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22 | BROADBAND COMMUNITIES | www.broadbandcommunities.com | JULY 2014 THE LAW Advice for Developers: Preempt Disaster No developer wants to think a relationship with a service provider will go wrong, but planning ahead of time to be able to efciently terminate a contract and substitute an alternative provider is always a good idea. By Carl E. Kandutsch / Kandutsch Law Ofce and Stephen Mayo / Inteleconnect I magine the following scenario: You are a developer whose company spent several million dollars building a mixed-use community that includes an apartment complex, a planned unit development of single-family homes and buildings for commercial lease. For several years, the development fourished. Most of the apartments were leased, and home sales were active. Ten the economy slowed, and so did business at the development. At that point, the community's television and broadband service provider seemed to lose interest. Te television programming, provided in bulk to all residents of the development, is expensive and inadequate. Te Internet access service, also purchased in bulk, is expensive and measurably slower than what is available from other ISPs in the same geographic area. Worst of all, services are unreliable, and outages are frequent. When customers call the service provider's "hotline," they are placed on hold for extended periods, and those who are willing to wait for a human voice on the line are treated rudely and unresponsively. Service appointments are missed, and often the attempted fxes do not work. When customers give up calling the service provider, they call your ofce to complain about the service provider and demand that something – anything – be done. Meanwhile, the service provider's poor performance is afecting the marketability of the development. Irate residents and commercial tenants have plastered the Internet's social media platforms with complaints, some legitimate, others not. Several complaints have been lodged with the Better Business Bureau, not only against the service provider but also against your company. Leasing and sales activities at the development have slowed to a crawl. Low occupancy, now chronic, plagues the development while costs remain constant. Because the service provider's bulk service fee must be paid on all rentable units and salable lots, including those that are unoccupied, a signifcant portion of that fee must come from your company's pocket. Rumors fy, investors are unhappy and there's no end in sight. What to do? After making multiple phone calls and sending numerous letters to the service provider and receiving apologies and promises but no meaningful action, you inform the service provider CEO that you are preparing a notice of default. Te CEO says he is in discussions with a large cable operator concerning the sale of his assets at the development, and a default notice would kill any prospect of a sale. You wait, but when time passes and nothing changes, you eventually deliver a default notice alleging that the provider's Internet service is uncompetitive