Fairpoint Can Afford Lobbyists and PR Firms, But Not Your Refund Company fights giving customers their money back... Given they're in bankruptcy because of their botched deal with Verizon, it's not particularly surprising that Fairpoint Communications is working with a bit of a tight purse. Still, while they've not been able to pay their bills, they've still been able to recently hire two new top tier PR firms to shore up their sagging brand image. Of course their lawyers are also still getting paid, filing a motion this week asking that Fairpoint be relieved from paying customers refunds for the months of horrible service caused by their implosion: FairPoint Communications has filed a court motion asking that it not be forced to give Maine customers rebates because of its poor service as the company works through bankruptcy. The company is objecting to the Maine Public Utilities Commission's regulatory order Monday that it pay rebates in the form of $1.72 a line per month for 12 months — a total of more than $8 million. According to the Bangor Daily News, Maine regulators first demanded the refunds long before the company entered bankruptcy, but Fairpoint has simply ignored the requests repeatedly: "FairPoint, instead of following the rulings of this commission, they have ignored our rulings," said Commissioner Jack Cashman. "I find this as offensive now as the first time they did this." Three times since the October order finding the company had not met service quality standards, FairPoint asked the PUC to delay implementation of the order requiring rates to be adjusted by rebating customers. Of course Fairpoint somehow came up with the money needed to lobby state lawmakers in order to prevent broadband stimulus funds from going to a University of Maine public/private project designed to expand broadband throughout the state. In short you've got lawyers, lobbyists and marketing firms still getting paid, but not Fairpoint consumers.
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  AMDUSERPremium
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| Maine should takeover.. Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint violated the states conditions for approval of the sale.
Also, pay have another company [ie TDS Telecom] take over the phone systems run by Fairpoint. | |
|  |  ThrowDemsOutIf you can't convince 'em, confuse 'emPremium
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Mullica Hill, NJ
kudos:4 | Re: Maine should takeover.. said by AMDUSER:Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint violated the states conditions for approval of the sale. Also, pay have another company [ie TDS Telecom] take over the phone systems run by Fairpoint. LOL. 1st it is illegal to just takeover Fairpoints assets and give them to someone else. And what makes you think TDS Telecom could afford to buy them?
Even if they could buy them with loans from investment firms, what makes you think that TDS Telecom would do any better in running the service than Fairpoint has? They are even a smaller outfit than Fairpoint.
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| | | | | Re: Maine should takeover.. said by ThrowDemsOut:said by AMDUSER:Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint violated the states conditions for approval of the sale. Also, pay have another company [ie TDS Telecom] take over the phone systems run by Fairpoint. LOL. 1st it is illegal to just takeover Fairpoints assets and give them to someone else. And what makes you think TDS Telecom could afford to buy them? Even if they could buy them with loans from investment firms, what makes you think that TDS Telecom would do any better in running the service than Fairpoint has? They are even a smaller outfit than Fairpoint. Illegal? Guess you haven't heard of eminent domain. States have taken people's house/land away, you think they can't take away some wires if they decide to? | |
| | | | ThrowDemsOutIf you can't convince 'em, confuse 'emPremium
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kudos:4 | Re: Maine should takeover.. said by ualdayan:said by ThrowDemsOut:said by AMDUSER:Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint violated the states conditions for approval of the sale. Also, pay have another company [ie TDS Telecom] take over the phone systems run by Fairpoint. LOL. 1st it is illegal to just takeover Fairpoints assets and give them to someone else. And what makes you think TDS Telecom could afford to buy them? Even if they could buy them with loans from investment firms, what makes you think that TDS Telecom would do any better in running the service than Fairpoint has? They are even a smaller outfit than Fairpoint. Illegal? Guess you haven't heard of eminent domain. States have taken people's house/land away, you think they can't take away some wires if they decide to? Yes. I've heard of it. But the state has to pay market cost to do that. And unlike some homeowner who can't afford the lawyers to fight them, Fairpoint has the lawyers to fight the state in court for years to make sure they aren't robbed by the state.
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| | | | | | | Re: Maine should takeover.. As I just posted, the supreme court CLEARLY RULED that $1.00 a year is 'ample compensation'. So, pray, tell me, what legal grounds would fairpoint have to contest? You are the one who always argues that a corporation has the same rights as a person. Well, a person has a RIGHT to have their PRIVATE PROPERTY seized for a pittance. So Fairpoint would have no case? Oh, wait, if it's a CORPORATION that is giving up the assets, then it's different than if it's a person? So, which is it then. Does a corporation HAVE the rights of a person or not? You can't have it both ways.
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| | | | | | | | Re: Maine should takeover.. Come on guys. TK's point is reasonable and correct here.
We don't want the government essentially confiscating assets in situations like this, whether under the guise of eminent domain or anything else. That would open up a cascade of abuses and precedent and we couldn't begin to predict where it would end.
I don't like the BS these companies pull any more than any of you do but there is a normal bankruptcy process for these situations.
Saying that the little guy gets screwed with eminent domain may be true but the solution to that is to end such abuses, not to screw companies as well as some perverse compensation.
"Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint "
Now there is probably some legitimate, legal way to do something along the lines not of revoking a right to operate but of reclassifying them and their regulatory situation but this is a separate issue from taking the assets whether with compensation or without. If nothing else it would create a legal quagmire as TK points up, though it should also be philosophically unacceptable in any but the most dire economic calamities and this doesn't begin to rise to that level. | |
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kudos:4 | Re: Maine should takeover.. said by asdfdfdfdfdf :
Come on guys. TK's point is reasonable and correct here.
We don't want the government essentially confiscating assets in situations like this, whether under the guise of eminent domain or anything else. That would open up a cascade of abuses and precedent and we couldn't begin to predict where it would end.
I don't like the BS these companies pull any more than any of you do but there is a normal bankruptcy process for these situations.
Saying that the little guy gets screwed with eminent domain may be true but the solution to that is to end such abuses, not to screw companies as well as some perverse compensation.
"Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint "
Now there is probably some legitimate, legal way to do something along the lines not of revoking a right to operate but of reclassifying them and their regulatory situation but this is a separate issue from taking the assets whether with compensation or without. If nothing else it would create a legal quagmire as TK points up, though it should also be philosophically unacceptable in any but the most dire economic calamities and this doesn't begin to rise to that level.
And they are also wrong about eminent domain being able to just pay $1 for Fairpoint's assets. That is just a wet dream by advocates of state supremacy in the economy.
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| | | | |  woody7Premium
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Torrance, CA | Don't always agree with TkJunkmail, but if not mistaken, sometime in the past not sure but "Corporations" were granted status such as that as an individual,(a supreme court case) when I find it, will post.Peace
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San Francisco, CA | This is precisely why large corporations need to be redefined. There is no one at the helm that can be personally charged, and since the company is in bankruptcy, it has nothing to lose. | |
| | | | | | woody7Premium
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Torrance, CA | Re: Maine should takeover.. If not mistaken, a comptroller or cfo can a lot of time be held liable.
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| said by SLD:This is precisely why large corporations need to be redefined. There is no one at the helm that can be personally charged, and since the company is in bankruptcy, it has nothing to lose. Redefine the law so that if people in corporations break the law using the corporations, they go to prison. If Fairpoint ignores local government, the executives making those decisions need jail time. | |
| | | | | | |  PhoenixDown-- Wants FIOSPremium
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kudos:1 | Re: Maine should takeover.. The PUC should be able to get relief from the court and the sheriffs can go in and seize money and property.
Ultimately, shame on the PUC for not following due dilligence and allowing this fiasco to happen in the first is.
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| | | | | | | | | | ThrowDemsOutIf you can't convince 'em, confuse 'emPremium
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kudos:4 | Re: Maine should takeover.. said by mob:said by ThrowDemsOut: Fairpoint has the lawyers to fight the state in court for years to make sure they aren't robbed by the state. The purpose of the state is to defend the citizens...This is a good case of when to do it too.. Failpoint has proved with stunning clarity that they are incapable of living up to standards that they (Failpoint) set in negotiations. Breach of contract is a good start.. Do you swallow everything that they feed you? Why is it perfectly OK for a company to rip anyone off, do whatever they want, and if anyone questions the actions, they are wrong for doing so? I never said what you accuse me of. Just stating a little REALITY(something BBR users are often in short supply of).
And the purpose of the state is not to protect its citizens; it is to CONTROL them. Something most people realize by the time they pay taxes and earn their own way in life.
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| | | | | | said by ThrowDemsOut:Yes. I've heard of it. But the state has to pay market cost to do that. And unlike some homeowner who can't afford the lawyers to fight them, Fairpoint has the lawyers to fight the state in court for years to make sure they aren't robbed by the state. Put a Lien on them for every cent they owe. If they don't pay up, they forfeit the rights to it. | |
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1 edit | Eminent domain could work to take the network away. The state of Maine could just give it to *AT&T at no cost if they will agree to run the phone system.. [I was just using TDS as an example..]
AT&T does know how to run rural phone service, they also have the expertise to fix the problems with the phone system.. I'm not saying that they would, just that company is financially sound and could accommodate a few million more customers without much problem. | |
| | | | | | | Re: Maine should takeover.. Dont go there with AT&T I have them in a rural area and most of there rural area's are one step above two cans and a string. | |
| | | | |  rcdaileyDragoonflyPremium
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Rialto, CA | Verizon, with ancient roots including General Telephone Company, also knows how to run rural telephone service. But Verizon decided to dump rural Maine. Why would AT&T be interested in trying to do what Verizon did not want to do?
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kudos:1 | Ok then as soon as fairpoi t leaves bankruptcy the PUC needs to mandate extremely cheap open access and agressive network upgrades. Screw fairpoint.
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| | | | | said by ThrowDemsOut:LOL. 1st it is illegal to just takeover Fairpoints assets and give them to someone else. That's pretty much what happened with Chrysler.
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| | | | | Interesting you should say that. "The Supreme Court's decision in Kelo v. City of New London, 545 U.S. 469 (2005) affirmed the authority of New London, Connecticut, to take non-blighted private property by eminent domain, and then transfer it for a dollar a year to a private developer solely for the purpose of increasing municipal revenues". IF I read that correctly, the state of maine has EVERY RIGHT to seize the assets for $1.00/year, sumply because the purpose would be to increase revenues.
So, NO, it's NOT ILLEGAL to just take over fairpoints assets and give them to someone else. AND, YES, TDS telelcom COULD afford to buy them for $1.00/year
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kudos:4 | Re: Maine should takeover.. said by karlmarx:Interesting you should say that. "The Supreme Court's decision in Kelo v. City of New London, 545 U.S. 469 (2005) affirmed the authority of New London, Connecticut, to take non-blighted private property by eminent domain, and then transfer it for a dollar a year to a private developer solely for the purpose of increasing municipal revenues". But the private property owners GOT PAID, and it wasn't at a $1 price. The state's taxpayers picked up the tab when the state gave the BOUGHT & PAID for private property to the developer.
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| said by ThrowDemsOut:said by AMDUSER:Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint violated the states conditions for approval of the sale. Also, pay have another company [ie TDS Telecom] take over the phone systems run by Fairpoint. LOL. 1st it is illegal to just takeover Fairpoints assets and give them to someone else. And what makes you think TDS Telecom could afford to buy them? Even if they could buy them with loans from investment firms, what makes you think that TDS Telecom would do any better in running the service than Fairpoint has? They are even a smaller outfit than Fairpoint. It's also illegal to completely ignore the rulings of local government. | |
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1 edit | Re: Maine should takeover.. said by Metatron2008:said by ThrowDemsOut:said by AMDUSER:Why doesn't the state of Maine just revoke Fairpoints right to operate after Fairpoint violated the states conditions for approval of the sale. Also, pay have another company [ie TDS Telecom] take over the phone systems run by Fairpoint. LOL. 1st it is illegal to just takeover Fairpoints assets and give them to someone else. And what makes you think TDS Telecom could afford to buy them? Even if they could buy them with loans from investment firms, what makes you think that TDS Telecom would do any better in running the service than Fairpoint has? They are even a smaller outfit than Fairpoint. It's also illegal to completely ignore the rulings of local government. Well that is what court hearings and fines are for. And if they can't pay the fines, that is what bankruptcy court is for.
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| Re: Maine should takeover.. said by ThrowDemsOut:Well that is what court hearings and fines are for. And if they can't pay the fines, that is what bankruptcy court is for. Court hearings and fines are a slap on the wrist for stuff like this. And it doesn't even fit the crime. | |
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kudos:4 |  Attorneys already being paid; not hired for 1 motion
They're also able to afford the attorneys needed to filed a motion asking that they be relieved from paying customers refunds for the months of horrible service caused by their implosion: Guess what? The lawyers are already being paid to handle the bankruptcy proceeding. So, even if the lawyers are being paid by the hour, this comes to what - a few thousand dollars for this 1 motion to avoid paying $8 million. Sounds like a good use of legal fees.
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| | | Don't forget... those (censored) aren't paying their employees OT either...
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2 edits | So Fairpoint can simply ignore regulators? Sounds like being above the law to me. I wonder if TK wouldn't mind it so much if they also ran the mob and shot his family...
If the feds asked a normal person to pay something, ignoring it would send you to prison. Yet companies can do as they wish...
We need less talk, more company executives going to jail. TK has a point about them seizing assests, but nobody should be above the law like this.
And I don't really mean to signal you out TK, but these executives are currently able to go to work, make illegal decisions, and come back to work every day ignoring local government and law enforcement.
Seriously, think about it. | |
|  JKW
@fairpoint.com | Another incorrect assessment I lead the marketing and advertising for FairPoint. And while the amount of incorrect information that is often conveyed online and in other avenues continues to amaze me, I normally assume that most rational customers and the public will also realize that you can't believe everything you read.
In this case, I do want to correct comments provided in the opening of this post. It refers to the hiring of the two marketing firms in Portland - ViaGroup and Garrand - as somehow tied to PR, image and characterizes the move as an unplanned effort. This is not correct. We released the announcement that we had hired these two firms since we felt it was a positive news story and further demonstration of our commitment to the businesses and the people in northern New England. However, coverage of that release has been twisted, as it is here.
We were using a large advertising firm in the past located out of Boston. When I moved into this role late in 2008, we evaluated that firm, and the marketing team moved to try to see if we could eventually find an agency in Vermont, New Hampshire or Maine to take over the work. We wanted to have partners who live in our territory plus give the business to firms located in our states. The search and negotiation process started before we even converted any lines - January 2009. We talked to many firms and were excited to find two firms - located in Portland - who produced excellent work. So over the next several months, we negotiated contracts, ended our contractual relationship with the existing Boston-based firm and started working with these two new local firms this past summer. It had nothing to do with the bankruptcy filing, an image issue, or PR initiatives. We simply were replacing our marketing agency.
We are excited about both of these firms. They do great work and they will be great partners as we move forward. They already have been really helpful as we continue to work through marketing challenges that are even more difficult with inaccurate media and online coverage.
Thanks for the opportunity to comment and correct.
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| Re: Another incorrect assessment I don't see where you actually correct anything here, other than to note that the hunt for these two new marketing firms began in January, right during the high point of the Fairpoint customer crisis, yet supposedly this has nothing to do with image or branding.
That doesn't really address the Maine's PSCs claims that you're completely ignoring them and refusing to pay consumer refunds.
It also doesn't address the fact that Fairpoint was, also in that same time frame when money was tight, still lobbying against the private-public partnership and the University of Maine's efforts to wire rural Maine... | |
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Waterville, ME | We were using a large advertising firm in the past located out of Boston.
So what is it that you do?
Bruce | |
| | | | | Re: Another incorrect assessment He tells them what to do, I assume. But of course none of this is about brand image restoration. | |
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| | Just DIE ... and go AWAY .... I've dropped my landlines and went with a
cell phone ...
If they can afford 2 PR groups ... they can pay their
customers the month they owe them .... If you can't
afford it ... then file for Chapter 7 ... an sell it ALL ... | |
| | | | Re: Just DIE ... and go AWAY .... said by GenBlood:I've dropped my landlines and went with a cell phone ... If they can afford 2 PR groups ... they can pay their customers the month they owe them .... If you can't afford it ... then file for Chapter 7 ... an sell it ALL ... Amen!!
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1 edit | Let me put all of this into simple perspective... It's not GREATpoint!
It's not even a GOODpoint!
It's just a FAIRpoint.
On its way to becoming a POORpoint! | |
| | | Fairpoint Remember this article?
For 2yrs you were warned during our "Stop-the-Sale Campaign", but you didn't want to listen....
FairPoint Mess Puts Three States in Jeopardy
(From The Rutland Herald, April 9, 2009
By STEVE EARLY
When your pay, benefits, or job are in jeopardy, there’s little satisfaction in saying: ”We told you so!”
But that’s exactly what 3,500 northern New England telephone workers are entitled to tell state officials who approved Verizon’s sale to FairPoint. Their flawed regulatory decisions in Vermont, Maine, and New Hampshire have put employees, customers, local businesses, and the whole regional economy at risk.
As predicted by members of the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW) during their two-year “Stop-The Sale” campaign, FairPoint is teetering on the brink. Fairpoint does not now—and never did—have the capability to maintain decent landline service, much less provide real high-speed internet connections as promised. If Governors Douglas, Lynch, and Baldacci don't act quickly with a coordinated rescue plan—funded, in part, by federal stimulus money for rural broadband upgrades--FairPoint will end up in Chapter 11 bankruptcy. Because that’s exactly what happened in Hawaii in December, after Verizon (VZ) fled that state, leaving its successor drowning in debt.
Shares in equally troubled Fairpoint are now what’s called a “penny stock” (ie trading for less than a dollar). Dividend payments have been suspended and last year’s losses neared $69 million. In March, Fairpoint’s credit rating was downgraded by Standard & Poor’s, due to its staggering $2.5 billion in debt and generally “negative” outlook. The company is also experiencing what S&P calls “ongoing and accelerated access line losses” (Translation: customers are fleeing to wireless and cable TV competitors even faster than they did under Verizon).
To make matters worse, horrendous technical problems and service delays occurred—as CWA and IBEW warned they would—during this winter’s “cut-over” to new Fairpoint operating systems. The result was thousands of customer service complaints that forced all three states to hold emergency oversight meetings.
At an April 3 hearing in Concord, the New Hampshire Public Utilities Commission (PUC) was bombarded with public criticism of Fairpoint and Capgemini, the systems developer that botched the cutover. PUC member Graham Morrison, the only regulator in the entire region who voted against Verizon’s $2.4 billion sale last year, blasted Capgemini’s performance, saying: “You have placed the economic health of a large corporation and three states in jeopardy. You have tarnished the image of these three states. Your company is responsible for that.” At the same hearing, a leader of Fairpoint’s unionized service reps described their long hours of mandatory overtime trying to make the Verizon-to-Fairpoint transition less difficult for customers.
A FairPoint “stabilization plan” is now being developed which requires big service improvements within three months. To reach that goal, regulators want Fairpoint to hire even more outside consultants and contractors. If they stumble (as Capgemini already has), the Vermont Public Service Department wants “a change of Fairpoint management.”
All of this is too little, too late. It just diverts public attention from the original failure of state utility regulation and the federal tax loophole that propelled an unwise deal in the first place. (Verizon used a “Reverse Morris Trust” to save $600 million in taxes by structuring its landline sale with a buyer that was among the least qualified, financially, to serve the region.) No matter how long or hard FairPoint employees work today, customers will not experience “business as usual” by June. So now is the time for all three states to take responsibility for the mess they helped create by allowing a $100 billion company to leave town and then handing the keys over to the telecom equivalent of a lemonade stand operator, with predictable results.
Fortunately, in response to labor lobbying and America’s larger economic crisis, Congress in January allocated $7 billion for new public spending on rural broadband connections. FairPoint’s survival strategy depends on broadband upgrades—even though it clearly lacks the cash flow and investor confidence to finance them now. So the three states that so mistakenly approved the Verizon sale better start accessing a big chunk of those federal dollars, in pro-active fashion. If they don't, Vermont, Maine, and New Hampshire will end up begging for help later on, as Michigan has for the auto industry, under much less advantageous circumstances for everyone.
(Steve Early was a Verizon union representative for 27 years and aided the “Stop-The-Sale” campaign in northern New England. He is a Boston-based lawyer, labor journalist, and author of Embedded With Organized Labor, Monthly Review Press, 2009.) | |
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