Platte River Networks Lawsuit

IN THE UNITED STATES DISTRICT COURTFOR THE DISTRICT OF COLORADOCivil Action No.: 14-CV-3151T2 TECHNOLOGIES, INC.,Plaintiff,v.WINDSTREAM COMMUNICATIONS, INC.,a Delaware corporation, McLEOD USATELECOMMUNICATIONS SERVICES,LLC, d/b/a PAETEC BUSINESS SERVICES,LLC, an Iowa limited liability company, andPLATTE RIVER NETWORKS, INC., aColorado corporation,Defendants.____________________________________________________________________________COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL____________________________________________________________________________Plaintiff T2 Technologies, Inc. (T2 or Plaintiff) for its Complaint against WindstreamCommunications, Inc., (Windstream), McLeod USA Telecommunication Services, LLC,(McLeod), d/b/a PAETEC Business Services, LLC (PAETEC) and Platte River Networks,Inc. (Platte River) (collectively, Defendants), alleges as follows:NATURE OF ACTIONPlaintiff T2 Technologies, Inc. brings this action for damages pursuant to Section 207 ofthe Communications Act of 1934, as Amended, 47 U.S.C. 207 (Communications Act orAct) as a result of Windstream, McLeod, PAETEC and Platte Rivers violations of Section201(b) by engaging in an unjust and unreasonable practice, and Section 222(b) of the Act, 47U.S.C. 201(b) and 47 U.S.C. 222(b) as more fully set forth below.T2 also brings a claimCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 1 of 152against Defendants for intentional interference with T2s existing contracts over which this Courthas supplemental jurisdiction pursuant to 28 U.S.C. 1367.PARTIEST2 is Colorado Corporation doing business in the State of Colorado with its principalplace of business located at 4610 S. Ulster, # 150, Denver, Colorado 80239.Defendant Windstream is a Delaware corporation with its headquarters office located at4001 Rodney Parham, Little Rock, Arkansas, 72212.Windstream is authorized to conductbusiness in Colorado as a telecommunications provider. McLeod USATelecommunicationsServices, LLC-PAETEC (McLeod-PAETEC) is an Iowa limited liability company that also isauthorized to conduct business in Colorado as a telecommunications provider.McLeod-PAETEC has offices co-located with Windstreams office, but also maintains an office at 1Marthas Way, Hiawatha, Iowa, 52233.Platte River is a Colorado corporation which provides managed interstatetelecommunications services, among other services, and also acts as an agent for a variety oftelecommunications providers, including Windstream and McLeod-PAETEC. Platte Riversaddress is 2955 Inca Street, Suite 2K, Denver, Colorado, 80202.JURISDICTIONThis Court has jurisdiction pursuant to 28 U.S.C. 1331 in that the T2s claims arebrought pursuant to Section 207 of the Act, 47 U.S.C. 207, and seeks damages under Section206 of the Act, 47 U.S.C. 206, for violations of Section 201(b) and 222(b) of the Act.Thus,T2s complaint presents a federal question. T2 also brings a claim for intentional interferenceCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 2 of 153with existing contracts over which this Court has supplemental jurisdiction pursuant to 28 U.S.C. 1367.ALLEGATIONS THAT SUPPORT T2S CLAIMSA. THE BUSINESS OF T2 AND DEFENDANTS1. T2 is a telecommunications provider (i.e., a communications common carrier asdefined in Section 153(10) of the Act, 47 U.S.C. 153(10)) providing telecommunicationsproducts and services, including but not limited to, Voice over Internet Protocol (VoIP), localinterstate and intrastate long-distance services, local exchange services, dedicated Internet,wholesale telecommunications services and telecommunications hardware. To the extent T2provides interstate telecommunications services, T2 is regulated by the Federal CommunicationsCommission (FCC). Moreover, where T2 provides intrastate telecommunications service, T2 isregulated by the states in which it operates.2. Likewise, Defendants are communications common carriers and are facilitiesbased providers of interstate and intrastate telecommunications services.As communicationcommon carriers, Defendants are also regulated by the FCC in connection with their offering ofinterstate services and by the various states in which they provide intrastate services. AlthoughPlatte River provides interstate telecommunications services, it also acts as a sales agent for theDefendants Windstream and McLeod-PAETEC. Nonetheless, Platte River is also subject toregulation by the FCC in connection with its provision of interstate telecommunications services.Thus, Platte River is bound by Sections 201(b) and 222(b) of the Act, and its action in assistingWindstream and McLeod-PAETEC to violate these Sections of the Act, make Platte River alsoresponsible for engaging in unjust and unreasonable practices under Section 201(b) of the ActCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 3 of 154and responsible for misusing T2 and its customers confidential proprietary network informationunder Section 222(b) of the Act. T2 competes with all Defendants in the interstate and intrastatetelecommunications services market place. This Complaint, however, specifically relates to T2sinterstate telecommunications services and Defendants violations of Sections 201(b) and 222(b)of the Act as they are required to adhering to these provisions as FCC regulatedtelecommunications providers.B. T2S CLAI MS AGAI NST DEFENDANTS3. T2 alleges three claims against Defendants. First, T2 asserts that Defendantsviolated Section 201(b) of the Act, in that Defendants engaged in an unjust and unreasonablepractice towards T2 by intentionally misappropriating (that is, without T2s consent) 390telephone lines (with telephone numbers) assigned to T2 by the North American NumberingCouncil (NANC) for use in T2s business as a telecommunications provider of interstate andintrastate telecommunications service. Second, T2 claims that Defendants violated Section222(b) of the Act in that the Defendants unlawfully obtained T2 and its customers confidentialproprietary network information without T2s authorization for purposes of Defendants usingsuch information in their marketing efforts of their telecommunications services to their existingand prospective customers. T2 seeks damages for Defendants violation of these provisions ofthe Act pursuant to Section 206 of the Act, including actual damages, and reasonable attorneysfees and costs as permitted under that section of the Act.4. T2 also claims that Defendants intentionally interfered with T2s existingcontracts with its customers by their actions which resulted in T2 suffering damages to itsbusiness and reputation with its customers.Case 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 4 of 155C. DEFENDANTS ACTIONSTHAT I MPROPERLY MI SAPPROPRI ATED T2S 390TELEPHONE LINES5. T2 provided interstate service to Cambridge Group, LLC (Cambridge), aninsurance broker which also leases out office space to third parties.As a part of such leaseCambridge provides telephone services to its lessees utilizing the 16 lines T2 provided toCambridge.6. As stated above, T2 is a communications common carrier (as defined in Section153(10) of the Act, 47 U.S.C. 153(1)), or provider of interstate and intrastate telecommunicationsservice which services T2 purchases from its wholesale provider, XO TelecommunicationsServices, LLC (XO). Prior to June 17, 2014, T2 provided a variety of telecommunicationsservices to Cambridge, located in Denver, Colorado, by means of 16 telecommunications linespurchased from XO. Because of circumstances not relevant here, T2 and Cambridge decided thatT2 would not continue as Cambridges telecommunications services provider.D. CONSEQUENTLY, CAMBRIDGE DECIDED TO SWITCH PROVIDERS ANDCAMBRI DGES DECI SI ON TO KEEP I TS TELEPHONE LINES INVOKED ANINTER-CARRIER PROCESS ADOPTED BY THE FCC TO TRANSFER THELINES.7. Cambridge, on March 18, 2014, selected Windstream and/or McLeod-PAETEC,with the assistance of Platte River as Cambridges new telecommunications provider. Suchretention is known as Local Number Portability (LNP), and is mandated by Section251(b)(2) of the Act, 47 U.S.C. 251(b)(2). Cambridges decision invoked a process on the partof T2, XO and Defendants to effect the porting of Cambridges lines to Defendants.Section251(b)(2) of the Act requires local exchange carriers to provide LNP, i.e., the ability to retainones telephone number (i.e., line) when switching from one carrier to another. Cambridgeschoice of Defendants, Windstream and McLeod-PAETEC, as their telecommunications carrierCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 5 of 156triggers an inter-carrier process for LNP.Thus, Defendants, at the direction of Cambridge,submitted through Platte River or directly by Defendants a Local Service Request (LSR) toXO requesting cancellation of T2s service to Cambridge and requesting XO to portCambridges 16 telephone lines to Defendants. After submitting the LSR to T2 and XO,Defendants purportedly sent to the Number Portability Administration Center (NPAC) amessage to enter a pending subscription record with the necessary routing data or other numbersto record Cambridges porting of its 16 lines. The NPAC was created to support theimplementation of LNP by operating regional number portability databases. Defendants,however, sent NPAC a message to record Defendants porting of an additional 390 lines (i.e.,telephone numbers for the 390 lines) NPAC had assigned to T2. The NPAC data base containsproprietary information of both telecommunications providers and their customers. Uponreceiving the LSR, XO confirmed that it contained sufficient information to accomplish port, andthen created an internal service order which it sends to the appropriate operation support systemswithin XO to port the numbers to Defendant. The LOC confirmed Defendants porting of a totalof 406 T2 lines comprised of the 16 lines T2 had assigned to Cambridge as well as an additional390 lines T2 had assigned to its existing customers and which were working T2 telephone linesT2 had not authorized to be ported to Defendants. XO did then automatically send Defendantsan LSR Confirmation (LOC) which creates a disconnect order that establishes that service toCambridge will be disconnected on a specific date, in this case June 17, 2014. Moreover, XOestablished a 10-digit trigger in its telecommunications switches (this equipment routes, onbehalf of T2 inbound and outbound calls to and from Cambridge to the proper destination.). Thistrigger is necessary to prevent the misrouting of certain calls in the short interval afterCambridges numbers have been ported to Defendants, but before disconnection of T2s retailCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 6 of 157service to Cambridge has been completed. The data that Defendants send to NPAC also servesthe purpose of preventing the inadvertent porting of numbers. Defendants and XO did performthese afore mentioned functions.8. Defendants also obtained a letter of authorization (LOA) from Cambridge onMarch 18, 2014, authorizing Defendants to implement Cambridges switch of itstelecommunications services to Defendants for the 16 lines T2 provided to Cambridge.E. DEFENDANTS UNLAWFULLY PORTED ANADDITIONAL 390 LINES FROM T2WI THOUT T2S CONSENT.9. While T2 and XO ported the 16 lines to Defendants that T2 had assigned toCambridge, Defendants had also requested XO to port 390 additional T2 lines which are amongthe large blocks of telephone numbers which the NANC had assigned to T2 for use in providingits interstate and intrastate telecommunications services to its existing customers. T2 thenassigns these numbers to telephone lines. Defendants made this request based on Defendantsrepresentation to XO that T2 had given its oral and written permission for XO to port these 390additional T2 lines to Defendants. Windstream made the representation in writing to XO bymeans of an LSR. In fact, T2 had not given such authorization either orally or in writing.Nonetheless, based on Defendants LSR that T2 had authorized Defendants to receive the 390lines, XO ported them to Defendants and sent Defendants a LOC confirming that Windstreamhad requested XO to port the 16 lines T2 had assigned to Cambridge plus an additional 390 T2telephone lines.Defendants then had XO disconnect these numbers from XOs databasepreventing T2s use of lines in connection with its telecommunications platform of services. Thedisconnection meant T2 and its customers no longer had use of these 390 lines.Case 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 7 of 15810. Defendants were able to determine that T2 had these additional 390 lines byaccessing the data base managed by NPAC. Under NPAC regulations, telecommunicationsproviders are only allowed to access the NPAC data base for the exclusive purpose of routing,rating of calls, billing of calls, or performing maintenance in connection with the provision oftelecommunications services. Contrary to these NPAC regulations, Defendants accessed theNPAC database to find T2s 390 telephone lines as well as to obtain T2 and its customersproprietary network information for use in marketing T2s lines to their existing and prospectivecustomers.F. T2 ASSIGNED THESE ADDITIONAL 390 LINES TO ITS CUSTOMERS.11. T2 had actually assigned the additional 390 lines that Defendants unlawfullyported to themselves to T2 customers, including but not limited to, the Department of Defense,Department of Energy; multiple medical emergency facilities as numbers used for general, preand post-surgical contact, and obstetric or gynecological emergencies; Federal Contract SupportDesks; Whitehouse Military Operations support desks, several financial institutions maintelephone numbers, multiple Denver-based Charter schools main and backdoor phone numbers,a US-Based telephone number for IBM China, multiple other information technology companiesand their support and internal telephone numbers, as well as T2s main telephone numbers,including T2s HELP desk numbers, all of which require their customers to have by contract 24/7access to T2; T2s employees home telephone numbers; and other internal telephone numbers T2had assigned to itself for internal use. Defendants actions causing the disconnection of the 390numbers caused T2s customers to be unable to contact T2 or for T2 to contact its customers, forat least 21 hours, probably much more, beginning June 17, 2014. T2 learned of Defendantsmisappropriation of T2s additional 390 lines on June 17, 2014. T2 then spent at least 10 daysCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 8 of 159unwinding Defendants illegal port of T2s 390 numbers. Defendants illegal porting of T2s 390lines plus their action in obtaining T2 and its customers confidential proprietary networkinformation, caused T2 to suffer significant costs and damages totaling at least $360,000, if notmore. Defendants actions constitute an unjust and unreasonable practice in violation of Sections201(b) of the Act. Defendants actions also violated Section 222(b) of the Act by accessing theNPAC to learn of T2 and its customers confidential proprietary network information.G. DEFENDANTS ACTIONS I N PORTI NG T2S 390 TELEPHONE LINES CAUSEDDEFENDANTS TO VIOLATE SECTIONS 201(b) AND 222(b) OF THE ACT;DEFENDANTS ALSO INTENTI ONALLYI NTERFERED WI TH T2S EXISTINGCUSTOMERS CONTRACTS12. Defendants actions in porting T2s 390 telephone numbers without T2sauthorization constitute an unjust and irresponsible practice under Section 201 (b) of the Act.That Section of the Act states, in pertinent part, that all practices of common carriers, and inconnection with interstate telecommunications services, must be just and reasonable and that anysuch practice that is unjust or unreasonable shall be declared unlawful.13. Moreover, as alleged above, Defendants actionscaused T2 to incur substantialdamages, including but not limited to, the costs of unwinding the unauthorized porting of T2snumbers, T2s credits to its customers for the outage, and credits to customers who require 24/7service, damage to T2s reputation in the industry, T2s loss ofcustomers, with total at least$360,000.14. Defendants actions also violated Section 222(b) of the Act in that Defendantsintentionally misappropriated T2s 390 telephone numbers which include T2s customersconfidential proprietary network information for the purpose of marketing these numbers toexisting or prospective customers. Section 222(b) prohibits Defendants use of T2 and itsCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 9 of 1510customers proprietary network information.Such information is defined as information thatrelates to the quantity, technical configuration, type, destination, and usage of service subscribedto by T2s customers, and that is made available to T2 by its customers by virtue of T2srelationship with its customers. Defendants improper acquisition of such information about T2and its customers allows Defendants to unfairly compete with T2.15. Finally, Defendants actions in porting the 390 lines without T2s authorizationintentionally interfered with T2s existing customers contracts.RELIEF REQUESTEDFIRST CLAIM FOR RELIEF(Unjust and Unreasonable Practices in violation of section 201 (b) of the CommunicationsAct of 1934, as amended (Intentional Misappropriation (without T2s consent) of 390 ofT2s telephone numbers))16. T2 repeats and re-alleges the allegations in paragraphs 1 through 15, as if fully setforth herein.17. Defendants have engaged in unjust and unreasonable practices in violation ofSection 201(b) of the Act by misappropriating (i.e., without T2s authorization) T2s 390telephone numbers in connection with Defendants interstate telecommunication service.Defendants actions misappropriating these telephone numbers were intended to injure T2 in itsprovision of interstate telecommunication services in competition with Defendants, and benefitDefendants.18. Defendants are liable to T2 for actual damages T2 incurred by reason ofDefendants above alleged actions pursuant to Section 206 of the Act.Case 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 10 of 151119. T2 is entitled to recover such damages, including reasonable attorneys fees andcosts, pursuant to Section 206 of the Act.20. Defendants actions caused T2 damages to its business and reputation in an exactamount be proven at trial.SECOND CLAIMFOR RELIEF(Misuse of T2 and its Customer Proprietary Network Information in Violation of Section222(b) of the Communications Act 1934, as Amended (Illegally Taking and Using T2stelephone lines for marketing purposes))21. T2 repeats and re-alleges the allegations in paragraphs 1 through 20 as if fully setforth herein.22. Defendants have engaged in intentional misuse of T2 and its customersproprietary network information in violation of Section 222 (b) of the Act by taking T2stelephone numbers without T2s consent and using these numbers for the purpose of marketingits telecommunication services to Defendants existing or prospective customers.23. Defendants are liable to T2 for damages T2 incurred by reason of Defendantsabove alleged actions pursuant to Section 206 of the Act.24. T2 is entitled to recover such damages, including reasonable attorneys fees andcosts, pursuant to Section 206 of the Act.25. Defendants actions caused T2 damages in an exact amount be proven at trial.Case 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 11 of 1512THIRD CLAIM FOR RELIEF(Intentional Interference with Exiting Contracts)26. T2 repeats and re-alleges the allegations in paragraphs 1 through 25, as if fully setforth herein.27. T2 had contracts with the Department of Defense, Department of Energy;multiple medical emergency facilities as numbers used for general, pre and post-surgical contact,and obstetric or gynecological emergencies; Federal Contract Support Desks; WhitehouseMilitary Operations support desks, several financial institutions main telephone numbers,multiple Denver-based Charter schools main and backdoor telephone numbers, a US-Basedtelephone number for IBM China, multiple other information technology companies and theirsupport and internal telephone numbers, as well as T2s main telephone lines, including T2sHELP desk lines, all of which require 24/7 access by T2s customers and T2s ability to respondto customer inquiries; T2s employees home telephone lines; and other internal telephone linesT2 had assigned to itself for internal use.28. In these contracts, each of the parties (except for T2s employees and T2s internallines) with whom T2 contracted had agreed to subscribe to T2s interstate telecommunicationsservices in return for 24 hour, 7 days per week access to T2s interstate services for thepurposesofinquiring about, improving, modifying, changing, adding or discussingT2s existingtelecommunications services. T2 also committed to respond immediately to such inquiries,among the other contractual commitment on the part of both parties. One and or more of theparties with whom T2 contracted accessed T2s interstate telecommunications services on a dailyCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 12 of 1513basis, and T2 responded to such inquiries very promptly as it was required to do under itscontracts with these parties.29. Defendants knew or reasonably should have known of these contracts.30. Defendants by conduct, intentionally caused interference with the parties withwhom T2 contracted ability to access T2s services as well as T2s ability to give such access.31. Defendants interference with T2s contracts with parties with whom T2contracted and T2s ability to give access to such parties described above was improper.32. As a result of Defendants actions, T2 suffered damages, including, but notlimited to, granting credits to the parties with whom T2 contracted against their payments to T2for T2s telecommunication services, in an exact amount to be proved at trial.WHEREFORE, Plaintiff respectfully requests that:(a) As to the First claim for relief, this Court determine that Defendants violatedSection 201(b) of the Act, by intentionally misappropriating (i.e,. without T2s authorization)T2s 390 telephone numbers for and in connection with Defendants interstatetelecommunication services;(b) As to the first claim for relief, this Court award T2 actual damages in an exactamount T2 proves at trial pursuant to Section 206 of the Act;(c) As to the first claim for relief, this Court award Plaintiff reasonable attorneys feesand costs pursuant to Section 206 of the Act; andCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 13 of 1514(d) As to the first claim for relief, this Court award such other and further relief asmay be deemed just and reasonable;(e) As to the second claim for relief, this Court determine that Defendants violatedSection 222 (b) of the Act taking T2s telephone numbers without T2s consent for the purpose ofmarketing its telecommunication services to Defendants existing or prospective customers;(f) As to the second claim for relief, this Court award T2 actual damages pursuant toSection 206 of the Act in an exact amount T2 proves at trial;(g) As to the second claim for relief, this Court award Plaintiff reasonable attorneysfees and costs pursuant to Section 206 of the Act; and(h) As to the second claim for relief, this Court award T2 such other and further reliefas may be deemed just and reasonable.(i) As to the third claim for relief, this Court determine that Defendants intentionallyinterfered with T2s existing contracts;(j) As to the third claim for relief, this Court award T2 actual damages incurred as aresult of Defendants intentional interference with T2s existing contracts in an exact amount T2proves at trial;(k) As to the third claim for relief, this Court award T2 such other and further relief asmay be appropriate.PLAINTIFF DEMANDS A TRIAL BY JURYCase 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 14 of 15Case 1:14-cv-03151-MSK-KLM Document 1 Filed 11/20/14 USDC Colorado Page 15 of 15