Finger-Pointing in Core v. AT&T Over Access Charges' Burden of Proof

Each side in Core Communications’ legal fight to recover $11.4 million in unpaid access services charges from AT&T (see 2211230053) pointed the finger at the other in arguing which bears the burden of proof in showing that the calls at issue were legitimate and not improper robocalls.

Defendant AT&T has refused to pay plaintiff Core for its access services, claiming that nearly 100% of the calls that CoreTel affiliates in Delaware, New Jersey, Virginia and West Virginia connected were fraudulent. But AT&T’s claims of fraud “are at most an affirmative defense for which AT&T bears the burden of proof in this litigation,” said Core in its brief Friday (docket 2:21-cv-02771) in U.S. District Court for Eastern Pennsylvania in Philadelphia. AT&T’s brief countered that Core’s burden to establish its right to relief is based on a “straightforward application of well-established legal principles,” plus FCC precedent.

Access services and their associated charges are billed by local carriers like Core to long-distance carriers like AT&T under a complex system that’s regulated by the FCC and state public utilities commissions. The money that Core seeks to collect from AT&T is for access services that Core claims to have billed AT&T for transporting toll-free calls to AT&T and its customers, it said.

Core, as plaintiff, “has the burden of proving that it rendered the services in accordance with its tariffs,” said its brief. But there is nothing in its tariffs, nor in any applicable law, statute, regulation or order, that requires it, as an intermediate carrier, to verify the legitimacy “of each minute of each call before it sends it on to the next carrier and charges for that service,” Core said.

Core implements standards and processes “using reasonable efforts to track, filter, and stop the transmission of illegitimate, fraudulent, or suspicious call traffic,” said its brief. Its operations in this respect “are in accordance with and exceed” FCC rules, it said. Since Core provided services “pursuant to its deemed-lawful tariffs” and complied with all relevant “legal commands,” the burden shifts to AT&T “to prove any excuse for the requirement” to pay Core, including proving its “amorphous claim” that virtually 100% of the traffic at issue is fraudulent, “where an excuse from performance must be proven as an affirmative defense,” it said.

Fraud is an issue in the case only because AT&T “overstates” Core’s obligations under the FCC’s rules, said Core’s brief. Once it's understood that Core is in compliance with its obligations “and has no affirmative duty to ferret out fraud,” there's no relevance to demonstrating fraud in the traffic that Core “receives from originating carriers or upstream intermediate carriers and passes on further to AT&T,” it said. AT&T raises the “red herring” of fraudulent traffic, but that has nothing to do with Core or whether it “must be paid,” it said.

But the “ordinary rule” is that a plaintiff bears the “burden of persuasion” regarding the “essential elements of its claim,” countered AT&T’s brief. “When a carrier seeks to recover for tariffed services, an essential element of its case-in-chief is establishing that it provided the services exactly as set forth in the tariff,” it said. When local carriers like Core seek to collect access charges, it's well-established that the local carriers have the burden to demonstrate to their customers that those access charges are accurate, and they can’t unreasonably shift the burden of proof to long-distance carriers and their customers, it said.

There are “compelling legal and policy reasons” to apply the ordinary rule that a plaintiff bears the burden of persuasion on its claim, said AT&T’s brief. Core has “superior access to how the toll-free calls at issue are originated and routed, and the party with greater access to relevant information typically must bear the burden of proof,” it said.

Core has “better access to the information to identify a robocall, more control over who or what delivers calls onto their network, and is better positioned to prevent robocalls from entering the public telephone network,” said AT&T’s brief. AT&T, by contrast, “knows little about the origination of the toll-free calls,” it said.

Core’s contention that long-distance carriers like AT&T should bear the burden of proving Core’s access services were provided on improper robocalls “is directly contrary to two recent FCC decisions relating to Core’s burdens for detecting improper traffic,” said AT&T’s brief. In those decisions, the FCC found that Core twice improperly attempted to modify its tariff to make an improper burden shift to long-distance carriers of the responsibility for detecting and blocking fraudulent traffic, it said. “Core should not be allowed to accomplish with this motion -- shifting the burden to AT&T of detecting improper traffic -- what it was expressly prohibited from doing by the FCC through unlawful tariff revisions.”