CenturyLink countersued by state of Idaho over IEN network

CenturyLink earnings
Image source: CenturyLink

The state of Idaho is fighting back against CenturyLink and Education Networks of America, filing a counterclaim that said the two providers’ federal lawsuit violated the 11th Amendment of the U.S. Constitution, specifically the sovereign immunity of states.

The suit was filed in the Idaho Fourth District Court almost immediately after CenturyLink and ENA filed their lawsuit asking to be paid $37 million for work they performed on the defunct Idaho Education Network.

CenturyLink and ENA are asking for payment on invoices submitted with the suit – $812,836 for the carrier, and $4.4 million for ENA – as well as repayment for investments they each made in network infrastructure in anticipation of the IEN contract, which was slated to run through 2019, a Spokesman-Review article detailed. Total damages requested came to about $18.5 million for each provider.

The state of Idaho, for its part, said that “substantial funds” were advanced to the two providers by the state. Attorney General Lawrence Wasden contended that the state doesn't owe CenturyLink and ENA a thing, and that in fact they need to return millions of dollars paid to them to build the IEN.

The state Supreme Court voided the perpetually troubled IEN contract in March and said that the state could recover all funds paid to ENA and CenturyLink. While the order didn’t specify how much the providers needed to repay, Idaho Education News reported that the two vendors received a total of $29.7 million from the state before the project was canceled.

First proposed in 2008, the IEN was faced with a lawsuit almost immediately from Syringa Networks, which contended that the state improperly gave the buildout contract to CenturyLink and ENA.

The buildout was financed with a mix of state and federal funds, including a 2010 federal grant for $3 million, two grants of $3 million each from Albertson Foundation in 2011 and 2012, and $3 million in state funds in both 2013 and 2014. However, by 2014, the state faced a $14.5 million budget shortfall on the project, partly because promised E-Rate funds were being withheld by the FCC due to the Syringa lawsuit and an investigation into the contract award itself.

In March of 2015, the $60 million IEN project was mothballed when the state Supreme Court found in favor of Syringa Networks, saying the broadband contract had been illegally amended to favor CenturyLink and ENA. The state may also have to repay $13.3 million in E-Rate payments – hence the back and forth now on who will pay who.

For more:
- see this Spokesman-Review article
- see this Idaho Education News post

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