Tag: Google fiber

My take on OTMR litigation so far

For several weeks, I have avoided offering commentary on the OTMR litigation because I know that, no matter what I say, some are going to think I’m looking at it through an anti-Google or pro-AT&T lens.

But since I have 25 years of experience handling business disputes in federal court, and 5 years of work on the Board of NES, I’m going to go ahead and give my thoughts about the litigation from time-to-time.

None of this is in any particular order.  None of this is official information from Metro or anyone else. None of this repeats privileged communications. And, I am not speaking for Metro here. This is just stuff I’m thinking about the lawsuits:

– I don’t care who is actually named in the Nashville lawsuit as of today, there are multiple parties who are certainly actively planning a litigation strategy. These include Metro, AT&T, Google, Comcast, and NES. On top of this, I’d bet money that TVA is paying attention to what is happening, as well as the State of Tennessee. And, there are probably more than a few state level lobbyists who are thinking about what, if anything, might happen in the legislature.  There have probably been times over the last few weeks where the collective hourly rate of everyone billing time on this has been into the several thousands of dollars per hour.

– At this point in a lawsuit, anyone who says they know how it’s going to go at the end is just making a guess. There are too many moving parts to predict accurately more than a few steps ahead.

– In Louisville, if AT&T wins the federal preemption argument in their summary judgment motion, it will be good news for AT&T here in Nashville. Due to some nuances in Kentucky law that are different than in Tennessee, the converse is not necessarily true.  If AT&T loses its summary judgment motion, it might be, but won’t necessarily be, bad news for them in the Nashville lawsuit.

– The federal preemption argument that AT&T is making is a pretty good argument. Blame Congress if you want. Blame the telecommunications lobby in D.C. over the last century if you want. But there are clear federal regulations about moving stuff on poles, and our OTMR ordinance is in conflict with those clear federal regulations.

– Anybody who says they know how the lawsuit plays out if AT&T wins its federal preemption argument in Louisville or Nashville is making stuff up. Maybe our federal court would only invalidate the ordinance on AT&T’s poles and not on NES’s poles. Maybe our federal court would be swayed by how inefficient that would be, come up with some argument to still rule against AT&T so OTMR could go forward, and let a court of appeals sort it out. Maybe our federal court will just copy whatever happens in Louisville, or maybe not. There just isn’t a way to know.

– Media reports show that AT&T sent a letter to NES saying that they expect NES to honor its existing agreement with AT&T. What’s up with that? I don’t know – but my guess is that AT&T doesn’t have an actual legal dispute with NES yet. When you have a contract with someone, you really shouldn’t sue them until they breach the contract or until they make it clear that they are about to breach the contract.  I infer that NES hasn’t made a definitive statement to AT&T yet about whether NES will honor the contract or the OTMR ordinance.  I presume that, if NES chooses to honor the ordinance, they’ll be a defendant pretty quickly – maybe in a separate lawsuit – maybe in the existing lawsuit.

– Speaking of NES as a defendant…you have to wonder whether Comcast has a lawsuit getting ready to be filed. Like Google and AT&T, Comcast has a contract with NES for pole attachments. My best guess is that OTMR conflicts with that contract too.

– Very few members of the public or media ever come to NES Board meetings. If you had been to a few about two years ago, you would have been treated to a complicated analysis about the role that TVA plays in the area of pole attachment regulations. I am paraphrasing, but I think it boils down to the idea that TVA has the complete unilateral ability to regulate, if it wants, what happens with attachments on poles that carry TVA power. In Tennessee, TVA has never exercised the right to make pole attachment regulations. If they ever did, as I understand it, we’d all have to follow their regulations. Most likely, TVA will continue to not regulate attachments here – but they are a player in this saga if they want to be one.

– Most of the media coverage of the lawsuit focuses on the top level headline of AT&T suing Metro, and some coverage talks about the federal preemption argument I have talked about here. But AT&T is also suing based on the Metro Charter – which says that NES “shall have exclusive management and control of the operation of said electric power plant and/or distribution system.” AT&T argues that, because the Charter grants NES the exclusive right to manage and control the power grid and distribution system, the Council and Mayor had no authority to enact OTMR. This is a pretty esoteric Charter issue – and there is absolutely no case law on this topic. The Charter is a unique document in Tennessee and this provision has never been litigated. Novel issues create uncertainty for all parties.

– About Google’s offer to help…I mean, if I’m Metro Legal, I’d guess I’d rather have their help than not, but it honestly won’t help that much. Metro will likely be in touch with Louisville, which has every reason to share information freely with Nashville. Metro will have its own outside counsel who will get paid to consider only Metro’s best interests. Plus, there is no way to have really deep collaboration sessions with Google’s team because meetings like that would not have the protection of the attorney-client privilege or work product doctrine.  So, Metro could really only share ideas about concepts with Google, but not strategy.  You never know what matters to a judge though – maybe it helps in the long run.

– Speaking of the judge, the Nashville case got assigned to Judge Kevin Sharp. I don’t think he’s got a bias or perspective that would influence the case one way or another. He’s a careful thinker. When he was in private practice, he did some work for big companies, and he did some work as a plaintiff’s lawyer for regular people. I don’t think he’ll take political issues into consideration.

– OTMR was never going to be implemented right away. There was always going to be some time for the companies involved to create needed new procedures.  NES was always going to have to approve some contractors to do OTMR too. My sense was that it was going to take 90 days, plus or minus, before Google could actually make a request to make a One Touch move of someone else’s equipment. Until these companies do this leg work, things might develop slowly in the litigation.

Here’s a quick list of things I am looking for over the next few months:

– What happens with the Louisville summary judgment? It will be interesting. Any result will be argued all ways by all parties here in Nashville. In the end, it’ll be an interesting non-binding data point and perhaps not much more.

– How long does it take for NES to be ready for Google to make a One Touch request? Will NES honor the ordinance (I assume, yes?) or their contract with AT&T?

– Is Comcast going to sue? Do they wait until there’s an actual One Touch request to move their equipment?

– Is NES inevitably a party because of their central role as a pole owner, and a party to written contracts with Google, and AT&T, and Comcast? Does NES join (or get forced to join) in litigating the Metro Charter issue that AT&T raised in its lawsuit?

Metro has asked for its deadline to file an Answer or a Motion to Dismiss to be moved to November 14. Louisville filed a Motion to Dismiss, which was denied. This is really a tactical decision, and I’m not in those conversations. I’d expect a Motion to Dismiss by Metro to be a likely loser…but sometimes you might file a motion that is a probable loser anyway just to have a chance to run your arguments by the judge, and try to get a preview of how the court is thinking about things. Best case is that you win your long shot motion. Worst case is that you maybe learn something about the judge’s thoughts. The down side is time – it slows the case down to file a motion that you suspect is a loser. In federal court, sometimes the wait for a ruling on a motion is an excruciating multi-month exercise.

– Usually, there is a case management conference about 6-8 weeks after a case is filed. The conference in this case is set for November 21. Judge Sharp has one of the Magistrate Judges conduct his case management conferences, and they typically are mostly administrative (setting deadlines, etc.). However, the parties are required to submit a proposed case management plan a few days in advance. That probably won’t be very interesting, but it might give a little insight into the pace of litigation that the parties expect. Also, I’m guessing everyone’s out-of-town lawyers will show up for that conference.

I know this has been a long post and my comments are in no particular order.  But I’ve been holding back for a few weeks…and I wanted to just get these thoughts out.

I’ll try to provide more thoughts as the two (maybe more?) lawsuits move forward.

Sept. 20 Council Meeting

The Council still has a lot going on. Here’s a quick summary:

One Touch Make Ready

You all know what this is.  The bill is on 3rd reading. Council Member Weiner has proposed a resolution related to OTMR. I also am proposing an amendment that would allow, under some circumstances, for the costs of any litigation to be absorbed by a new attacher.

Since the Council Rules don’t allow amendments on 3rd reading for this bill, I would need to successfully get the Rules suspended for my amendment to be considered.  Never say never, but it only takes two objecting Council Members to stop the Rules from being suspended. So, it would be pretty easy for just the lead sponsors to stop my amendment from being considered — if that’s what they would prefer.

I’ve written previously about this topic here, here, here, and here.

Short Term Rental Property

There are three bills on 3rd reading — 257 (about stop work orders and the penalty for operating without a permit), 373 (about posting a permit number online), and 374 (about verifying an STRP application under oath, and adding a statement to the application about homeowner’s association rules).  I expect all of these to pass on 3rd reading. At the request of some STRP owners, I will try to add an amendment to 373 to allow the alternative of posting an image of a permit. Either way, the permit number will be required to be included in online advertisements.

There are three others on 2nd reading — 375, 381, and 382.  Don’t get too attached to the text at these links — I expect all of these to have fairly major amendments or substitutes offered on Tuesday. I think that each then will be deferred to allow more time for public conversation about the newly proposed provisions.

Marijuana

The bill to offer law enforcement in Metro the option to give a civil citation or make an arrest for small amounts of marijuana is set for 3rd reading. It passed easily on 2nd and I think it will pass on 3rd also.

The impact of current marijuana laws is unfairly focused on minority groups. That’s really bad. But I have been concerned about whether the new law (that gives discretion to either arrest or give a citation) will make that unfair enforcement problem worse. The lead sponsor has said that he intends to follow this closely after the bill is passed to make sure that the discretion to give a citation or make an arrest is not exercised unfairly. So, I voted for this and will again on 3rd reading.

Fair Deals?

There are always several items on the agenda that I want to know more about just to make sure I understand the deal.  RS2016-373 would amend the terms of a fire hall property on Richard Jones Road. RS2016-378 is about an economic impact study on certain historic properties in Nashville due to placing “Distributed Antenna System Nodes” around the county.

And, on second reading, BL2016-388 relates to the Metro Health and Educational Facilities Board (a new one for me) entering a Payment In Lieu Of Taxes agreement for land on 12th Avenue South. I’ve asked for the various exhibits mentioned in the bill — you can’t tell much from the bill itself.

On 1st Reading

CM Cooper and I have introduced a bill that would require all reports that any Metro agency has to give to the Council to be posted online in an electronic format. That doesn’t happen now.

I also have a bill on first reading that mirrors my proposed amendment to the OTMR ordinance. If I am not able to get the Council Rules suspended to consider my amendment, I’ll still have this new bill that would have to be considered on subsequent readings.

And, the Gulch pedestrian bridge bill is on first reading also. I’m sure that will draw attention in the coming weeks.

“Hold Harmless” Amendment Follow-Up

In my last post, I described the “hold harmless” amendment I am proposing for OTMR. A Google representative promised to get back to me about whether Google would support the amendment. He has now gotten back to me. He reports that Google won’t support the amendment.

Here’s where I see us on OTMR. As the process has unfolded, it looks like Metro’s policy decision, and perhaps the weight of public opinion, is that the city wants to give Google the OTMR that it has asked for, pretty much no matter what.

The goal of my amendment is to protect Metro from the costs and legal fees that we will have if we are drawn into the pending nationwide dispute between major telecommunication industry competitors. The amendment relies on market forces to guide an attacher’s decision about whether to agree to hold Metro harmless for litigation costs.

The amendment would require that, if any pole owner or existing pole attacher were to provide notice of a legal dispute over proposed Make Ready work, the new attacher would be able to choose either to: (1) hold Metro harmless for all losses including attorneys’ fees and then proceed with the disputed One Touch Make Ready; or (2) not hold Metro harmless and not proceed with the disputed One Touch Make Ready. This would let the new attacher balance the incumbants’ slowness, the specific litigation threat being made, and their own potential cost savings by having faster deployment, and then make an informed business decision about whether the new attacher’s own interest is served by holding Metro harmless, or not.

The “hold harmless” amendment does not delay the OTMR ordinance. It relies on market forces to give a new attacher the choice to hold Metro harmess if it makes economic sense for the new attacher.

Let me also say a word about the process so far. While there is a lot of talk about delay, it is important to remember that the only delay so far was for three weeks at the request of the bill sponsors! My issue is that, on a bill drafted and pushed by a single private market competitor, I don’t think Metro (whether it’s the Council, the Mayor, or the Vice Mayor) should adopt the position that we’re going to pass it no matter what. There can be no principled negotiation after you make it clear that you’re going to give the private market competitor exactly what they’ve asked for.

For me, a principled position with Google would have been to dig into whether their number one objective is “obtain faster and cheaper deployment” or “obtain faster and cheaper deployment in an ordinance that guarantees Nashville will join the existing litigation battle.” Wanting Metro to have a principled negotiation with Google about this is not being anti-Google or pro-AT&T or pro-Comcast.

Some have been very dismissive of the litigation threat here. I urge you to read the Council Analysis on this topic. I urge you to read a copy of the Louisville lawsuit. Not all litigation threats are created equal. Not all lawsuits are created equal. Here, Legal Director Cooper says the likelihood of litigation is 100%, and we know that a U.S. District Court Judge in Louisville has already denied the city’s request to dismiss AT&T’s lawsuit there. The argument I hear from some that the Nashville they know isn’t afraid of a little ‘ole lawsuit is a sloppy one. The Council should be evaluating risk not thumbing our nose at it.

If our collective policy decision continues to be that we want OTMR now, and that we’ll sort out the problems later, I’ll respect that choice. Until the bill passes, though, I will continue to argue that it is possible to be pro-Google and also still explore whether their real goal is faster deployment or also for Nashville to be pawn in an ongoing litigation fight.

Trying to add “hold harmless” language to OTMR

I filed an ordinance for first reading on September 20 that would amend the pending OTMR ordinance to allow an Attacher the choice to hold Metro harmless if threatened litigation were to materialize. The Attacher could choose to cover Metro’s losses and attorneys’ fees and proceed with its planned Make Ready work, or the Attacher could choose not to cover Metro’s losses and attorneys’ fees and not proceed with the work.

The proposed ordinance is here.  I know those things are hard to read — so here’s what the OTMR ordinance would like if my new ordinance were passed.

Also, I plan to offer the substance of this ordinance as an amendment to the main OTMR ordinance next Tuesday.

The Council procedural stuff gets complicated.  But, the starting point is that I would prefer to offer these changes as an amendment to the main OTMR ordinance on third reading on Sept. 20.  But because amendments can’t be considered for this bill on third reading under the rules, I would need to ask to suspend the rules.  And, if any two Council members object, I can’t suspend the rules.

My sense is that if Google were okay with this language, I could probably succeed in getting the Council rules suspended to allow the language to be considered.

If my effort to amend the main OTMR ordinance on third reading fails because two or more colleagues object, then I have my ordinance with the same language as a fallback. Of course, it would take three readings to move it forward — just like any other ordinance.

I gave Google’s lobbyist a copy of the proposed amendment today.  They said they’d get back to me.  I will be curious to see if Metro Legal or the Council Director will have a position about the legality of what I have drafted. I assume the Mayor’s Office will continue to not take a position. Having said all that, you would think that most people could get behind Metro being protected as much as possible if the promised litigation actually happens.

It should be interesting to see how this goes.

My unscientific OTMR poll

Over the last month, everyone in the Council has received huge numbers of emails about the proposed “One Touch Make Ready” ordinance.  Many of them have had an identical “Subject” line and look to me like they were generated from automatic email bots connected to Google in some way.  I wanted to hear more from these emailers.

(I want to be clear — sending me thousands of emails all with essentially the same content from an email bot is fine. I’m okay with that. Really, I am. But it is fair for me to then want to dig a little deeper with that group of folks.)

Different people email for different reasons.  I wanted to explore whether these constituents were being motivated by the thought that “Google asked for help, and I hate Comcast/AT&T” or motivated by having independently worked through the issues, some of both, or something else entirely.

I’ll include results in a link later in this post. But hopefully, you’ll stay with me long enough to hear me say that I did my best to ask the questions in a fair way.  I sent it to approximately 1,700 people whose emails made me think that a piece of software actually hit “Send” on the email — although obviously I can’t be sure if that was true for all of the senders. Within several hours, I got 442 responses.

I have been happy to see that only 5 people have written me to accuse the questions of being loaded to get a particular result. Many more have written to separately thank me for asking for their feedback.

I won’t spend a lot of time here trying to analyze the results. I think they largely speak for themselves. But I will make a few quick observations. Just over two-thirds of respondents said that they were motivated to email Council members after hearing about the ordinance through the media.

There was one open-ended question that asked people to describe the ordinance. There were more lengthy (multiple paragraph) responses than I had expected.  I appreciate the time people spent in responding.

The meat of the survey had to do with two questions asking about whether respondents thought there were alternatives to a One Touch approach. I am sure Google would note that 78% of respondents thought that One Touch is the only way forward. And I am sure others would say that just under 70% of these same respondents said that other solutions could achieve the same goals. Beyond that, I’ll let people reach their own conclusions.

Here is a summary of the results.

Finally, again, I do NOT mean for this post or the survey results to be advocating for anything. I wanted to hear more from these 1,700 people. I sent the survey. Now everyone has the results.

One Touch Make Ready

On September 6, Google’s Model One Touch Make Ready bill is up for second reading. I have told all of the main players that I won’t decide my vote until the day of the vote. But, I think they all know that I am leaning against voting for it.  Here’s what I think I know —

I want Nashville to have better broadband access. I want it to be deployed more quickly.

Unlike some threats of litigation that we hear about, AT&T’s threat of litigation is very real. There is a lawsuit in Louisville already. If we pass Google’s proposed ordinance, all AT&T has to do is change some names and details in their existing lawsuit and file it here.

One of the things I do for a living is help clients make assessments and business decisions about existing and potential legal disputes. While I’m no pro at federal telecommunications laws and regulations and I make no predictions about whether AT&T or Google is right about the lawsuit in Louisville, I do know enough about the legal issues to be 100% confident that both sides have legitimate, good faith legal arguments to make. The Louisville lawsuit will almost certainly be decided ultimately by the U.S. Court of Appeals for the Sixth Circuit, in Cincinnati. This will take years.

If at all possible, Nashville should not spend tax dollars to litigate a sister lawsuit to the one going on in Louisville. A lawsuit in Nashville would end up in exactly the same place as the Louisville lawsuit – the 6th Circuit Court of Appeals. If possible, I would rather avoid spending dollars litigating when we could instead wait to see what the 6th Circuit says in the Louisville lawsuit.

In addition, while there is talk about wanting a 21st century solution for broadband deployment, I am not sure about this premise.  I mean, is it really a 21st century solution to have a minimum of three companies all deploying literally identical sets of glass fiber on our telephone poles? Wouldn’t a 21st century solution be to deploy high speed wireless technology? Google already is experimenting with wireless in a few other cities.

Because high speed wireless deployment should be our real goal, and because I do not understand why we would opt into a guaranteed lawsuit that is already underway in Louisville, I prefer an agreed solution where the parties all agree on a way to make the process go more quickly in Nashville while the litigation is being resolved. This would require compromise by all – Google wouldn’t have the process go as quickly as they would like, but it would move more quickly than the incumbents might like. I think the Metro Government has conveyed, and must continue to convey, to all of these companies that we demand an agreed approach and that we won’t participate as a litigant in their ongoing nationwide court battles.

I have urged this approach to all parties.  And I have told all parties that, more than anything else, I am in favor of working out a compromise.  I have told all parties that I will most likely vote against the interests of whoever I think is being the least cooperative in reaching an agreed upon solution.

Honestly, it is a close call about who is being the least cooperative in working something out while we wait for the Louisville litigation to get resolved. As of today, my opinion is that Google is (just barely) being the least cooperative in reaching a compromise agreement. For this reason, if I had to vote today, I would be leaning toward voting against the bill on second reading.

There are still 5 days until the Council meeting – so this might change depending on how any further negotiations go. I urge Google, AT&T, Comcast, NES, and the Mayor’s Office to continue their discussions.