Common use of Ameritech’s Position Clause in Contracts

Ameritech’s Position. Ameritech objects to Staff’s claim that Xxxxxx could not have agreed on the amount of liquidated damages because it did not review the payment provisions. Ameritech points out that in the aforementioned Xxx decision, the state commission imposed liquidated damages provisions in an arbitration, and the federal court affirmed. Xxxxxxxxx states that the carrier on which the liquidated damages were imposed had not agreed that the amounts were a reasonable approximation of the damages that would result from a breach. Under Staff’s logic then, Xxxxxxxxx asks how the state commission could have imposed liquidated damages. The answer, according to Ameritech, is that a liquidated damages amount is no more and no less “agreed” than any other contract provision. In a “typical contract,” Ameritech contends that the liquidated damages amount is agreed, like the other provisions in the contract; in an arbitrated agreement, the amount can be imposed – just like all sorts of other provisions that would normally be agreed. Similarly here, Xxxxxxxxx maintains that Xxxxxx “agreed” to the liquidated damages amount no more and no less than they “agreed” to any other provisions in the Agreement. If Staff’s view of “agreement” were correct, Ameritech claims that the Commission would from now on have to reject all negotiated agreements except those that the parties aver they reviewed line by line. In response to Staff’s argument that payments under the 11-State Plan can not be liquidated damages because the amounts may be affected by the monthly cap, and so are not “fixed,” Ameritech states that unless and until the cap in the 11-State Plan is ever reached, that argument is moot. If the 11-State Plan’s cap is ever reached, Ameritech contends that any affected CLEC that wants to can make the claim that Staff is asserting and obtain a determination whether it is entitled to additional damages. Ameritech maintains that nothing prohibits parties from agreeing on liquidated damages and also agreeing that the payment of liquidated damages will be capped. Nor, Ameritech continues, has Staff shown that the lower monthly cap under the 11-State Plan will have any effect. Ameritech asserts that the cap in the 11-State Plan covers only amounts due carriers operating under the 11-State Plan and claims that it will not deprive any carrier of remedy payments. As for why the cap in the 11-State Plan is lower than that in the Illinois Remedy Plan, Ameritech states that the 11-State Plan covers fewer CLECs and does not include Tier 2 payments. Xxxxxxxxx also claims that had the 11-State Plan been in place for all CLECs under the Illinois Remedy Plan during last year, it would have made “virtually no difference.” (Ameritech Reply Brief at 21)

Ameritech’s Position. Ameritech objects to Staff’s claim that Xxxxxx Royal could not have agreed on the amount of liquidated damages because it did not review the payment provisions. Ameritech points out that in the aforementioned Xxx decision, the state commission imposed liquidated damages provisions in an arbitration, and the federal court affirmed. Xxxxxxxxx states that the carrier on which the liquidated damages were imposed had not agreed that the amounts were a reasonable approximation of the damages that would result from a breach. Under Staff’s logic then, Xxxxxxxxx asks how the state commission could have imposed liquidated damages. The answer, according to Ameritech, is that a liquidated damages amount is no more and no less “agreed” than any other contract provision. In a “typical contract,” Ameritech contends that the liquidated damages amount is agreed, like the other provisions in the contract; in an arbitrated agreement, the amount can be imposed – just like all sorts of other provisions 3 Staff states that this sum, while variable from year to year, is something on the order of $320 million. that would normally be agreed. Similarly here, Xxxxxxxxx maintains that Xxxxxx Royal “agreed” to the liquidated damages amount no more and no less than they “agreed” to any other provisions in the Agreement. If Staff’s view of “agreement” were correct, Ameritech claims that the Commission would from now on have to reject all negotiated agreements except those that the parties aver they reviewed line by line. In response to Staff’s argument that payments under the 11-State Plan can not be liquidated damages because the amounts may be affected by the monthly cap, and so are not “fixed,” Ameritech states that unless and until the cap in the 11-State Plan is ever reached, that argument is moot. If the 11-State Plan’s cap is ever reached, Ameritech contends that any affected CLEC that wants to can make the claim that Staff is asserting and obtain a determination whether it is entitled to additional damages. Ameritech maintains that nothing prohibits parties from agreeing on liquidated damages and also agreeing that the payment of liquidated damages will be capped. Nor, Ameritech continues, has Staff shown that the lower monthly cap under the 11-State Plan will have any effect. Ameritech asserts that the cap in the 11-State Plan covers only amounts due carriers operating under the 11-State Plan and claims that it will not deprive any carrier of remedy payments. As for why the cap in the 11-State Plan is lower than that in the Illinois Remedy Plan, Ameritech states that the 11-State Plan covers fewer CLECs and does not include Tier 2 payments. Xxxxxxxxx Ameritech also claims that had the 11-State Plan been in place for all CLECs under the Illinois Remedy Plan during last year, it would have made “virtually no difference.” (Ameritech Reply Brief at 21)

Ameritech’s Position. In addition to allegedly having not demonstrated that the 11-State Plan will result in decreased wholesale performance, Ameritech objects to Staffalso contends that Staff has not shown that the quality of Ameritech’s claim wholesale service is driven by the remedy plans in interconnection agreements. Xxxxxxxxx argues that Xxxxxx could not have agreed on Staff has offered no support for its underlying premise—that the amount quality of liquidated damages because it did not review Ameritech’s service will vary with the payment provisionsstringency of the performance assurance plans. Ameritech points out that in the aforementioned Xxx decision, the state commission imposed liquidated damages provisions in an arbitration, The connection between a remedy plan and the federal court affirmed. Xxxxxxxxx states that the carrier on which the liquidated damages were imposed had not agreed that the amounts were a reasonable approximation quality of the damages that would result from a breach. Under Staff’s logic then, Xxxxxxxxx asks how the state commission could have imposed liquidated damages. The answerperformance, according to Ameritech, is not as simple as Staff assumes. Ameritech witness Xxx testifies that a liquidated damages amount Ameritech’s performance is no more also motivated by its desire to provide good quality service to all of its customers and no less “agreed” than any other contract provisionits intent to comply with TA96 and the corresponding rules. In a “typical contract,” Moreover, Ameritech’s claims that its uniform performance from state to state, notwithstanding the disparity in available performance plans, strongly suggests that the particulars of remedy plans are not important determinants of the quality of performance. Furthermore, even if one assumes that remedy plans are major determinants of the quality of its performance, Ameritech contends that the liquidated damages amount is agreed, like the other provisions there are still two holes in the contract; in an arbitrated agreement, the amount can be imposed – just like all sorts of other provisions that would normally be agreed. Similarly here, Xxxxxxxxx maintains that Xxxxxx “agreed” to the liquidated damages amount no more and no less than they “agreed” to any other provisions in the Agreement. If Staff’s view of “agreement” were correct, Ameritech claims that the Commission would from now on have to reject all negotiated agreements except those that the parties aver they reviewed line by line. In response to Staff’s argument that approval of the Agreement could affect Ameritech’s performance. First, Ameritech observes that the dominant performance assurance plan in Illinois today is the Illinois Remedy Plan. It is that plan, Ameritech avers, that governs its wholesale performance vis-à-vis CLECs with which its does the bulk of its wholesale business, including AT&T, TCG, WorldCom, XxXxxx, RCN, Z-Tel and others. Thus, to whatever extent the quality of Ameritech’s performance is driven by the stringency of its remedy plans, Ameritech maintains that the driver in Illinois is the Illinois Remedy Plan. In addition, the same electronic systems are available to all CLECs, and Ameritech uses the same processes for all CLECs. As a result, Ameritech contends that carriers with the 11-State Plan will use the same systems and processes as carriers with the Illinois Remedy Plan, and whatever positive benefit stems from the Illinois Remedy Plan will inure to all CLECs in Illinois. The second hole that Ameritech finds in Staff’s position is that Staff does not take into account that Ameritech’s wholesale operations and processes are region-wide, not state-specific. As a result, Xxxxxxxxx argues that the remedy plan(s) in any one state can have only a limited effect on Ameritech’s performance, because their effect is diluted by the remedy plan(s) in all the other states. Thus, Xxxxxxxxx concludes that Staff’s stated aim, to ensure the quality of Ameritech’s wholesale performance by making it subject to the Illinois Remedy Plan, will fail because Ameritech’s wholesale performance outside of Illinois is not subject to the Illinois Remedy Plan. Ameritech also objects to Staff’s contention that the 11-State Plan provides a lower potential liability for Tier 1 payments than the Illinois Remedy Plan. Ameritech claims that Staff offers no evidence to support its assertion and even admits that it can not evaluate whether Ameritech would be paying similar amounts under the two plans. Ameritech contends that Staff’s theory that Ameritech’s potential liability under the 11- State Plan is less than that under the Illinois Remedy Plan is based solely on inference and speculation. Even if Staff demonstrated that some aspect of the 11-State Plan should be rejected, Ameritech argues that the proper remedy would be to reject only that portion of the 11-State Plan. Ameritech maintains that the Commission could not use one deficient aspect of the 11-State Plan as a pretext for rejecting the entire 11- State Plan; if it did, it would be rejecting a host of agreed provisions with no lawful justification. Nor does Ameritech believe that the fact that there are fewer performance measures in 11-State Plan mean that it will pay out less under the 11-State Plan can than under the Illinois Remedy Plan. Ameritech maintains that not be liquidated damages because the amounts may be affected by the monthly capall measures are meaningful to all carriers, and so many measures are not “fixed,” Ameritech states even applicable to all carriers. Individual carriers, Xxxxxxxxx notes, make their own business decisions about the products and processes, and, thus, the associated performance measures that unless and until matter to them. According to Ameritech, what follows from the cap fact that there are more measures in the Illinois Remedy Plan than in the 11-State Plan is ever reachedabsolutely nothing. Xxxxxxxxx also argues that increasing the number of data points from 10 to 30 should not be considered inconsistent with the public interest. The distinction between 10 data points and 30 data points can not lead to a deterioration in its wholesale performance because, according to Ameritech, its wholesale performance is driven by transactions with major CLECs that argument do significant business. To the extent that Staff’s point is moot. If the 11-State Plan’s cap that CLECs that do little business will receive lower payments than they otherwise would (rather than receive a deterioration in service), Ameritech claims that that is ever reachednot a public interest concern—if CLECs that do little business enter into a negotiated agreement that gives them lower remedy payments than they might receive under another plan, Ameritech contends that any affected CLEC that wants they are free to can make the do so. In response to Staff’s claim that Staff is asserting and obtain Ameritech’s table of critical values will result in a determination whether it is entitled to additional damages. Ameritech maintains that nothing prohibits parties from agreeing on liquidated damages and also agreeing that different number of occurrences than the payment of liquidated damages will be capped. Nor, Ameritech continues, has Staff shown that the lower monthly cap under the 11-State Plan will have any effect. Ameritech asserts that the cap in the 11-State Plan covers only amounts due carriers operating under the 11-State Plan and claims that it will not deprive any carrier of remedy payments. As for why the cap in the 11-State Plan is lower than that single critical value in the Illinois Remedy Plan, Ameritech states counters that the table of critical values may yield more occurrences and higher remedy amounts. Ameritech also downplays the omission of the procedural cap in the 11-State Plan covers fewer CLECs and does not include Tier 2 payments. Xxxxxxxxx also claims that had the 11-State Plan been in place for all CLECs Plan, which triggers renewed Commission oversight under the Illinois Remedy Plan. Removal of the procedural cap, Xxxxxxxxx argues, does not eliminate it from the Illinois Remedy Plan during last yearand, it would have made “virtually no differencemore importantly, does not remove the Commission’s authority.” (Ameritech Reply Brief at 21)

Ameritech’s Position. In addition to allegedly having not demonstrated that the 11-State Plan will result in decreased wholesale performance, Ameritech also contends that Staff has not shown that the quality of Ameritech’s wholesale service is driven by the remedy plans in interconnection agreements. Xxxxxxxxx argues that Staff has offered no support for its underlying premise—that the quality of Ameritech’s service will vary with the stringency of the performance assurance plans. The connection between a remedy plan and the quality of performance, according to Xxxxxxxxx, is not as simple as Staff assumes. Ameritech witness Xxx testifies that Ameritech’s performance is also motivated by its desire to provide good quality service to all of its customers and its intent to comply with TA96 and the corresponding rules. Moreover, Ameritech’s claims that its uniform performance from state to state, notwithstanding the disparity in available performance plans, strongly suggests that the particulars of remedy plans are not important determinants of the quality of performance. Furthermore, even if one assumes that remedy plans are major determinants of the quality of its performance, Ameritech contends that there are still two holes in Staff’s argument that approval of the Agreement could affect Ameritech’s performance. First, Ameritech observes that the dominant performance assurance plan in Illinois today is the Illinois Remedy Plan. It is that plan, Ameritech avers, that governs its wholesale performance vis-à-vis CLECs with which its does the bulk of its wholesale business, including AT&T, TCG, WorldCom, XxXxxx, RCN, Z-Tel and others. Thus, to whatever extent the quality of Ameritech’s performance is driven by the stringency of its remedy plans, Ameritech maintains that the driver in Illinois is the Illinois Remedy Plan. In addition, the same electronic systems are available to all CLECs, and Ameritech uses the same processes for all CLECs. As a result, Ameritech contends that carriers with the 11-State Plan will use the same systems and processes as carriers with the Illinois Remedy Plan, and whatever positive benefit stems from the Illinois Remedy Plan will inure to all CLECs in Illinois. The second hole that Ameritech finds in Staff’s position is that Staff does not take into account that Ameritech’s wholesale operations and processes are region-wide, not state-specific. As a result, Xxxxxxxxx argues that the remedy plan(s) in any one state can have only a limited effect on Ameritech’s performance, because their effect is diluted by the remedy plan(s) in all the other states. Thus, Xxxxxxxxx concludes that Staff’s stated aim, to ensure the quality of Ameritech’s wholesale performance by making it subject to the Illinois Remedy Plan, will fail because Ameritech’s wholesale performance outside of Illinois is not subject to the Illinois Remedy Plan. Ameritech also objects to Staff’s claim contention that Xxxxxx could not have agreed on the amount of liquidated damages because it did not review 11-State Plan provides a lower potential liability for Tier 1 payments than the payment provisionsIllinois Remedy Plan. Ameritech points out claims that in Staff offers no evidence to support its assertion and even admits that it can not evaluate whether Ameritech would be paying similar amounts under the aforementioned Xxx decision, the state commission imposed liquidated damages provisions in an arbitration, and the federal court affirmedtwo plans. Xxxxxxxxx states that the carrier on which the liquidated damages were imposed had not agreed that the amounts were a reasonable approximation of the damages that would result from a breach. Under Staff’s logic then, Xxxxxxxxx asks how the state commission could have imposed liquidated damages. The answer, according to Ameritech, is that a liquidated damages amount is no more and no less “agreed” than any other contract provision. In a “typical contract,” Ameritech contends that Staff’s theory that Ameritech’s potential liability under the liquidated damages amount 11- State Plan is agreed, like the other provisions in the contract; in an arbitrated agreement, the amount can be imposed – just like all sorts of other provisions that would normally be agreed. Similarly here, Xxxxxxxxx maintains that Xxxxxx “agreed” to the liquidated damages amount no more and no less than they “agreed” to any other provisions in that under the AgreementIllinois Remedy Plan is based solely on inference and speculation. If Staff’s view Even if Staff demonstrated that some aspect of “agreement” were correctthe 11-State Plan should be rejected, Ameritech claims argues that the proper remedy would be to reject only that portion of the 11-State Plan. Ameritech maintains that the Commission could not use one deficient aspect of the 11-State Plan as a pretext for rejecting the entire 11- State Plan; if it did, it would from now on have to reject all negotiated agreements except those be rejecting a host of agreed provisions with no lawful justification. Nor does Ameritech believe that the parties aver they reviewed line by line. In response to Staff’s argument fact that payments there are fewer performance measures in 11-State Plan mean that it will pay out less under the 11-State Plan can than under the Illinois Remedy Plan. Ameritech maintains that not be liquidated damages because the amounts may be affected by the monthly capall measures are meaningful to all carriers, and so many measures are not “fixed,” Ameritech states even applicable to all carriers. Individual carriers, Xxxxxxxxx notes, make their own business decisions about the products and processes, and, thus, the associated performance measures that unless and until matter to them. According to Ameritech, what follows from the cap fact that there are more measures in the Illinois Remedy Plan than in the 11-State Plan is ever reachedabsolutely nothing. Xxxxxxxxx also argues that increasing the number of data points from 10 to 30 should not be considered inconsistent with the public interest. The distinction between 10 data points and 30 data points can not lead to a deterioration in its wholesale performance because, according to Ameritech, its wholesale performance is driven by transactions with major CLECs that argument do significant business. To the extent that Staff’s point is moot. If the 11-State Plan’s cap that CLECs that do little business will receive lower payments than they otherwise would (rather than receive a deterioration in service), Ameritech claims that that is ever reachednot a public interest concern—if CLECs that do little business enter into a negotiated agreement that gives them lower remedy payments than they might receive under another plan, Ameritech contends that any affected CLEC that wants they are free to can make the do so. In response to Staff’s claim that Staff is asserting and obtain Ameritech’s table of critical values will result in a determination whether it is entitled to additional damages. Ameritech maintains that nothing prohibits parties from agreeing on liquidated damages and also agreeing that different number of occurrences than the payment of liquidated damages will be capped. Nor, Ameritech continues, has Staff shown that the lower monthly cap under the 11-State Plan will have any effect. Ameritech asserts that the cap in the 11-State Plan covers only amounts due carriers operating under the 11-State Plan and claims that it will not deprive any carrier of remedy payments. As for why the cap in the 11-State Plan is lower than that single critical value in the Illinois Remedy Plan, Ameritech states counters that the table of critical values may yield more occurrences and higher remedy amounts. Ameritech also downplays the omission of the procedural cap in the 11-State Plan covers fewer CLECs and does not include Tier 2 payments. Xxxxxxxxx also claims that had the 11-State Plan been in place for all CLECs Plan, which triggers renewed Commission oversight under the Illinois Remedy Plan. Removal of the procedural cap, Xxxxxxxxx argues, does not eliminate it from the Illinois Remedy Plan during last yearand, it would have made “virtually no differencemore importantly, does not remove the Commission’s authority.” (Ameritech Reply Brief at 21)