Federal Communications Commission FCC 07-14 
Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of
APCC Services, Inc.,
Data Net Systems, LLC,
Davel Communications, Inc.,
Jaroth, Inc. d/b/a Pacific Telemanagement
Services, and 
Intera Communications Corp.,
Complainants,
v.
)
)
)
)
)
)
)
)
)
)
)
)
File No. EB-003-MD-011
)
NetworkIP, LLC, and )
Network Enhanced Telecom, LLP, )
)
Defendants. )
MEMORANDUM OPINION AND ORDER
Adopted:  February 22, 2007  Released:  February 23, 2007
By the Commission:
TABLE OF CONTENTS
Paragraph  
I. INTRODUCTION ……………………………………………………………………………….. 1
II. BACKGROUND ………………………………………………………………………………… 2
A.  Factual Background ………………………………………………………………………….. 2
B.  Procedural History …………………………………………………………………………… 5
III. DISCUSSION …………………………………………………………………………………... 10
A.  Network Owes Complainants $2,789,505.84 in Principal, 
Plus Prejudgment Interest at an Annual Rate of 11.25% ……………………………………10
B.  All of Network’s Grounds for Eliminating or Reducing the 
Damages Award Lack Merit ……………………………………………………………….. 14
1.  The Enforcement Bureau did not err in granting APCC’s
motion for waiver of Rule 1.718 …………………………………………………... 14
2.  APCC’s March 2002 Informal Complaint 
was effectively served ……………………………………………………………... 35
3.  The Informal Complaints effectively named NET as a 
Defendant ………………………………………………………………………….. 46
4.  The statute of limitations does not bar APCC’s damages
claims ……………………………………………………………………………… 50
Federal Communications Commission FCC 07-14
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5.  No equitable grounds warrant barring APCC’s claims ……………………………...52
6.  Network has failed to meet its burden of proving that 
APCC’s damages should be reduced to avoid double 
recovery …………………………………………………………………………… 55
IV. CONCLUSION ………………………………………………………………………………….65
V. ORDERING CLAUSES ………………………………………………………………………... 66
I. INTRODUCTION
1. In this Memorandum Opinion and Order, we grant a supplemental complaint for 
damages1 filed by APCC Services, Inc., Data Net Systems, LLC, Davel Communications, Inc., Jaroth, 
Inc. d/b/a Pacific Telemanagement Services, and Intera Communications Corp. (collectively, 
“Complainants” or “APCC”) against NetworkIP, LLC, and Network Enhanced Telecom, LLP 
(collectively, “Defendants” or “Network”) pursuant to section 208 of the Communications Act of 1934, as 
amended (“the Act”),2 and section 1.722 of the Commission’s rules.3 Complainants allege that, under the 
Commission’s payphone compensation rules,4 Network owes Complainants “dial-around” compensation 
and prejudgment interest for 11,622,941 payphone calls completed during the period October 1, 1999
through November 22, 2001.  For the reasons explained below, we agree with Complainants and award 
damages in the principal amount of $2,789,505.84, plus prejudgment interest at an annual rate of 11.25%,
pursuant to sections 201(b), 208, 209, and 276 of the Act.5
II. BACKGROUND
A. Factual Background6
2. Complainants are billing and collection agents for payphone service providers (“PSPs”).7
Complainant Jaroth, Inc. d/b/a Pacific Telemanagement Services also is itself a PSP.8 Network is a 
  
1 Supplemental Complaint for Damages, File No. EB-03-MD-011 (filed Apr. 4, 2005) (“Damages Complaint”).
2 47 U.S.C. § 208.
3 47 C.F.R. § 1.722.
4 See, e.g., 47 C.F.R. §§ 64.1300, 1310.  Unless otherwise indicated, all C.F.R. references to Part 64 of the 
Commission’s rules refer to the rules in effect from October 1, 1999 through November 22, 2001.  The parties refer 
to the relevant period as ending on Nov. 23, 2001, mirroring references made in various letter rulings and orders 
discussed herein.  Because a new payphone compensation methodology had to be in place on November 23, 2001, 
as discussed below, we believe it is clearer to say that the period under discussion here ran “through November 22, 
2001.”  
5 47 U.S.C. §§ 201(b), 208, 209, 276.
6 We incorporate by reference the facts found during the liability proceeding involving these parties in APCC 
Services, Inc. v. NetworkIP, LLC and Network Enhanced Telecom, LLP, Memorandum Opinion and Order, 20 FCC 
Rcd 2073 (Enf. Bur. 2005) (“Bureau Liability Order”), aff’d, Order on Review, 21 FCC Rcd 10488 (2006) 
(“Commission Liability Order”).
7 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2074, ¶ 2.
8 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2074, ¶ 2.
Federal Communications Commission FCC 07-14
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telecommunications carrier that owns switches and that offers other companies a package of 
telecommunications services that enables those companies to provide prepaid calling cards to end-user 
customers.9  End-user customers can use those prepaid calling cards to make “coinless” calls from 
payphones.10  In this proceeding, Complainants seek compensation from Network for such “coinless” 
calls involving Complainants’ payphones and a Network-owned switch.
3. The coinless payphone calls at issue here were made by end-user customers with prepaid 
calling cards.  When the card-holder placed a coinless call from one of Complainants’ payphones, the 
local exchange carrier (“LEC”) serving the payphone transported the call to the interexchange carrier 
(“IXC”) that Network had engaged to provide transport services.11 The IXC transported the call to one of 
three switches owned by Network. That Network switch then routed the call to the terminating LEC (i.e., 
the LEC serving the call recipient) for completion.12  
4. The prepaid calling cards used to make the coinless payphone calls at issue here were 
sold to end-user customers by entities (“Debit Card Providers”) to which Network sold a package of 
telecommunications services that enabled the Debit Card Providers to offer prepaid calling cards to the 
public.13 Network’s business relationship with the Debit Card Providers was set forth in detailed 
contracts.14 Network’s contractual package of services sold to the Debit Card Providers included (i) 
internet access to traffic and billing records specific to the Debit Card Provider, (ii) call routing by 
Network, and (iii) resold transport services of the underlying IXC.15 The Debit Card Providers played no 
role in actually transporting the coinless payphone calls at issue here.16
B. Procedural History
5. During the period October 7, 1997 through November 22, 2001, the applicable 
Commission rules provided that, with respect to each coinless payphone call, the last facilities-based 
carrier that physically routed the call to the recipient’s LEC had to pay $.24 (“dial-around compensation” 
or “payphone compensation”) to the originating PSP.17 This dispute began when, during the period
  
9 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2074, ¶ 2.
10 See, e.g.,. Bureau Liability Order, 20 FCC Rcd at 2074, ¶ 2.  “Coinless” payphone calls are those initiated, not by 
depositing coins in the payphone, but rather by dialing a special access number that triggers a specific service 
(which may or may not then require the dialing of additional numbers), such as directory assistance, operator 
service, toll-free (e.g., “800”) service, and calling card service (either pre-paid or credit card).  See, e.g., Bureau 
Liability Order, 20 FCC Rcd at 2075, ¶ 4.  
11 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2077, ¶ 9.
12 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2077, ¶ 9. 
13 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2077, ¶ 10.  Some of the Debit Card Providers did not, in fact, 
sell calling cards directly to end users, but rather resold Network’s services to other entities, which then sold calling 
cards directly to end users.  Some provided “PIN-based services.”  Id.  Neither party asserts that these nuances have 
any bearing on the issues here.
14 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2077, ¶ 11. 
15 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2077, ¶ 10.
16 Id.
17 Bureau Liability Order, 20 FCC Rcd at 2074-2077, ¶¶ 3-8.  See In the Matter of Request to Update Default 
(continued....)
Federal Communications Commission FCC 07-14
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October 1, 1999 through November 22, 2001, end users used prepaid calling cards sold by Debit Card 
Providers to make coinless calls on Complainants’ payphones.  Upon learning that a Network switch was
involved in handling at least some of those calls, Complainants sought per-call dial-around compensation 
from Network. Specifically, on March 29, 2002, Complainants filed at the Commission an informal 
complaint regarding coinless payphone calls carried by Network and Sprint;18 and on September 30, 
2002, Complainants filed at the Commission an informal complaint regarding coinless payphone calls 
carried by Network and any carrier other than Sprint.19 In those Informal Complaints, Complainants 
argued that Network owed $.24 for each payphone call at issue, because for each of those calls Network
allegedly was the last identified facilities-based carrier within the meaning of the Commission’s rules and 
orders.
6. Network declined to pay the dial-around compensation sought by Complainants.  
Network asserted that Complainants should look, instead, to the various Debit Card Providers for 
compensation.  In Network’s view, the Debit Card Providers, not Network, were the last identified 
facilities-based carriers within the meaning of the Commission’s rules and orders.20
7. Complainants ultimately filed a formal complaint alleging that Network’s refusal to pay 
dial-around compensation violated the Commission rules and orders implementing section 276 of the Act, 
and thus violated, inter alia, section 201(b) of the Act.21  Pursuant to rule 1.722,22 Complainants elected to 
“bifurcate” the matter and have only the issue of Network’s liability decided first, prior to and separate 
from any subsequent proceeding regarding the specific amount of any damages owed.23
8. After a full liability proceeding, the Bureau Liability Order concluded, inter alia, that (i) 
Network (and not the Debit Card Providers) is liable to Complainants for per-call dial-around 
compensation under the Commission’s payphone compensation rules, and (ii) Network’s failure to pay 
Complainants in accordance with the Commission’s payphone compensation rules violated section 201(b) 
  
(...continued from previous page)
Compensation Rate for Dial-around Calls from Payphones, Report and Order, 19 FCC Rcd 15636, 15659 at n.203 
(2004) (“Update Order”); Implementation of the Pay Telephone Reclassification and Compensation Provisions of 
the Telecommunications Act of 1996, Third Report and Order and Order on Reconsideration of the Second Report 
and Order, 14 FCC Rcd 2545, 2638 at ¶ 203 (1999) (some subsequent history omitted) (“Third Order”); Third Order 
on Reconsideration and Order on Clarification, 16 FCC Rcd 20922, 20924 at ¶ 6 (2001) (“Clarification Order”); 
Fourth Order on Reconsideration and Order on Remand, 17 FCC Rcd 2020, 2023 at ¶ 7 (2002) (some subsequent 
history omitted) (“Fourth Order”); Revised Answer to Formal Complaint, File No. EB-03-MD-011 (filed Sept. 15, 
2003) (“Liability Answer”) at 5 ¶ 8; Complainants’ Initial Brief of Issues Designated by the Commission’s Oct. 6, 
2005 Letter Ruling, File No. EB-03-MD-011 (filed Oct. 28, 2005) (“Complainants’ Initial Brief on Damages”) at 2.
18 Informal Complaint, File No. EB-02-MDIC-0017 (filed Mar. 29, 2002) (“March 2002 Informal Complaint”).
19 Informal Complaint, File No. EB-02-MDIC-0071 (filed Sept. 30, 2002) (“September 2002 Informal Complaint”).  
See, e.g., Damages Complaint at 3, ¶ 3 and 4, ¶ 6; Answer to Supplemental Complaint for Damages, File No. EB-
03-MD-011 (filed May 31, 2005) (“Damages Answer”) at 2, ¶ 3 and 3 ¶ 6;  Joint Statement, File No. EB-03-MD-
011 (filed July 15, 2005) (“Damages Joint Statement”) at 5, 7, ¶¶ (1) and (13). 
20See, e.g., Bureau Liability Order, 20 FCC Rcd at 2078-79, ¶ 13.
21 Formal Complaint, File No. EB-03-MD-011 (filed June 3, 2003) (“Liability Complaint”).
22 47 C.F.R. § 1.722.
23 See, e.g., Bureau Liability Order, 20 FCC Rcd at 2074, n.6.
Federal Communications Commission FCC 07-14
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of the Act.24 Accordingly, the Bureau Liability Order granted Complainants’ Liability Complaint,25 and
the Commission recently affirmed the Bureau Liability Order.26
9. After the release of the Bureau Liability Order, Complainants filed the instant Damages 
Complaint pursuant to rule 1.722.  As stated above, Complainants allege that, under the Commission’s 
payphone compensation rules, Network owes Complainants per-call dial-around compensation for 
11,622,941 payphone calls completed during the period October 1, 1999 through November 22, 2001, 
plus prejudgment interest at an annual rate of 11.25%.  For purposes of this proceeding, Network agrees 
with Complainants about the number of payphone calls at issue.27 Nevertheless, Network advances
numerous grounds why we should fully or partially reject the damages award sought by Complainants.28  
For the reasons explained below, we find Network’s arguments and defenses to be meritless, and we
award the requested damages in full: $2,789,505.84 in principal, plus prejudgment interest at an annual 
rate of 11.25%, pursuant to sections 201(b), 208, 209, and 276 of the Act.29  
III. DISCUSSION
A. Network Owes Complainants $2,789,505.84 in Principal, Plus Prejudgment 
Interest at an Annual Rate of 11.25%.
10. Given the quarterly billing practices of the payphone industry, payment of dial-around 
compensation for a coinless payphone call becomes due -- and thus a claim for non-payment accrues -- on 
the first day of the quarter that is one quarter after the one in which the call was made (e.g., compensation 
for calls made in the first quarter of 1999 became due on July 1, 1999, the first day of the third quarter of 
1999).30  Applying that principle here in conjunction with the two-year limitations period in section 
  
24 Supporting these conclusions was a determination that, with respect to the coinless payphone calls at issue, 
Network (and not the Debit Card Providers) was the last facilities-based carrier within the meaning of the 
Commission’s rules and orders.  Bureau Liability Order, 20 FCC Rcd at 2080, 2081-82, 2083-85, ¶¶ 8, 9-10, 11-13, 
22-26.
25 Bureau Liability Order, supra.
26 Commission Liability Order, supra.
27 See ¶ 11, infra.
28 See, e.g., Damages Answer; Defendants’ Initial Brief on Unresolved Issues, File No. EB-03-MD-011 (filed Oct. 
28, 2005) (“Defendants’ Initial Brief on Damages”); Defendants’ Reply Brief on Unresolved Issues, File No. EB-
03-MD-011 (filed Nov. 14, 2005) (“Defendants’ Reply Brief on Damages”); Defendants’ Motion and Memorandum 
of Points and Authorities to Compel Full Response to Interrogatory No. 4, File No. EB-03-MD-011 (filed Nov. 10, 
2005) (“Motion to Compel”). 
29 47 U.S.C. §§ 201(b), 208, 209, 276.  Note, however, that the prejudgment interest period is to be reduced by 
fifteen days.  See Parts III.A, III.B.1., infra.
30 See, e.g., Implementation of the Pay Telephone Reclassification and Compensation Provisions of the 
Telecommunications Act of 1996, Fifth Order on Reconsideration and Order on Remand, 17 FCC Rcd 21274,  
21284-85 at ¶¶ 30-32 (2002) (“Fifth Order”); Fourth Order, 20 FCC Rcd at 2024 n.28; Third Order, 14 FCC Rcd at 
2630-31, ¶¶ 187-189; Implementation of the Pay Telephone Reclassification and Compensation Provisions of the 
Telecommunications Act of 1996, Report and Order, 11 FCC Rcd 20541, 20598-99 at ¶ 115 (1996) (“First Order”); 
Implementation of the Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act 
of 1996, Order, 13 FCC Rcd 7303, 7305 at ¶ 4 (Com. Carr. Bur. 1998) (“Coding Digit Waiver Order”); APCC 
(continued....)
Federal Communications Commission FCC 07-14
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415(b) of the Act31 yields the following starting points for damages recovery purposes: regarding the 
calls addressed in the Informal Complaint filed on March 29, 2002 (i.e., calls carried by Network and 
Sprint), APCC may recover on all claims accrued on or after March 29, 2000, which includes all calls 
completed on or after October 1, 1999. Regarding the calls addressed in the Informal Complaint filed on 
September 30, 2002 (i.e., calls carried by Network and any carrier other than Sprint), APCC may recover 
on all claims accrued on or after September 30, 2000, which includes all calls completed on or after April 
1, 2000.  The end point for completed calls subject to APCC's claims is November 22, 2001, which by 
Commission order is the date on which the compensation regime at issue concluded.32 Thus, APCC can 
seek dial-around compensation here for calls completed during the period October 1, 1999 through 
November 22, 2001 (the “Relevant Period”).
11. The parties correctly agree that, during the Relevant Period, the compensation rate 
established by Commission rule was $.24 per completed payphone call.33 For purposes of this 
proceeding, the parties have stipulated that the number of completed calls involving Complainants’ 
payphones and a Network switch during the Relevant Period is 11,622,941.34 That number of completed 
calls (11,622,941) multiplied by the compensation rate per call ($.24) equals $2,789,505.84.  
Accordingly, we hereby award damages to Complainants in the principal amount of $2,789,505.84.  In 
addition, consistent with past Commission practice,35 we award prejudgment interest at an annual rate of 
  
(...continued from previous page)
Services, Inc. v. TS Interactive, Inc., Memorandum Opinion and Order, 19 FCC Rcd 10456, 10463 at ¶ 18 (Enf. Bur. 
2004) (“APCC v. TSI”).
31 47 U.S.C § 415(b).
32 See, e.g., Third Order, 14 FCC Rcd at 2638, ¶ 203;  Clarification Order, 16 FCC Rcd at 20924, ¶ 6; Fourth 
Order, 17 FCC Rcd at 2023, ¶ 7; Bureau Liability Order, 20 FCC Rcd at 2074-2077, ¶¶ 3-8.  Network asserts that, if 
a payphone compensation claim does not accrue until two quarters after a call is made, then APCC cannot obtain 
recovery for calls completed in the two quarters preceding November 23, 2001. Defendants' Initial Brief on 
Damages at 16-17 and n.7. Network's assertion confuses the concepts of liability attachment and claim accrual.
Liability for a call attaches when the call is completed; but a claim for non-payment of that liability does not accrue 
until a carrier fails to pay on the payment due date. See Part III.B.4, infra. If it were otherwise, a PSP could sue a 
carrier on the day after a call was completed, before a bill was even rendered.  Thus, Network is liable for all calls 
completed through November 22, 2001, even though some of APCC’s claims for Network’s failure to pay on that 
liability accrued after that date. 
33 See, e.g., n.32, supra; Liability Answer at 14, ¶ 16; Complainants’ Initial Brief on Damages at 2.
34 See, e.g., APCC, Inc. v. NetworkIP, LLC and Network Enhanced Telecom, LLP, Letter from Alexander P. Starr 
to Counsel, File No. EB-03-MD-011 (rel. Oct. 6, 2005) (“ISC Order”) at 3-4; Joint Proposed Order, File No. EB-03-
MD-011 (filed Sept. 30, 2005) at 3-4.   
35 See, e.g., Update Order, 19 FCC Rcd at 15661, ¶ 79; Bell Atlantic – Delaware, Inc. v. Frontier Communications 
Services, Inc., Memorandum Opinion and Order, 16 FCC Rcd 8112, 8115 at ¶ 17 and n.43 (2001) (“Bell Atlantic v. 
Frontier”); Implementation of the Pay Telephone Reclassification and Compensation Provisions of the 
Telecommunications Act of 1996, Second Report and Order, 13 FCC Rcd 1778, 1805-06 at ¶¶ 59-60 (1997) (some 
subsequent history omitted) (“Second Order”); Third Order, 14 FCC Rcd at 2630-2631, ¶¶ 187-189; APCC v. TSI, 
19 FCC Rcd at 10466, ¶ 22; Illinois Bell Telephone Co., Inc. v. One-Call Communications, Inc., Memorandum 
Opinion and Order, 16 FCC Rcd 16697, 16703 at ¶ 13, n.43 (Enf. Bur. 2001).  See generally US Sprint 
Communications Limited Partnership v. Pacific Northwest Bell Telephone Co., Memorandum Opinion and Order, 8 
FCC Rcd 1288, 1298 (1993); TeleDial America, Inc. v. Michigan Bell Telephone Co., Order, 8 FCC Rcd 1171 
(1993); MCI Telecommunications Corp. v. AT&T Co., Memorandum Opinion and Order, 94 F.C.C. 2d 332 (1983).
Federal Communications Commission FCC 07-14
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11.25%.36 Moreover, because payphone industry practice is that compensation for a dial-around call 
becomes due on the first day of the quarter that is one quarter after the one in which the billed call was 
made,37 prejudgment interest shall begin to accrue on that day.38
12. Network observes, correctly, that the Commission has discretion not to award 
prejudgment interest on equitable grounds,39 and argues that we should refrain from doing so here, 
because (i) Complainants refused to heed Network’s advice to seek recovery from the Debit Card 
Providers, and (ii) Complainants delayed in seeking recovery from Network.40 We reject Network’s 
argument.  The Commission has already held that Complainants were correct in seeking recovery from 
Network rather than from the Debit Card Providers.41 Moreover, the two-year statute of limitations in 
section 415 of the Act addresses Network’s argument as to delay.42 Thus, Network has not shown the 
extraordinary circumstances necessary to warrant a departure from the Commission’s usual practice – in 
both payphone complaint cases and non-payphone complaint cases – of awarding prejudgment interest in 
order to promote fairness and to make the complainant whole.43
13. Network further argues that, if we do award prejudgment interest, it should not be at the 
rate of 11.25%, but rather at the IRS rate for tax underpayments by large corporations, which is much 
  
36 Although Network disputes the use of the 11.25% rate, see para. [13], infra, the parties agree that interest should 
be computed annually.  Complainants’ Initial Brief on Damages at 6; Defendants’ Reply Brief on Damages at 3, n.5.  
See, e.g., Implementation of the Pay Telephone Reclassification and Compensation Provisions of the 
Telecommunications Act of 1996: AT&T Request for Limited Waiver of the Per-Call Compensation Obligation, 
Memorandum Opinion and Order, 13 FCC Rcd 10893, 10895 at ¶ 3 (Com. Carr. Bur. 1998) (“Coding Digit Waiver 
Grant Order”). 
37 See, e.g., n.30, supra. 
38 See, e.g., Coding Digit Waiver Grant Order, 13 FCC Rcd at 10895, ¶ 3.  Our award of prejudgment interest 
excludes the period May 19, 2003 to June 3, 2003, however.  See Part III.B.1., infra.
39 See Damages Answer at 14-15, ¶¶ 39-40; Defendants’ Initial Brief on Damages at 22-25 (citing General 
Communication, Inc. v. Alaska Communications Systems Holding, Memorandum Opinion and Order, 16 FCC Rcd 
2834, 2862 at ¶ 72 (2001) (“GCI v. Alaska”), and Starpower Communications, LLC v. Verizon South, Inc., 
Memorandum Opinion and Order, 18 FCC Rcd 23625, 23635 at ¶ 19 (2003) (“Starpower v. Verizon”)).  
40 See, e.g., Damages Answer at 14-15, ¶¶ 39-40; Defendants’ Initial Brief on Damages at 22-25; Defendants’ Reply 
Brief on Damages at 2, n.3.  
41 Commission Liability Order, 21 FCC Rcd at 10490, ¶ 6; Bureau Liability Order, 20 FCC Rcd at 2085, ¶ 26.
42 47 U.S.C. § 415.
43 See, e.g., nn.35, 36, supra; see also Bell Atlantic-Delaware, Inc.. v. MCI Telecommunications Corp., 
Memorandum Opinion and Order, 16 FCC Rcd 8112, 8120 at ¶ 17 and n.43 (2001); Rainbow Programming 
Holdings, Inc. v. Bell Atlantic-New Jersey, Inc., Memorandum Opinion and Order, 15 FCC Rcd 11754, 11763 at ¶ 
26 (Enf. Bur. 2000); Mile Hi Cable Partners, LP v. Public Service Company of Colorado, Order, 15 FCC Rcd 
11450, 11458-59 at ¶ 14 (Cable Ser. Bur. 2000).  Our research reveals that the Commission awards prejudgment 
interest in the vast majority of cases.  In fact, the failure to award prejudgment interest, absent some compelling 
reason, may constitute an abuse of discretion.  See, e.g., National Communications Ass’n, Inc. v. AT&T Co., 1999 
WL 258263 (S.D.N.Y. Apr. 29, 1999) (citations omitted).  It may be that denying prejudgment interest is 
appropriate only if either the complainant has itself acted unlawfully, or the principal amount of damages is 
uncertain, or the complainant will be made whole through some other mechanism, such as statutory treble damages.  
None of those circumstances exists here.
Federal Communications Commission FCC 07-14
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lower than 11.25%.44 To support this argument, Network points out, again correctly, that the Commission 
has applied IRS rates for prejudgment interest in a variety of payphone and non-payphone contexts.45  
What Network overlooks, however, is that the Commission has repeatedly applied and affirmed the 
11.25% prejudgment interest rate in the specific payphone context at issue here, i.e., the late payment of 
per-call dial-around compensation accrued in 1999-2001.46  Accordingly, although we have discretion to 
apply a different rate, we decline to depart from the precedent applied to this context, and we award 
prejudgment interest at an annual rate of 11.25%.
B. All of Network’s Grounds for Eliminating or Reducing the Damages Award Lack 
Merit.
1. The Enforcement Bureau did not err in granting APCC’s Motion for 
Waiver of rule 1.718.
14. During the course of this formal complaint proceeding, the Enforcement Bureau issued 
an order granting an APCC motion for waiver and extension of rule 1.718’s “relation-back” filing 
deadline.47 Network then sought Commission reconsideration of the Waiver Order on three grounds:  the 
Waiver Order (i) exceeds the Commission’s authority by essentially waiving a statutory limitations 
period;48 (ii) applies the wrong legal standard;49 and (iii) misjudges the facts favoring and disfavoring 
waiver.50 For the following reasons, we deny Network’s Petition.51
  
44 See, e.g., Damages Answer at 14-15, ¶ 39; Defendants’ Initial Brief on Damages at 23-24; Defendants’ Reply 
Brief on Damages at 3, n.5.
45 See, e.g., Damages Answer at 14-15, ¶ 39 (citing Starpower v. Verizon., 18 FCC Rcd at 23635 ¶ 19 (2003)); 
Defendants’ Initial Brief on Damages at 23-24 (citing Fourth Order,17 FCC Rcd at 2033, ¶¶ 32-33; Fifth Order, 17 
FCC Rcd at 21307, ¶¶ 99-101; GCI v. Alaska, 16 FCC Rcd at 2863, ¶ 74)).  
46 See, e.g., Update Order, 19 FCC Rcd at 15661, ¶ 79; Fifth Order, 17 FCC Rcd at 21283-85, 21307, ¶¶ 28-31, 99-
100; Fourth Order, 17 FCC Rcd at 2033, ¶ 33 (stating that, “while that approach [of using  the 11.25% rate] remains 
fitting in its context, in the very different context of one-time … true-up payments, a commercially-oriented rate is 
most suitable”) (emphasis added); Bell Atlantic v. Frontier, 16 FCC Rcd at 8120, ¶ 17 n.43 (ordering the 
computation of prejudgment interest at 11.25% and noting that the “use of the 11.25 percent interest rate is unique to 
cases in which IXCs are late in making payments to PSPs, and is not necessarily applicable in other contexts”); 
Third Order, 14 FCC Rcd at 2630-31, ¶¶ 187, 189; APCC  v. TS Interactive, 19 FCC Rcd at 10466-67, ¶¶ 20-21; 
Illinois Bell v. OneCall, 16 FCC Rcd at 16703, ¶ 13 n.43 (stating that “[t]he Commission has previously determined 
that an 11.25% interest rate is appropriate when IXCs are late in making payments to PSPs”). 
47 APCC Services, Inc.  v. Network IP, LLC and Network Enhanced Services, LLP, Order, 20 FCC Rcd 16727 (Enf. 
Bur. 2005) (“Waiver Order”).
48 Petition for Reconsideration, File No. EB-03-MD-011 (filed Nov. 22, 2005) (“Petition”) at 5-7; Reply to 
Complainants’ Opposition to Defendants’ Petition for Reconsideration, File No. EB-03-MD-011 (filed Dec. 16, 
2005) (“Petition Reply”) at 3-4.
49 Petition at 7-9; Petition Reply at 9.
50 Petition at 8-17; Petition Reply at 5-10.
51 Our rules permit us to adjudicate a petition for reconsideration of an order issued pursuant to delegated authority.  
47 C.F.R. § 1.106(a)(1).  Doing so makes sense here, given that this Order resolves all other outstanding issues.  See 
generally 47 U.S.C. §§ 154(i), (j); 47 C.F.R. § 1.1.  Moreover, by adjudicating the Petition in conjunction with 
resolving all other outstanding issues, we render moot APCC’s otherwise compelling objection that the Petition 
(continued....)
Federal Communications Commission FCC 07-14
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15. Pursuant to section 208 of the Act, the Commission’s rules establish an “informal” 
complaint process that provides a relatively simple and streamlined mechanism for seeking resolution of a 
dispute with a common carrier.52 If a complainant is not satisfied with the results of the informal 
complaint process, the complainant can then commence a “formal” complaint process, which resembles 
commercial litigation in court.53
16. Under section 415(b) of the Act, a “complaint” against a carrier seeking recovery of 
damages must be filed within two years from the time the damages claim accrues.54 It is well established 
that “[a]n ‘informal complaint’ filed pursuant to sections 1.716-1.718 of the Commission’s rules 
constitutes a ‘complaint’ within the meaning of section 415 of the Act and thus tolls the running of the 
two-year limitations period.”55 Under rule 1.718, for purposes of continuing the tolling of the limitations 
period, the filing date of a formal complaint can “relate back” to the filing date of a prior informal 
complaint involving the same parties and the same matter, but only if the formal complaint is filed within 
six months after the defendant’s response to the informal complaint.56
17. Here, on September 30, 2002, APCC filed an informal complaint against Network57
seeking recovery of payphone compensation for the period September 30, 2000 (two years before the 
filing date, the limitations period under section 415 of the Act) through November 22, 2001 (the 
regulatory cut-off date for the kind of compensation at issue).58 Network filed its response to APCC’s 
Informal Complaint on November 19, 2002.59 Therefore, pursuant to the six-month deadline under rule 
1.718, May 19, 2003 was the last date on which APCC could file a formal complaint that would relate 
back to September 30, 2002 (the filing date of the informal complaint) and thereby retain the full potential 
  
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improperly seeks interlocutory relief.  See Opposition to Defendants’ Petition for Reconsideration, File No. EB-03-
MD-011 (filed Dec. 9, 2005) (“Opposition to Recon.”) at 6-7 (citing 47 C.F.R. § 1.106(a)(1) (stating that “[p]etitions 
for reconsideration of … interlocutory actions will not be entertained”)).
52 47 C.F.R. §§ 1.716-1.718.
53 47 C.F.R. §§ 1.720-1.736.
54 47 U.S.C. § 415(b).
55 See, e.g., Operator Communications, Inc. v. Contel of the South, Inc., Memorandum Opinion and Order, 20 FCC 
Rcd 19783, 19792 at ¶ 23 (2005).
56 47 C.F.R. § 1.718 (stating, in pertinent part, that a formal complaint “will be deemed to relate back to the filing 
date of the informal complaint: Provided, That the formal complaint: (a) Is filed within six months from the date of 
the carrier’s [i.e., the defendant’s] report . . . ”).
57 September 2002 Informal Complaint.  In Network’s view, the Waiver Order’s statement that APCC’s informal 
complaint effectively named Network Enhanced Telecom, LLP, as a defendant is incorrect.  Petition at 3 n.2.  We 
reject Network’s assertion elsewhere in this Order.  See Part III.B.3., infra.
58 See, e.g., September 2002 Informal Complaint.  As explained previously, due to certain unique characteristics of 
payphone billing and payment cycles, payphone compensation claims accrue on the first day of the quarter 
following the quarter after the quarter in which the call was made. Thus, an informal complaint filed on September 
30, 2002 allows recovery for calls made from April 1, 2000 forward.  See, e.g., Part III.A, supra.  Network points 
out that APCC’s September 2002 Informal Complaint purports to seek recovery back to October 7, 1997.  Petition at 
3 n.2.  It has subsequently become clear, however, that APCC is seeking recovery for only the shorter period 
described above.   See, e.g., ISC Order at 3-4, ¶¶ 12-13; Complainants’ Initial Brief on Damages at 2-3. 
59 Response to Informal Complaint, File No. EB-02-MDIC-0071 (filed Nov. 19, 2002).
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recovery period of April 1, 2000 through November 22, 2001.60
18. On May 19, 2003, the filing deadline under rule 1.718, APCC attempted to file a formal 
complaint against Network.61 That day, APCC delivered the formal complaint to Mellon Bank and served 
Network.62 APCC submitted the wrong filing fee, however:  $165 per defendant instead of the $170 
required by Commission rules at that time.63 In addition, APCC submitted a single check rather than a 
check for each defendant.  Because APCC submitted an inadequate filing fee, Mellon Bank automatically 
rejected and returned the formal complaint.64 As a result, the formal complaint was not officially “filed” 
on May 19, 2003, and APCC missed the six-month deadline under rule 1.718.65
19. According to APCC, it submitted the wrong filing fee (and thus missed the six-month 
deadline under rule 1.718) because it consulted only the hard-copy version of the Code of Federal 
Regulations (“CFR”), dated October 1, 2002, which contained a filing fee amount -- $165 per defendant -
- that had been superseded by the time APCC filed its formal complaint in May 2003.  The new fee of 
$170 per defendant, although adopted in July 2002, did not become effective until after publication of the 
October 1, 2002 CFR, and so was not reflected therein.66
20. On June 3, 2003, APCC filed a revised version of the formal complaint, along with the 
correct filing fee.67 That same day, APCC also filed its motion for waiver and extension of rule 1.718’s 
six-month relation-back deadline from May 19, 2003 to June 3, 2003.68 APCC’s Waiver Motion 
essentially sought to preserve the full potential recovery period of April 1, 2000 through November 22, 
2001, and to avoid the loss of approximately nine months of potential recovery (i.e., April 1, 2000 to 
  
60 As discussed elsewhere herein, prior to the September 2002 Informal Complaint, APCC had submitted a different 
informal complaint on March 29, 2002. See Parts II.B, III.B.2-3.   The September 2002 Informal Complaint seeks 
recovery of per-call dial-around compensation for payphone calls involving Network and all carriers other than 
Sprint, whereas the March 29, 2002 informal complaint seeks such recovery only for payphone calls involving 
Network and Sprint.  See Part II.B, supra.
61 See, e.g., Supplemental Complaint for Damages [rejected], File No. EB-03-MD-011 (served May 19, 2003) 
(“Attempted Damages Complaint”) at 31 (Certificate of Service); Damages Joint Statement  at 9, ¶ (9); Waiver 
Order, 20 FCC Rcd at 16729, ¶ 5. 
62 Attempted Damages Complaint at 31; Opposition to Complainants’ Motion for a Partial Waiver of Section 1.718 
of the Commission’s Rules, File No. EB-03-MD-011 (filed June 9, 2003) (“Opposition to Waiver Motion”) at 2; 
Damages Joint Statement at 9 (stating that Complainants “submitted” a formal complaint on May 19, 2003); Waiver 
Order, 20 FCC Rcd at 16729, ¶ 5; but see Damages Answer at 2, ¶ 7 (stating that Defendants never received the 
May 19, 2003 complaint ).
63 47 C.F.R. § 1.1106.  See Complainants’ Motion for Partial Waiver of Section 1.718 of the Commission’s Rules, 
File No. EB-03-MD-011 (filed June 3, 2003) (“Waiver Motion”) at 4-5. 
64 See generally 47 C.F.R. § 1.1116(a).  See, e.g., Waiver Motion at 5; Opposition to Waiver Motion at 2; Damages 
Answer at 4; Damages Joint Statement at 9. 
65 See, e.g., 47 C.F.R. § 1.1116(a)(2).
66 See Waiver Order, 20 FCC Rcd at 16729, ¶ 6; Waiver Motion at 4-5, 7-9. 
67 See Waiver Order, 20 FCC Rcd at 16729, ¶ 7; Liability Complaint, supra.  
68 Waiver Motion.
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January 2, 2001) that would otherwise occur if the relation-back feature of rule 1.718 was denied.69
21. In assessing APCC’s Waiver Motion, the Bureau applied the following well-established 
standards: 
Generally, the Commission may grant a waiver for good cause 
shown.  The Commission may exercise its discretion to waive a rule 
where the particular facts make strict compliance inconsistent with the 
public interest.  In addition, the Commission may take into account 
considerations of hardship, equity, or more effective implementation of 
overall policy on an individual basis.  Waiver is therefore appropriate 
only if special circumstances warrant a deviation from the general rule, 
and such a deviation will serve the public interest.70
22. Over Network’s opposition,71 the Waiver Order largely granted APCC’s Waiver Motion 
because (i) APCC attempted in good faith to file its formal complaint by the six-month deadline of rule 
1.718; (ii) APCC’s filing errors were not an attempt to “game” the system to obtain some undue 
advantage; (iii) denying a waiver would allow a $5.00 fee error to jeopardize the statutory right of 
numerous independent payphone service providers to substantial sums of per-call compensation;72 and 
(iv) through many communications between the parties before the six-month deadline of rule 1.718, 
Network was fully aware that APCC would file a formal complaint in the absence of a settlement, and 
thus Network had little expectation of finality and repose on May 19, 2003.  Accordingly, the Waiver 
Order waived and extended rule 1.718’s six-month relation-back deadline from May 19, 2003 to June 3, 
2003.73 Because APCC’s mistakes were “easily avoidable,” however, the Waiver Order excluded from 
  
69 See, e.g. ,Waiver Order at 5, 15-17.   The financial differential between the two recovery periods (i.e., April 1, 
2000 through November 22, 2001 with the waiver, versus January 2, 2001 through November 22, 2001 without) is 
over one million dollars in principal amounts owed.  See Waiver Order at 4, n.23; ISC Order at 3-4, ¶¶ 12, 13.  
70 Waiver Order, 20 FCC Rcd at 16730-31, ¶ 9 (quoting Application for Review by Information Technology Dept. of 
State of North Dakota, Order, 18 FCC Rcd 21521, 21524 at ¶ 9 (2003) (“North Dakota Order”), rev’d on other 
grounds, In the Matter of Request for Review of the Decision of the Universal Service Administrator by Bishop 
Perry Middle School, New Orleans, LA, Order, 21 FCC Rcd 5316 (2006) (“Schools and Libraries Waiver Order”).  
Put differently, “[w]hile an applicant for a waiver faces a heavy burden of persuasion, the Commission must give a 
‘hard look’ to meritorious waiver requests and may grant such requests where the waiver will not undermine the 
policy of the general rule and where public interest considerations require the waiver.” Id. (quoting Application of 
Winstar Broadcasting, Memorandum Opinion and Order, 17 FCC Rcd 6126, 6128 at ¶ 9 (2003) (“Winstar Order”).  
See, e.g., Delta Radio, Inc. v. FCC, 387 F.3d 897, 900-901 (D.C. Cir. 2004); Mountain Solutions, Ltd., Inc. v FCC, 
197 F.3d 512, 517-522 (D.C. Cir. 1999); Northeast Cellular Telephone v. FCC, 897 F.2d 1164, 1166 (D.C. Cir. 
1990).
71 Opposition to Waiver Motion. 
72 See n.69, supra.
73 Waiver Order, 20 FCC Rcd at 16730-33, ¶¶ 8-14 (relying upon, inter alia, Metricom, Inc. Request for Waiver of 
Section 27.208(A) of the Commission’s Rules, Order, 13 FCC Rcd 890 (Wireless Tel. Bur. 1998) (“Metricom Waiver 
Order”) (granting two-day waiver of payment deadline, because delay was caused by applicant’s bank’s error in 
transmitting payment to Mellon Bank); Southern Communications Systems, Inc. Request for Waiver of Section 
24.711(a)(2) of the Commission’s Rules, Order, 12 FCC Rcd 1532 (Wireless Tel. Bur. 1997) (“SCS Waiver Order”) 
(granting one-day waiver of payment deadline, because of applicant’s prior record of compliance, prompt remedial 
action, and good faith effort to pay on time); MFRI, Inc. Request for Waiver of Section 24.711(a)(2) of the 
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the scope of the waiver any prejudgment interest accrued during the 15-day period between the date on 
which APCC should have filed its formal complaint with the correct fee (May 19, 2003) and the date on 
which APCC effectively filed its formal complaint with the correct fee (June 3, 2003).74
23. Based on this record, we conclude that the Bureau’s determination in the Waiver Order
was correct. We agree with the Waiver Order that, at bottom, a $5.00 fee error by APCC’s counsel -- as 
negligent as it may have been -- should not deprive APCC and its numerous PSP principals of their right 
under section 276 of the Act and our rules to substantial sums of dial-around compensation, where the 
formal complaint was otherwise submitted and served on time and in good faith, with advance notice to 
Network.  Put simply, under these specific circumstances, strict enforcement of our six-month relation-
back deadline would unduly conflict with the public interest in ensuring the payment of compensation 
necessary to “promote the widespread deployment of payphone services to the benefit of the general 
public….”75
24. In its multifaceted challenge to the Waiver Order, Network first argues that, in allowing 
APCC to re-file its formal complaint after the relation-back deadline of rule 1.718 had passed, the Waiver 
Order exceeded the Commission’s authority by effectively waiving the statutory limitations period in 
section 415(b) of the Act.76 We disagree.  Network mischaracterizes  the Waiver Order.  As stated above, 
APCC’s filing of the informal complaint on September 30, 2002 – not APCC’s submission of the formal 
complaint on May 19 or June 3, 2003 – tolled the running of the limitations period under section 415(b) 
of the Act.  Thereafter, the question whether APCC’s subsequent formal complaint was sufficiently 
timely so as to benefit from that preexisting tolling was a matter purely of the Commission’s rules 
regarding the internal management of its complaint proceedings.  Consequently, the Waiver Order had no 
effect on the statutory limitations period, and pertained only to the Commission’s relation-back rules.  
Accordingly, the Waiver Order falls squarely within the Commission’s authority.77
  
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Commission’s Rules, Order, 12 FCC Rcd 1540 (Wireless Tel. Bur. 1997) (“MFRI Waiver Order”) (granting one-day 
waiver of payment deadline, because applicant attempted to pay on time and failed only due to administrative 
errors); Longstreet Communications Int’l, Inc. Request for Waiver of Section 24.711(a)(2) of the Commission’s 
Rules, Order, 12 FCC Rcd 1549 (Wireless Tel. Bur. 1997) (“Longstreet Waiver Order”) (granting nine-day waiver 
of payment deadline, because of applicant’s prior record of compliance, prompt remedial action, and good faith 
effort to pay on time); Application of Fred Farley for Authority to Construct and Operate a Domestic Public 
Cellular Radio Telecommunications Service, Memorandum Opinion and Order, 4 FCC Rcd 4670 (Com. Car. Bur. 
1989) (“Farley Waiver Order”) (granting three-day waiver of filing deadline, because improper filing on due-date 
was caused by clerical error)).
74 Waiver Order, 20 FCC Rcd at 16732, ¶¶ 12-13.  In other words, the calculation of prejudgment interest on 
APCC’s award of payphone compensation in this damages proceeding will exclude the period from May 19, 2003 to 
June 3, 2003. 
75 47 U.S.C § 276(b)(1).  See generally, Schools and Libraries Waiver Order, supra.
76 Petition at 5-7; Petition Reply at 3-4.  Network inexplicably failed to raise this issue in its Opposition to APCC’s 
Waiver Motion; consequently, we could have declined to address this issue here.  See, e.g., Knology, Inc. v. Georgia 
Power Co., Memorandum Opinion and Order, 18 FCC Rcd 24615, 24617 n.16, 24624 (2003) (“Knology v. Georgia 
Power”) (and cases cited therein) (declining to consider belatedly raised issues).  
77 See, e.g., In the Matter of Meredith/New Heritage Strategic Partners, L.P., Memorandum Opinion and 
Consolidated Order, 9 FCC Rcd 6841, 6842 at ¶ 6 (1994) (“Meredith”) (stating that, “[w]here the time limit is not 
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25. Network next argues that the Bureau erred in the Waiver Order by applying the 
Commission’s general waiver standard rather than a stricter waiver standard applied “in connection with 
filing deadlines for pleadings which initiate adjudicatory proceedings.”78 According to Network, where, 
as here, a waiver request concerns “a filing deadline for an adjudicatory pleading, a party ‘must cite the 
intervention of something beyond the control of the party which could not have been foreseen, and for 
which no corrective action could have been taken.’”79 In Network’s view, under that standard, APCC’s 
Waiver Motion should be denied, because the failure to pay the correct fee and the decision to file on the 
last day of the six-month period were foreseeable, correctable, and within APCC’s control.80
26. This argument, too, fails for two reasons.81 First, by its own terms, the strict Meredith
waiver standard applies only to filing deadlines for pleadings that “initiate adjudicatory proceedings.”82  
Applying a different waiver standard to filing deadlines for pleadings that initiate adjudications makes 
sense, because the initiation deadline is when the defendant’s interest in certainty, finality, and repose, 
and the Commission’s interest in resource management, are most acute.83 Here, the deadline at issue --
when a formal complaint must be filed in order to “relate back” to a cognate informal complaint -- does 
  
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set by statute, but is regulatory in nature, the Commission may exercise its discretion and accept late-filed materials 
in appropriate circumstances, upon a showing of good cause”).
78 Petition at 8-9 (quoting Meredith, 9 FCC Rcd at 6843, ¶ 9).
79 Petition at 9 (quoting Meredith, 9 FCC Rcd at 6843, ¶ 10, and also citing In the Matter of Time Warner 
Entertainment/Advance-Newhouse Partnership v. Florida Power & Light Co., Order on Reconsideration, 14 FCC 
Rcd 18899, 18901 at ¶ 5 (Cable Serv. Bur. 1999) (“Time Warner”); In Re Applications of Clifford Stanton Heinz 
Trust, Memorandum opinion and Order, 11 FCC Rcd 5354, 5358 at ¶ 20 (Wireless Tel. Bur. 1996) (“Heinz Trust”)).  
See Petition at 7-9, 11-12; Petition Reply at 9.
80 Id. 
81 Like the statute of limitations issue discussed above, Network inexplicably failed to raise this waiver standard 
issue in its Opposition to APCC’s Waiver Motion; consequently, we could have declined to address this issue here.  
See, e.g., Knology v. Georgia Power, 18 FCC Rcd at 24617 n.16, 24624.  
82 Meredith, 9 FCC Rcd at 6843, ¶ 9 (emphasis added).  See In the Matter of Northeast Gwinnett Cablevision, 
Memorandum Opinion and Order, 13 FCC Rcd 10282, 10284 at ¶ 6 (Cable Serv. Bur. 1998) (“Northeast Gwinnett 
Cablevision”) (stating that “[t]he Commission made it clear in its decision in [Meredith] that it will strictly apply the 
good cause standard in connection with filing deadlines initiating adjudicatory proceedings….”) (emphasis added).  
Network implicitly acknowledges that the Meredith standard applies only to deadlines for pleadings that initiate an 
adjudicatory proceeding.  See Petition at 2 (stating that, “[i]n cases involving pleadings that initiate adjudications, 
deadlines may be waived only if Complainants had a legitimate reason ….”) (emphasis added); Petition Reply at 9 
n.6.
83 See generally In the Matter of:  Continental Cablevision of Massachusetts, Inc., Memorandum Opinion and 
Order, 13 FCC Rcd 13782 (1998) (applying Meredith standard to a deadline for filing a complaint initiating a 
proceeding); In the Matter of Falcon Cablevision, Memorandum Opinion and Order, 16 FCC Rcd 8845 (Cable Serv. 
Bur. 2001) (same); In the Matter of Falcon Cablevision, Consolidated Memorandum Opinion and Order, 16 FCC 
Rcd 4633 (Cable Serv. Bur. 2001) (same); Northeast Gwinnett Cablevision, supra (same); Falcon Classic Cable v. 
McCreary County, KY, Memorandum Opinion and Order, 13 FCC Rcd 6489 (Cable Serv. Bur. 1998) (same); In the 
Matter of Falcon Cablevision, Memorandum Opinion and Order, 12 FCC Rcd 4190 (Cable Serv. Bur. 1997) (same); 
but see Time Warner, supra; Heinz Trust, supra; In the Matter of:  Telenois, Inc., Order, 10 FCC Rcd 9530 (Cable 
Serv. Bureau 1995) (applying Meredith standard to deadlines for filing application for review, opposition to 
reconsideration petition, and opposition to rate complaint, respectively). 
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not concern a pleading that initiated the instant proceeding.  It is the informal complaint filed on 
September 30, 2002 that initiated the proceeding (and, as stated above, that tolled the running of the 
limitations period), not the subsequent formal complaint.  Put differently, the Informal Complaint 
initiated this proceeding, whereas the formal complaint simply continued it.  Consequently, the Bureau 
correctly applied the general waiver standard, rather than the Meredith waiver standard, in the Waiver 
Order.84
27. Second, in each of the cases relied upon by Network, the movant failed to submit and 
serve the pleading at issue within the deadline period, and thereby failed to satisfy any of the public 
interests in enforcing deadlines.85 Here, by contrast, APCC did submit its formal complaint to the 
Commission, and did serve the formal complaint on Network, before the six-month deadline expired.  For 
this reason, too, the Bureau was correct in applying the general waiver standard, rather than the Meredith
waiver standard, in the Waiver Order.
28. Network last argues that, even under the Commission’s general waiver standard, the 
Bureau should not have granted a waiver of the six-month relation-back deadline.  Specifically, Network 
contends that the Waiver Order misapplies the general waiver standard to the operative facts in several 
respects.  Network’s contention lacks merit, for the reasons described below.
29. Network’s principal argument is that the Bureau erred in relying at all on the substantial 
financial harm to APCC and its PSP principals that would likely result from denying the Waiver Motion.  
In Network’s view, the analysis should have focused solely on the circumstances of APCC’s failure to 
perfect a filing on time.  Network observes that a denial of a waiver request will always harm the 
requesting party, so reliance on such harm in the waiver analysis would provide no “limiting principle,” 
leading the Commission to engage improperly in ad hoc decision-making, and skewing the balance 
inherently and unfairly towards waiver grants.  Network further states that, under a properly limited 
analysis focusing exclusively on the circumstances of APCC’s failure to perfect a filing on time, the 
Waiver Motion should have been denied because, as the Waiver Order concluded, the failure stems from 
APCC’s mistakes, which do not qualify as good cause.86
30. Network’s argument is unpersuasive.  As stated above, the Commission has repeatedly 
held that, in determining the propriety of waiving a Commission rule, the Commission may evaluate “the 
public interest” and “considerations of hardship, equity, or more effective implementation of overall 
policy on an individual basis.”87 Those factors plainly encompass consideration of the potential harm to 
the requesting party.  Indeed, the Commission has frequently and recently assessed such harm in 
  
84 We note that, in the most recent Commission-level reference to Meredith, the Commission implied that the 
Meredith standard might not materially differ from the general waiver standard.  In re Application of Independent 
Communications, Inc., Memorandum Opinion and Order, 15 FCC Rcd  7080, 7082 at ¶ 8 (1999) (stating that, “[i]n 
demonstrating good cause [for a deadline waiver] in connection with adjudicatory pleadings, a party need only 
provide a legitimate reason for not being able to file pleadings within the time specified as opposed to ‘unusual or 
compelling circumstances’….”).
85 See Meredith, supra; Time Warner, supra; Heinz Trust, supra.
86 Petition at 10-12; Petition Reply at 9.
87 North Dakota Order, 18 FCC Rcd at 21524, ¶ 9.
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evaluating the propriety of waiver.88 Thus, the Waiver Order did not err by considering the potential 
harm to APCC and its PSP principals.
31. Network next argues that, even if it were appropriate to consider the potential harm to 
APCC and its PSP principals, the Waiver Order erroneously exaggerated the harm by failing to recognize 
that (i) denying a waiver would not deprive APCC of its entire recovery, and (ii) APCC can seek damages 
from its attorneys in a malpractice suit.89  We disagree with Network’s characterization of the Waiver 
Order.  The Waiver Order recognized that denial of the Waiver Motion would reduce, but not eliminate, 
APCC’s potential recovery.90 Moreover, as Network implicitly concedes, the reduction in potential 
recovery would diminish APCC’s total potential recovery by a substantial sum, even though a part of the 
recovery would remain.  Finally, that APCC and its PSP principals might recover any lost potential 
damages in a malpractice suit is too speculative and remote to be dispositive of whether the Bureau 
properly weighed the public interest.  Consequently, we find that the Waiver Order did not misjudge the 
potential harm facing APCC and its PSP principals.
32. Network also asserts that the Waiver Order erred by considering favorably the absence of 
bad faith or gamesmanship by APCC.91 The Waiver Order’s consideration of that factor, however, has 
ample precedent,92 and in any event was not dispositive standing alone.
33. Network concludes by contending that the Waiver Order erred by failing to consider 
Network’s interest in not paying millions of payphone compensation dollars more than would be owed 
  
88 See, e.g., n.73, supra; Schools and Libraries Waiver Order, 21 FCC Rcd at 5321, 5323, 5324, 5326-27, ¶¶ 11, 14, 
16, 20, 22; In the Matter of Federal-State Joint Board on Universal Service, North River Telephone Cooperative, 
Order, 2006 WL 3814766, __ FCC Rcd __, DA 06-2584 (Wireline Comp. Bur. Dec. 28, 2006) at ¶ 6; In the Matter 
of Requests for Review and Waiver of the Decision of the Universal Service Administrator by Alaska Gateway 
School District et al., Order, 21 FCC Rcd 10182, 10186 (Wireline Comp. Bur., Sept. 14, 2006) (“Alaska Gateway 
Order”) at ¶ 7; In the Matter of Federal-State Joint Board on Universal Service:  Cellular South Licenses, Inc. 
Petition for Waiver of Section 54.802(a) of the Commission’s Rules, Order, 21 FCC Rcd 9165, 9168-69 (Wireline 
Comp. Bur., Aug. 14, 2006) at ¶¶ 8-9; In the Matter of Federal-State Joint Board on Universal Service; Dixon 
Telephone Co., Lexcom Telephone Co., Citizens Telephone Co. of Higginsville, Missouri Petitions for Waiver of 
Section 54.301 Local Switching Support Data Submission Reporting Date, Order, 21 FCC Rcd 1717 (Wireline 
Comp. Bur. 2006); In the Matter of Federal-State Joint Board on Universal Service; Fibernet, LLC Petition for 
Waiver of FCC Rule 54.307(c)(4), Order, 20 FCC Rcd 20316, (Wireline Comp. Bur. 2005); In the Matter of 
Federal-State Joint Board on Universal Service; Alliance Communications Cooperative, Inc. and Hills Telephone 
Co., Inc., East Ascension Telephone Co., LLC, Columbus Telephone Co. Petitions for Waiver of Section 54.301 
Local Switching Support Data Submission Reporting Date, Order, 20 FCC Rcd 18250 (Wireline Comp. Bur. 2005); 
In the Matter of Federal-State Joint Board on Universal Service; Citizens Communications and Frontier 
Communications Petition for Waiver of Section 54.802(a) of the Commission’s Rules, Order, 20 FCC Rcd 16761 
(Wireline Comp. Bur. 2005).
89 Petition at 12-14.
90 Waiver Order, 20 FCC Rcd at 16727-28, 16730, 16733, ¶¶ 1, 8, 15. 
91 Petition at 11-12.
92 See, e.gSchools and Libraries Waiver Order at ¶¶ 11 (“applicants’ errors could not have resulted in an advantage 
for them”), 14, 16, 20, 22; Metricom Waiver Order, 13 FCC Rcd at 891, ¶ 6; SCS Waiver Order, 12 FCC Rcd at 
1534, ¶ 8; MFRI Waiver Order, 12 FCC Rcd at 1542, ¶ 7; Longstreet Waiver Order, 12 FCC Rcd  at 1551, ¶ 7.  See 
also Alaska Gateway Order, 21 FCC Rcd at 10185-86, ¶ 7; Request for Waiver Filed byUtica City School District,
Order, 21 FCC Rcd 8758 (Wireline Comp. Bur. 2006).
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without a waiver.  Network points out that Defendants, like APCC’s PSP principals, are small companies, 
and they structured their operations in good faith in a manner that they believed would result in the Debit 
Card Providers, not Defendants, owing and paying any payphone compensation due.93  We do not doubt 
that Network has a strong interest in having APCC’s error reduce Network’s exposure to damages here.  
It was Network’s own mistaken view of the Commission’s payphone compensation regime, however, that 
gave rise to those damages. Moreover, unlike APCC, Network has a potential contractual basis for 
mitigating the effect of its error: indemnification actions against the Debit Card Providers.94  Thus, for all 
of the reasons previously discussed, the public interest favors grant of the waiver, rather than strict 
application of the rule that would relieve Network of a substantial part of its legal liability due to the 
purely administrative error of APCC.95
34. In sum, we conclude that the Bureau did not err in granting APCC’s Waiver Motion.  
Accordingly, Network’s Petition for Reconsideration of the Waiver Order is denied.
2. APCC’s March 2002 Informal Complaint was effectively served.
35. With respect to informal complaints under section 208 of the Act, the Commission acts 
much like a process server.  A complainant files with the Commission an informal complaint containing, 
inter alia, “the name of the carrier against which the complaint is made,”96 and then “[t]he Commission 
will forward [the] informal complaint[ ] to the appropriate carrier for investigation.”97 To facilitate that 
procedure (among other reasons), the Commission’s rules require “[e]very common carrier … [to] 
designate an agent in the District of Columbia … upon whom service of all notices, process, orders, 
decisions, and requirements of the Commission may be made for and on behalf of said carrier in any 
proceeding before the Commission.”98 Service can be effectuated “by mailing a copy [of the informal 
complaint] to the last known address.”99  
36. Here, on March 29, 2002, several months prior to the September 2002 Informal 
Complaint discussed above, APCC filed with the Commission and mailed to the putative defendant a 
  
93 Petition at 15-17.
94 Bureau Liability Order, 20 FCC Rcd at 2077-78, ¶ 11. Many, if not all, of Network’s contracts with Debit Card 
Providers might be construed to require the Debit Card Providers to hold Network harmless for  payphone 
compensation due on calls made with the Debit Card Providers’ products.  See Liability Answer at Att. B. 
95 See generally, Schools and Libraries Waiver Order, 21 FCC Rcd at 5321, 5323, 5324, 5326-27, ¶¶ 11, 14, 16, 20, 
22 (granting waivers to prevent substantial financial harm that would otherwise result from minor, good-faith 
procedural mistakes).  Network also asserts that APCC’s failure to prosecute its claims diligently counsels against 
waiver of rule 1.718.  Petition at 15-16.  To the extent that Network is referring to APCC’s failure to sue the Debit 
Card Providers, Network’s argument mischaracterizes the proper targets of APCC’s collection efforts.  See 
Commission Liability Order, supra; Bureau Liability Order, supra (both holding that Network, and not the Debit 
Card Providers, are liable to APCC). To the extent that Network is referring to APCC’s failure to sue Network until 
September 30, 2002, the two-year statute of limitations in section 415(b) of the Act adequately addresses any 
concerns arising from the timing of APCC’s action.
96 47 C.F.R. § 1.716.
97 47 C.F.R. § 1.717.
98 47 C.F.R. § 1.47(h) (emphasis added).
99 47 C.F.R. § 1.47(d).
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different informal complaint seeking recovery of per-call dial-around compensation.100  As previously 
explained, the March 2002 Informal Complaint concerns calls carried by Network and Sprint, whereas the 
September 2002 Informal Complaint concerns calls carried by Network and all carriers other than 
Sprint.101
37. As of the time that APCC filed the March 2002 Informal Complaint, NetworkIP, LLC 
had not designated an agent for service of process in the District of Columbia, in violation of Commission 
rules.102  Nevertheless, the Commission attempted to effectuate service by mail on Network’s “last known 
address” by using the following contact information provided by APCC in the March 2002 Informal 
Complaint, which was also the address to which APCC itself mailed the March 2002 Informal Complaint:  
“Mr. Doug Williams, Network, IP, Inc., 1950 Stemmons Freeway, Suite 2045, Dallas, TX 75207.”103  
APCC had obtained that contact information from Sprint during the discovery phase of certain federal 
court litigation, in response to APCC’s request for identification of all switch-based resellers to which 
Sprint had routed coinless payphone calls originated from APCC payphones.104 No response to the 
March 2002 Informal Complaint was ever filed.105
38. In September 2002, having received no response to the March 2002 Informal Complaint, 
APCC sent to NetworkIP, LLC -- and NetworkIP, LLC received -- a letter referencing the March 2002 
Informal Complaint and suggesting Commission-supervised mediation regarding the dispute.106 Shortly 
thereafter, APCC filed and successfully served on NetworkIP, LLC the September 2002 Informal 
  
100 See, e.g., March 2002 Informal Complaint; Damages Joint Statement at 6; APCC Services, Inc. v. NetworkIP, 
LLC and Network Enhanced Telecom, LLP, Complainants’ Initial Brief on Issues Designated by the Commission’s 
June 21, 2005 Letter Ruling, File No. EB-03-MD-011 (filed July 1, 2005) (“Complainants’ Initial Brief on 
Service”), Attachment 10 at 2, ¶ 4.
101 See, e.g., March 2002 Informal Complaint; September 2002 Informal Complaint. 
102 See Forms 499-A for 2001 and 2002 for NetworkIP, LLC, contained in a database maintained by the Universal 
Service Administrative Co. and accessible through the Enforcement Bureau listing on the Commission’s website, 
www.fcc.gov.  Network does not deny APCC’s allegation that NetworkIP, LLC lacked a designated agent in the 
District of Columbia as of March 29, 2002.  See Damages Complaint at 3 n.2.  
103 APCC Services, Inc. v. NetworkIP, LLC, Official Notice of Informal Complaint, File No. EB-02-MDIC-0017 
(April 17, 2002) (“First Notice”) (directing a response within 30 days); Complainants’ Initial Brief on Service, 
Attachment 4; March 2002 Informal Complaint; Damages Joint Statement at 5-6; Complainants’ Initial Brief on 
Service at 7 and Attachment 10 at 2, ¶ 4.
104 See, e.g., March 2002 Informal Complaint at 4; Damages Joint Statement at 6.
105 See, e.g., Damages Answer at 3; Defendants’ Brief Regarding Complaints’ [sic] Failure to Serve the March 29, 
2002, Informal Complaint, File No. EB-03-MD-011 (filed July 1, 2005) (“Defendants’ Initial Brief on Service”) at 
7, n.5; Defendants’ Reply Brief Regarding Complainants’ Failure to Serve the March 29, 2002 Informal Complaint, 
File No. EB -03-MD-011 (filed July 11, 2005) (“Defendants’ Reply Brief on Service”) at 8; Damages Joint 
Statement at 7 ¶ (16). 
106 See, e.g., Complainants’ Initial Brief on Service at Attachment 3; Damages Answer at 3; Damages Joint 
Statement at 6 ¶ (9).  In addition, in October 2002, the Commission sent another notice -- to the same address as the 
First Notice – directing a response to the March 2002 Informal Complaint.  APCC Services, Inc. v. NetworkIP, LLC 
and Network Enhanced Telecom, LLP, Official Notice of Informal Complaint, Notice of Possible Enforcement 
Action, File No. EB-02-MDIC-0017 (Oct. 9, 2002) (“Second Notice”); Complainants’ Initial Brief on Service at 
Attachment 5; Damages Joint Statement at 7.
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Complaint;107 and in that Informal Complaint APCC again referenced the March 2002 Informal 
Complaint.108 On November 15, 2002, APCC faxed to NetworkIP, LLC’s counsel -- and NetworkIP, 
LLC’s counsel received -- a copy of the March 2002 Informal Complaint and the Commission’s First 
Notice.109 Nevertheless, as stated above, NetworkIP, LLC never filed a response to the March 2002 
Informal Complaint.110
39. Network asserts here that the March 2002 Informal Complaint was never properly served 
and that Network received no actual notice of the March 2002 Informal Complaint until November 
2002.111 Network argues, therefore, that the filing of the March 2002 Informal Complaint did not toll the 
running of the limitations period, and the filing date of the June 2003 Damages Complaint does not relate 
back to the filing date of the March 2002 Informal Complaint.112 Accordingly, in Network’s view, the 
recovery period regarding calls carried by Network and Sprint should extend back only to June 2001 (two 
years before the June 2003 Damages Complaint) rather than to October 1, 1999.113
  
107 See, e.g., September 2002 Informal Complaint, supra; Damages Joint Statement at 7, ¶ (13); Defendants’ Initial 
Brief on Service at 6.  APCC mailed the September 19, 2002 letter and the September 2002 Informal Complaint to a 
different address than it mailed the March 2002 Informal Complaint.  Compare March 2002 Informal Complaint 
with September 2002 Informal Complaint and Complainants’ Initial Brief on Service at Attachment 3.
108 September 2002 Informal Complaint at 2 n.3.
109 See, e.g., Complainants’ Initial Brief on Service, Attachment 8 at 2; Damages Joint Statement at 7.
110 NetworkIP, LLC also never responded in writing to APCC’s September 19, 2002 letter.  See Complainants’ 
Initial Brief on Service at 4.  
111 See, e.g., Liability Answer at 7, ¶ 25, 15; Damages Answer at 27, ¶ 94, 30, ¶¶ 101-102;  Defendants’ Initial Brief 
on Service at 2-7; Defendants’ Reply Brief, File No. EB-03-MD-011 (filed July 11, 2005) (“Defendants’ Reply 
Brief on Service”) at 1-6. 
112 See, e.g., Liability Answer at 14-16; Damages Answer at 14; Petition at 3 and n.2, 16 and n.23 Defendants’ Initial 
Brief on Service at 4-5, 7, n.5; Defendants’ Reply Brief on Service at 2, 4-6. 
113 See, e.g., Liability Answer at 14-16; Damages Answer at 14; Petition at 3 and n.2, 16 and n.23; Defendants’ 
Initial Brief on Damages at 12; Defendants’ Initial Brief on Service at 4-5, 7, n.5; Defendants’ Reply Brief on 
Service at 2, 4-6.  Network also contends that the filing date of the June 2003 Damages Complaint cannot relate 
back to the filing date of the March 2002 Informal Complaint, because the time between those two filings exceeded 
the six-month period specified in rule 1.718.  See Damages Answer at 27; Petition at 3, 16; Defendants’ Initial Brief 
on Damages at 13-14.  To support that contention, Network suggests that where, as here, no response to an informal 
complaint is filed, the six-month relation-back period should be deemed to start running from the filing date of the 
informal complaint (or thereabouts), rather than from a non-existing response; otherwise, the dispute could linger 
indefinitely in the informal complaint phase, undermining the rule’s goal of promoting speed and finality.  
Defendants’ Initial Brief on Damages at 13-14.  Network’s contention lacks merit.  As previously explained, the 
rule’s plain language clearly provides that the six–month period runs from the date of the defendant’s response, not 
from the date of the informal complaint.  47 C.F.R. § 1.718.  Moreover, a defendant has the power to prevent undue 
lingering of claims by simply filing a response.  Finally, the Commission has ample authority to manage the 
informal complaint docket so as to prevent claims from becoming stale.  See, e.g., 47 U.S.C. §§ 154(i)-(j); 
Implementation of the Telecommunications Act of 1996:  Amendment of Rules Governing Procedures to be 
Followed When Formal Complaints Are Filed Against Common Carriers, Report and Order, 12 FCC Rcd 22497, 
22501, 22539, 22559, at ¶¶ 5, 95, 128, 144 (1997) (“Formal Complaints Order”) (subsequent history omitted).  
Here, Network never filed a response to the March 2002 Informal Complaint, so the six-month period applicable to 
that Informal Complaint (as opposed to the September 2002 Informal Complaint) had not even begun to run when 
APCC filed the June 2003 Damages Complaint.
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40. To support its assertion that the March 2002 Informal Complaint was not properly served, 
Network points out that (i) the individual addressee, Doug Williams, did not work for NetworkIP, LLC; 
(ii) the business addressee, “Network IP, Inc.”, did not exist; (iii) the address was not of NetworkIP’s 
headquarters; (iv) APCC had previously known of NetworkIP, LLC’s correct name and address via prior 
correspondence; (v) NetworkIP, LLC had a registered agent in Texas, which APCC could have found; 
(vi) NetworkIP, LLC’s website listed its headquarters’ address, which APCC could have found; (vii) 
APCC did not re-send (or ask the Commission to re-send) the March 2002 Informal Complaint when 
APCC learned of NetworkIP, LLC’s correct name and address in September 2002.114
41. Network is correct that the filing date of the June 2003 Damages Complaint relates back
to the filing date of the March 2002 Informal Complaint only if the March 2002 Informal Complaint was 
filed and served properly.  For the reasons explained below, however, we reject Network’s arguments 
regarding service and conclude that the March 2002 Informal Complaint was effectively served by mail in 
the Spring of 2002.
42. First, as stated above, NetworkIP, LLC failed to designate an agent for service of process 
in the District of Columbia and thereby violated a Commission rule designed to avoid precisely the kind 
of service problem alleged here by NetworkIP, LLC.  Thus, Network cannot complain about the 
Commission’s attempts to work around NetworkIP LLC’s rule violation and provide Network actual 
notice of the informal complaint.115 Moreover, especially in light of the absence of a registered agent, the 
address used to serve the March 2002 Informal Complaint qualifies as the “last known address” under 
rule 1.47(d), because (i) the individual addressee, Doug Williams, worked for a closely related affiliate of 
NetworkIP, LLC;116 (ii) the business addressee, “Network IP, Inc.”, is so close to “NetworkIP, LLC” that 
any reasonable person would have suspected that NetworkIP, LLC was the intended recipient;117 (iii) 
though not of NetworkIP’s headquarters, the address used was of a NetworkIP, LLC office containing 
collocation space, manned by several NetworkIP, LLC employees;118 (iv) the previous correspondence 
between the parties did not clearly identify NetworkIP, LLC;119 (v) APCC obtained the contact 
  
114 See, e.g., Defendants’ Initial Brief on Service at 2-7; Defendants’ Reply Brief on Service at 1-6.
115 Indeed, rather than attempt to provide Network actual notice of the informal complaint via U.S. mail, the 
Commission could have simply “posted” the informal complaint in the Commission Secretary’s Office.  47 U.S.C. § 
1.47(h).  
116 NetworkIP, LLC and the affiliate for which Mr. Williams worked had common officers, a common address 
(including suite number), and a common phone number.  Liability Answer at 18; Complainants’ Reply Brief of 
Issues Designated by the Commission’s June 21, 2005 Letter Ruling, File No. EB-03-MD-011 (filed July 11, 2005) 
(“Complainants’ Reply Brief on Service”) at 2-3 and Attachment 1.  Further, that affiliate was named in several of 
the contracts submitted in the record by Network as guarantor of NetworkIP and NET obligations to customers.  See, 
e.g., Liability Answer at Attachment B-30.  In addition, Mr. Williams, at the Dallas address, had been Sprint’s 
contact for its business relationship with NetworkIP for at least a year.  Complainants’ Initial Brief on Service at 3 
and Attachment 3.
117 See n.142, infra.
118 Opposition to Motion for Waiver at 4; Defendants’Initial Brief on Service at 2-3; Complainants’ Reply Brief on 
Service at 4; Damages Joint Statement at 6; www.networkip.net.  Further, the telephone at that address (a number 
provided for NetworkIP by local directory assistance) was answered “NetworkIP,” and the receptionist confirmed 
the Dallas address as NetworkIP’s address.  Complainants’ Initial Brief on Service, Attachment 10 at 2.  
119 See Initial Brief on Service at Attachment 13.
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information from a credible source, Sprint;120 and (vi) neither APCC’s mailing nor the Commission’s was 
ever returned as “undeliverable,”121 and the Commission never received any inquiry about the nature or 
import of the mailings. Given all of these circumstances, we find that service of the March 2002 Informal 
Complaint was effectively made to Network’s “last known address” under rule 1.47(d) in the Spring of 
2002.122
43. Even assuming, arguendo, that the March 2002 Informal Complaint was not effectively 
served by mail in the Spring of 2002, we conclude that it was effectively served in November 2002, for 
the following reasons.  Neither the Act nor the Commission’s rules specify a deadline for effectuating 
service of a previously filed informal complaint.  Consequently, we look to federal court procedures for 
guidance.123 Under federal court procedures, a plaintiff has at least 120 days from the complaint’s filing 
date to effectuate service, and a court has broad discretion to permit even more time if circumstances 
warrant.124 The factors courts usually consider most relevant are whether the plaintiff made reasonable 
efforts to effectuate service, and whether the delay in service has prejudiced the defendant’s ability to 
defend against the claims.125
44. Applying those principles here, we conclude that, in November 2002, APCC made 
effective and sufficiently timely service of the March 2002 Informal Complaint.  First, Network concedes 
  
120 March 2002 Informal Complaint at 4.; Liability Complaint at 12, ¶ 24 and Attachment 10; Damages Joint 
Statement at 6, ¶ (3); Complainants’ Initial Brief on Service at 2 and Attachment 1.
121 Complainants’ Initial Brief on Service at 6-7 and Attachment 10.   Further, as APCC notes, complainants in the 
dial-around compensation context often do not have nearly as much useful identifying information (or access to such 
information) as does a typical plaintiff in court serving process on a typical defendant.  See Complainants’ Reply 
Brief on Service at Attachment 4. Unlike a typical plaintiff in court, dial-around complainants “are obliged by law
to allow calls from payphones that will be routed to any carrier for completion, including calls that during the period 
covered by this dispute were completed by FBRs [facilities-based resellers] who were unknown to Complainants 
and whom Complainants had no means of identifying and tracking.”  Complainants’ Reply Brief on Service at 7.  
See, e.g., Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act of 1996, 
Further Notice of Proposed Rulemaking, 18 FCC Rcd 11003, 11107 at ¶ 7 (2003); Pay Telephone Reclassification 
and Compensation Provisions of the Telecommunications Act of 1996: Petitions for Clarification, Third Order on 
Reconsideration and Order on Clarification, 16 FCC Rcd 20922, 20924 at ¶ 6 (2001);  Second Order, 16 FCC Rcd at 
8103, ¶ 8; Coding Digit Waiver Grant Order, 13 FCC Rcd at 10915-16, ¶ 38.   
122 See generally State of Wisconsin – Educational Communications Board v. DirecTV, Memorandum Opinion and 
Order, 18 FCC Rcd 20261 (Media Bur. 2003) (finding service to be adequate under circumstances analogous to 
those here).
123 See, e.g., In the Matter of Implementation of the Telecommunications Act of 1996:  Amendment of Rules 
Governing Procedures to Be Followed When Formal Complaints Are Filed Against Common Carriers, Order on 
Reconsideration, 16 FCC Rcd 5681, 5685 at ¶ 33 (2001); Formal Complaints Order, 12 FCC Rcd at 22503, 22530,
¶ 20 and n.48, ¶ 73 and n.204; In the Matter of Implementation of the Telecommunications Act of 1996:  Amendment 
of Rules Governing Procedures to Be Followed When Formal Complaints Are Filed Against Common Carriers, 
Report and Order, 3 FCC Rcd 1806, 1811-12 at ¶ 47 (1988).
124 See, e.g., Fed.R.Civ.P. 4(m) (and Advisory Committee Notes thereto); Wright & Miller, 4B Federal Practice & 
Procedure, § 1137 (3d ed. 2002).  More precisely, the court must extend the service deadline beyond 120 days if 
“good cause” to do so exists, and the court has broad discretion to extend the service deadline beyond 120 days even 
in the absence of good cause.  See, e.g., id.
125 See, e.g., id.  
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that, on November 15, 2002, NetworkIP, LLC’s counsel received from APCC a copy of the March 2002 
Informal Complaint and of the Commission’s First Notice.126 Such actual notice perfects service.127  
Moreover, although the substantial delay in perfecting service is far from ideal, it was completed within 
acceptable time limits under the specific circumstances of this case.  In particular, as described above, 
reasonable service efforts were made in the Spring of 2002, especially given NetworkIP, LLC’s failure to 
comply with our rule requiring the designation of an agent for service of process in the District of 
Columbia.  Moreover, in September 2002, APCC made additional reasonable attempts to draw
NetworkIP, LLC’s attention to the March 2002 Informal Complaint.  Furthermore, Network has not 
shown – or even attempted to show – any relevant prejudice arising from the delay, such as the loss or 
destruction of evidence or the inability to locate key witnesses.128
45. In sum, we hold that the March 2002 Informal Complaint was effectively served.  
Therefore, with respect to calls carried by Network and Sprint, the filing date of the June 2003 Damages 
Complaint relates back to the filing date of the March 2002 Informal Complaint.
3. The informal complaints effectively named Network Enhanced Telecom,
LLP (NET) as a defendant.
46. APCC’s March 2002 Informal Complaint named “Network IP, Inc.” as the sole 
defendant.129 APCC’s September 2002 Informal Complaint named “NetworkIP, LLC” as the sole 
defendant.130 Neither the March 2002 Informal Complaint nor the September 2002 Informal Complaint 
named “Network Enhanced Telecom, LLP” -- one of the two defendants named by the formal Damages 
Complaint resolved in this order -- as a defendant.  Based on these facts, Network argues that the claims 
in the Damages Complaint against Network Enhanced Telecom, LLP cannot relate back to the filing date 
of either Informal Complaint.131 In Network’s view, because Network Enhanced Telecom, LLP is an 
independent legal entity separate and distinct from the entities named in the Informal Complaints, we 
cannot link Network Enhanced Telecom, LLP to the claims alleged in the Informal Complaints.132 We 
  
126 Defendants’ Reply Brief on Service at 2; Damages Joint Statement at 7, ¶ (15).  
127 See, e.g., International Telecharge, Inc. v. Southwestern Bell Telephone Co., Memorandum Opinion and Order, 
11 FCC Rcd 10061, 10077 at ¶ 43 (Com. Car. Bur. 1996); Cellular Marketing, Inc. v. Houston Cellular Telephone 
Co., Order, 10 FCC Rcd 8897, 8898 at ¶ 6 (Wireless Tel. Bur. 1995); Telecable Associates, Inc. v. South Central 
Bell Telephone Co., 6 FCC Rcd 6850, 6850 at ¶ 5 (Com. Car. Bur. 1991); UACC Midwest, Inc. v. South Central Bell 
Telephone Co., Order, 6 FCC Rcd 6847, 6848 at ¶ 7 (Com Car. Bur. 1991).  Network maintains that we cannot 
consider the November 15, 2002 delivery to NetworkIP, LLC’s counsel to be sufficient service, because doing so 
would apply retroactively an unprecedented “actual notice” standard that can be adopted only through a notice-and-
comment rulemaking and applied only prospectively.  See Defendants’ Reply Brief on Service at 6.  Our ability to 
cite the multiple authorities referenced earlier in this footnote amply refutes Network’s contention.
128 See, e.g., Husowitz v. American Postal Workers Union. 190 F.R.D. 53, 58 (E.D.N.Y. 1999).  Network asserts that 
some Debit Card Providers have gone out of business, which hinders Network’s ability to seek indemnification.  
See, e.g.,  Defendants’ Initial Brief on Damages at 17-19, 25, Attachment 5.  Network does not assert, however, that 
those events occurred between March and November 2002.  
129 March 2002 Informal Complaint.
130 September 2002 Informal Complaint.
131 Defendants’ Initial Brief on Service at 2-9; Defendants’ Reply Brief on Service at 2-6 .
132 Liability Answer at 15-16; Defendants’ Reply Brief on Service at 7.  
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disagree. 
47. It is well established that, if the following test is met, the Commission may “pierce the 
corporate veil” and hold one entity liable for the acts and omissions of a different entity:
‘[S]eparate corporate structures may be ignored where the purpose of a statutory 
scheme or regulation would otherwise be frustrated.  The critical question, 
therefore, is whether the conduct of the [two] corporations in light of the 
relationship which exists among them requires that the legal concept of separate 
corporate identities be disregarded in order to preserve the integrity of [the Act] 
and to prevent the [corporations] from defeating the purpose and objective of the 
statutory provisions….’  Other criteria include:  (1) a common identity of 
officers, directors and shareholders; (2) sharing the same principal offices; [and] 
closeness of relationship between entities.133
48. Applying that test here, we can and should pierce the corporate veil and treat Network 
Enhanced Telecom, LLP as if it had been specifically named as a defendant by the Informal Complaints.  
First, Network Enhanced Telecom, LLP and NetworkIP, LLC are, at a minimum, close affiliates.134  
Second, Network Enhanced Telecom, LLP and NetworkIP, LLC have common officers, common offices, 
and common phone numbers.135 Third, the two entities hold themselves out as being interchangeable.  
For example, many of the contracts with Debit Card Providers expressly identify the Network entity as 
“Network Enhanced Telecom d/b/a NetworkIP.”136 And on the website www.networkip.net, NetworkIP, 
LLC identifies itself as “NetworkIP (Network Enhanced Telecom, LLP).”137  Furthermore, in written 
communications with APCC, correspondence on “NetworkIP” letterhead referred to the sender as “NET” 
(an acronym for Network Enhanced Telecom) and “NetworkIP (NET),”138 and information labeled as 
  
133 Publix Network Corporation, Order to Show Cause and Notice of Opportunity for Hearing, 17 FCC Rcd 11487, 
11504 at ¶ 39 (2002) (finding that five interrelated companies were, “for legal purposes, one and the same”) 
(“Publix”) (quoting Petition of Telecable to Stay, Decision, 19 F.C.C. 2d 574, 585 at ¶ 36 (1969) (finding that two 
affiliated companies “must be treated as a single operation”) (“Telecable”)) (footnotes omitted).  See, e.g., In re 
Applications of Ameritech Corp., Transferor, and SBC Communications Inc., Transferee, Memorandum Opinion 
and Order, 14 FCC Rcd 14712, 14898, n.825 (1999); Petition by Dimension Cable TV, Inc. to Stay, Memorandum 
Opinion and Order, 27 F.C.C. 2d 43, 46 at ¶ 7 (Rev. Bd. 1971) (finding that two affiliated entities would be treated 
as one entity for purposes of the proceeding) (“Dimension”).  
134 See www.networkip.net and Complainants’ Initial Brief on Service at Attachment 12 (the former identifying 
NetworkIP as a privately held company, and the latter establishing NET as NetworkIP’s “initial member”).  APCC 
asserts that NetworkIP is solely owned by NET.  Liability Reply at 15.
135 Damages Reply at Att. 5; Complainants’ Initial Brief on Service at 9, n.22, Attachment 10; Complainants’ Reply 
Brief on Service at 2-3; www.networkip.net; Defendants’ Initial Brief on Service at Attachments A and E; 
Defendants’ Reply Brief on Service at Attachments A and B; Damages Joint Statement at 6 ¶ (10).  
136 See, e.g., Liability Answer at Attachment B-18. 
137 Reply to Defendants’ Answer to Formal Complaint, File No. EB-03-MD-011 (filed Sept. 24, 2003) (“Liability 
Reply”) at 15-16; Complainants’ Initial Brief on Service at Attachment 16; www.networkip.net.  
138 Liability Reply at 15-16; Complainants’ Initial Brief on Service at Attachment 13; Defendants’ Reply Brief on 
Service at Attachment B.
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pertinent to “NET” was produced in response to inquiries regarding NetworkIP.139 Indeed, in certain 
comments filed with the Commission, the first page identified the commenter as “Network Enhanced 
Telecom, LLP d/b/a Network IP (‘NET’).”140
49. The foregoing facts show a common identity between NetworkIP, LLC and Network 
Enhanced Telecom LLP.  Given this operational overlap, “the conduct of [Network Enhanced Telecom, 
LLP and NetworkIP, LLC] in light of the relationship which exists among them requires that the legal 
concept of separate corporate identities be disregarded in order to preserve the integrity of [section 276 of 
the Act] and to prevent the [Defendants] from defeating the purpose and objective of the statutory 
provisions….”141 In other words, for all purposes relevant here, we should treat these two entities as one 
and the same.  Thus, we consider the Informal Complaints’ naming of NetworkIP, LLC as a defendant to 
be tantamount to naming Network Enhanced Telecom, LLP as a defendant.142 Accordingly, the Damage 
Complaint’s claims against Network Enhanced Telecom, LLP relate back to the filing dates of the 
Informal Complaints.  In that way, APCC’s PSP principals will receive the level of per-call, dial-around 
compensation contemplated by sections 276 and 415 of the Act and our payphone compensation rules. 
4. The statute of limitations does not bar APCC’s damages claims.
50. According to Network, on January 26, 2000, it notified APCC unequivocally and in 
writing that it would not agree -- then or ever -- to pay dial-around compensation for payphone calls 
handled by Network-owned switches.143 In Network’s view, therefore, APCC’s claims for payment of 
dial-around compensation accrued on January 26, 2000 under the Commission’s “discovery” rule;144 in 
turn, the two-year limitations period under section 415(b) of the Act lapsed on January 26, 2002, two 
months before APCC filed any of the damages claims at issue here.145 Consequently, Network argues 
  
139 Complainants’ Initial Brief on Service at 9-10 and Attachment 14; Defendants’ Reply Brief on Service at 
Attachment B.  
140 Complainants’ Initial Brief on Service at Attachment 15 (Comments in CC Docket No. 96-128, Implementation 
of Payphone Classification and Compensation Provisions of the Telecommunications Act of 1996 (filed Oct. 9, 
2001)).
141 Publix, 17 FCC Rcd at 11504, ¶ 39.
142 We recognize that the March 2002 Informal Complaint did not name “NetworkIP, LLC” as the defendant, but 
rather “Network IP, Inc.,” which was not the correct name of any relevant entity.  We consider that to be a trivial, 
immaterial error, however.  Under the well-established “misnomer doctrine”, we find “Network IP, Inc.” and 
“NetworkIP, LLC” to be interchangeable for purposes of initiating the complaint proceeding.  See, e.g., Roberts v. 
Michaels, 219 F.3d 775, 777-779 (8th Cir. 2000); Morrel v. Nationwide Mutual Fire Insurance Co., 188 F.3d 218, 
224 (4th Cir. 1999); Datskow v. Teledyne, Inc., 899 F.2d 1298, 1301 (2nd Circ. 1990); Miller v. Northwest Region 
Library Board, 348 F.Supp.2d 563, 567 (M.D.N.C. 2004); Shoap v. KIWI S.A., 149 FRD 509 (M.D. PA 1993).
143 See, e.g., Liability Complaint at Attachments 4, 6; Liability Answer at 3; APCC Services, Inc. et al. v. 
NetworkIP, LLC and Network Enhanced Telecom, LLP, Brief of Network, File No. EB-03-MD-011(filed Dec. 19, 
2003) (“Network Liability Brief”) at 3-6, 9-12, nn.9, 18, 24; Opposition to Motion for Waiver at 4.; Damages Reply 
at Exh. 5, ¶ 6; Petition at 16; Defendants’ Initial Brief on Damages at 6-9 and Exh. 2; Defendants’ Reply Brief on 
Damages at 4-5, 9 and Attachments E and H.    
144 See, e.g., Defendants’ Initial Brief on Damages at 4-9 (citing First Payphone Order, 11 FCC Rcd at 20598, ¶ 
114).
145 See, e.g., Damages Answer at 27; Defendants’ Initial Brief on Damages at 17.
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that the statute of limitations in section 415(b) of the Act bars all of APCC’s damages claims.146
51. Network’s argument rests on a flawed understanding of the Commission’s discovery 
rule.  Contrary to Network’s assertion, it is well-established that when a complaint concerns periodic 
continuing conduct, such as overbilling or underpaying, a new claim accrues (or is “discovered”) each 
time an additional instance of the allegedly unlawful conduct occurs.147 Applying that standard here, 
APCC’s claims did not accrue once and for all on January 26, 2000; instead, a new claim accrued each 
time dial-around compensation became due and Network failed to pay.  Thus, the Damages Complaint is 
timely under section 415(b) of the Act with respect to every instance in which payment of dial-around 
compensation became due, and Network failed to pay, during the two years before March 29, 2002 
regarding calls carried by Network and Sprint, and during the two years before September 30, 2002 
regarding calls carried by Network and carriers other than Sprint.
5. No equitable grounds warrant barring APCC’s claims.
52. Network argues that, even if timely under section 415(b) of the Act, APCC’s claims are 
“barred by the doctrines of waiver, estoppel, and/or laches.”148 According to Network, because Network 
definitively told APCC on January 26, 2000 that Network would not pay dial-around compensation for 
calls handled by Network’s switches, APCC should have either (i) promptly sued the Debit Card 
Providers, or (ii) sued Network before March 2002.  Moreover, APCC’s failure to take either of those 
actions has allegedly prejudiced Network, because as of October 2005 many of the Debit Card Providers 
have ceased to exist, diminishing Network’s ability to seek indemnification.149 Thus, in Network’s view, 
equity precludes APCC’s belated attempt to recover from Network here.
53. Network’s argument has no merit. First, as the Bureau Liability Order and the 
Commission Liability Order have held, it is Network who owes dial-around compensation, not the Debit 
Card Providers.  Thus, APCC never had any duty, equitable or otherwise, to seek recovery from the Debit 
Card Providers.  
54. Second, to obtain an equitable remedy for an opponent’s alleged lack of diligence, a 
party must have been scrupulously diligent itself.  Network falls short in that regard.  As early as August 
2000, APCC notified Network that APCC intended to hold Network, and not the Debit Card Providers, 
  
146 See, e.g., Defendants’ Initial Brief on Damages at 4-9, 12.
147 See, e.g., Operator Communications, Inc. v. Contel of the South, Inc., Memorandum Opinion and Order, 20 FCC 
Rcd 19783, 19785 at ¶ 11 (2005); MCI Telecommunications Corp. v, US West Communications, Inc., Memorandum 
Opinion and Order, 15 FCC Rcd 9328, 9329-30 at ¶ 5 (2000); AT&T Corp. v. Bell Atlantic-Pennsylvania, 
Memorandum Opinion and Order, 14 FCC Rcd 556, 565 at ¶ 16 (1998); Aetna Life Ins. Co. v. AT&T Co., 3 FCC 
Rcd 2126, 2128-29 at ¶ 12 (1988); Tele-Valuation, Inc. v. AT&T Co., Memorandum Opinion and Order, 73 FCC 2d 
450, 452 at ¶ 4 (1979).  Nothing in the First Payphone Order is to the contrary.  In the First Payphone Order, the 
Commission held that, “for purposes of bringing a complaint before the Commission concerning a carrier's payment 
of payphone compensation, the time period for the statute of limitations does not begin to run until after the carrier-
payor considers a compensation claim and issues a final denial of the claim.”  11 FCC Rcd at 20598, ¶ 114.  Read in 
context, that conclusion (i) applies only where, unlike here, the dispute concerns ANI verification, and (ii) was 
designed to liberalize, not restrict, the time within which a PSP may bring a compensation claim.
148 Liability Answer at 16; Damages Answer at 30, ¶ 103.  See Defendants’ Initial Brief on Damages at 9-12, 17-19.  
149 See, e.g.,  Defendants’ Initial Brief on Damages at 17-18 and Attachment 5.  
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responsible for dial-around compensation.150 Notwithstanding this notice, Network’s contractual 
relationships with the Debit Card Providers, and the filing of APCC’s March 2002 Informal Complaint, 
September 2002 Informal Complaint, and June 2003 Formal Complaint, the record contains no evidence 
that Network has taken any steps to (i) ensure that the Debit Card Providers were paying dial-around 
compensation to APCC, or (ii) seek indemnification from the Debit Card Providers, even after the Bureau 
Liability Order was released in February 2005.  Therefore, Network’s present inability to obtain full 
satisfaction via indemnification processes is a dilemma of its own making.  Accordingly, we reject 
Network’s equitable arguments against APCC’s damages claim.
6. Network has failed to meet its burden of proving that APCC’s damages 
should be reduced to avoid double recovery.
55. The parties agree that APCC received some dial-around compensation from some of the 
Debit Card Providers for payphone calls made during the Relevant Period.151 Network maintains, 
therefore, that any damages award here should be reduced by some amount in order to avoid the 
possibility that APCC might recover dial-around compensation from both Network and the Debit Card 
Providers for the same payphone calls.152 We disagree, for the following reasons.
56. Both parties acknowledge that, at this point, neither APCC nor Network can determine 
the extent, if any, to which the compensation paid by Debit Card Providers to APCC was for payphone 
calls at issue here, i.e., calls that were made using a Debit Card Provider’s calling card and were handled 
by a Network switch.  Only the Debit Card Providers might have the call payment information needed to 
permit such a determination.153 The lack of direct evidence about whether the Debit Card Providers’ 
payments were for the calls at issue here would not present a problem had the Debit Card Providers 
contracted exclusively with Network to handle coinless payphone calls.  We could then readily infer that 
all of the Debit Card Providers’ payments to APCC were for calls handled by a Network switch, and 
reduce the damages award on a dollar-for-dollar basis.
57. Network provides no evidence, however, that the Debit Card Providers could not and 
did not contract with facilities-based carriers other than Network to handle coinless payphone calls made 
with their calling cards.  And a review of Network’s contracts with the Debit Card Providers reveals no 
facial bar on Debit Card Providers’ ability to contract with facilities-based carriers other than Network.  
In fact, virtually all of the contracts specifically state that the arrangements between the Debit Card 
Providers and Network are not exclusive. 154 Thus, as far as the direct evidence in the record shows, 
  
150 See, e.g., Liability Complaint at 9-11 and Attachments 4, 6; Damages Reply at Exh. 5, ¶ 6; Complainants’ Reply 
Brief on Damages at 24-26. 
151 See, e.g., Complainants’ Answer to Defendant’s Interrogatories 4 and 5 (filed Oct. 12, 2005), with Supplement 
(filed Nov. 10, 2005), Further Supplement (filed Nov. 15, 2005), and Further Supplement (filed Dec. 13, 2005) 
(together, “Complainants’ Rog. Responses”); Damages Reply at 26-27 and Attachment E; Damages Joint Statement 
at 12; Complainants’ Initial Brief on Damages at 8.
152 See Liability Answer at 17; Damages Answer at iv, 31; Defendants’ Initial Brief on Damages at 20-22; 
Defendants’ Reply Brief on Damages at 6-10.
153 See, e.g., Damages Joint Statement at 12; Damages Reply at 26-27; Defendants’ Initial Brief on Damages at 17-
19, 25 and Att. 5; Defendants’ Reply Brief on Damages at 9, Attachment B (directing Debit Card Providers to 
maintain call information).
154See, e.g., Liability Answer at Attachment B-11, part 2.1.
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some, most, or even all of the payments made by Debit Card Providers to APCC could have been for 
coinless payphone calls not at issue here, i.e., calls not handled by a Network switch.  Consequently, the 
record does not permit a definitive conclusion about the extent, if any, to which the Debit Card Providers’ 
payments to APCC were for calls handled by a Network switch and thus should reduce the damages 
award to APCC.
58. Because neither party can provide definitive information about whether any of the dial-
around compensation paid by Debit Card Providers to APCC was for payphone calls handled by a 
Network switch, the outcome here turns heavily on who bears the burden of proof regarding that fact.  
According to Network, because APCC is the complainant, APCC bears the burden of proving not only 
liability and damages generally, but also the precise dollar amount of harm arising from Network’s failure 
to pay.  And in Network’s view, providing damages with such precision requires APCC to, inter alia, 
ascertain and net out an appropriate amount for sums already received by APCC from Debit Card 
Providers.155 We disagree, for the following reasons.
59. Network is correct that, in complaint proceedings under section 208 of the Act, the 
complainant bears the burden of proving liability and damages.  APCC satisfied that burden, however, by 
showing that (i) Network was the last facilities-based carrier to handle the 11,622,941 payphone calls at 
issue, and (ii) Network failed to pay any dial-around compensation to APCC for those calls. Having 
thereby demonstrated that the party legally responsible for payment failed to pay, APCC has no additional 
burden to prove further that some third parties who were not legally responsible for payment also failed to 
pay.  Instead, if Network wants us to reduce its legal obligation to pay damages to APCC to account for 
payments allegedly made to APCC by some collateral sources, it is Network’s burden to prove that such a 
reduction is warranted.  Thus, Network bears the burden of proving how much (if any) of the payments 
made by Debit Card Providers to APCC were for payphone calls handled by a Network switch.
60. Assigning the burden of proof to Network comports with substantial precedent holding 
that the assertion of setoffs for collateral source payments is an affirmative defense for which the 
defendant bears the burden of proof.156 Indeed, Network implicitly acknowledged that precedent by twice
pleading this issue as an affirmative defense, before shifting gears late in the proceeding and arguing that 
APCC has the burden of proof.157 Moreover, assigning the burden of proof to Network is fair and 
sensible, because Network had (and still has) the greater access to pertinent evidence.158 In particular, 
unlike APCC, Network had a contractual relationship with the Debit Card Providers regarding the 
  
155 Defendants’ Initial Brief on Damages at 20-22 (citing C.F. Communications Corp. v. Century Telephone of 
Wisconsin, Inc., Hearing Designation Order, 16 FCC Rcd 8801, 8808 at ¶ 21 (Enf. Bur. 2001); New Valley Corp. v. 
Pacific Bell, Memorandum Opinion and Order, 15 FCC Rcd 5128, 5134 at ¶ 14 (2000); Hi-Tech Furnace Systems, 
Inc. v. FCC, 224 F.3d 781, 787 (D.C. Cir. 2000)); Defendants’ Reply Brief on Damages at 9-10.
156 See, e.g., 5 Wright & Miller, Federal Practice & Procedure, § 1271; Giles v. General Electric Co., 245 F.3d 474, 
494 n.36 (5th Cir. 2001); Hassan v. U.S. Postal Service, 842 F.2d 260, 263 (11th Cir. 1988); Regency 
Communications, Inc. v. Cleartel Communications, Inc., 304 F.Supp.2d 1, 6-7 (D.D.C. 2004).  Cf., AT&T 
Communications v. Northwestern Bell Telephone Co., Memorandum Opinion and Order, 8 FCC Rcd 1014, 1021 at 
¶¶ 21-22 (1993) (stating that “AT&T has made a claim for specific damages, and NWB, in turn, may properly argue 
that it is entitled to certain offsets against those damages”). 
157 Compare Liability Answer at 17 and Damages Answer at iv, 31 with Defendants’ Initial Brief on Damages at 20-
22.
158 See, e.g., 5 Wright & Miller, Federal Practice & Procedure, § 1271.
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payphone calls at issue.  Thus, unlike APCC, Network had a significant opportunity to obtain payment 
information from the Debit Card Providers, either during the Relevant Period or soon after APCC notified 
Network (in 2000, 2002, and 2003) of its intention to hold Network (and not the Debit Card Providers) 
responsible for dial-around compensation.159 Moreover, APCC has no independent basis for developing 
payment information, because during the Relevant Period the Debit Card Providers -- like all payors of 
dial-around compensation -- were not required to and did not itemize their payments to APCC according 
to call-paths.160 Thus, as stated above, Network bears the burden of proving how much (if any) of the 
payments made by Debit Card Providers to APCC were for payphone calls handled by a Network switch.
61. The record evidence supplied by Network falls short of meeting that burden.  
Specifically, having failed to produce evidence that it had exclusive contractual arrangements with the 
Debit Card Providers, Network proffers, instead, only two bases for offsetting any damages award by 
amounts paid by the Debit Card Providers to APCC:  (i) Network alleges that its contracts with the Debit 
Card Providers obligated the Debit Card Providers to pay dial-around compensation; and (ii) Network 
references a letter it sent to the Debit Card Providers reminding them of their alleged contractual 
obligation to pay dial-around compensation.161 Based on only these two pieces of evidence, combined 
with the absence of direct, contrary evidence from APCC, Network argues that “the only logical 
assumption” to draw is that all of the Debit Card Providers’ payments to APCC were for payphone calls 
carried by a Network switch.162
62. We reject Network’s argument, for several reasons.  First, the contractual language on 
which Network relies does not appear in many of its contracts with the Debit Card Providers.163 Second, 
even where it does appear, the contractual language is ambiguous about whether a Debit Card Provider 
must pay dial-around compensation to PSPs.164 Third, standing alone, Network’s single letter 
  
159 Network again faults APCC for declining Network’s purported offer in 2000 to “assist” APCC in seeking 
compensation from the Debit Card Providers, which Network asserts is the real reason for the present lack of 
available information.  See, e.g., Brief of Network, File No. EB-03-MD-011(filed Dec. 19, 2003) (“Network 
Liability Brief”) at 3-6, 9-10; Petition at 16; Defendants’ Initial Brief on Damages at 6-8, 9 and Exh. 2.  As we have 
explained previously, see Part III. B. 4., supra; Bureau Liability Order, 20 FCC Rcd at 2084, ¶¶ 24-25, regardless of 
any attempt by Network to help APCC, APCC had no obligation or right to seek information and compensation 
from the Debit Card Providers, as it was Network (and not the Debit Card Providers) who was the last facilities-
based carrier responsible for paying compensation to APCC.
160 Complainants’ Initial Brief on Damages at 9; Bureau Liability Order, 20 FCC Rcd at 2076-77, ¶ 8 (and orders 
cited therein).
161 Defendants’ Reply Brief on Damages at 8-10, Exs. F, G.
162 Defendant’s Reply Brief on Damages at 8.
163See Liability Answer at Att. B. 
164 A typical version of the contractual language states, in pertinent part:  “Customer shall be responsible for 
payment of all applicable taxes or assessments due to local, state, federal, and international taxing authorities, 
including income, sales, use, other excise taxes or assessments (including Universal Service Fund and Dial-around 
Compensation), resulting from Customer’s resale of the Services to Card Holders unless customer provides 
appropriate tax exempt certificate.”  Liability Answer at Attachment B-1, p. 2  (emphasis added).  Here, the 
payments at issue are “due to” a private party – APCC – not to any “local, state, federal, [or] international taxing 
authority”.  Thus, the contracts do not plainly obligate the Debit Card Providers to make such payments. In 
addition, the contractual language applicable to the largest Debit Card Provider is similarly ambiguous.  It provides, 
in pertinent part:  “[Debit Card Provider] is responsible for any fees and sales or use taxes levied by any taxing or 
(continued....)
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“reminding” Debit Card Providers to pay dial-around compensation directly to PSPs cannot support an 
inference that any or all of the dial-around compensation paid by Debit Card Providers to APCC was for 
calls handled by Network’s switches, in the absence of evidence of other admonishments and reminders.  
Indeed, give the contractual language’s ambiguity, it is equally if not more reasonable to assume that the 
Debit Card Providers simply ignored Network’s letter because the letter conflicted with their 
interpretation of the contract.165
63. Finally, even if Network were correct that the contracts obligated Debit Card Providers 
to pay compensation to APCC for the calls at issue here, the contracts’ lack of exclusivity would still 
fatally undermine Network’s position.  In particular, Network would still have to prove which payments 
(if any) were for calls handled by a Network switch rather than for any other kinds of calls. And despite 
urging from Commission staff, 166 Network failed to offer any such proof – or even an arguably 
reasonable proxy for allocating the Debit Card Providers’ payments between Network-switched calls and 
non-Network switched calls.  Network seems to assume that, if it can provide any evidence suggesting 
that some of the Debit Card Providers’ payments might be for Network-switched calls, then we will 
simply infer that all of the payments were, in fact, for Network-switched calls.  Network’s assumption is
incorrect.167
64. To summarize, Network has the burden of proving that payments made by Debit Card 
Providers to APCC were for payphone calls at issue here, i.e., calls handled by a Network switch, as 
opposed to calls handled by facilities-based carriers other than Network. Network has failed to meet that 
burden.  Therefore, the payments made by Debit Card Providers to APCC provide no basis for reducing 
the amounts owed by Network to APCC.168
  
(...continued from previous page)
regulatory authority (including universal service fees and dial around compensation) upon the compensation paid 
buy [Debit Card Provider] for Services and Deliverables.  [Network] will itemize any such fees or sales or use taxes 
levied on [Network] by listing them separately on its invoices.”  Liability Answer Attachment B-10.  The better 
reading of that provision is that Network – and not the Debit Card Provider -- was obligated to pay dial-around 
compensation directly to PSPs, and then Network could invoice the Debit Card Provider for the dial-around 
compensation that Network had paid to PSPs on the Debit Card Provider’s behalf.  
165 Network also points out that, during pre-complaint settlement discussions, APCC indicated that it would deduct 
from its claim against Network sums paid by Debit Card Providers.  See Defendant’s Reply Brief on Damages at 7, 
Ex. E.  Even if admissible, see generally Fed. R. Evid. 408, APCC’s statement cannot reasonably be interpreted to 
mean that APCC was willing to reduce Network’s liability by amounts received from the Debit Card Providers for 
payphone calls having nothing to do with APCC’s claim, i.e., calls not handled by a Network switch.
166 See ISC Order at 5 (stating that “the primary purpose of the briefs is to provide a calculation of damages (dial-
around compensation and interest) owed by Defendants to Complainants, if any, together with a full explanation of 
how the amount was calculated,” and making specific mention of the “double recovery issue”).
167 The weakness of Network’s assertion is highlighted by the fact that one of the Debit Card Providers paid APCC 
almost $30 million in dial-around compensation for payphone calls made during the Relevant Period.  Supplement 
to Complainants’ Answer to Defendant’s Interrogatory No.4, File No. EB-03-MD-011 (filed Nov. 10, 2005) 
(“Supplemental Data”) at 3 and App. A.  Thus, if we were simply to assume, as Network would have it, that all of 
the Debit Card Providers’ payments were for payphone calls handled by a Network switch, then APCC’s damages 
would be wiped out many times over, just by this one Debit Card Provider.
168 At the eleventh hour of this proceeding, Network belatedly revealed the existence of additional Debit Card 
Providers, some of which paid dial-around compensation to APCC.  See, e.g., APCC v. NetworkIP, Letter from 
(continued....)
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IV. CONCLUSION
65. Because Network was the last facilities-based carrier for 11,622,941 completed calls 
from APCC’s payphones from October 1, 1999 through November 22, 2001, Network owes APCC $.24 
for each of those calls, which amounts to $2,789,505.84, plus prejudgment interest at an annual rate of 
11.25% (to be calculated by the parties).  All of Network’s asserted grounds for eliminating or reducing 
the amount it owes APCC lack merit.  Specifically, the Enforcement Bureau was correct to waive rule 
1.718’s six-month deadline for filing a formal complaint that relates back to the filing date of the 
September 2002 Informal Complaint; APCC’s March 2002 Informal Complaint was effectively served; 
both the March 2002 Informal Complaint and the September 2002 Informal Complaint effectively named 
Network Enhanced Telecom, LLP as a Defendant; neither the statute of limitations nor any equitable 
doctrine bars or reduces APCC’s claims on tardiness grounds; and the record does not demonstrate that 
the damages award should be reduced by amounts received by APCC from collateral sources.  
Consequently, APCC’s Damages Complaint is granted in its entirety.
V. ORDERING CLAUSES
66. ACCORDINGLY, IT IS ORDERED, pursuant to sections 1, 4(i), 4(j), 201(b), 208, 
209, and 276 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151, 154(i), 154(j), 201(b), 
208, 209, 276, and sections 1.106, 1.716-1.736 and 64.1300-64.1320 of the Commission’s rules, 47 
C.F.R. §§ 1.106, 1.716-1.736, 64.1300-64.1320, that the petition of Defendants NetworkIP, LLC and 
Network Enhanced Telecom, LLP for reconsideration of the Bureau’s order granting the 
Complainants’motion for a waiver of section 1.718 of the Commission’s rules, 47 C.F.R. § 1.718, IS 
DENIED.
67. IT IS FURTHER ORDERED, pursuant to sections 1, 4(i), 4(j), 201(b), 208, 209, and 
276 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151, 154(i), 154(j), 201(b), 208, 209, 
276, and sections 1.716-1.736 and 64.1300-64.1320 of the Commission’s rules, 47 C.F.R. §§ 1.716-1.736, 
64.1300-64.1320, that the above–captioned formal complaint is hereby GRANTED in its entirety, and
this proceeding IS TERMINATED.  
68. IT IS FURTHER ORDERED, pursuant to sections 1, 4(i), 4(j), 201(b), 208, 209, and 
276 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151, 154(i), 154(j), 201(b), 208, 209, 
276, and sections 1.716-1.736 and 64.1300-64.1320 of the Commission’s rules, 47 C.F.R. §§ 1.716-1.736, 
64.1300-64.1320, that defendants Network IP, LLC and Network Enhanced Telecom, LLP SHALL PAY
to Complainants APCC Services, Inc., Data Net Systems, LLC, Davel Communications, Inc., Jaroth, Inc. 
d/b/a Pacific Telemanagement Services, and Intera Communications Corp., within 90 days of release of 
this Order, damages in the amount of $2,789,505.84, plus interest at an annual rate of 11.25%, computed 
  
(...continued from previous page)
Alexander P. Starr to Counsel, File No. EB-03-MD-011 (released Dec. 6, 2005) (“December 6 Letter Ruling”).  This 
raised the question of how to respond to Network’s tardy revelation of evidence.  See December 6 Letter Ruling;
Complainants’ Initial Brief on the Issue of Defendant’s Late-Produced Evidence, File No. EB-03-MD-011 (filed 
Jan. 13, 2006); Defendants’ Brief, File No. EB-03-MD-011 (filed Jan. 13, 2006); Complainants’ Reply Brief on the 
Issue of Defendant’s Late-Produced Evidence, File No. EB-03-MD-011 (filed Jan. 27, 2006); Defendants’ Reply 
Brief, File No. EB-03-MD-011 (filed Jan. 27, 2006).  That issue is now moot, given our determination that Debit 
Card Providers’ payments of dial-around compensation to APCC are irrelevant to the calculation of damages owed 
to APCC by Network.
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beginning on the first day of the quarter following the quarter after the quarter in which the billed call was 
made, continuing through the date of payment, excluding the period May 19, 2003 to June 3, 2003.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary