quite frankly, I suspect that they have far more limited resources than organizations like CTIA do.

[00:43:01] Speaker 06:
But whatever the explanation, the mere presence of intermediaries cannot be dispositive.

[00:43:05] Speaker 02:
Now, I said that the Commission primarily... Well, I didn't suggest it was dispositive.

[00:43:08] Speaker 02:
I just asked you what you thought about their role here.

[00:43:10] Speaker 06:
Well, and I think that they are here in part because they are the very beneficiaries of having one of their primary clients serve as the administrator.

[00:43:22] Speaker 06:
Indeed, the longtime CEO of Erickson has been a longtime member of the board of CTIA.

[00:43:29] Speaker 06:
I don't say that to suggest that you should discount their views either.

[00:43:32] Speaker 06:
My view is simply that they have skin in the game, as Mr. Carranza suggested.

[00:43:36] Speaker 06:
Now, I do want to say just a word about the Commission's argument on this issue of alignment, because I think that this is, with all due respect, the central issue in the case.

[00:43:44] Speaker 06:
The Commission had previously argued that the alignment requirement was satisfied because of its characterization of Delaware law, and I'm content to rest on our briefs on the proposition that the duties of the directors, in fact, run to the parent, except in the discrete context of insolvency.

[00:43:58] Speaker 06:
But what I heard my friend and former colleague, Mr. Gossett, arguing for the commission this morning was quite different.

[00:44:04] Speaker 06:
He was arguing that alignment is not, in fact, a discrete requirement and that Romanettes 1 through 3 set out the sole meets and bounds of the neutrality argument.

[00:44:14] Speaker 06:
And with all due respect, that has never been the commission's position until about 15 minutes ago.

[00:44:20] Speaker 06:
It was not the commission's position even in its brief.

[00:44:23] Speaker 06:
And if I could refer the court to one source on rebuttal, it is to paragraph

[00:44:28] Speaker 06:
18 of the Warburg order at page 483 of the Joint Appendix, quote, in addition to meeting the Commission's requirements set forth in the regulation, the NANPA, the relevant administrator, must be impartial and may not be aligned with any particular telecommunications industry segment.

[00:44:46] Speaker 06:
It would be bad enough.

[00:44:47] Speaker 03:
You seem to be arguing, as you did earlier, and I can't find any support for it, that if you have

[00:44:54] Speaker 03:
holy owned subsidiary and apparent in a situation like that you cannot cure the problem of potential bias

[00:45:04] Speaker 03:
with conditions, and I don't see anything in the law that supports that.

[00:45:08] Speaker 03:
And you're ignoring the conditions.

[00:45:09] Speaker 03:
It seems to me that the relevant argument here is whether, having recognized the threat to neutrality, the Commission dealt with it.

[00:45:18] Speaker 03:
And your argument, when you first started, was they can't cure it.

[00:45:22] Speaker 03:
If you find this arrangement, it's done.

[00:45:26] Speaker 03:
and you said the only way they could do it was to go back and restructure the corporation.

[00:45:31] Speaker 03:
That's just not, I don't understand where that's coming from.

[00:45:34] Speaker 03:
That is because of the purpose of this alignment requirement, Judge Edwards, and it's born... No, but you're suggesting now that that fits with your notion of the purpose before you said that's what the rule says.

[00:45:46] Speaker 03:
I can't find a rule that says that.

[00:45:48] Speaker 06:
Well, just to be clear, I mean, to step back, neither the statute nor the regulation

[00:45:52] Speaker 06:
makes any provision for safeguards.

[00:45:54] Speaker 03:
Right.

[00:45:55] Speaker 03:
So now we have to look to see whether the agency is arbitrary and capricious and sane.

[00:45:58] Speaker 03:
We understand there's a neutrality obligation.

[00:46:01] Speaker 03:
We're addressing it.

[00:46:02] Speaker 03:
And here are the conditions.

[00:46:04] Speaker 03:
And we think they're sufficient.

[00:46:05] Speaker 03:
That should be the vital.

[00:46:06] Speaker 06:
Well, just to be clear, Judge Edwards, I mean, first of all, the commission has never said that an alignment problem can be cured for safeguards.

[00:46:14] Speaker 06:
So if the commission were, in fact, doing that here, it would be doing it for the first time.

[00:46:19] Speaker 06:
Now, that's not the end of the analysis by any means.

[00:46:22] Speaker 06:
But I do think that if you take a look at the commission's order, what it purported to be doing, and after all we're in chenry land here, was addressing an undue influence problem with safeguards.

[00:46:33] Speaker 06:
To the extent the commission was discussing safeguards, it was discussing it in the context of the requirement in Romanette 3.

[00:46:41] Speaker 06:
And I think with all due respect, I think that's why we hear the commission today

[00:46:45] Speaker 06:
trying to write the alignment requirement out of the regulations altogether.

[00:46:50] Speaker 06:
We're not disputing the proposition that if you have an undue influence problem, it can be addressed with safeguards.

[00:46:56] Speaker 06:
But again, the issue of alignment is an eligibility requirement.

[00:47:01] Speaker 06:
It's not just a conduct requirement.

[00:47:02] Speaker 06:
It governs the threshold question of whether you can get in the door in the first place.

[00:47:06] Speaker 06:
And just to illustrate why the commission's argument proves too much, the commission

[00:47:11] Speaker 06:
happily accepted the lifeline that Judge Sentel offered in his last question argument.

[00:47:17] Speaker 06:
But I think that lifeline proves way too much, because if you accept the proposition, Judge Edwards, that an alignment problem can, in fact, be addressed with safeguards, there would be no barrier whatsoever to Erickson itself serving as the administrator here.

[00:47:31] Speaker 06:
Because Erickson does not qualify under the commission's view

[00:47:36] Speaker 06:
as a telecommunication service provider that would itself be disqualified.

[00:47:41] Speaker 02:
And critically, the commission... Well, we don't have to deal with that case if it ever came up.

[00:47:45] Speaker 02:
But we don't have to deal with that case to resolve this case.

[00:47:48] Speaker 06:
But Judge Tatel, that proves why it cannot be that an alignment problem can be cured with safeguards.

[00:47:54] Speaker 06:
And the last thing I would say on this particular issue, Judge Edwards, is that even assuming that it could be, we don't think that the safeguards at issue address the relevant problem

[00:48:04] Speaker 06:
which is that the duties of the directors would remain to Erickson as the parent.

[00:48:10] Speaker 06:
And having a voting trust and having a code of conduct and all of these other safeguards that were in the appendix to which Mr. Gossett pointed do nothing to alter the operation of those duties.

[00:48:21] Speaker 06:
So even assuming, arguing that you could have safeguards, we think that the safeguards here would plainly be insufficient.

[00:48:28] Speaker 06:
And the last thing I would say on this point and indeed in the argument is simply that if you agree with us,

[00:48:34] Speaker 06:
that an alignment problem cannot be cured with safeguards, then we think that the appropriate remedy has to be to disqualify Talcordia, at least as it's currently constituted, because the commission itself, in this order, recognized the threat of bias.

[00:48:50] Speaker 06:
In paragraph 181, it stated, quote, Erickson's managed services contracts and equipment sales revenues are worth considerably more than its bid for the administrator contract.

[00:49:01] Speaker 06:
So it is conceivable that Erickson might be tempted to prioritize its managed services contracts and sales over the administrator contract.

[00:49:09] Speaker 06:
Given that recognition, it is simply inexplicable that the Commission somehow thought that any alignments that Erickson had

[00:49:17] Speaker 06:
were irrelevant to the analysis.

[00:49:19] Speaker 06:
And for that reason, and because Erickson is also a network equipment manufacturer, we respectfully submit that the commission's order should be vacated and the matter remanded to the commission so that it can conduct proper proceedings.

[00:49:30] Speaker 06:
Thank you.

[00:49:32] Speaker 02:
Thank you, gentlemen.

[00:49:33] Speaker 02:
The case is submitted.