Prison Phone Justice

Before The
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
In the Matter of:
Rates For Interstate Inmate
Calling Services

)
)
)
)

WC Docket No. 12-375

OPPOSITION TO PETITION FOR STAY
The Wright Petitioners hereby submit this Opposition to the Petition For Stay Pending
Judicial Review, filed by Global Tel*Link (the "Petition"). 1 Global Tel*Link ("GTL") requests that
the Commission stay the effectiveness of changes made to the Inmate Calling Service ("ICS") rates
contained in the Order on Reconsideration adopted on August 2, 2016, and released on August 9,
2016, in the above-captioned proceeding. 2
GTL's Petition must be denied. GTL is simply wrong that (i) it will likely prevail in a future
judicial review of the new ICS rate caps; (ii) it will suffer irreparable harm from the implementation
of new ICS rate caps; (iii) other interested parties will not be substantially harmed if the stay of the
new ICS rate caps is granted; and (iv) the public interest favors granting a stay of the new ICS rate
caps.
Instead, as discussed below, the new ICS rate caps will fully compensate GTL for its costs
associated with providing ICS to the public. Moreover, the new ICS rate caps are necessary to force
GTL and other ICS providers to cease their new practice of raising intrastate rates to "make them
whole" in light of the cap on ancillary ICS fees that went into effect on June 20, 2016. In light of
the Commission's goal to protect consumers from unjust, unreasonable and unfair ICS rates and
fees, GTL's Petition must be denied.
1

The Petition was filed on September 1, 2016. Pursuant to Section 1.45(d) of the FCC’s rules, this
Opposition is filed within 7 days of the submission. See 47 C.F.R. § 1.45(d) (2015).
2

Rates for Interstate Inmate Calling Services, Order on Reconsideration, FCC 16-102, rel. Aug. 9,
2016 (the "Recon Order"). The Recon Order has yet to be published in the Federal Register.

1

I.

GTL Will Not Be Successful On The Merits
1.

Assertions Regarding the Court's Likely Ruling Are Misplaced

First, it must be noted that GTL makes several unfounded assumptions regarding the
treatment of its future request for stay to be filed with the United States Court of Appeals for the
District of Columbia (the "Court of Appeals"). According to GTL, the grant of its future request to
stay the Recon Order is a foregone conclusion.
For example, GTL asserts that the Court of Appeals "evidently determined that the
challengers' argument that the Commission lacks the authority to cap intrastate ICS rates was likely
to succeed" when it granted a stay on March 23, 2016. 3 GTL also asserts that it obtained a stay of
the intrastate ICS rate caps because (i) the rates fail to account for site commissions and (ii) the
rates are below the providers' self-reported costs. 4 GTL continues with its unsupported assertions
when it concludes that a stay application will be successful because some providers will operate at a
loss, 5 alleging that this finding "is the end of the matter." 6
However, the Court of Appeals did not explain the basis for why it granted the stay requests
with respect to the caps on intrastate ICS rates and single-call ancillary fees. Because the standard
applied by the Court of Appeals is a balancing of the four Virginia Petroleum Jobbers factors, it is
impossible to accurately determine why the Court of Appeals granted a stay in its review of the
Second Report and Order without being provided further information from the Court of Appeals. It
could have found a high likelihood of success on the merits but a lesser likelihood of substantial
irreparable harm, or vice versa. Or, it could have found both factors strongly favored a stay.

3

Petition, pg. 12.

4

Id., pg. 15.

5

Id., pg. 18 (citing Motion of CenturyLink Public Communications, Inc. for Partial Stay Pending
Judicial Review, filed Feb 5, 2016).

6

Petition, pg. 19.
2

Certainly, none of the three stay orders referenced by GTL provide any sound basis for concluding
which aspect of the Commission's rules were troublesome. On the other hand, when a court denies
a stay, we can confidently conclude that it found neither a strong likelihood of success on the merits
nor a strong likelihood of irreparable harm.
Thus, the fact that the Court of Appeals permitted the Commission's caps on ancillary fees to
go into effect for both inter- and intra- ICS calls does allow the conclusion that the court did not see
a substantial likelihood of success as to whether such caps can be justified on the basis of Section
276 authority. Moreover, almost all of the other rules adopted in the Second Report and Order were
permitted to go into effect. 7 Many of these rules apply equally to intrastate and interstate ICS calls,
which certainly suggests that the Court of Appeals does not have a uniform objection to the
Commission's regulation of intrastate ICS rates and fees.
2.

FCC Has Requisite Authority To Regulate Intrastate ICS Rates.

With GTL's divination skills (or lack thereof) addressed, it is also necessary to address
whether GTL's arguments regarding the Commission's statutory authority will be successful in
challenging the Commission's authority to adopt the new ICS rate caps. In particular, GTL argues
that Section 276 does not provide "the Commission the authority to regulate existing intrastate rates
on the grounds that they are unreasonably high." 8 However, GTL’s support for these conclusions
utterly fail to address clear precedent to the contrary.
First, GTL completely ignores the holding of AT&T Corp. v. Iowa Utilities Board, in which
the Supreme Court determined the Commission had requisite authority to implement regulations
7

The Court of Appeals did not impose a stay of the following rules adopted in the Second Report and
Order: (i) the caps on TTY rates (47 C.F.R. § 64.6040), (ii) the Annual Reporting and Certification
Requirement (47 C.F.R. §64.6060); (iii) the caps on Taxes and Fees (47 C.F.R. § 64.6070); (iv) the
prohibition of Per-Call or Per-Connection charges (47 C.F.R. § 6080); (v) the prohibition on Flat-Rate
Calling (47 C.F.R. § 64.6090); (vi) the Minimum and Maximum Prepaid Calling Account balances (47
C.F.R. § 64.6100) and (v) the Consumer Disclosure of Inmate Calling Service Rates (47 C.F.R. § 64.6110).
8

Petition, pg. 13.
3

relating to intrastate communications services as the result of the enactment of the
Telecommunications Act of 1996. 9 In AT&T, the Supreme Court rejected efforts by parties to limit
the Commission's authority to "purely interstate and foreign matters" and instead found that Section
201(b) of the Communications Act provided the Commission with the authority to "carry out the
'provisions of this Act,'" which necessarily includes Section 276. 10
Moreover, GTL inexplicably cites Illinois Public Telecommunications Association v. FCC
("IPTA") for the proposition that the Commission may not interpret Section 276(b) to establish a
cap on intrastate ICS rates. 11 As GTL should be aware, the Court of Appeals in IPTA specifically
held that Section 276 gave authority to the Commission "to set local coin call rates in order to"
ensure that "payphone operators [are] 'fairly compensated.'" 12 Moreover, the Court of Appeals in
IPTA specifically addressed "problematic locational monopolies" such as ICS in correctional
facilities by (i) affirming the Commission's reservation of authority for further action in the future to
"modify its deregulation scheme, for example, by limiting the number of compensable calls from
each payphone" and (ii) clearly stating that "the Commission has been given an express mandate to
preempt State regulation of local coin calls." 13
Therefore, the Commission is best suited to make "difficult policy choices," 14 including the
determination whether it is necessary to impose caps on intrastate ICS rates to ensure that ICS
9

See 525 U.S. 366, 377-378 (1999) ("Since Congress expressly directed that the 1996 Act…be
inserted into the Communications Act of 1934…the Commission’s rulemaking authority would seem to
extend to implementation" of the 1996 Act provisions).
10

Id., 525 U.S. at 378. Also significant is that Section 276(c) of the Communications Act gives the
Commission the explicit power to preempt State requirements. 47 U.S.C. § 276(c).
11

Petition, pg. 13 (citing Illinois Pub. Telecomms. Ass’n v. FCC, 117 F.3d 555 (D.C. Cir. 1997).

12

IPTA, 117 F.3d at 563.

13

Id.

14

Metrophones Telecomms., Inc. v. Global Crossing Telecomms., Inc., 423 F.3d 1056, 1070 (9th Cir.
2005) aff'd Global Crossing Telecomms., Inc. v. Metrophones Telecomms., Inc., 550 U.S. 555 (2007) (citing
Nat'l Cable & Telecomms. Ass'n v. Brand X Internet Servs., 545 U.S. 967 (2005)).
4

providers receive only "fair compensation" rather than the current regulatory regime that permits
unjust, unreasonable and unfair ICS rates and fees to be charged in the absence of competitive
marketplace.
3.

The Recon Order Correctly Addresses Site Commissions and Fully
Compensates GTL.

Much like Securus and Telmate, GTL also argues that it will be successful in its appeal
because the Commission did not ban site commissions, or otherwise permit ICS providers to shift
their entire obligation to pay site commissions onto the backs of ICS customers. 15
First, GTL ignores the fact that Commission determined thirteen years ago that site
commissions were not recoverable "costs." 16 While ICS providers like GTL would have preferred
that the Commission rescue ICS providers from the folly of their own making, the Commission's
adoption of new ICS rate caps, and the decision to not ban or otherwise regulate site commissions,
fits squarely within the Commission's statutory authority and its past long-standing precedent. The
only support GTL provides for its argument that the Commission should have opened an escape
hatch for ICS providers from their entirely voluntary contractual obligations is an order
implementing rules to establish price caps for cable service. 17
Initially, it is rather surprising that GTL, an opponent of the Commission's so-called "rate of
return" regulations adopted in this proceeding in 2013, 18 would now point to an invasive regulatory
structure to support its call for the pass-through of site commissions to ICS providers. However,
15

Petition, pg. 15.

16

See Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act of
1996, Order on Remand, 17 FCC Rcd 3248, 3262 (2002)(finding that site commissions are "negotiable by
contract with the facility owners and represent an apportionment of profits between the facility owners and
the providers of the inmate payphone service.").
17

Petition, pg. 17, nt. 72 (citing First Order on Reconsideration, Second Report and Order, and Third
Notice of Proposed Rulemaking, Implementation of Sections of the Cable Television Consumer Protection
and Competition Act of 1992, 9 FCC Rcd 1164, ¶ 89 (1993) (the "Cable Order").

18

Petition, pgs. 4-5.
5

even in that order, the Commission noted that "[i]ncreases in external costs more than inflation will
be reflected in rate increases, and decreases in such costs and increases less than inflation will be
reflected in rate reductions." 19 If GTL now wishes to avail itself of the regulatory structure adopted
in the Cable Order to justify its shifting of site commissions onto the backs of its ICS customers, it
must also avail itself of the entire price-cap structure for cable companies that do not face effective
competition. Otherwise, GTL's reference to the Cable Order is meaningless.
Furthermore, there is sufficient evidence in the record that GTL will be fairly compensated
under the new ICS rate caps and permissible ancillary fees, especially when one acknowledges that
call volume will substantially increase after the new ICS rate caps go into effect. 20 GTL failed to
provide any analysis of its costs to support its argument that it will not be fairly compensated. On
the other hand, the Wright Petitioners have provided evidence that GTL will be fairly compensated
for providing ICS to its customers.
Specifically, on July 29, 2016, the Wright Petitioners provided an updated cost analysis for
each ICS provider – including GTL – that submitted a cost study in 2014. 21 The analysis applied
the new ICS rate caps adopted in the Recon Order to the providers' costs specified in their bloated
2014 cost studies 22 and showed that the seven largest ICS providers would have all of their costs
covered by a significant margin. 23 Therefore, GTL will not be successful on this argument either.

19

Cable Order, ¶ 90.

20

See 2016 Stay Order, 31 FCC Rcd at 291. See Praeses Ex Parte Submission, Oct. 13, 2015, pg. 2
("Interstate ICS call volume is now approximately 76 percent higher than before the effective date of the
2013 ICS Order and overall interstate ICS revenue has increased approximately 12 percent."). See also
Petitioners’ Ex Parte Submission, dated July 18, 2013.

21

See Wright Petitioners Ex Parte Submission, dated July 29, 2016.

22

See Second Report and Order, 30 FCC Rcd at 12,790 ("We take the data at face value, even though
the analysis shows that there is significant evidence—both from our own analysis and commenters’
critiques—suggesting that the reported costs are overstated.").
23

See Wright Petitioners Ex Parte Submission, dated July 29, 2016, at Exhibit A.
6

II.

GTL Failed to Make Any Showing That Its Losses Are Irreparable
GTL's Petition also failed to include any analysis to support its claim that it will suffer

irreparable injury as the result of the new ICS rates caps. 24 Unlike Securus and Telmate, GTL
apparently could not be bothered to even submit a self-serving affidavit from one of its executives
to make the argument that GTL had lost $X million in renegotiating its monopoly contracts.
Instead, GTL, through its counsel, merely asserts that "[t]he process of reviewing and revising
hundreds of contracts with hundreds of customers…will consume tremendous resources." 25
Such bald assertions, without any supporting evidence, simply do not establish a cognizable
"irreparable harm." To establish an irreparable harm, the Commission has stated that the "injury
must be 'both certain and great; it must be actual and not theoretical. Petitioners must provide 'proof
indicating that the harm [they allege] is certain to occur in the near future.'" 26 Nowhere in the
Petition did GTL even attempt to make this showing.
Moreover, GTL's financial reports submitted to Alabama's Public Service Commission show
that GTL's "Income From Operations" in FY 2015 was $35.5 million, and $41.2 million in FY
2014. 27 Thus, even if the Commission was to take GTL's unsupported assertion that "tremendous
resources" will be consumed to review and revise its agreements with correctional authorities when
the new ICS rate caps go into effect, it is abundantly clear that these costs do not threaten "the very
existence" of GTL's business.

24

Petition, pg. 21.

25

Id., pg. 22. See also Connect America Fund, Order, 27 FCC Rcd 7158, 7160 (2012).

26

See Connect America Fund, Order, 27 FCC Rcd 7158, 7160 (2012). See also Expanding the
Economic and Innovation Opportunities of Spectrum through Incentive Auctions, Opinion, DA 15-1454
(Dec. 18, 2015) ("Further, it is 'well settled that economic loss does not, in and of itself, constitute irreparable
harm.' The only exceptions to this rule are when (1) the economic loss threatens the 'very existence of the
movant's business,' and (2) such loss is great, certain, and imminent.") (internal references omitted).
27

See Appendix A.
7

Finally, the Wright Petitioners previously submitted copies of recently-adopted amendments
to existing ICS contracts purported designed to ensure that both the ICS provider and the
correctional facility "remain whole." 28 GTL actively engaged in the process, forcing through
changes in Los Angeles County, California, and Jefferson County, Texas. 29 Included with the
materials that were provided by GTL to Jefferson County, Texas, was an analysis of the Second
Report and Order in this proceeding. 30 A copy of this analysis is provided herewith as Appendix B
for ease of reference. As noted in the analysis, GTL presented five distinct menu options to
Jefferson County, Texas, to ensure that the "County still has the ability to make commission if
desired" by converting the current 81.5% site commission "to a per minute 'cost recovery' fee." Id.
Thus, to the extent that GTL is now arguing that it will suffer irreparable harm by going
through similar renegotiations again, the Wright Petitioners respectfully suggest that perhaps GTL
could better utilize its "limited" resources by shifting its efforts away from devising new fees to pass
onto its customers. Moreover, it should also be noted that GTL continues to fight to pay site
commissions and a lump-sum "financial incentive" of $6.0 million to serve ICS customers held in
correctional facilities maintained by the Georgia Department of Corrections.

As set forth in

Appendix C, GTL has appealed a decision to assign a new contract to Securus Technologies. GTL's
Best and Final Offer is attached hereto as Appendix D.
However, regardless of how GTL wishes to spin these facts, in the absence of any attempt to
quantify its expenses associated with implementing the new ICS rate caps, GTL has utterly failed to
show that it will "suffer serious and irreparable harm." 31

28

See Opposition to GTL’s Petition for Waiver, dated June 17, 2016, at Appendix B, Appendix C. See
also Wright Petitioners Ex Parte Presentation, dated July 29, 2016, at Exhibit B.
29

See Wright Petitioners Ex Parte Presentation, dated July 29, 2016, at Exhibit B.

30

Id.

31

Petition, pg. 21.
8

III.

A Stay Will Harm Consumers
GTL is simply wrong in stating that "interested parties…will not suffer material irreparable

injury in the event of a stay." 32 Any delay in the effectiveness of the Recon Order would delay
immediate relief to millions of ICS customers currently being charged excessive ICS intrastate
rates, who have seen their ICS expenses increase due to the actions of GTL and other ICS
providers. It is obvious that GTL's Petition seeks additional time simply to perpetuate its drive to
collect as much revenue as possible from its unjust, unreasonable and unfair intrastate ICS rates
charged to its customers to replace the revenue it lost when the Commission's cap on ancillary ICS
fees went into effect. Coupled with the increase in intrastate rates discussed above, there will be
substantial harm to third-parties if the new ICS rate caps are not imposed as soon as possible.
IV.

There Are Strong Public Interest Benefits Arising From Denial of Stay.
Finally, the Wright Petitioners have provided irrefutable evidence that reform of all ICS

rates is required, and that there will be overwhelmingly positive public interest benefits arising from
the Commission's implementation of a uniform ICS rate cap on intrastate and interstate calls. Any
delay in the effectiveness of the Recon Order would be, in fact, counter to the public interest.
In particular, the Wright Petitioners have introduced overwhelming evidence that increased
contact between inmates and their families and loved ones will reduce recidivism rates, which will
decrease the cost of incarceration. In fact, it was shown that just a 1% decrease in the recidivism
rate would result in savings of more than 250 million dollars for state, county and local
jurisdictions. Also, the Wright Petitioners have provided previous statements from Securus, GTL,
Telmate and CenturyLink in response to Requests for Proposals asserting that the reduction in rates
and fees would lead to increased call volume, increased revenues for ICS providers, and, in turn,
increased commissions paid to the correctional facilities that receive site commissions.
32

Id., pg. 23.
9

GTL attempts to equate "the public interest" to "GTL's pecuniary interest" but the
Commission must reject this effort. 33 While GTL and the other ICS providers may have an interest
in (i) escaping from their entirely voluntary obligations to pay site commissions, and (ii) avoiding
the "burdens of litigation," the public interest substantially supports the elimination unjust,
unreasonable and unfair ICS rates and fees.
CONCLUSION
Thus, GTL has (i) failed to establish that an appeal of the Order on Reconsideration would
be successful on the merits; (ii) failed to provide any evidence that it will suffer irreparable harm;
(iii) failed to show the lack of harm to third parties (in fact, great harm will be caused from a delay
in the effectiveness of the lower rates for all ICS calls); and (iv) failed to show any public interest
benefit from granting a stay.
Therefore, the Wright Petitioners oppose Global Tel*Link's Petition for Stay, and
respectfully request that the Commission adopt an order denying the request as legally
unsustainable.
Respectfully submitted,

By:
Lee G. Petro
DRINKER BIDDLE & REATH LLP
1500 K Street N.W.
Suite 1100
Washington, DC 20005-1209
(202) 230-5857
Counsel for The Wright Petitioners
September 8, 2016

33

Petition, pg. 23.
10

APPENDIX A

Lee G. Petro
202-230-5857 Direct
202-842-8465 Fax
Lee.Petro@dbr.com
Law Offices
1500 K Street N. W.
Suite 1100

March 22, 2016

Washington, D.C.
20005-1209
(202) 842-8800
(202) 842-8465 fax
www.drinkerbiddle.com
CALIFORNIA
DELAWARE
ILLINOIS
NEW JERSEY

By PDF to Darrell.Baker@psc.alabama.gov
Darrell Baker, Director
Utility Service Division Alabama
Public Service Commission
PO Box 304260
Montgomery, AL 36130-4260

NEW YORK
PENNSYLVANIA

Re:

Public Records Request

WASHINGTON D.C.
WISCONSIN

Dear Mr. Baker:
This letter is a formal request for records under the Code of Alabama, §§ 36-12-40
and 36-12-41. I am sending this request to you in your capacity as the records custodian
in the Telecommunications Division of the Alabama Public Service Commission
(“APSC”). If, however, you are not a records custodian, please forward this letter to the
appropriate person and advise me accordingly by phone or e-mail.
I request copies of the annual financial reports (that is, Annual Reports to
Shareholders and Form 10-Ks filed with the Securities and Exchange Commission, or
financial statements— including balance sheets and income statements—as the case
may be) for the year 2015 by or on behalf of the companies listed below;
The request applies to the following companies, along with their wholly-owned
subsidiaries and parent entities, along with any submissions supplied by third-parties on
the behalf of the company:

Established 1849

1. ATN, Inc., d/b/a AmTel
2. City Tele Coin, Inc.
3. Combined Public Communications
4. Consolidated Telecom, Inc.
5. DSI-ITI, LLC
6. Embarq Payphone Services, Inc.
7. Global Tel*Link
8. Infinity Networks, Inc.
9. Inmate Calling Solutions d/b/a ICSolutions
10. Legacy Long Distance International, Inc.
11. Network Communications International Corp. d/b/a 1800Call4Less

Mr. Darrell Baker
March 22, 2016
Page 2

12. Pay Tel Communications, Inc.
13. Securus Technologies, Inc. (f/k/a Evercom Systems, Inc.)
14. Talton Communications, Inc.
15. Telmate, LLC
16. Value-Added Communications, Inc.

PDF or other electronic or scanned copies of the subject records delivered to me
by email or on disk are preferable, but printed copies are acceptable if electronic copies
do not exist. Please note that I do not need certified copies of the records.
I recognize that you may charge reasonable fees for the copies. Please provide me,
by phone or e-mail, with the cost for the requested copies, and instructions for payment.
If you are producing printed copies of the records, I will be happy to provide my FedEx
billing information to facilitate shipping the records to me at the above address.
I would appreciate your expediting this request and complying with it at your
earliest opportunity. If you have any questions or require any additional information,
please do not hesitate to contact me by phone or e-mail.
Respectfully submitted,

Lee G. Petro
DRINKER BIDDLE & REATH LLP
1500 K Street N.W., Suite 1100
Washington, DC 20005-1209
202-230-5857 – Telephone
202-842-8465 - Telecopier

Petro, Lee G.
From:
Sent:
To:
Cc:
Subject:
Attachments:

Baker, Darrell <Darrell.Baker@psc.alabama.gov>
Friday, June 03, 2016 11:11 AM
Petro, Lee G.
Jones, Tom
Response to FOIA
Combined Public Communications, Inc._ AL Annual Financial Statements - INMATE year ending 2015-12.pdf; Crown Correctional Telephone, Inc._ AL Annual Financial
Statements - INMATE - year ending 2015-12.pdf; GTL Holdings.pdf; Infinity Networks,
Inc._ AL Annual Financial Statements - INMATE - year ending 2015-12.pdf; Inmate
Calling Solutions 2015.pdf; Lattice Incorporated - AL Annual Financial Statements INMATE - for the year ending December 31, 2015.pdf; Network Comm. & International
Calling Serv..PDF; Network Communications International Corp_ AL Annual Financial
Statements - INMATE - year ending 2015-12.pdf; Pay Tel Communications_AL Annual
Financial Statements -INMATE - YE- 12-31-15.pdf; Securus 2015 Annual Report.pdf;
Telmate Financial Statement 2015.pdf; AL FOIA Request - 2016.pdf; Ally Telecom
Group, L.L.C. - AL Inmate Record Retention Annual Report (No Service).pdf; American
Phone Systems LLC_ AL Annual Financial Statements - INMATE - year ending
2015-12.pdf; American Phone Systems.pdf; City Tele Coin, Inc.PDF; Combined Public
Communications Inc _ AL Annual Financial Statements - INMATE - year ending
2015-12.pdf; CenturyLink Inc-2015 - 10-K (Full Version).pdf

This should complete the FOIA dated March 22, 2016.
CenturyLink submitted their FCC 10K Report which our legal department said met the criteria. Everything is
consolidated with their local exchange company operations.
See attached.
Respectfully,
Darrell A. Baker
Director, Utility Services Division
Phone: (334) 242-2947
Toll Free 1-800-882-3919
 

1

Lee G. Petro
202-230-5857 Direct
202-842-8465 Fax
Lee.Petro@dbr.com
Law Offices
1500 K Street N. W.
Suite 1100

June 17, 2015

Washington, D.C.
20005-1209
(202) 842-8800
(202) 842-8465 fax
www.drinkerbiddle.com
CALIFORNIA
DELAWARE
ILLINOIS
NEW JERSEY

By PDF to Darrell.Baker@psc.alabama.gov
Darrell Baker, Director
Utility Service Division Alabama
Public Service Commission
PO Box 304260
Montgomery, AL 36130-4260

NEW YORK
PENNSYLVANIA

Re:

Public Records Request

WASHINGTON D.C.
WISCONSIN

Dear Mr. Baker:
This letter is a formal request for records under the Code of Alabama, §§ 36-12-40
and 36-12-41. I am sending this request to you in your capacity as the records custodian
in the Telecommunications Division of the Alabama Public Service Commission
(“APSC”). If, however, you are not a records custodian, please forward this letter to the
appropriate person and advise me accordingly by phone or e-mail.
I request:
1. copies of the annual financial reports (that is, Annual Reports to
Shareholders and Form 10-Ks filed with the Securities and Exchange
Commission, or financial statements— including balance sheets and
income statements—as the case may be) for the years 2013 and 2014
filed by or on behalf of the companies listed below;
2. copies of provider notifications to the APSC with respect to the provider’s
progress in complying with the maximum $5.95 payment transfer fee
requirement in accordance with paragraph 8.25 of the APSC ICS Order
under Docket 15957, dated December 9, 2014 (the “Order”); and
3. copies of the required abbreviated tariff for each provider in accordance
with paragraph 10.04, Appendix F, and Appendix G to the Order, page
10.

Established 1849

Mr. Darrell Baker
July 15, 2015
Page 2

The request applies to the following companies, along with their wholly-owned
subsidiaries and parent entities, along with any submissions supplied by third-parties on
the behalf of the company:
1. ATN, Inc., d/b/a AmTel
2. City Tele Coin, Inc.
3. Combined Public Communications
4. Consolidated Telecom, Inc.
5. DSI-ITI, LLC
6. Embarq Payphone Services, Inc.
7. Global Tel*Link
8. Infinity Networks, Inc.
9. Inmate Calling Solutions d/b/a ICSolutions
10. Legacy Long Distance International, Inc.
11. Network Communications International Corp. d/b/a 1800Call4Less
12. Pay Tel Communications, Inc.
13. Securus Technologies, Inc. (f/k/a Evercom Systems, Inc.)
14. Talton Communications, Inc.
15. Telmate, LLC
16. Value-Added Communications, Inc.
PDF or other electronic or scanned copies of the subject records delivered to me
by email or on disk are preferable, but printed copies are acceptable if electronic copies
do not exist. Please note that I do not need certified copies of the records.
I recognize that you may charge reasonable fees for the copies. Please provide me,
by phone or e-mail, with the cost for the requested copies, and instructions for payment.
If you are producing printed copies of the records, I will be happy to provide my FedEx
billing information to facilitate shipping the records to me at the above address.
I would appreciate your expediting this request and complying with it at your
earliest opportunity. If you have any questions or require any additional information,
please do not hesitate to contact me by phone or e-mail.

Mr. Darrell Baker
July 15, 2015
Page 3

Respectfully submitted,

Lee G. Petro
DRINKER BIDDLE & REATH LLP
1500 K Street N.W., Suite 1100
Washington, DC 20005-1209
202-230-5857 – Telephone
202-842-8465 - Telecopier

GTEL Holdings, Inc. and
Subsidiaries
Consolidated Financial Statements as of and for the
Year Ended December 31, 2015

GTEL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 2015

2015

ASSETS
CURRENT ASSETS:
Cash and cash equivalents
Accounts receivable—less allowance for doubtful accounts
Prepaid expenses and other current assets
Prepaid license fees
Income tax receivable
Deferred tax asset
Total current assets

$

14,719,592
36,380,812
17,556,507
1,132,642
32,231,016
12,374,917
114,395,486

PROPERTY AND EQUIPMENT—Net

65,424,833

PREPAID LICENSE FEES

3,287,107

OTHER INTANGIBLE ASSETS—Net

548,649,354

GOODWILL

384,744,868

OTHER ASSETS

7,152,693

TOTAL

$ 1,123,654,341

-2-

GTEL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 2015

2015

LIABILITIES AND STOCKHOLDER’S EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt
Accounts payable
Accrued liabilities
Commissions payable
Deferred revenue

$

Total current liabilities

6,150,000
18,306,264
25,802,604
23,539,200
15,612,250
89,410,318

DEFERRED TAX LIABILITY

196,197,000

OTHER LONG TERM LIABILITY

3,908,732

LONG-TERM DEBT

772,583,170

Total liabilities

1,062,099,220

COMMITMENTS AND CONTINGENCIES (Note 11)
STOCKHOLDER’S EQUITY:
Common stock, $0.01 par value—1,000 shares authorized,
issued, and outstanding
Additional paid-in capital
(Accumulated deficit) retained earnings
Total stockholder’s equity

100
95,781,862
(34,226,841)
61,555,121

TOTAL

$ 1,123,654,341

-3-

GTEL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2015

2015

NET REVENUE

$ 558,766,089

OPERATING EXPENSES:
Cost of revenues—exclusive of depreciation and
amortization expenses
General and administrative—exclusive of bad debt and
billing arrangement and depreciation and amortization expenses
Bad debt and billing arrangement expenses
Depreciation and amortization expense
Loss on disposal of property and equipment
Total operating expenses

290,486,841
111,697,083
(6,100,302)
126,868,789
354,509
523,306,920

INCOME FROM OPERATIONS

35,459,169

INTEREST EXPENSE

53,334,874

OTHER INCOME (EXPENSES):
Interest income
Transaction-related expenses
Sponsor fees
Other expense

15,969
(1,847,124)
(2,056,953)
(21,177)

Total other expenses

(3,909,285)

LOSS BEFORE TAXES

(21,784,990)

INCOME TAX BENEFIT

(8,095,865)

NET LOSS

$ (13,689,125)

-4-

GLOBAL TEL*LINK CORP
UNAUDITED FINANCIAL STATEMENTS
AS OF AND FOR THE YEAR ENDED 12/31/2013
As of & for the
STATEMENT OF FINANCIAL POSITION
Assets
Cash
AR
Prepaid and other current assets
Prepaid patent license, current
Income tax receivable
Intercompany balances
Deferred tax asset, current
Total current assets

24,862,675
14,384,194
8,906,026
1,140,975
10,651,479
6,439,690
7,819,049
74,204,088

Property & equipment, net
Prepaid patent license, long term
Other intangible assets
Goodwill
Deferred tax asset, long term
Other assets, long term
Total assets

36,457,832
3,218,978
513,104,321
60,570,254
7,870,895
11,931,373
707,357,741

Liabilities & Equity
Current portion of long term debt
Accounts payable
Accrued liabilities
Commission payable
Deferred revenue, current
Total current liabilities

6,150,000
8,176,369
12,394,068
18,326,707
5,742,737
50,789,880

Deferred tax liability, long term
Long term debt
Total liabilities
Common Stock
Additional paid in capital
Accumulated deficit
Total equitiy
Total liabilities & equity
check total s/b zero

266,560,293
826,653,115
1,144,003,288
100
93,773,849
(530,419,496)
(436,645,547)
707,357,741
(0)

STATEMENT OF OPERATIONS
Net revenue

322,792,155

Cost of revenue
General & Administrative
Bad Debt Expense
Loss on disposal of assets
Total operating expenses
Income from operations

198,548,667
77,498,894
2,743,149
314,367
279,105,077
43,687,077

Interest expense

50,495,824

Interest Income
Transaction related expenses
Expenses associated with early extinguishment of debt
Sponsor fees
Other
Total other income

14,841
109,856
(18,162,472)
(2,083,256)
(37,900)
(20,158,931)

Income before taxes
Income tax expense
Net income

(26,967,677)
(7,764,010)
(19,203,667)

APPENDIX B

APPENDIX C

APPENDIX D

CERTIFICATE OF SERVICE
I hereby certify that, on September 8, 2016, the forgoing Opposition was served via
electronic mail on the following persons:

Marlene H. Dortch, Secretary
Federal Communications Commission
Marlene.Dortch@fcc.gov

Commissioner Michael O’Rielly
Federal Communications Commission
Michael.ORielly@fcc.gov

Chairman Tom Wheeler
Federal Communications Commission
Tom.Wheeler@fcc.gov

Howard Symons
General Counsel
Federal Communications Commission
Howard.Symons@fcc.gov

Commissioner Mignon Clyburn
Federal Communications Commission
Mignon.Clyburn@fcc.gov

Matthew DelNero, Chief
Wireline Competition Bureau
Federal Communications Commission
Matthew.Delnero@fcc.gov

Commissioner Jessica Rosenworcel
Federal Communications Commission
Jessica.Rosenworcel@fcc.gov

Michael K. Kellogg
mkellogg@khhte.com
Counsel for Global Tel*Link

Commissioner Ajit Pai
Federal Communications Commission
Ajit.Pai@fcc.gov

By:
Lee G. Petro

9/8/2016

ECFS Confirmation

Welcome to the FCC’s new Electronic Comment Filing System, ECFS 3.0, launched June 20, 2016. This system contains the entire
history of docketed proceedings from 1992 to the present. New submissions here will be added to the public record. We will
continue to re阀砂ne this system in response to user feedback. Please tell us about your experience using this system by sending an
email to ECFSfeedback@fcc.gov (mailto:ECFSfeedback@fcc.gov).
 
1

Submit a Filing
Proceeding:

12-375

Con阀砂rmation #:

201609083091521638

Submitted:

Sep 8, 2016 1:54:44 PM

Status:

RECEIVED

Name(s) of Filer(s)

The Wright Petitioners

Law Firm(s)

Drinker Biddle & Reath, LLP

Attorney/Author Name(s)

Lee G. Petro

Primary Contact Email

Lee.Petro@dbr.com

Type of Filing

OPPOSITION

Filing

2

Review

3

Con阀砂rmation

File Number
Report Number
Bureau ID Number
Address of

Law Firm

Address

1500 K Street, N.W. Suite 1100, Washington,  DC,  20005

Email Con阀砂rmation

Yes

Submit Another  (/ecfs/阀砂lings)

Federal Communications Commission
445 12th Street SW, Washington, DC 20554
Phone: 1-888-225-5322
TTY: 1-888-835-5322
Videophone: 1-844-432-2275
Fax: 1-866-418-0232
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