Tuesday, October 10, 2006

"LUS takes bond fight to state’s high court"

In more reporting on LUS's state Supreme Court appeal the Advocate's Kevin Blanchard publishes a follow-up report on Lafayette's filings to supplement his article last week that focused on the Naquin attorneys' case.

He lays out the structure of the legal case very clearly...and even gets a bit into the legal principles that govern whether or not the Supreme Court will take the case. That level of reporting is always a nice surprise--good reporting on unfamiliar but important topics like this one should be educational but seldom are.

A few teasers, on the basic incoherence of the law:
While one part of that law, called the Local Government Fair Competition Act, says that any communications bonds must be paid back “solely” from revenues generated from the sale of communications services, another portion says that nothing in the Fair Competition Act restricts governments to “pledge” the resources of its other utilities to secure communications bonds...

Additionally, the Legislature when passing the Fair Competition Act declared its intent was not to prevent government-owned communications operations from being able to engage in the same business practices as private competitors, LUS argues.
The law clearly anticipates such loans--it even provides mechanisms for their oversight. The (un)Fair Competition Act is bad law from the first moment in that it exists solely to hobble one class of competitors and to benefit another. But, were that not enough, it deserves to be repealed simply because it is incoherent. Lafayette's team should not have let those inconsistencies pass. My guess is that the did because of exhaustion and the sense that the inconsistencies cut both ways and theoretically they might end up with more than they would have had those confusions not been resolved. The trouble with such reasoning is that this is an asymmetrical law that only restricts one side of competitive situation. There is no handle in this law that could be used against the corporations; any confusions simply make it easier to tie the process of building and running a public utility up in court. And that is exactly what is happening.

Take a look, it's a good article. This is an important case, one that should be heard by the Supreme Court on its merits. It's important law and exactly the sort of issue the court exists to address.

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