LTD Broadband CEO Predicts He Will Lose FCC Appeal but Could Sue

“There is literally zero chance the FCC is going to rule in our favor” and reverse its rejection of LTD Broadband’s long-form application for the Rural Digital Opportunities Fund (RDOF) program, company CEO Corey Hauer said Thursday at a Minnesota Public Utilities Commission meeting. Even so, Hauer said the wireless ISP will continue to defend itself at the PUC and still wants to keep its eligible telecom carrier (ETC) designation in the state.

LTD could sue the FCC if the agency rejects the company’s application for review (AFR), Hauer told us afterward. “The FCC has sat on our AFR for 13 months with no action because in doing so, they prevent us from taking them to court,” he said in an email. “I do not expect the FCC to act on our AFR, as it exposes them to litigation … But if they were to surprise me, and they ultimately reject our AFR, we could sue in federal court.” Hauer believes his company “is likely to succeed on the merits, particularly on arbitrary and capricious treatment of LTD,” he said. The FCC didn’t comment.

Minnesota PUC commissioners voted 5-0 to lift a stay on an administrative law judge proceeding considering revocation of the company’s ETC designation. In the same vote, the commission granted Minnesota Telecom Association and Minnesota Rural Electric Association’s motion to suspend LTD’s ETC designation while the proceeding goes on. The commission moved forward despite an LTD letter Monday arguing that the state commission should postpone Thursday’s vote since the FCC circulated an order on the company’s application for review (see 2311130065).

Hauer won’t forecast even a 1% chance that the FCC will reverse itself, he said: It’s zero. Also, Hauer said moving to an ALJ proceeding in Minnesota is a “waste of time and money and resources.” Minnesota commissioners and ALJs are “busy,” he said. “This is as far from ripe as you can possibly think of.”

The CEO’s comments prompted Chair Katie Sieben to ask, “Do you still want ETC status in Minnesota?” Hauer replied, “We do.” Sieben returned, “But I heard you say that, if the matter is sent back to the ALJ, that that’s a lot of effort for your company to engage in a contested case hearing. … If you’re ready to just give up your ETC status now, we could save a lot of that contested-case work.”

Other parties “have gone through great effort to besmirch LTD’s capability,” replied Hauer. “Certainly we’re not going to just raise the white flag and say these guys are right.”

Commissioner John Tuma sees “sufficient evidence" that affidavits on which the Minnesota PUC based its original ETC approval weren't completely accurate, he said. Commissioner Valerie Means said what’s most important to her is the public interest, which is “to have widespread access to broadband yesterday.” She said "significant time has now passed and we continue to have areas that are unserved and underserved.” Means asked Hauer if he knew a “date certain” for FCC action on LTD’s appeal. The CEO said no.

Minnesota's attorney general's office heard from consumers and counties that current LTD service, “in the places where theoretically LTD is built out and doing its best job, is still wildly inadequate,” said Assistant AG Erin Conti. “We are concerned that LTD’s performance to date is insufficient, and the idea that it is going to be prepared to deploy additional resources effectively is in grave doubt.”