Free Notice (Other) - District Court of Colorado - Colorado

Case 1:02-cv-01977-RPM

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 02-CV-01977-RPM (Consolidated with Civil Action No. 02-CV-01978-RPM for pretrial purposes) SPA UNIVERSAIRE, VACATION TAN & TRAVEL, DOUGLAS CHEESMAN, CARL LESHER, ROXANNE LEWIS, DENNIS LINDEMAN, DOUG MACKEY, LORI R. VALDEZ, and KENT FITZGERALD, individually and on Behalf of All Others Similarly Situated, Plaintiffs,

QWEST COMMUNICATIONS INTERNATIONAL INC., and QWEST CORPORATION, Defendants.

PLAINTIFFS' NOTICE OF CLARIFICATION OF CLASS DEFINITION
1.

This case is about injury to competition and harm to consumers caused by the

failure of Qwest, as the incumbent local exchange carrier ("ILEC") in certain areas,' to disclose interconnection agreements to state regulators and competitors as required. The secret agreements Qwest made with competing local exchange carriers ("CLECs") McLeod and Eschelon contained favorable prices that other CLECs were entitled to as well, under applicable FCC "pick and choose" regulations.

2.

Three years ago, plaintiffs alleged a class comprised of "all those who subscribed

to Local Telephone Service in the Geographic Markets of Qwest at any time since October 16,1998

and who were damaged by the conduct complained of herein (the 'Class')."

Consolidated

Amended Class Action Complaint (Dkt. No. 12 (Mar. 7, 2003)) 737. Such Geographic The ILEC for a given area is the telephone company that owns the circuit-switched twisted pair wires traditionally strung on telephone poles along the streets to bring local telephone service into homes and businesses.

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Markets were "those portions of Arizona, Colorado, Idaho, Iowa, Minnesota, Montana, North Dakota, Nebraska, New Mexico, Oregon, South Dakota, Utah, Washington, Wyoming where Qwest ... is or has been the [ILEC]." Id. 71. The class expressly excluded "those portions of these [listed] states in which Qwest is not, or was not, the ILEC." Id. 722.

3.

Qwest urged that the class as so defined was too broad. See Amended

Scheduling Order (Dkt. No. 56 (Jul. 28, 2005)) at pp. 4-5. At the Court's June 24, 2005 conference, plaintiffs agreed to narrow and refine the class definition based upon some modest discovery from Qwest in the form of responses to document requests and interrogatories.

4.

The result was a class definition that plaintiffs provided defendants on October

11, 2005. That definition reduced the number of states from 14 to eight, provided for subclasses in each of those states, and confined itself to consumers who obtained "circuit switched twisted pair" service in those eight states during the period from October 2,2000 to July 8, 2004.2 The beginning date for the class period is the effective date of the secret

The October 11,2005 document provided:
CLASS DEFINITION

Without prejudice to plaintiffs7 right later to seek modification based upon discovery taken during the course of the action: All persons and entities (other than defendants, their affiliates, successors and assigns) who subscribed to basic local exchange service in the Service Area by means of circuitswitched twisted pair wireline facilities during the period from October 2,2000 through July 8,2004 (the "Class"). The Class is further subdivided into the: "Arizona Subclass;" "Colorado Subclass;" "Iowa Subclass;" "Minnesota Subclass;" "New Mexico Subclass;" "Oregon Subclass;" "Utah Subclass;" and "Washington Subclass" (collectively, the "Subclasses"). The Class and Subclasses exclude persons and entities who subscribed to basic local exchange service by means of wireless service, voice over Internet protocol ("VoIP"), nonVoIP cable telephony, or any other non-circuit-switched twisted pair wireline facilities.

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"McLeod [interconnection] Agreement" containing favorable prices3 The end date is when the FCC lifted the obligation of ILECs to permit CLECs to "pick and choose" among interconnection terms like those in the McLeod Agreement. 5. The October 11, 2005 class definition assumed, but did not repeat, the

condition from the complaint that plaintiffs assert their claims only with respect to the areas within each of the eight states where Qwest was the ILEC. Plaintiffs did not intend to expand the class definition to include areas where Qwest was not the ILEC (and therefore played no role in providing local telephone service). Indeed, it would be utterly illogical to assert that @vest S secret interconnection agreements caused competitive harm in areas where other telephone companies served as the ILEC and charged for interconnection. 6. On April 25,2006, at the deposition of defendants' expert, Dr. Gary Dorman,

plaintiffs became aware that defendants might ignore the condition in the complaint and oppose class certification based upon a class definition that includes consumers who obtained service where Qwest is not the ILEC. At his deposition, Dr. Dorman acknowledged that the class addressed by plaintiffs in their expert report is confined to areas where Qwest is the ILEC. See attached Ex. 1 (excerpts of deposition of Gary J. Dorman) at pp. 59-61. Nevertheless, Dr. Dorman characterized the proposed class as "extraordinarily broad" on the basis that it includes areas where Qwest is not the ILEC. Id. at 59.

7.

Shortly thereafter, plaintiffs' counsel wrote defendants' counsel to clarify this

purported ambiguity. See attached Ex. 2 (McMahon letter to Theis (May 3, 2006)). Subsequently, plaintiffs' counsel sought but failed to obtain acceptance of the clarification from defendants' counsel. See attached Ex. 3 (Theis e-mail to McMahon/ Berger (May 18, 2006)). 8. It is implicit in the October 11,2005 class definition that plaintiffs' claims are

Plaintiffs allege that the McLeod Agreement harmed competition because its secret status prevented other CLECs from obtaining like terms.
3

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limited to areas where Qwest is the ILEC, as provided for in the complaint. It is unlikely that defendants genuinely construe the class to include areas where third-parties serve as ILECs and charge for interconnection. Nevertheless, to avoid any potential prejudice to defendants, plaintiffs provide this formal notice of clarification prior to the initiation of briefing on class certification. 9. There can be no prejudice to Qwest from this clarification because it only

reduces Qwest's exposure, and because class certification is in its early stages. Indeed, Qwest should welcome the clarification since it consistently has sought a narrower, more specific class. 10. Even had the point of this clarification not been implicit in plaintiffs' October

11,2005 class definition, to refine the class definition would be perfectly appropriate. In i n
re Domestic Air Transportation Antitrust Litigation, 137 F.R.D. 677, 683 n.5 (N.D. Ga. 1991), "[pllaintiffs ... revised their class definition twice since the filing of their original motionfor class certzfication. The act of refining a class definition is a natural outcome of federal class action practice." (Emphasis added).4 Here, the motion for class certification has not yet been filed.

CONCLUSION
For the foregoing reasons, the class definition should be deemed to include the condition set forth in the complaint which provides that claims are asserted only in areas where Qwest serves as the ILEC. Dated: May 23,2006

Qwest's expert Dr. Dorman also served as defendants' expert in that case. Dr. Dorman testified that damages could not be shown using common proof, against which the plaintiffs' expert testified that an econometric model could be used for that purpose. Although the plaintiffs' expert had not yet developed such a model at the time of class certification, the court certified the class (over defendants' objections) on the basis of plaintiffs' expert's testimony that he could do so. See attached Ex. 1 (Dorman depo.) at pp. 15-14.

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Respectfully submitted, By:
s l Thomas P. McMahon Thomas P. McMahon JONES & KELLER, P.C. 1625 Broadway, 16th Flr. Denver, Colorado 80202 Telephone: (303) 753- 1600 Fax: (303) E-mail : tpmappb fh.com

s l Randall K. Berger Peter S. Linden Randall K. Berger Andrew Watt KIRBY McINEFWEY & SQUIRE, LLP 830 Third Avenue, 10th Floor New York, New York 10022 Telephone: (2 12) 3 17-2300 Fax: (212) 751-2540 E-mail: [email protected]

By:

and Joseph P. Garland LAW OFFICE OF JOSEPH P. GARLAND 275 Madison Avenue 1lth Floor New York, New York 10016 Telephone: (2 12) 66 1-9400 Fax: (212) 213-1816 E-mail: JoeaJPGarlandLaw .corn
Attorneys for Plaintiffs

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CERTIFICATE OF SERVICE I hereby certify that on May 23, 2006, I electronically filed the following documents:

-

Plaintiffs' Notice of Clarification of Class Certification

This documents was filed with the Clerk of the Court using the CM/ECF system which will send notification of such filing to the following email addresses:

S/ Michele O'Neill Michele O'Neill Jones & Keller, P.C. 1625 Broadway, Suite 1600 Denver, CO 80202 Telephone: (303) 573- 1600 moneill~,ioneskeller.com

@PFDesktop\::ODMA/WORL,DOX///JUPITER/WDOX/TNDOXlCLIENTS/P-OO5 801001 /pleadings100 1002 14.WPD 6