Grant Gross
Senior Writer

AT&T, MCI settle call-routing claims

news
Feb 23, 20042 mins

Companies had fought over access fees

WASHINGTON – Telecommunications giants MCI and AT&T have settled several claims they have against each other, including a September 2003 AT&T lawsuit that alleged MCI had fraudulently redirected millions of dollars worth of call-routing fees to AT&T.

On Monday, MCI filed an agreement to end the companies’ claims against each other with the judge overseeing its ongoing bankruptcy proceedings. The terms of the agreement were not disclosed, but AT&T agreed to end its call-routing lawsuit against MCI, and MCI agreed to withdraw its responding contempt-of-court claims against AT&T.

The two companies also agreed to settle claims against each other for access and other charges unrelated to the AT&T lawsuit. MCI, still officially known by its prebankruptcy name of WorldCom, had claimed AT&T owed it $220 million in access fees, and AT&T had claimed MCI owed it more than $100 million in access fees, according to the MCI document filed with the U.S. Bankruptcy Court for the Southern District of New York. Each company had disputed the other’s claims.

Officials from both companies called the settlement good for both companies in a press release issued by MCI. “This resolution is good for our creditors as well as both companies overall,” Stasia Kelly, MCI executive vice president and general counsel, said in a statement. “It allows us to better focus on the common good of the industry — fostering healthy competition and serving our customers.”

In its lawsuit, AT&T accused MCI of “outright theft” of AT&T revenues. According to the AT&T lawsuit, MCI allegedly rerouted long-distance calls made to its Phoenix telephone network through Canada and back to Phoenix on AT&T lines so that AT&T would have to pay termination charges on those calls. AT&T accused MCI and local telephone carrier Onvoy of using this type of call rerouting to shift tens of millions of dollars worth of phone line charges from MCI to AT&T.

MCI had denied the AT&T allegations.

MCI was scheduled to emerge from bankruptcy at the end of this month but asked for a 60-day extension to complete U.S. Securities and Exchange Commission paperwork.

Grant Gross

Grant Gross, a senior writer at CIO, is a long-time IT journalist who has focused on AI, enterprise technology, and tech policy. He previously served as Washington, D.C., correspondent and later senior editor at IDG News Service. Earlier in his career, he was managing editor at Linux.com and news editor at tech careers site Techies.com. As a tech policy expert, he has appeared on C-SPAN and the giant NTN24 Spanish-language cable news network. In the distant past, he worked as a reporter and editor at newspapers in Minnesota and the Dakotas. A finalist for Best Range of Work by a Single Author for both the Eddie Awards and the Neal Awards, Grant was recently recognized with an ASBPE Regional Silver award for his article “Agentic AI: Decisive, operational AI arrives in business.”

More from this author