In New Ex Parte, Conexon Again Questions Legitimacy Of Wisper ISP’s Kansas ETC Designation
August 15, 2019 – In a recent ex parte filed with the FCC, Conexon, LLC has continued its opposition to a petition filed by Wisper ISP, Inc. for waiver of the FCC’s 180-day deadline for Connect America Fund (CAF) Phase II auction winners to obtain eligible telecommunications carrier (ETC) designation.[1] Wisper is seeking a waiver of the deadline, which was February 25, 2019, because its ETC application in the state of Oklahoma is still pending.
Conexon’s FCC ex parte letter reveals new information derived from transcripts of Wisper’s hearing before the Oklahoma Corporation Commission (OCC) concerning the merits of Wisper’s ETC application.
Based on testimony recorded in the transcript, Conexon’s letter suggests, among other things, Wisper may have made a material misrepresentation to the Kansas Corporation Commission (KCC) when applying for designation as an ETC in Kansas. If you’ve been following along since the beginning, you’ll remember that Conexon’s opposition to Wisper’s waiver petition, filed in June 2019, essentially makes the same claim, but the testimony from the OCC hearing bolsters it - big time.
In that June 2019 opposition, Conexon asked the FCC to declare Wisper in default of its CAF II compliance obligations in the state of Kansas because Wisper misstated its broadband speed obligations in the ETC application submitted to the KCC. Specifically, Wisper incorrectly stated that it is obligated to provide broadband service with speeds of at least 25 Mbps for downloads and 3 Mbps for uploads in its CAF II-supported areas of Kansas.[2] In reality, for all of Wisper’s winning bids in Kansas, Wisper committed to providing broadband service with speeds of at least 100 Mbps for downloads and 20 Mbps for uploads. Wisper did not place a single bid in the 25/3 Mbps service tier. Despite this, the KCC granted Wisper’s ETC application. Wisper’s erroneous broadband speed obligation has not been corrected.
In its recent ex parte, Conexon more or less accuses Wisper of being careless with its obligation to provide factually accurate information to state commissions and the FCC. This accusation is evidenced by the following exchange between Conexon’s counsel and Wisper’s CEO during cross-examination testimony at the Oklahoma Commission’s “Merits Hearing” on Wisper’s Oklahoma ETC application:
Q. Okay. So does Wisper believe that it is obligated to accurately represent facts to the Oklahoma Corporation Commission?
A. Yes, we do both to the best of our ability.
Q. To the best of your ability. To the best of your ability means the best that you can possibly know or your efforts to know?
A. Yes.
Q. And then how about to the FCC, same question?
A. Yes.
Q. So if Wisper wasn’t accurately representing facts to the OCC or the FCC would that be an issue?
A. That depends on how inaccurate they were and if they were material or not.[3]
Incredibly reckless statement right there from Wisper’s CEO. He is claiming it would not be a problem if Wisper were to not accurately represent facts to the OCC or the FCC, depending on how inaccurate the misrepresentations were and if they were material or not. Unbelievable. I can’t imagine the FCC agreeing with the Wisper CEO’s take on that. Not a chance.
Conexon’s counsel continued with the cross-examination by asking what Wisper’s CEO considered to be a material misrepresentation. In response, Wisper’s CEO tried to walk-back his answer somewhat:
Q. Okay. So is it possible for something that’s – what would be a material misrepresentation versus one that’s not?
A. I don’t know. I’ll leave it to you to come up with something like that. I don’t know. I’m not going to surmise.
Q. Okay. I’m just trying to figure out. Are you saying that as long as it’s not a big misrepresentation it’s okay.?
A. No. I would say that it’s the same thing we sign on all our lease and loan documents, the errors and omission that you didn’t do something right, or something you had to come back to do, or maybe you didn’t have something quite right you have the ability to say, well, we made a mistake. This isn’t the way it should be.[4]
The point here is that the testimony provided by Wisper’s CEO makes it sound like he plays fast and loose with the obligation to be forthright in regulatory proceedings. The testimony calls into question whether Wisper’s Kansas ETC application contains a material misrepresentation. And, it may even raise suspicion that if one exists, it may have been purposeful. Here’s how Conexon describes the testimony’s potential impact on Wisper’s Kansas ETC petition:
Given that Wisper still has yet to correct the record with the KCC with respect to Wisper’s CAF-II broadband performance obligations in Kansas, Wisper must believe its misrepresentations to the KCC of Wisper’s CAF-II broadband performance obligations in Kansas do not constitute a material misrepresentation. Assuming the Commission disagrees with Wisper and concludes that this is, in fact, a material misrepresentation by Wisper of its CAF-II performance obligations, the Commission must conclude that the ETC designation order granted to Wisper by the KCC is fundamentally flawed and is insufficient to satisfy Wisper’s CAF-II obligation to obtain ETC designation in Kansas by February 25, 2019. As a result, the Commission must find Wisper in default with respect to its CAF-II winning bids in Kansas throughout the areas where Wisper is required to provide 100/20 Mbps broadband speeds.[5]
Surely this will get the attention of the FCC. I’d bet the Wireline Competition Bureau is already looking into it. I’ll repeat what I said in a previous blog post – I can’t believe the KCC or Wisper has not already taken steps to fix this inaccuracy. Maybe this Conexon ex parte will trigger such an action.
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[1] Letter to Marlene Dortch, Secretary, FCC, from Jonathan Chambers, Partner, Conexon, LLC, WC Docket No. 10-90, AU Docket No. 17-182, WC Docket No. 14-58 (Aug. 14, 2019) (Conexon Ex Parte). Conexon filed an opposition to Wisper’s petition for waiver on June 12, 2019. Connect America Fund, WC Docket No. 10-90, Connect America Fund Phase II Auction, AU Docket No. 17-182, ETC Annual Report and Certifications, WC Docket No. 14-58, Opposition Of Conexon, LLC To Wisper ISP Inc. Petition For Waiver Of Deadline For ETC Designation (June 12, 2019), available at https://www.fcc.gov/ecfs/filing/106120494418206.
[2] Application for Designation as an Eligible Telecommunications Carrier for Purposes of Receiving Federal Universal Service Support From the FCC Connect America Fund – Phase II, Kansas Corporation Commission, KCC Docket No. 19-WIIZ-225-ETC, Application Of Wisper ISP Inc. For Designation As An Eligible Telecommunications Carrier (Public Version), p. 13 (Dec. 7, 2018).
[3] Conexon Ex Parte at p. 7-8.
[4] Conexon Ex Parte at Exhibit 4.
[5] Conexon Ex Parte at p. 8.
