"The FCC Won't Let Me Be": GCI Settles With DOJ And FCC In FCA Case Alleging Bid-Rigging And Inflated Pricing [telecom]

by Paula Ramer and Eliza Buergenthal

On May 11, 2023, the Department of Justice (DOJ) announced that Alaska's largest telecommunications provider, GCI Communications Corp. (GCI), had agreed to pay US$40 million to settle a False Claims Act action brought against the company by one of its employees: U.S. ex rel. Robert Taylor v. GCI Liberty, Inc., No. 19-CV-02029 JCC (W.D. Wash. 2021). The relator alleged that the company engaged in price inflation and bid rigging in violation of the Federal Communications Commission's (FCC) regulations surrounding the Universal Service Fund's Rural Health Care Program (RHCP).

Through the RHCP, which promotes access to healthcare in rural areas, the FCC pays companies the difference between providing telecommunications services in rural areas versus more densely populated areas in the same state. The program gives $570 million annually to eligible companies. Companies participating in the RHCP must go through a competitive bidding process regulated by the FCC.

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