Before the

[Federal Communications Commission]{.smallcaps}

# Washington, D.C. 20554

In the Matter of ) ) File No. EB-00-IH-0432

SBC Communications, Inc. )

) NAL/Acct. No. 200132080011

Apparent Liability for Forfeiture )

###### NOTICE OF APPARENT LIABILITY FOR FORFEITURE

# Adopted: December 19, 2000 Released: December 20, 2000 

By the Chief, Enforcement Bureau:

# I. INTRODUCTION

1.  In this Notice of Apparent Liability for Forfeiture (NAL), we find
    that SBC Communications, Inc. (SBC) has apparently violated certain
    of the conditions that the Commission imposed pursuant to its
    approval of the merger application of Ameritech Corp. (Ameritech)
    and SBC.[^1] In particular, it appears that, in seven of its
    in-region states and for a period of up to 13 months, SBC[^2] failed
    to report certain performance data in accordance with the published
    Business Rules adopted in the Carrier-to-Carrier Performance Plan
    that SBC agreed to undertake as part of the merger conditions
    adopted in the *SBC/Ameritech Merger Order*.

2.  The Carrier-to-Carrier Performance Plan is central to achieving the
    public interest goals enumerated in the *SBC/Ameritech Merger
    Order*, including that of ensuring open local markets by monitoring
    the quality of SBC's service to other telecommunications
    carriers.[^3] The Commission adopted the Performance Plan as a means
    to ensure that "SBC/Ameritech's service to telecommunications
    carriers will not deteriorate as a result of the merger and the
    larger firm's increased incentive and ability to discriminate and to
    stimulate the merged entity to adopt 'best practices' that clearly
    favor public rather than private interests...."[^4] Based upon our
    review of the facts and circumstances surrounding this matter, we
    find that SBC is apparently liable for a forfeiture in the amount of
    eighty eight thousand dollars (\$88,000.00).

######## II. BACKGROUND

########  

3.  SBC is an incumbent local exchange carrier (ILEC) that provides
    local telephone service in 13 states, including Arkansas, Kansas,
    Missouri, Oklahoma, Texas, California, Nevada, Illinois, Michigan,
    Indiana, Ohio, Wisconsin, and Connecticut. At the end of 1999, SBC
    served nearly 60 million local exchange access lines in its 13-state
    region, and served customers in 23 countries.[^5] SBC also provides
    in-region interLATA, wireless, Internet access, out-of-region
    interLATA, cable and wireless television, security monitoring, and
    directory publishing services.[^6] In 1999, SBC had total operating
    revenues of more than \$49 billion.[^7]

4.  In the *SBC/Ameritech Merger Order*, the Commission concluded that
    the merger of SBC and Ameritech posed significant public interest
    harms that were not mitigated by the proposed transaction's
    potential public interest benefits.[^8] The Commission, however,
    also found that the voluntary conditions submitted by the
    Applicants, and as modified by the Commission, would alter the
    public interest balance by mitigating substantially the potential
    public interest harms while providing additional public interest
    benefits.[^9] The Commission explained that these merger conditions
    were designed to accomplish five primary public interest goals: (a)
    promoting equitable and efficient advanced services deployment; (b)
    ensuring open local markets; (c) fostering out-of-territory
    competition; (d) improving residential phone service; and (e)
    ensuring compliance with and enforcement of the conditions.[^10]
    These conditions would remain in effect for 36 months after release
    of the *SBC/Ameritech Merger Order.*[^11]

5.  The Carrier-to-Carrier Performance Plan is part of the package of
    conditions designed to foster the public interest goal of opening
    local markets to competition by ensuring that SBC's service to
    competitors does not deteriorate as a result of the merger.[^12] The
    Performance Plan requires SBC to file with the Commission and each
    of the relevant state commissions, on a monthly basis, performance
    data reflecting 20 different categories for each of SBC's 13
    in-region states.[^13] The data in the 20 categories reflect SBC's
    performance in responding to requests for facilities and services
    from its rivals, as well as its end-user customers.[^14] The
    Business Rules accompanying the Carrier-to-Carrier Performance Plan
    describe the specific data requirements and measurement standards
    for each performance measurement.[^15] This condition also requires
    that SBC make voluntary incentive payments to the U.S. Treasury in
    the event that it fails to meet designated performance
    thresholds.[^16] The merger conditions also require SBC to retain an
    independent auditor to provide a thorough and systematic review of
    SBC's compliance with the conditions and to determine the
    sufficiency of its internal controls.[^17] The Commission approved
    SBC's retention of Ernst and Young, LLC as its independent
    auditor.[^18]

6.  On August 31, 2000, Ernst and Young submitted its attestation report
    regarding SBC's compliance with the Commission's merger conditions
    from October 8, 1999 through December 31, 1999.[^19] The independent
    auditor's report is confined to the statements made by SBC in its
    assertion, in the accompanying Report of Management on Compliance
    with the Merger Conditions, that it had complied with the merger
    conditions set forth in the *SBC/Ameritech Merger Order,* except as
    noted therein, and had corrected the noted deficiencies*.*[^20] The
    auditor's report, along with the underlying data in SBC's monthly
    filings, revealed numerous instances of SBC's failure to comply with
    the requirements of the Carrier-to-Carrier Performance Plan through
    the submission of inaccurate performance data.[^21] In particular,
    the record shows that, in submitting data for 13 of the performance
    measurements for Texas, Oklahoma, Kansas, Missouri, Arkansas,
    California, and Nevada, SBC continuously used incorrect benchmarks
    and disaggregation levels, and also excluded key data for a period
    of up to 13 months.[^22]

7.  The performance measurements at issue in this NAL concern: Percent
    Firm Order Confirmations (FOCs) Returned Within "X" Hours (PM 1);
    Average Response Time for OSS Pre-Order Interfaces (PM 2); Order
    Process Percent Flow Through (PM 3); Percent SWBT Caused Missed Due
    Dates (PM 4); Average Delay Days for SWBT Caused Missed Due Dates
    (PM 7); Average Response Time for Loop Qualification Information (PM
    9); Mean Time to Restore (PM 12); Trouble Report Date (PM 13);
    Average Trunk Restoration Interval (PM 14); Percent Trunk Blockage
    (PM 15); Percent Missed Collocation Due Dates (PM 17); Billing
    Timeliness (PM 18); and OSS Interface Availability (PM 19).

8.  Because the Commission's ability to detect potential discriminatory
    conduct depends upon SBC's strict compliance with the approved terms
    and conditions of the Carrier-to-Carrier Performance Plan, failure
    to report the performance data in accordance with the published
    Business Rules could compromise the effectiveness of the merger
    conditions in ensuring open local markets.[^23] The
    Carrier-to-Carrier Performance Plan is, therefore, a key aspect of
    the Commission's oversight of SBC's behavior towards it competitors.

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III. **DISCUSSION**

**A. Violations**

9.  Based on the facts set forth below, we find that SBC is apparently
    liable for a forfeiture for willful and repeated violation of the
    merger conditions adopted in the *SBC/Ameritech Merger Order*. For a
    period of up to 13 months from November, 1999 through November,
    2000, SBC apparently violated its obligation to report accurately
    the data sought by the performance measurements in the
    Carrier-to-Carrier Performance Plan for Texas, Oklahoma, Kansas,
    Missouri, Arkansas, California, and Nevada. We find that SBC's
    failure to report this information accurately is willful and
    repeated. The term "willful" means that the violator knew it was
    taking the action in question, irrespective of any intent to violate
    the Commission's rules, and repeated means more than once.[^24]
    Furthermore, a continuing violation is \"repeated\" if it lasts more
    than one day.[^25]

10. SBC, in its Assertion on Compliance, does not dispute that it
    gathered and reported the data sought by the specific performance
    measurements discussed below in a manner contrary to the Business
    Rules for those measurements.[^26] Although we are aware that a few
    of the violations occurred as a result of SBC's application of
    different standards, which were required by the Texas and California
    business rules, SBC was, nevertheless, obligated to seek the
    Commission's advice and approval before modifying the Commission's
    Business Rules.[^27] The merger conditions require that no changes
    be implemented until the Common Carrier Bureau is notified and
    directs SBC to implement such changes.[^28] Given the importance of
    maintaining the integrity of the Carrier-to-Carrier Performance
    Plan, we cannot excuse SBC's failure to diligently follow the
    Business Rules set forth in the *SBC/Ameritech Merger Order*.

11. Consistent with the Commission's determination in the *SBC/Ameritech
    Merger Order* that our monitoring of SBC's performance through these
    measurements is a key tool in offsetting or preventing some of the
    potential harmful effects of that merger,[^29] we find SBC's lack of
    diligence in following the Business Rules to be significant. One of
    the goals behind establishing detailed Business Rules at the outset
    was to have the Carrier-to-Carrier Performance Plan work in a
    self-executing manner in order to ensure timely disclosure of
    accurate performance data and submission of any required payments.
    This would enable Commission staff to focus its resources on
    analyzing the results of the data, rather than monitoring the
    gathering of the data. SBC's failure to follow the Business Rules
    could lead to inaccurate and unreliable results which would
    compromise the Commission's ability to monitor effectively SBC's
    conduct towards other carriers. For example, the use of less
    rigorous standards than those required under the designated business
    rules could mask material deficiencies in SBC's performance and
    ultimately undermine the voluntary payment scheme established in the
    merger conditions. The omission of key data could also lead to a
    "muddying" of the reported results. In addition, inaccurate results
    will make it difficult for CLECs to determine independently whether
    there are discrimination problems. Therefore, we must insist on
    rigorous adherence to the Carrier-to-Carrier Performance Plan.

12. The record evidences the following specific apparent violations by
    SBC of the Carrier-to-Carrier Performance Plan:

Apparent violations of PM 1 (Percent Firm Order Confirmations (FOCs)
Returned Within "X" Hours) by SBC:

-   For ten months from November 1, 1999, until August 31, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    1[^30] in the SWBT region by failing to report correctly the percent
    of FOCs timely returned by using the incorrect date, and standard
    (*i.e.*, 2:00), instead of military (*i.e*.,14:00), time*.*[^31] The
    use of standard time masked whether the return of FOCs occurred in
    the a.m. or p.m. and thereby potentially overstated the percent of
    FOCs timely returned.

-   For three months from December 1, 1999, until February 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    1[^32] in the PacBell and Nevada Bell regions by overstating the
    percent of FOCs timely returned by excluding from the measurement
    the interval of time from the receipt of a fax request to the time
    the information was entered into the order entry system.[^33]

Apparent violations of PM 2 (Average Response Time for OSS Pre-Order
Interfaces)[^34] by SBC:

-   For six months from November 1, 1999, until April 17, 2000, SBC
    apparently violated the Business Rules for Performance Measurement 2
    in the SWBT region by overstating its speed in assessing service
    availability by using a benchmark of 86,400 seconds, instead of 5.5
    seconds.[^35]

-   For six months from November 1, 1999, until April 17, 2000, SBC
    apparently violated the Business Rules for Performance Measurement 2
    in the SWBT region by failing to report accurately the response time
    for requests for customer service records by collecting the data
    into a single category, instead of disaggregating the data into two
    categories of "CSR Summary 1-30 Lines" and "CSR 31 Lines or
    more,"[^36] thereby masking differences between the categories.

Apparent violation of PM 3 (Order Process Percent Flow Through)[^37] by
SBC:

-   For nine months from November 1, 1999, until July 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement 3
    in the SWBT region by failing to

> report accurately the percent of Mechanized Order Generator (MOG)
> eligible orders that progress through SBC's ordering system by
> disaggregating the data by OSS interface, rather than by service
> type,[^38] thereby masking potential problems occurring within
> different types of services.
>
> Apparent violations of PM 4 (Percent SWBT Caused Missed Due Dates) by
> SBC:

-   For six months from November 1, 1999, until April 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    4c[^39] in the SWBT region by failing to report accurately the
    percent of missed due dates for installation of UNEs by
    disaggregating the data into two categories of field work and no
    field work, instead of a single UNE category.[^40]

-   For eight months from November 1, 1999, until June 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    4c in the SWBT region by failing to report accurately the percent of
    missed due dates for installation of UNEs by excluding the data from
    two categories.[^41]

> Apparent violation of PM 7 (Average Delay Days for SWBT Caused Missed
> Due Dates) by SBC:

-   For nine months from November 1, 1999, until July 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    7c[^42] in the SWBT region by failing to report accurately the
    average number of delay days on missed due dates for installation of
    UNEs by excluding the data from two categories.[^43]

> Apparent violations of PM 9 (Average Response Time for Loop
> Qualification Information) by SBC:

-   For five months from December 1, 1999, until April 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    9[^44] in the PacBell and Nevada Bell regions by understating the
    average response time for providing loop qualification information
    for ADSL by excluding the data reflecting the time interval between
    receipt of a request for loop information and the submission of the
    request to the Outside Plant Engineer handling this request.[^45]

-   For four months from November 1, 1999, until February 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    9[^46] in the SWBT region by understating the average response time
    for providing loop qualification information for ADSL by excluding
    the data reflecting the time interval between receipt of a request
    for loop information and the submission of the request to the
    Outside Plant Engineer handling this request.[^47]

> Apparent violations of PM 12 (Mean Time to Restore) by SBC:

-   For eight months from November 1, 1999, until June 5, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    12b[^48] in the SWBT region by failing to report accurately the mean
    time to restore design service by disaggregating the data into
    categories of dispatch and no dispatch, instead of a single category
    for design service.[^49]

-   For eight months from November 1, 1999, until June 5, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    12c[^50] in the SWBT region by failing to report accurately the mean
    time to restore UNE by disaggregating the data into categories of
    dispatch and no dispatch, instead of a single category for UNE
    service.[^51]

> Apparent violation of PM 13 (Trouble Report Date) by SBC:

-   For nine months from December 1, 1999, until August 31, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    13a[^52] in the Nevada Bell region by failing to report accurately
    the frequency of customer trouble reports by using an incorrect
    number of UNEs in the denominator of the calculation of the trouble
    report rate.[^53]

> Apparent violation of PM 14 (Average Trunk Restoration Interval)[^54]
> by SBC:

-   For ten months, from December 1, 1999, until September 8, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    14 in the PacBell region by failing to report accurately the average
    trunk restoration interval by disaggregating the data at a statewide
    level, rather than by market region,[^55] thereby masking potential
    problems occurring at the market region level.

> Apparent violation of PM 15 (Percent Trunk Blockage)[^56] by SBC:

-   For nine months from December 1, 1999, until August 31, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    15 in the PacBell region by failing to report accurately the percent
    of trunk blockage by disaggregating the data at a statewide level,
    rather than by market region,[^57] thereby masking potential
    problems occurring at the market region level.

> Apparent violations of PM 17 (Percent Missed Collocation Due
> Dates)[^58] by SBC:

-   For eight months from November 1, 1999, until June 5, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    17 in the SWBT region by failing to report accurately the percent of
    missed collocation due dates by disaggregating the data into
    additional categories of collocation (caged initial; caged augments;
    cageless initial; cageless augments; shared caged initial; shared
    caged augments; virtual initial; and virtual augments.), instead of
    limiting the disaggregation to the categories of physical, virtual,
    cageless, and additions.[^59]

> Apparent violation of PM 18 (Billing Timeliness)[^60] by SBC:

-   For 13 months from November 1, 1999, until at least November 20,
    2000, SBC apparently violated the Business Rules for Performance
    Measurement 18 in the SWBT region by failing to report accurately
    billing timeliness by excluding the billing information for all
    provisioned UNEs.[^61]

> Apparent violations of PM 19 (OSS Interface Availability)[^62] by SBC:

-   For nine months from December 1, 1999, until August 30, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    19 in the PacBell region by region by failing to report accurately
    on their web site the availability of OSS interface by failing to
    include the Z-scores for this measurement.[^63]

-   For three months from December 1, 1999, until March 20, 2000, SBC
    apparently violated the Business Rules for Performance Measurement
    19 in the PacBell and Nevada Bell regions by overstating OSS
    interface availability by excluding system outage data.[^64]

**B. Forfeiture Amount**

13. In light of SBC's apparent willful or repeated failure to comply
    with the merger conditions in the *SBC/Ameritech Merger Order*, we
    find that a forfeiture is warranted. Section 503(b)(1) of the Act
    states that any person that willfully or repeatedly fails to comply
    with any provision of the Act or any rule, regulation, or order
    issued by the Commission, shall be liable to the United States for a
    forfeiture penalty.[^65] For the time period relevant to this
    proceeding, section 503(b)(2)(B) of the Act authorizes the
    Commission to assess a forfeiture of up to \$110,000 for each
    violation, or each day of a continuing violation, up to a statutory
    maximum of \$1,100,000 for a single act or failure to act.[^66] In
    determining the appropriate forfeiture amount, we consider the
    factors enumerated in section 503(b)(2)(D) of the Act, including
    "the nature, circumstances, extent and gravity of the violation,
    and, with respect to the violator, the degree of culpability, any
    history of prior offenses, ability to pay, and such other matters as
    justice may require."[^67]

14. SBC has submitted 13 monthly reports embodying one or more of the
    apparent violations detailed above and thus has committed 13
    separate apparent violations of the *SBC/Ameritech Merger Order*.
    While several of the apparent violations discussed in this NAL
    clearly had the effect of casting SBC's performance in a more
    favorable light, all of the apparent violations we have discussed
    demonstrate that SBC repeatedly failed to implement the Business
    Rules as adopted by the Commission. Because section 503(b)(6) of the
    Act limits the Commission's jurisdiction over this cause of action
    to one year from the time the action accrued, our forfeiture
    calculation does not include a penalty for any violations that
    occurred during November and December of 1999. Therefore, for
    forfeiture purposes, SBC has committed 11 apparent violations of the
    *SBC/Ameritech Merger Order*.

15\. Under the Commission's forfeiture guidelines, the base forfeiture
amount for failure to file required forms or information is \$3000 per
violation.[^68] The Commission's rules, however, explicitly provide that
the Commission and its staff may issue a higher or lower forfeiture than
provided in the guidelines, as permitted by statute. We believe that an
upward adjustment in the forfeiture amount is warranted in this case. As
explained above, inaccurate reporting of performance data may compromise
the effectiveness of the merger conditions in promoting open local
markets. Moreover, we are faced here with noncompliance with a number of
the reporting requirements in the *SBC/Ameritech Merger Order* over an
extended period of time. Therefore, we will apply a forfeiture amount of
\$8000 to each of the 11 violations described herein, and find SBC
apparently liable for a forfeiture amount in the amount of \$88,000. We
note that our imposition of a proposed forfeiture in this proceeding is
independent of SBC's obligation to make voluntary payments for failure
to perform according to the benchmarks and other parity guidelines set
forth in Appendix C of the *SBC/Ameritech Merger Order*. [^69]

> **IV. ORDERING CLAUSES**

IV. 16\. ACCORDINGLY, IT IS ORDERED THAT, pursuant to section 503(b) of
    the Act, [^70] and section 1.80 of the Commission's Rules, [^71] SBC
    Communications is HEREBY NOTIFIED of its APPARENT LIABILITY FOR
    FORFEITURE in the amount of eighty eight thousand dollars
    (\$88,000.00) for willfully or repeatedly violating the Commission's
    merger conditions in the *SBC/Ameritech Merger Order*.

17\. IT IS FURTHER ORDERED THAT, pursuant to section 1.80 of the
Commission's Rules, within thirty (30) days of the release date of this
NOTICE OF APPARENT LIABILITY, SBC Communications SHALL PAY to the United
States the full amount of the proposed forfeiture OR SHALL FILE a
written statement showing why the proposed forfeiture should not be
imposed or should be reduced.

18\. Payment of the forfeiture amount may be made by mailing a check or
similar instrument payable to the order of the Federal Communications
Commission, to the Forfeiture Collection Section, Finance Branch,
Federal Communications Commission, P.O. Box 73482, Chicago, Illinois
60673-7482. The payment should note the "NAL/ Acct. No." referenced
above.

19\. The response, if any, must be mailed to Charles W. Kelley, Chief,
Investigations and Hearings Division, Enforcement Bureau, Federal
Communications Commission, 445 12^th^ Street S.W., Room 3-B443,
Washington, D.C., 20554, and must include the "NAL/Acct. No." referenced
above.

20\. The Commission will not consider reducing or canceling a forfeiture
in response to a claim of inability to pay unless the respondent
submits: (1) federal tax returns for the most recent three-year period;
(2) financial statements prepared according to generally accepted
accounting practices ("GAAP"); or (3) some other reliable and objective
documentation that accurately reflects the respondent's current
financial status. Any claim of inability to pay must specifically
identify the basis for the claim by reference to the financial
documentation provided.

21\. IT IS FURTHER ORDERED that a copy of this Notice of Apparent
Liability shall be sent by Certified Mail/Return Receipt Requested to
SBC Communications, c/o Sandra L.Wagner, Vice President-Federal
Regulatory, 1401 I Street, N.W., Suite 1100, Washington, D.C. 20005.

FEDERAL COMMUNICATIONS COMMISSION

David H. Solomon

####### Chief, Enforcement Bureau

[^1]: Applications of Ameritech Corp., Transferor, and SBC
    Communications, Inc., Transferee, For Consent to Transfer Control of
    Corporations Holding Commission Licenses and Lines Pursuant to
    Sections 214 and 310(d) of the Communications Act and Parts 5, 22,
    24, 25, 63, 90, 95, and 101 of the Commission's Rules, CC Docket
    98-141, *Memorandum Opinion and Order*, 14 FCC Rcd 14712, 14856
    (1999) (*"SBC/Ameritech Merger Order"*)

[^2]: SBC refers to SBC Communications, Inc. and all its affilliates,
    including its incumbent LECs.

[^3]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14856, 14867.

[^4]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14867.

[^5]: ^?^ SBC 1999 Annual Report at 6.

[^6]: *SBC 1999* Annual Report at 4.

[^7]: *SBC 1999* Annual Report at 76.

[^8]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14854.

[^9]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14855.

[^10]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14856.

[^11]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14868.

[^12]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14867.

[^13]: *See* *SBC/Ameritech Merger Order,* 14 FCC Rcd 14867, Appendix C
    at ¶ 24, and Attachment A at ¶ 13*.* The categories cover key
    aspects of pre-ordering, ordering, provisioning, maintenance and
    repair associated with UNEs, interconnection, and resold services.
    *Id.* SBC is required to file this report on the 20^th^ of each
    month. The filing of performance data for the states in the original
    Southwestern Bell Telephone (SWBT) region (Texas, Oklahoma, Kansas,
    Missouri, and Arkansas) was required beginning on November 1, 1999,
    for the months of August and September, on November 20^th^ for the
    month of October, and then on 20^th^ of each month thereafter for
    the previous month's data. The performance data for the Pacific Bell
    (PacBell) and Nevada Bell states of California and Nevada had to be
    filed beginning on December 1, 1999, for the months of September and
    October, on December 20^th^ for the month of November, and on the
    20^th^ of each subsequent month. The Commission required SBC to file
    similar data for the states in the Ameritech region (Illinois, Ohio,
    Wisconsin, Indiana and Michigan) in two phases with the filing of
    the first set commencing on January 6, 2000, and the second set
    starting on March 6, 2000. The filing of performance data in the
    Southern New England Telephone region of Connecticut began on
    October 8, 2000. The subsequent monthly reports for the Ameritech
    states and Connecticut are also due on the 20^th^ of each month.
    *See* *SBC/Ameritech Merger Order,* Appendix C at ¶ 24*.*

[^14]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14867.

[^15]: *See* *SBC/Ameritech Merger Order,* Appendix C, Attachments A-2a,
    , "SBC/Ameritech Performance Measurements Business Rules (except
    California and Nevada)," and A-2b, "SBC/Ameritech Performance
    Measurements Business Rules (California and Nevada)." The applicable
    business rules for performance measures in all states except for
    California and Nevada are those developed in a Texas collaborative
    process involving SBC's application for in-region, interLATA
    authorization. The performance measures in California and Nevada are
    reported using rules that were developed in a collaborative process
    in California. *SBC/Ameritech Merger Order* at ¶ 379.

[^16]: *See* *SBC/Ameritech Merger Order,* Appendix C, Attachment A-3,
    *"*Calculation of Parity and Benchmark Performance and Voluntary
    Payments*,"* and Attachment A-4, "Voluntary Payments for Performance
    Measurements." The amount of the payments varies according to the
    level and significance of discrimination detected. *SBC/Ameritech
    Merger Order,* 14 FCC Rcd 14867. SBC is required to make its first
    payments to the U.S. Treasury for failing to meet the performance
    thresholds during the months of August, September, and October of
    2000 no later than December 20, 2000. The reported data form the
    basis for calculating the payments.

[^17]: *SBC/Ameritech Merger Order,* Appendix C at ¶ 67.

[^18]: *See* Aug. 24, 1999 Letter from Robert C. Atkinson, Deputy Chief,
    Common Carrier Bureau, to Charles Foster, Group President, SBC.

[^19]: *See* Aug. 31, 2000 Report of Independent Auditors, Ernst &
    Young, LLP (*Auditor's Report on Compliance*). This report only
    covered SBC's conduct in Texas, Oklahoma, Kansas, Missouri, and
    Arkansas, California and Nevada.

[^20]: *See* Aug. 31, 2000 Report of Management on Compliance with the
    Merger Conditions (*Management's Assertion on Compliance*). In its
    statement, SBC stated that it had corrected some of the deficiencies
    by the time of the release of the auditor's report and had scheduled
    correction of other deficiencies prospectively. Although the
    independent auditor has not provided us with confirmation of the
    implementation of any corrections to date, the Common Carrier Bureau
    has been able to confirm corrections of deficiencies in the use of
    incorrect benchmarks and disaggregation levels from SBC's monthly
    filings. The monthly filings, however, do not inform us whether the
    deficiencies involving the exclusion of data have been corrected. We
    are relying on SBC's representations in its statement regarding the
    date of correction of the deficiencies involving the exclusion of
    data.

[^21]: *Auditor's Report on Compliance* at 2. *See also* SBC's Initial,
    Monthly, and Interim Performance Data Submissions, Nov. 1, 1999,
    through Nov. 20, 2000.

[^22]: *See* *Management's Assertion on Compliance*, Attachment A.
    Although the Auditor's Report only covered SBC's performance in
    1999, the attached Management's Assertion on Compliance covers SBC's
    correction of the deficiencies through August, 2000.

[^23]: *SBC/Ameritech Merger Order,* 14 FCC Rcd 14867, 14868.

[^24]: *See Southern California Broadcasting Co*., 6 FCC Rcd 4387, 4388
    (1991); *see also Hale Broadcasting Corp*., 79 FCC 2d 169, 171
    (1980).

[^25]: *Southern California Broadcasting Co*., 6 FCC Rcd 4388.

[^26]: *Management's Assertion on Compliance* at 1, 3, and Attachment A.

[^27]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ e;
    14, ¶ a; 15, ¶ b; 16, ¶¶ g and h. *See also* June 5, 2000 Letter
    from Chris Jines, Executive Director, Federal Regulatory, SBC, to
    Carol Mattey, Deputy Chief, Common Carrier Bureau. The Commission
    subsequently incorporated some aspects of the Texas Business Rules
    on May 1, 2000. *See* May 30, 2000 Letter from Carol Mattey, Deputy
    Chief, Common Carrier Bureau, to Marian Dyer, Vice President-Federal
    Regulatory, SBC.

[^28]: *See* *SBC/Ameritech Merger Order,* Appendix C, Attachment A at ¶
    4. *See also* May 30, 2000 Letter from Carol Mattey, Deputy Chief,
    Common Carrier Bureau, to Marian Dyer, Vice President-Federal
    Regulatory, SBC.

[^29]: *SBC/Ameritech Merger Order*, 14 FCC Rcd 14868.

[^30]: This performance measurement measures the percent of FOCs
    returned within a specific time frame from receipt of a complete and
    accurate service request to return of confirmation to CLEC.
    *SBC/Ameritech Merger Order,* Appendix C, Attachment A-2a at A-12.

[^31]: *Management's Assertion on Compliance,* Attachment A at 15, ¶ d.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    Aug. 31, 2000 letter and attached Interim Performance Data
    Submission, Aug. 31, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Mark Stone, FCC.

[^32]: This performance measurement measures the average time from
    receipt of a service request to return of a FOC/Local Service
    Confirmation (LSC). *SBC/Ameritech Merger Order,* Appendix C,
    Attachment A-2b at A-52.

[^33]: *Management's Assertion on Compliance,* Attachment A at 16, ¶ f.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    SBC Monthly Performance Data Submission, Feb. 20, 2000.

[^34]: This performance measurement measures the average response time
    in seconds from the SWBT side of the Remote Access Facility (RAF)
    and return for pre-order interfaces (Verigate, DataGate and EDI
    where the pre-order functionality is integrated) by function.
    *SBC/Ameritech Merger Order,* Appendix C, Attachment A-2a at A-15.

[^35]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ b.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    SBC Interim Performance Data Submission, April 17, 2000.

[^36]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ c.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    SBC Interim Performance Data Submission, April 17, 2000.

[^37]: This performance measurement measures the percent of orders or
    LSRs from entry to distribution that progress through SWBT ordering
    systems. *SBC/Ameritech Merger Order,* Appendix C, Attachment A-2a
    at A-17.

[^38]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ d.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    June 20, 2000 letter and attached Interim Performance Data
    Submission, June 20, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Anthony Dale, FCC.

[^39]: This performance measurement measures the percent of UNEs (8db
    loops are measured at an order level) where installations are not
    completed by the negotiated due date. *SBC/Ameritech Merger Order,*
    Appendix C, Attachment A-2a at A-20.

[^40]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ e.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    SBC Monthly Performance Data Submission, April 20, 2000.

[^41]: *Management's Assertion on Compliance,* Attachment A at 15, ¶ c.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    SBC Monthly Performance Data Submission, July 20, 2000.

[^42]: This performance measurement measures the average calendar days
    from due date to completion date on company missed UNEs (8db loops
    are measured at an order level). *SBC/Ameritech Merger Order,*
    Appendix C, Attachment A-2a at A-31.

[^43]: *Management's Assertion on Compliance,* Attachment A at 15, ¶ c.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    SBC Monthly Performance Data Submission, July 20, 2000.

[^44]: This performance measurement measures the average time required
    to provide loop qualification information to ADSL. *SBC/Ameritech
    Merger Order,* Appendix C, Attachment A-2b at A-84.

[^45]: *Management's Assertion on Compliance,* Attachment A at 16, ¶ g.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    SBC Monthly Performance Data Submission, April 20, 2000.

[^46]: This performance measurement measures the average time required
    to provide loop qualification for ADSL. *SBC/Ameritech Merger
    Order,* Appendix C, Attachment A-2a at A-33.

[^47]: *Management's Assertion on Compliance,* Attachment A at 14, ¶ a.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    SBC Monthly Performance Data Submission, Feb. 20, 2000.

[^48]: This performance measurement measures the average duration of
    network customer trouble reports for design service from the receipt
    of the customer trouble report to the time that the trouble report
    is cleared. *SBC/Ameritech Merger Order,* Appendix C, Attachment
    A-2a at A-40.

[^49]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ e.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    June 5, 2000 letter and attached Interim Performance Data
    Submission, June 5, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Carol E. Mattey, FCC.

[^50]: This performance measurement measures the average duration of
    network customer trouble reports for UNEs from the receipt of the
    customer trouble report to the time the trouble report is cleared
    excluding no access and delayed maintenance. *SBC/Ameritech Merger
    Order,* Appendix C, Attachment A-2a at A-41.

[^51]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ e.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    June 5, 2000 letter and attached Interim Performance Data
    Submission, June 5, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Carol E. Mattey, FCC.

[^52]: This performance measurement measures the total number of network
    customer trouble reports for POTS received within a calendar month
    per 100 access lines. *SBC/Ameritech Merger Order,* Appendix C,
    Attachment A-2b at A-99.

[^53]: *Management's Assertion on Compliance,* Attachment A at 14, ¶ i.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    Aug. 31, 2000 letter and attached Interim Performance Data
    Submission, Aug. 31, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Mark Stone, FCC.

[^54]: This performance measurement measures the average time to restore
    service affecting new trunk groups. *SBC/Ameritech Merger Order,*
    Appendix C, Attachment A-2b at A-104.

[^55]: *Management's Assertion on Compliance,* Attachment A at 14, ¶ h.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    Sep. 8, 2000 letter and attached Interim Performance Data
    Submission, Sep. 8, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Mark Stone, FCC.

[^56]: This performance measurement measures the percent of calls
    blocked on outgoing traffic from LEC end office to CLEC end office
    and from LEC tandem to CLEC end office. *SBC/Ameritech Merger
    Order,* Appendix C, Attachment A-2b at A-105.

[^57]: *Management's Assertion on Compliance,* Attachment A at 14, ¶ g.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    Aug. 31, 2000 letter and attached Interim Performance Data
    Submission, Aug. 31, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Mark Stone, FCC.

[^58]: This performance measurement measures the percent of SWBT caused
    missed due dates for collocation projects. *SBC/Ameritech Merger
    Order,* Appendix C, Attachment A-2a at A-48.

[^59]: *Management's Assertion on Compliance,* Attachment A at 13, ¶ e.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999;
    June 5, 2000 letter and attached Interim Performance Data
    Submission, June 5, 2000, from Chris Jines, Executive Director,
    Federal Regulatory, SBC, to Carol E. Mattey, FCC.

[^60]: This performance measurement measures the length of time from the
    billing date to the time a wholesale bill is sent or transmitted
    (made available) to the CLECs. *SBC/Ameritech Merger Order,*
    Appendix C, Attachment A-2a at A-49.

[^61]: *Management's Assertion on Compliance,* Attachment A at 15, ¶ b.
    *See also* SBC Initial Performance Data Submission, Nov. 1, 1999.

[^62]: This performance measurement measures the percent of time OSS
    interface is available compared to scheduled availability.
    *SBC/Ameritech Merger Order,* Appendix C, Attachment A-2b at A-110.

[^63]: *Management's Assertion on Compliance,* Attachment A at 14, ¶ m.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    SBC Monthly Performance Data Submission, August 30, 2000.

[^64]: *Management's Assertion on Compliance,* Attachment A at 16, ¶ e.
    *See also* SBC Initial Performance Data Submission, Dec. 1, 1999;
    SBC Monthly Performance Data Submission, March 20, 2000.

[^65]: 47 U.S.C. §503(b)(1)(B); *see also* 47 C.F.R. § 1.80(a)(2).

[^66]: 47 U.S.C. § 503(b)(2)(B); *see also* 47 C.F.R § 1.80(b)(2).

[^67]: 47 U.S.C. § 503(b)(2)(D); *see also* *The Commission's Forfeiture
    Policy Statement and Amendment of Section 1.80 of the Commission's
    Rules*, 12 FCC Rcd 17087, 17100 (1997) ("*Forfeiture Policy
    Statement*"); *recon. denied* 15 FCC Rcd 303 (1999); 47 C.F.R. §
    1.80(b)(4).

[^68]: *Forfeiture Policy Statement,* 12 FCC Rcd 17114.

[^69]: *See* *SBC/Ameritech Merger Order,* Appendix C, Attachment A-3,
    *"*Calculation of Parity and Benchmark Performance and Voluntary
    Payments*,"* and Attachment A-4, "Voluntary Payments for Performance
    Measurements."

[^70]: 47 U.S.C. § 503(b).

[^71]: 47 C.F.R. § 1.80.