indicates that is the fact that the f c c has stated that its purpose is to enforce the law against blanca to deter misconduct to find wrongdoing to protect rate payers to protect subscribers to protect competition to protect federal funds to protect the public from waste fraud and abuse and to redress most recently redress misappropriation of federal funds also  that simply a reimbursement for overpaid and i'm sorry i didn't follow that isn't isn't the remedy here the collection of the amount of  never presented with well here's the rule we think you violated what do you think about that so i want to ask they were never told why there was an investigation or an audit just for providing a mobile cellular telephone exchange service in a rural area which is some dispute it that the rural area is a high cost area where carriers can get us the funding as a limitation in the rules that says block or could provide telephone exchange servers with a cellular telephone service well can i ask you this this will so with regard to a right of return carrier like mobile services by definition are not the t r s and that you knew that the t r s was all that you would be able to get subsidized well on record provided fixed link service those customers all got cell phones but blanca for continuity purposes name continuity just kept calling the cellular service betters follow well when is it entitle to receive subsidies when it is actually your betters carrier that is serving six lines to the study area and restrict restricted area and not where the as an uncommon carrier it doesn't it's not it's not limited in those rules as to whether it's incumbent or competitor but just defines mobile services as being eligible for us a funding but i think you've got to go through that door if you're a competitive carrier then yes but block a is what will but where is that rule your honor where is the rule that blocking ha here i would call the penalty everything blankets paying the f c c doesn't see any penalty at all but we know at least there's three and a half one million dollars of money being collected above and beyond the debt which is asserted in the orders six million seven hundred thousand dollars if this goes the way it's going the f c c will collect about ten and a half one million dollars so all that extra is penalty i would say the whole thing's dollars but if the finding where you wrote seven dollars it would be wrong if it's seven hundred dollars it's wrong that's seven million dollars that's wrong if it's seven hundred billion dollars that's wrong it doesn't matter to us what the accounting was we're not challenging that we're saying you can't do any amount is wrong because you didn't have a rule in place in two thousand and four which told blanka going forward we're going to say that's improper use what the f c c has done is created a fifty page story in this case as to why blank it couldn't get the the u s s money that it received but it never points to we told this story to you in two thousand and four or two thousand and three it just made it up for this case that's that's one of our main arguments there isn't it's the main argument there's no notice in this case of the story the f c c is telling really indicate it is unaware and then greg elation that apply to its business that blackout was unaware of the law that applies to the functioning of its  business no one can knows very well the law that applies to the functioning of its business and the f c s and that and the law that prohibits subsidies to incumbent carriers that are providing that are subject to competition that that's that's what the statute says but it doesn't say blanca can't get money for cellular telephone exchange service and inspection i think it's three  now for fourteen years after cellular licensing started there was no service in the area so it's not a question of what's blocking keeping competition now the question was in ca and louie valley there was no cellular telephone service so block i stepped up and said i'll do it and i won't make much money doing it even with the us if fund but i'll do it to get service to the subscribers nine roman numeral nine at the top and and this is an example you won't find then i'll let mister novak contradict me there's not a single citation in this table of authorities that when you read that prevents blocker from during want to did not want there's not one in here and an example would be at the top of page nine there are two citations  improvement act regulations which has nothing to do with u s s funding in the couple of cellular rulemaking proceedings which were superceded nine hundred and ninety four but which i responded rule so your question goes to that but the nd notices the demand letter doesn't cite anything it didn't give us anything to respond to it just said you're eligible to receive u you were not aware ok and then so i have fourteen days after june nd two thousand and sixteen to figure out what the f c c has been doing for ten years and i don't have any citations to or there were literally spend this is record page twenty six dollars there are literally scores of rules in those rules sections is impossible to know which rule the f c c thinks the block of violate it and i see that my time as  subsidies that were available only to support basic local telephone service to fixed locations and only within its designated study area but in fact as blanca later admitted to the commission it claimed subsidies for mobile telephone service for which it wasn't eligible and for service outside its eligible study area in response the commission directed blanket to repay the public subsidies that it improperly claimed and in fact that's all the government  haven't sought to impose any sort of fine or any forfeiture penalty the government is simply seeking dollar for dollar recovery of the public funds a blanket improperly obtained when it misreported the nature of its service and when we're talking about public funds the government has a responsibility to seek recovery of any improper payments the commission faithfully and lawfully carried out that responsibility here now we think that largely suffices to resolve this case but i'm happy to answer any questions that the court may have well my question is exactly what regulation your honor this stems from forty seven thirty two point one four it's in our statutory agendum at page eight that's the rule that defines what qualify as a regulated accounts now i think blank is over complicating the matter here what happens that b submitted a cost study and that cost study had it indicate which costs fall into its quote unquote regulated accounts and it included in its regulated accounts wireless infrastructure that it turns out w used only for mobile cellular service it described that as a better service that wasn't true we later found out and block admitted to the commission it was providing mobile cellular service mobile service is not a regulated service in the meaning of forty seven dollars c f r thirty two dollars regulated accounts are only those that are subject to mandatory tariff ing requirements and no tariffs apply to mobile service  fact the commission has mandatorily de tariffed mobile cellular service so under what particular regulation does regulated mean mandatory as opposed communications act and then thirty two dollars b talks about tariff requirements under state law and there are no tariff requirements under state law that apply to mobile service and that's true for two reasons number one if you look at thirty two point one four b it says except where such treatment is prescribed or otherwise excluded from the requirements pertaining to regulated telecommunications products and services by the federal communications commission and the f issued orders forbearing from applying tariffs to mobile service and the other place you'll see that the forbearance provision that we used it's forty seven seas and forty seven u s c section one hundred and sixty and subsection  says that when the commission forbearers from applying a provision a state can't continue applying it either says the state commission may not continue to apply or enforce any provision that the f c c has determined to forbear from applying terrifying requirements and in fact block a hasn't pointed to anything in colorado rod law that purports to apply tariffs to mobile service it claims to have had a tariff for better and of course the service that it provided wasn't bettors better is a fixed service and what blanket provided was mobile service it wasn't restricted to fixed locations in any way and of course in addition block a provided service outside its eligible study area and there's no dispute over that and it's cost audi's which were the basis for the subs is being paid out directed it to account for its costs for providing regulated service when it can receive subsidies and what its limitations were you're on i guess i'd respond that in two ways st of all we're talking about we're talking about local telephone exchange service especially in rural areas pervasively regulated industry and entities that participate in closely regulated industries it's incumbent upon them to familiarize themselves with the rules that govern their conduct and i would point the court to the supreme court's decision in bennett that says when you're talking about a subsidy program which is what we have here on top of the ordinary rules that apply to all local exchange carriers if there's any question if there's any confusion it's incumbent upon the entity that seeking subsidies to seek clarification if it had any question about whether these were regulated accounts could have sought clarification from the that was going on saying look here's your problem here's here's the list of regulations you're miles and this is why seven we are investigating your auditing your records your honor i think the demand letter provided that notice now blanca in its brief complains that it didn't have any well it doesn't think it's efficient process before that demand letter we do in fact think it had extensive process before then but the rule  this court explained in reagans is that the notice that's required is pretty deprivation notices one round of notice and comment required and that happened here we should demand letter after having conducted much of this investigation th put blanca on notice of the basis for this action factually and legally block and then have an opportunity to state its case in the commission make its arguments and even after that if i supplements after the commission issued its decision block and then sought reconsideration from the commission so that point it again an opportunity to make any further arguments that wish to make and your honor i would point out the administrate a procedure act says that due regard of the rule of prejudicial error harmless error so even if there's any argument that block is making that it didn't have notice with that demand letter in the initial proceedings before the commission it had abundant opportunity afterwards to do so and i haven't heard any explanation from block of what other or additional arguments it would have made before the commission if it had some sort of other or additional argument sorry other additional notice that it has already had a opportunity to make here so we don't see any notice issue and if the court were to think there was any notice issue it seems to me that it's clearly harmless given how the proceedings here proceeded so you're proposing if they didn't know then they know now your honor if they didn't know then they knew it multiple other stages during the administrative proceedings and not even just now not even after the administrative proceedings completed and multiple intermediate step because again we have so you're arguing that blanca given it's a business operation should know the rules and these rules are obvious to anyone in this business and as you start your investigation it is very obvious to you and to those investigating that they are breaking the rules the thing i don't understand here is why you kept getting the money it was was the last year the block i had been seeking had been doing this improper accounting so a lot of this wasn't fully known until post two thousand and twelve obviously that point the spigot was off because blanca ceased the improper reporting on its own now when we st have reason to suspect that they're well let me say this we rely largely in administering this program on certifications by the regulated entities and the  entities including blanket here have to certify to the government that these cost studies are complete accurate and comply with all rules issued by the commission and generally those certifications are relied on we would have no way of knowing from the cost audio alone that anything suspicious happened here it was in the course of a routine random audits that indications st turned up that blankness accounting wasn't above the level and then an investigation took place and when we do that investigation it does need to be a careful investigation we need to make sure that everything is done properly and by the book and of course is complaining elsewhere here that it thinks it didn't get sufficient process well the reason it took a period of time to run this all down is because we did have to conduct a great deal of investigation of process to make sure we knew exactly what had happened and it back out the accounting and make sure we determine the proper amount that was due so you know i understand that some time was taken here but i don't think that was a problem i think that was the government doing its due diligence and its responsibility and providing the precise process that blank and now complains about  wonka's also complaining that you never really thought of the books identify you know what the improper overpayment was or what the subsidy they receive is why weren't they given access to those records in the administrative your honor they do have access to those records if you look carefully they're not complaining otherwise those cost studies which were the books were blocked his own books blocked up provided them to the commission and in fact once those were subpoenaed blanca had an obligation to preserve them it has those books the accounting that was done to figure out which portion of the subsidies were improper was the same accounting used by blockers own consultants when previously it had returned the portion of the funds for other years to neka and as i think conceded earlier in the arguments it's never been raising any challenge to the accounting to the determination the calculation of the amount due it's only challenging whether it owes any repayment at all so it does have all of the necessary records it seems to be making a hyper technical arguments that even though it has some of these records they should have been included in what was files of quote unquote record in this court now we do believe that the record we filed is complete and i think if you take a close look blank has never clearly explained what additional materials it thinks it needs that it doesn't already have that it is are in any way relevant to any argument that it preserved and is advancing in this court the communications act requires that any challenge any staff level relied on that it didn't have access to so it has your honor all of those materials and if it thought any was mature as a relevant st of all it should have had to present them to the commission itself in its application for review or else the forfeited but nd of all blanket could have tendered them to the court in any number of ways it could have had it cost studies or other materials to its brief if you thought there's a problem with this but there's not been a record it could have submitted a motion to supplement the record i think the fact that it hasn't done so is telling and again i would point out that really the scope of this few remaining in this commission is only sought dollar for dollar recovery for that matter didn't seek interests or any inflation adjustment or any penalty for that what i think happening again restudy baucus brief is now pointing to is that once the commission plan after ninety dollars days that interest rate increased and it's now been accumulating a seven percent interest but not dating back to the underlying rule violations in two thousand and five to two thousand and ten it's the fact that blanca owes a debt to the government due the government is entitled to collect it blanka has to pay it if it were to succeed in prevail in this appeal it might be able to get refunded but there is no excuse for having a debt that is now due which hasn't been stayed for not making that payment and the fact that it's incurring interest or even any sort of penalties at this stage i think is separate from the question as to whether the relief ordered in the order the repayment of a six million seven hundred and fifty thousand improper funds was a penalty it wasn't that block a miss reported on mis characterized anything it's they didn't mischaracterize anything there's a box that says how much was your switching costs section thirty six point one two five there's a b says how much was your radio central office equipment section thirty six point one two six and one could put the numbers on that it's not technology specific they cancel your time's expired i think we understand the arguments you're excused case will be submitted