**DA 04-1611**

**Released: June 2, 2004**

**DOMESTIC SECTION 214 APPLICATION FILED FOR ACQUISITION OF ASSETS OF
INTERNATIONAL EXCHANGE COMMUNICATIONS, INC., BY MATRIX TELECOM, INC.**

**STREAMLINED Pleading Cycle Established**

**WC Docket No. 04-173**

**Comments Due: June 16, 2004**

**Reply Comments Due: June 23, 2004**

On April 28, 2004, Matrix Telecom, Inc. (Matrix) filed an application,
pursuant to sections 63.03 and 63.04 of the Commission's rules,[^1]
requesting consent for the acquisition of certain assets of
International Exchange Communications, Inc. (debtor-in-possession)
(IECom) by Matrix.[^2]

Applicants assert that this transaction is entitled to presumptive
streamlined treatment pursuant to section 63.03(b)(2)(i) of the
Commission's rules because the proposed transaction would result in
Matrix having a market share in the interstate, interexchange market of
less than 10 percent; Matrix will provide competitive telephone exchange
services or exchange access services, if at all, only in areas served by
dominant local exchange carriers that are not parties to this
transaction; and neither of the applicants nor their affiliates are
dominant with respect to any telecommunications service.[^3]

IECom provides 1+, calling card, and toll free service in each of the 48
contiguous states. Matrix provides 1+, calling card, and toll free
service in each of the 48 contiguous states. Matrix is wholly-owned by
Matrix Acquisition Holdings Corp., a holding company that is
wholly-owned by Platinum Equity LLC. Tom T. Gores owns 100 percent of
the equity interest in Platinum Equity, LLC. Neither Matrix Acquisition
Corp. nor Tom T. Gores own any additional telecommunications companies.
Platinum Equity, LLC owns Claricom Networks, Inc., which offers domestic
interstate and intrastate services as well as international services.

Applicants state that this proposed transfer of control is being made
pursuant to an order of the United States Bankruptcy Court of the
Northern District of California, San Francisco Division. On January 4,
2001, IECom filed a voluntary petition for relief under Chapter 11 of
the United States Bankruptcy Code. In order to resolve a dispute arising
from a business relationship between Matrix and IECom, the parties
entered into a settlement agreement, dated August 12, 2002, whereby
Matrix agreed to purchase certain assets from IECom, including its
retail customer base consisting of 1+, calling card, and toll-free
customers. As part of the bankruptcy proceeding, the court issued an
order directing the parties to consummate the asset transfer pursuant to
the settlement agreement as soon as regulatory approval could be
obtained.[^4]

Matrix states that the consummation of the proposed transaction will
serve the public interest in promoting competition in the domestic
telecommunications market by providing it the opportunity to strengthen
its competitive position by combining IECom's resources with Matrix's
global resale services, products and expertise. Matrix claims that its
operations will more readily increase in size and profitability, due to
enhanced economize of scale. Accordingly, Matrix argues that the
proposed acquisition will benefit consumers through improved services
and lower rates. Additionally, Matrix maintains that approval of the
proposed transfer will ensure continuous, uninterrupted service to the
customers of IECom, who might otherwise have their service disrupted due
to circumstances stemming from IECom's current bankruptcy.

**[GENERAL INFORMATION]{.underline}**

The acquisition of assets identified herein has been found, upon initial
review, to be acceptable for filing as a streamlined application. The
Commission reserves the right to return any acquisition of assets
application if, upon further examination, it is determined to be
defective and not in conformance with the Commission's rules and
policies. Interested parties may file **comments on or before June 16,
2004** and **reply comments on or before June 23, 2004**.[^5] Unless
otherwise notified by the Commission, Applicants are permitted to
transfer control on the 31^st^ day after the date of this notice.[^6]
Comments may be filed using the Commission\'s Electronic Comment Filing
System (ECFS) or by filing paper copies. *See Electronic Filing of
Documents in Rulemaking Proceedings*, 63 Fed. Reg. 24121 (1998).

Comments filed through the ECFS can be sent as an electronic file via
the Internet to \<http://www.fcc.gov/e-file/ecfs.html\>. Generally, only
one copy of an electronic submission must be filed. If multiple docket
or rulemaking numbers appear in the caption of this proceeding, however,
commenters must transmit one electronic copy of the comments to each
docket or rulemaking number referenced in the caption. In completing the
transmittal screen, commenters should include their full name, U.S.
Postal Service mailing address, and the applicable docket or rulemaking
number. Parties may also submit an electronic comment by Internet
e-mail. To get filing instructions for e-mail comments, commenters
should send e-mail to ecfs@fcc.gov, and should include the following
words in the subject line \"get form \<your e-mail address\>.\" A sample
form and directions will be sent in reply.

Parties who choose to file by paper must file an original and four
copies of each filing. If more than one docket or rulemaking number
appears in the caption of this proceeding, commenters must submit two
additional copies for each additional docket or rulemaking number.
Filings can be sent by hand or messenger delivery, by commercial
overnight courier, or by first-class or overnight U.S. Postal Service
mail (although we continue to experience delays in receiving U.S. Postal
Service mail). The Commission\'s contractor, Natek, Inc., will receive
hand-delivered or messenger-delivered paper filings for the
Commission\'s Secretary at 236 Massachusetts Avenue, N.E., Suite 110,
Washington, D.C. 20002. The filing hours at this location are 8:00 a.m.
to 7:00 p.m. All hand deliveries must be held together with rubber bands
or fasteners. Any envelopes must be disposed of before entering the
building. Commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail) must be sent to

9300 East Hampton Drive, Capitol Heights, MD 20743. U.S. Postal Service
first-class mail, Express Mail, and Priority Mail should be addressed to
445 12th Street, SW, Washington, D.C. 20554. All filings must be
addressed to the Commission\'s Secretary, Office of the Secretary,
Federal Communications Commission.

**In addition, one copy of each pleading must be sent to each of the
following:**

(1) the Commission's duplicating contractor, Qualex International, 445
    12^th^ Street, S.W., Room CY-B402, Washington, D.C. 20554; e-mail:
    <qualexint@aol.com;> facsimile: (202) 863-2898; phone: (202)
    863-2893;

(2) Tracey Wilson, Competition Policy Division, Wireline Competition
    Bureau, 445 12^th^ Street, S.W., Room 5-C437, Washington, D.C.
    20554; e-mail: <tracey.wilson-parker@fcc.gov>;

(3) Dennis Johnson, Competition Policy Division, Wireline Competition
    Bureau, 445 12^th^ Street, S.W., Room 6-A461, Washington, D.C.
    20554; e-mail: <dennis.johnson@fcc.gov>;

(4) Julie Veach, Competition Policy Division, Wireline Competition
    Bureau, 445 12^th^ Street, S.W., Room 5-C124, Washington, D.C.
    20554; e-mail: <julie.veach@fcc.gov>;

(5) Susan O'Connell, Policy Division, International Bureau, 445 12^th^
    Street, S.W., Room 7-B544, Washington, D.C. 20554; email:
    [susan.o'connell@fcc.gov](mailto:cynthia.bryant@fcc.gov); and

(6) Christopher Killion, Office of General Counsel, 445 12^th^ Street,
    S.W., Room 8-C740, Washington, D.C. 20554; e-mail:
    <chris.killion@fcc.gov>.

Filings and comments are also available for public inspection and
copying during regular business hours at the FCC Reference Information
Center, Portals II, 445 12th Street, SW, Room CY-A257, Washington, DC,
20554. They may also be purchased from the Commission\'s duplicating
contractor, Qualex International, Portals II, 445 12th Street, SW, Room
CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile
202-863-2898, or via e-mail <qualexint@aol.com>.

For further information, please contact Tracey Wilson, at (202)
418-1394, or Dennis Johnson at (202) 418-0809.

\- **FCC** -

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[^1]: 47 C.F.R §§ 63.03, 63.04; *see* 47 U.S.C. § 214.

[^2]: The Applicants are also filing an application for consent to
    transfer assets for international services. Any action on this
    domestic 214 application is without prejudice to Commission action
    on other related pending applications.

[^3]: 47 C.F.R § 63.03(b)(2)(i). Letter from Thomas K. Crowe and Gregory
    E. Kunkle, Counsel for Matrix, to Marlene H. Dortch, Secretary,
    Federal Communications Commission, Office of the Secretary, WC
    Docket No. 04-173 (filed May 24, 2004) (Matrix Letter).

[^4]: *See* Application Exhibit B at para. 8.

[^5]: *See* 47 C.F.R. § 63.03(a).

[^6]: Such authorization is conditioned upon receipt of any other
    necessary approvals from the Commission in connection with the
    proposed transaction.