Hartford Business Journal

14 Hartford Business Journal • July 4, 2016 www.HartfordBusiness.com Subscribe online: HartfordBusiness.com/subscribe Delivering Business. When you need information to grow your business, we deliver! Subscribe today to receive weekly issues in print and digital, plus special publications and full online access! GreenGuide C O N N E C T I C U T S P R I N G 2 0 1 6 BUILDING MOMENTUM Big deals, new potential markets push FuelCell Energy toward profitability A s u p p l e m e n t o f TRASH-T0-ENERGY'S CHALLENGE ECOMPANY: LACK OF ROOF SPACE NO PROBLEM FOR JCC from page 1 Frontier claims the ads began appear- ing in California and Texas last month, con- taining untrue statements about its internet speeds and pricing, which are causing the company to lose customers and suffer eco- nomic harm. Charter's ads, the suit says, also contained the phrase "ripped off by Frontier." Charter, which moved its headquarters from St. Louis to Stamford after receiving a $6.5 million forgivable loan from the state in 2012, responded last week with a countersuit containing similar allegations against Frontier, accusing its rival of false advertising in viola- tion of the federal Lanham Act and Connecti- cut's Unfair Trade Practices Act. Charter's allegations pertain to portions of Frontier's website, which provides compari- sons between both companies' various offer- ings. Charter says the comparisons contain "false boasts" about Frontier's own product capabilities and "false claims" about Charter's. In addition to damages and other penal- ties, each company has asked the judge for preliminary and permanent injunctions. Asked for comment last week, Frontier said: "Charter's recent ad campaign is false and misleading and does not accurately portray the competitive, high-quality products and servic- es that we provide our customers. We owe it to our customers, employees, and shareholders to defend ourselves against false attacks such as this and to ensure that our products and ser- vices are honestly and fairly represented at all times by all parties." Charter said it would not comment direct- ly on the suit. "However, these are competitive markets, we believe in our products and services and we're going to compete to bring in more cus- tomers," Charter said. Legal action common Telecom providers are big advertisers, and they haven't been shy about suing each other — or at least threatening to — over the contents of commercial speech. Frontier, for example, issued a cease-and- desist order against Comcast in 2011 over bill- boards that claimed Frontier would "pull the plug" on its FiOs products it had previously acquired from Verizon, according to report- ing by FierceTelecom. In recent years, Verizon and Cablevi- sion settled several lawsuits related to false claims about internet speeds. And in 2009, AT&T sued Verizon over using a wireless coverage map in a televi- sion ad that AT&T argued was misleading. It dropped its lawsuit later that year. The latest battle between Frontier and Charter stems from new territories and cus- tomers both have picked up recently through major acquisitions in multiple states. California and Texas — the targeted geog- raphy of Charter's ads, Frontier's suit says — are two states where those interests have overlapped. In April, Frontier closed its $10.54 billion acquisition of Verizon assets in California, Texas and Florida. The deal included 5.4 million voice and broadband subscriber con- nections, landline operations and 1.2 million FiOS television subscribers. The following month, Charter completed a much larger $67 billion acquisition of Time Warner Cable and Bright House Networks, making it the second largest cable provider in the country behind Comcast. California and Texas were among the states where the deal gave Charter an increased presence. Charter's countersuit acknowledges the heightened competition. "Charter competes with Frontier for cus- tomers in locations throughout the United States," it reads. "This competition has intensified in recent months since Frontier acquired new networks and customers from Verizon in California and Texas." Each company's allegations take aim at specific claims that appeared in advertising and online. For example, Frontier identified a Charter ad it says made the claim that one of Charter's internet tiers (60 megabits per second) was "10x faster than Frontier's." Frontier rebuts that claim, saying its base-level internet speeds in California and Texas are 50 Mbps with maximum speeds of up to 500 Mbps. Charter takes issue with a claim on Fron- tier's website that says Charter internet speeds "slow to a crawl" during busy traffic times, while Frontier's internet service does not. In the suit, Charter says that claim has been disproven by annual performance testing conducted by the Federal Communications Commission. "The FCC's most recent testing demon- strates that Charter delivers the internet speeds it advertises with rare exceptions, whereas Frontier generally does not," Charter wrote. CT similarities While Frontier's Verizon deal is much larg- er than its $2 billion purchase of AT&T's Con- necticut wireline business and fiber network in Oct. 2014, there are similarities. Following the Connecticut deal, hundreds of former AT&T customers filed complaints with state regulators about outages and other problems, which ultimately spurred Frontier to issue refunds. The situation has been somewhat similar in California, Texas and Florida, according to media reports about customer complaints in the wake of the April switchover. One of Charter's ads cited in Frontier's lawsuit takes aim at customer complaints about Frontier's call center. "[U]nlike Frontier, our helpful agents will answer your call," one ad cited by the suit said. Frontier wrote that its customer service reps "are based entirely in the United States" and "are in fact both helpful and answer customer calls." Frontier's Connecticut deal also led to an advertising surge from in-state competitors, including Cox and Comcast, some of which seized on negative media coverage of Fron- tier's system switchover. "Ready for better business Internet with- out disruption?" one Comcast ad asked. No lawsuits, however, were filed over the Connecticut advertising. Frontier and Charter are due back in court by mid-September, unless they settle the dis- pute on their own. n Ads target internet speeds, complaints Shown above are examples of advertising included in a false-claims lawsuit and countersuit filed recently by Frontier and Charter Communications, respectively. I M A G E S | C O N T R I B U T E D

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