AT&T Sues FCC Over Plan to Expand Broadband Service

AT&T has filed a lawsuit against the FCC in the U.S. District Court in Washington D.C. late Friday, charging that changes the FCC wants to make to a broadband outreach program are violating federal law.

We appealed a narrow issue in the order dealing [with] intercarrier comp., spokesman Michael Balmoris of the Dallas-based company said in an email to the International Business Times, referencing intercarrier competition. The company didn't comment further.

The FCC couldn't immediately be reached for comment.

AT&T seeks a review of the FCC decision on the grounds that it exceeds the Commission's authority; is contrary to the Communications Act of 1934, as amended by the Telecommunications Act of 1996; and is arbitrary, capricious, an abuse of discretion, and otherwise contrary to law.

AT&T requests that this Court hold unlawful, vacate, enjoin, and set aside the Order, the filing continued.

The Connect America Fund, which was rolled out by FCC Chairman Julius Genachowski in October, aims to provide broadband service to 18 million Americans who lack access. The commission estimates the plan will eventually save consumers who make long-distance calls at least $1 billion annually.

However, the FCC voted 4-0 later in the month to make changes to the program, which AT&T is finding issue with. Those changes included capping the fund at $4.5 billion. The commission also reformed intercarrier compensation rate policies, including requiring telecommunications companies to negotiate in good faith with Voice over Internet Protocol companies in regards to calling costs, according to The Hill newspaper.

The FCC and AT&T engaged in a recent spat after the commission called for an administrative hearing last month regarding the $39 billion AT&T/T-Mobile USA merger. The FCC blasted the deal as one against the public interest.

AT&T and Deutsche Telekom, the parent company of T-Mobile, have withdrawn their merger application and plan to seek reapplication following the trial with U.S. Department of Justice, which is scheduled to begin Feb. 13. However, the Justice Department recently announced plans to file a motion this week to either withdraw or seek a delay in its case against the merger.

Shares of AT&T are down 0.17 percent to 28.98 at late-morning trading.