CallPlus gets piece of the High Court action

By CHRIS BARTON

Telecommunications company CallPlus will get a limited part in a High Court case the Commerce Commission has brought against Telecom.

The commission alleges that Telecom's introduction of its 0876-prefix internet dialling scheme was anti-competitive behaviour, and the High Court at Wellington has ruled that one of CallPlus' claims against Telecom is virtually identical.

However, Justice Wild said CallPlus' other claims, based on damages and Telecom's disconnection of the company's free internet provider, i4free, should be heard separately.

CallPlus chief executive Malcolm Dick said the company would accept Justice Wild's option of a limited form of concurrent hearing with the commission's proceedings. Mr Dick believed CallPlus would benefit from having the commission's evidence to amplify its case.

Mr Dick said the damages claimed would be "in the vicinity of $20 million" and involved i4free being prevented from starting its business as planned in late 1999 because of the introduction of the 0867 prefix.

Other claims involved harm to its business through Telecom's disconnection of i4free's lines when it launched in April.

CallPlus obtained an interim injunction against Telecom in the High Court at Auckland on April 17 which required Telecom to reconnect its lines and cease limiting i4free's internet traffic.

Citing Section 36 of the Commerce Act, the commission began proceedings against Telecom in July, alleging that the 0867 prefix prevented or deterred other carriers such as Clear from competing in several telecommunications markets.

If found guilty, Telecom could face a fine of up to $5 million for each breach.

Both the commission and Telecom had objected to CallPlus' joining the High Court proceedings. Both said the nature of the two cases were different - the commission's being a regulatory challenge and CallPlus' being a commercial challenge.

Justice Wild said Telecom was "the party which one might have expected to seek a single hearing, rather than strongly oppose it."

This was because it was likely to face two complex and costly hearings if the proceedings were not heard together.

He also said that if CallPlus' evidence on the Section 36 issue was relevant and admissible and not repetitive of the commission's own evidence, he could not "see why the commission would not want it in."