US LEC wins reciprocal compensation dispute

US LEC announced Thursday it has won a dispute with Verizon Communications over reciprocal compensation fees for ISP traffic on Verizon’s North Carolina network. An independent arbitrator awarded the competitive carrier an estimated $800,000 for unpaid reciprocal compensation fees between July 1999 and January 2001.

The case is the second US LEC has brought against the former GTE South, which became part of Verizon after the merger of Bell Atlantic and GTE. In January 2000, an arbitrator awarded $650,000 to US LEC for violation of a previous reciprocal compensation agreement.

US LEC Vice President of Regulatory Affairs Wanda Montano said this week’s decision was “a resounding victory for US LEC.” She said that Verizon has consistently refused to pay its fees under the negotiated agreements, forcing the carrier to file enforcement actions.

US LEC has been involved in a morass of reciprocal compensation disputes in the last few years with BellSouth and Verizon. So far the company has won every case that has gone through arbitration, except for one controversial case involving one of its customers (Metacomm).

In April 2000, the North Carolina Utilities Commission ruled against US LEC in its fight with BellSouth over $153 million in fees billed on traffic originating from Metacomm’s corporate network.

US LEC had signed an agreement with Metacomm to reimburse the customer 40 percent of the interconnection revenue US LEC garnered from BellSouth.

But the commission found that Metacomm kept its network connections, which US LEC terminated, open on a near-continuous basis, despite having practically no customers accessing the network.

US LEC currently has two more cases pending against BellSouth.