Legal Blog

Offit Kurman Wins Judgement in United States Court of Appeals in Case Against Verizon

In a published opinion issued by the United States Court of Appeals for the Fourth Circuit on May 13, 2014 in CoreTel Virginia, LLC v. Verizon Virginia, LLC et al., the appellate court reversed a federal trial court’s judgment and directed summary judgment in favor of Offit Kurman’s client, Coretel, and against Verizon on the primary claim in the case.  You can find that decision here: Fourth Circuit Decision. The primary claim concerned the right of Verizon to bill CoreTel, a competitive local exchange carrier or “CLEC,” at Verizon’s tariff prices for providing an interconnection between CoreTel’s and  Verizon’s networks.   The Fourth Circuit concluded that the interconnection agreement between the parties, in effect, incorporated the Federal Communications Act’s mandate that Verizon offer “entrance facilities” for interconnection at cost based (often referred to as “TELRIC”), and not much higher tariff, rates.  The Court rejected Verizon’s argument that the interconnection agreement only required cost based rates for rarely used unbundled network elements.  According to Verizon, in an argument the Court of Appeals rejected, the parties’ contract eliminated Verizon’s unbundling obligations which Verizon said allowed it to invoice CoreTel for all network entrance facilities  at rates many times higher than the TELRIC rates. Many CLECs across the country operate under similar interconnection agreements with larger communications carriers, and this decision could have a broad impact.  In fact, in its motion for rehearing which the Court of Appeals denied, Verizon explained that “Verizon has more than 50 active contracts with other telephone companies in Virginia and Maryland that contain the same language on which the panel majority relied … The panel majority’s decision threatens to upend the long-settled course of performance under those dozens of contracts, as  Verizon’s counterparties may seek to take advantage of this decision to seek tens of millions of dollars in refunds and to reduce their payments to Verizon prospectively.” Offit Kurman attorney Ed Tolchin represented CoreTel in the matter, and he can be reached at: Social Media Policy etolchin@offitkurman.com |240-507-1769.

Government contracts attorney Edward Tolchin’s practice is focused on government contracting, Business litigation, and technology matters. In government contracting issues, Mr. Tolchin represents prime and subcontractors in contract negotiation and formation matters and in disputes involving both government and commercial business issues. He has been involved in procurement cases before many of the federal and state boards of contract appeal, Government Accountability Office, Small Business Administration, United States Court of Federal Claims, Court of Appeals for the Federal Circuit and other federal and state courts across the United States.

His Business litigation practice involves large and small matters in federal and state courts and before numerous arbitration panels. In the technology arena, Mr. Tolchin has assisted in disputes, licensing, and business development matters for clients ranging from startups to Fortune 500 companies.

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