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Fiber Installation Provokes Lawsuits

Photonics Spectra
Jul 1999
Robert C. Pini

Communications companies deploying optical fiber are finding that empire building is still based on secure land rights. Two recent court cases, one each involving private and public lands, highlight the interpretation of property rights that affect carriers and systems developers.

In one case, private landowners have settled with AT&T over contested easements in Indiana. Nels Ackerson, a lead attorney for the landowners, said the problem goes back to the 1980s, when companies installing fiber optic networks moved too quickly and, in some cases, did not obtain right-of-way easements.

Cutting corners

"The companies cut a big corner," Ackerson said, contracting with railways and utilities that typically get easements to create a corridor but that do not own the land outright.

"Courts have established for years that a company that acquires a limited easement cannot transfer use," he said. "You can't sell more than you own."

AT&T agreed to pay landowners $3.6 million and court costs, or an average payment of $45,000 per mile for an estimated 80 miles of its Indiana network covered by the settlement. Ackerson cast the first-round victory as "a very small start" to the nationwide class-action suit in which landowners are seeking compensation in all 50 states for fiber optic cable installed along railroad and utility rights of way. An AT&T spokesman said the firm admitted no wrongdoing in the settlement.

The class action also threatens other phone and utility companies that have installed cable on overlapping easements. AT&T estimated that, of its 51,000 route miles, about 8,800 are on railroad rights of way and "significantly less" are on utility rights of way.

In the second case, a Minnesota district court judge has upheld the state's right to provide exclusive access to its freeway right of way for fiber optic infrastructure. Unlike utilities and railroads, highway commissions buy the land (not just an easement) on which they build.

The Minnesota Telephone Association and a consortium of local and rural service providers argued that the Telecommunications Deregulation Act of 1996 requires nondiscriminatory access to the right of way. The groups sued the state, seeking to make the freeway right of way accessible to all and to bar the commissioner of transportation from making exclusive contracts.

Don Mueting, assistant attorney general for Minnesota, said the installation contract allows other companies to have cable installed along the freeway right of way but does not allow them access after installation.

Safety trends

"I would argue with the use of the term 'exclusive,' " said Bill Jones, technical director of intelligent transportation systems at the US Department of Transportation. Jones has supervised the federal program to guide states in opening freeway rights of way. He noted that the Minnesota contract requires the installer to act as a wholesaler and to sell capacity to carriers.

The debate over freeway rights of way stems from policy changes. In the past, state governments did not grant utilities rights of way along freeways because the associated roadside construction caused accidents. Now, ironically, states are opening freeway rights of way to fiber optic installers -- out of concern for safety.

Highway authorities are installing smart photonic systems that help transportation officials manage the freeways and inform drivers about highway conditions. Cameras and other detectors monitor speed and traffic flow, feeding information to highway managers.

Data show that highway fatalities dropped after the systems were installed. But the systems require fiber optic communications because of the immense amount of data they provide. As a result, 24 state governments have changed their laws since 1994 to allow fiber optic telecommunications easements along coveted freeway rights of way.

Nine states are developing the roadside networks; all have made deals similar to Minnesota's, bartering rights of way for a specified number of fibers or reserved capacity. For safety reasons, officials in other states also have limited access.

The Minnesota Telephone Association said it will appeal the verdict. Meanwhile, it expects a ruling soon from the Federal Communications Commission on Minnesota's control of access.

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