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Biddeford Internet Company Sues Developer of Broadband Project
01/13/2014   Reported By: Susan Sharon

GWI, a Biddeford-based Internet company, has filed suit against the developers of the Three Ring Binder Project, designed to provide high-speed Internet service to unserved and under-served rural parts of Maine. Filed in Superior Court, the 37-page lawsuit accuses Maine Fiber Company, its principals and its sister companies of failing to complete the work, misusing federal stimulus grant money and violating the terms of its contract with the Biddeford carrier. Susan Sharon has more.

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The Three Ring Binder Project has been touted as "Maine's Internet Superhighway" - a plan to connect more than 100 rural communities, several hundred schools, libraries and government faclities with high-speed, reliable internet service. It was supposed to make businesses more productive and bring rural residents into the 21st Century.

In the summer of 2012, Maine Fiber announced that it had completed the 1,100-mile core network ahead of schedule and on-budget. Fletcher Kittredge of GWI was there to celebrate the announcement. He says he now regrets not making waves sooner.

"In retrospect, we should have laid the hammar down much earlier on," Kttredge said.

GWI was one of the partner carrier companies that helped launch the Three Ring Binder Project. The company signed an agreement with Maine Fiber to pay for fiber service. But GWI now contends that it's been overcharged by more than $700,000, and the two companies have been engaged in mediation over a contractual dispute for several months.

Attorney Lori Boxer-Macomber says it wasn't until GWI started grumbling that Maine Fiber hadn't completed its work that Maine Fiber said GWI owed additional money.

"We claim that we way overpaid. They claim that we owe them money. There's a dispute here," Boxer-Macomber says. "But the most important thing, I think, for everyone to take away, is that, right now, the people of Maine in rural communities are not being served. I'm sure everyone has seen - we're ranked 49th in the states as far as accessibility to broadband Internet services."

This, Boxer-Macomber says, despite the fact that the Three Ring Binder Project was the recipient of $25 million worth of federal stimulus grant funding under the American Recovery and Reinvestment Act.

Instead of fully investing that money for rural Internet service in Maine, the lawsuit alleges that Maine Fiber reconfigured the project, redesigned the network, and entered into contracts with financial institutions in New York City and other metropolitan areas to allow them to use it to transfer financial data to Canada and Europe.

"It's absolutely incorrect, and we vehemently disagree," says Dwight Allison, the CEO of Maine Fiber Inc. He says Maine Fiber regularly files reports with the National Telecommunications and Information Administration, which oversees the federal grant.

"Any place that we spent money the federal government got reports of that," Allison says. "Any place that we spent money that was different than what was originally anticipated was specifically approved in writing by the NTIA prior to any money being spent. So, no money whatsoever has been spent in any unacceptable or any unpermitted way."

Attorneys for GWI say they have filed a Freedom of Information request with the NTIA to review those filings. Meantime, a spokesperson for the agency declined to comment on GWI's allegations. When asked what evidence GWI has that Maine Fiber diverted public stimulus funds away from their intended use, Fletcher Kittredge had this to say.

"What we know is they didn't do very important parts of the system," Kittredge says. "We know that they told the NTIA, at least at one point, that they had saved a lot of money. And we know that they built this other stuff."

Kittredge acknowledges that 85 to 90 percent of the Three Ring Binder has been completed, but he says what little that remains is a significant part, essentially the on-and-off ramps for the "Super Highway."

But Dwight Allison of Maine Fiber says GWI accepted completion of the project back in 2012 in writing. And Allison says none of Maine Fiber's other customers, including the University of Maine System, Oxford Networks and Cornerstone Communications, which provides rural broadband to western Penobscot and southern Piscataquis Counties, have had complaints with the company or the project. Andy Hinckley is Cornerstone's general manager.

"They delivered the goods," Hinckley says. "We were able to connect our equipment to their fiber optic cables and use their cables as backhaul to our central network point in Bangor."

Hinckley says Maine Fiber's role in the Three Ring Binder Project should be characterized as the "middle mile," not the last mile of the network. He says the final mile is up to rural carriers like his company and GWI to provide.

In its lawsuit, GWI is asking the court to terminate its contract with Maine Fiber and award damages which it believes exceed $3 million.


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