Southern Telecom, Inc. v. TW Telecom of Georgia, L.P.
321 Ga. App. 110
Ga. Ct. App.2013Background
- Southern Telecom and TW are parties to 1990s contracts to share revenues from Atlanta and Birmingham telecom networks built on power facilities.
- TW predecessors acquired ICGT/ICG networks via Xspedius, then TW, and later capacity expanded through acquisitions, not through contract expansion.
- Contracts define Route Segments (Georgia Power facilities) and Alternate Route Segments (non-Georgia facilities) with different revenue shares.
- Assignee rights are limited to assignee's obligations as of the assignment date; growth by acquisition is not automatically included.
- Georgia and Alabama law provide that assignees stand in the shoes of assignors and cannot claim rights beyond those held by assignors at assignment time.
- The case focuses on whether revenue sharing covers preexisting networks of TW/Xspedius beyond the ICGT IC network as of the assignment date.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of assignee rights at assignment | Southern Telecom: assignee should share in revenues from post-assignment networks. | TW: revenues limited to ICGT Network as of assignment. | Assignee rights limited to obligations of assignor at assignment time. |
| ICGT Network definition applicability | Definition includes all facilities connected to ICGT Fibers. | Definition is limited to ICGT facilities in Atlanta. | Network = ICGT’s facilities in the Atlanta area; broad language does not expand beyond. |
| Growth by assignment considered | Contracts contemplated growth; assignments should be covered. | No evidence contracts contemplated expansion by assignment. | Contemplated growth does not include growth by assignment. |
| Records and scope of produced revenues | Southern Telecom entitled to records for all related revenues. | Records limited to revenues from facilities built under contracts. | TW must provide records only for revenues from contract-built facilities. |
Key Cases Cited
- Alabama Gold Life Ins. Co. v. Hall, 58 Ala. 1 (Ala. 1877) (assignee cannot exceed assignor's rights)
- Algernon Blair, Inc. v. Nat. Surety Corp., 222 Ga. 672 (Ga. 1966) (assignee has no more rights than assignor)
- Forsyth County v. Waterscape Svcs., 303 Ga. App. 623 (Ga. App. 2010) (de novo review on summary judgment; reasonable inferences in favor of nonmovant)
- Techwerks, Inc. v. Retail Technologies Corp., 235 Ga. App. 144 (Ga. App. 1998) (contract interpretation and whole-agreement rule)
- Medtronic AVE v. Advanced Cardiovascular Systems, 247 F.3d 44 (3rd Cir. 2001) (assignee stands in assignor's duties)
- Winkelblack v. Murphy, 811 S.2d 521 (Ala. 2001) (assignment of contracts; duties remain with assignor)