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Charter Fined $2 Million for Failing to Meet Merger Conditions

The New York State Public Service Commission this week fined Charter $2 million --and threatened to revoke the company's franchise for failing to meet conditions affixed to its merger with Time Warner Cable and Bright House Networks. Charter had already been fined $13 million for failing to complete some fairly modest broadband deployment conditions attached to the company's $79 billion deal. But state investigators in more recent weeks found that Charter repeatedly lied about the work it had completed in order to try and trick regulators into thinking it was meeting the conditions.

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That's been compounded by Charter's attempts in court to claim that the FCC's net neutrality repeal order bans states from holding the company accountable as it tries to wiggle out of a seperate NY State lawsuit over substandard speeds and false promises to consumers.

Tired of the tap dancing by Charter, New York State officials this week dialed things up a notch, not only fining the company $2 million for continued violation of its merger promises, but threatening the company's franchise license in New York State if it doesn't stop playing legal and ethical patty cake.

"As a condition of our approval of Charter's merger two years ago, we required Charter to make significant investments in its network," the state PSC said in a statement (pdf). "Our investigation shows that Charter failed to meet its obligations to expand the reach of its network to unserved and underserved customers at the required pace and that it failed to justify why it wasn't able to meet its obligations."

Moreso, previous PSC inquires indicate that Charter routinely attempted to mislead regulators by making its deployments--and the work it had done for condition compliance--seem greater than they actually were.

Charter claimed its $79 billion acquisition of Time Warner Cable and Bright House Networks would result in amazing "synergies" for consumers. Instead, most acquired customers received a rate hike and even worse customer service than they'd already grown accustomed to under their previous ISPs. These additional broadband deployments were supposed to counter any potential problems the deal created, and even those now appear to be somewhat...theatrical in nature.

Most recommended from 38 comments



cowboyro
Premium Member
join:2000-10-11
CT

25 recommendations

cowboyro

Premium Member

New bill line item...

Mandated regulatory settlement fee - $1.25

maartena
Elmo
Premium Member
join:2002-05-10
Orange, CA

21 recommendations

maartena

Premium Member

The "m" should have been a "b".

2 Million is a drop in the bucket. So is 13 Million. The upgrades they were supposed to do probably were going to cost them more in the 200-300 Million dollar range when all said and done, which isn't a big amount either on a $79 billion deal.

That fine should have been $2 BILLION, not million.

SimbaSeven
I Void Warranties
join:2003-03-24
Billings, MT

14 recommendations

SimbaSeven

Member

Oooh..

$2 Million? That sure taught them something. /s

I'm sure they can get that back with all the rate hikes. Expect an additional fee to your bill of ~$3-5.

Economist
The economy, stupid
Premium Member
join:2015-07-10
united state

12 recommendations

Economist

Premium Member

Petty Cash

Profit exceeds the fine, ensuring they keep making promises and then telling everyone to go F themselves, Bell Atlantic in PA style.

Again, a behavior will only stop when it stops being profitable to engage in the behavior.

Make the fine $20B, which would be legal if it were a condition of the merger in the first place (and thus not ruled an excessive penalty since the merging parties would have to agree to it as a condition) and they would live up to their promises.
ham3843
join:2015-01-15
USA

9 recommendations

ham3843

Member

Fine is worthless as a penalty..

Unless the regulators place specific legal terms and wording into the fine
that places the damages squarely on the shoulders of the executives.

It should specifically be placed on the CEO out of his salary not to be made up for in any way by customers at any time. Plus the fine should have been $20 million dollars to be removed from
CEO Tom Rutledge's own salary.
tmc8080
join:2004-04-24
Brooklyn, NY

4 recommendations

tmc8080

Member

I call BS

a $2M fine means BULLSHIT if it doesn't get put to getting consumers another service provider! there are options to open up these municipal geographies that are neglected or for whatever reason have chosen to drag their feet into the 21st century and mandate that something get deployed in the next 10 or so years even if it means bringing in NEW ISPs that have never before provided service in NYS.

FWIW, the NYSPSC is pathetic! For decades they sat idly by letting NYS drop to about 15th / 50 states for broadband deployment and even worse for next generation broadband.