See? There’s some home to humanity after all! If Purple and FCC can get along, so can we all!

FCC and Purple reached an agreement and made peace. Purple has issued a press release. Purple has survived the previous crisis, and will continue to serve customers!

For those of you, who’re like me and have short attention spans, like usual, here’s the summary, followed by the press release for you guys to glaze over.

While Purple and FCC has reached an agreement, I’d like to remind you all—this is only an INTERIM AGREEMENT (meaning they reached an agreement about the basic ideas, but are still debating about the details).

Now for the summary I promised you. Hopefully, your eyes haven’t glazed over yet.

• Purple has agreed to not challenge FCC’s recent declaratory ruling
• Accept a debt to FCC to the tune of as much as 20 million dollars.
• They expect to reach a full agreement about the rest of details within 6 months.
• This full agreement in 6 months will also include a plan for paying back FCC.
• FCC has released funds owed to Purple from past due reimbursement
• As a result, Purple has terminated their litigation against FCC

That’s all of it. The first one about Purple agreeing to not fight FCC’s recent declaratory ruling is a big ouch, since several companies and organizations are up in arms about it. I was going to email our PR department to find out what Purple had to say about their agreeing to this condition, but saw Purple’s CEO Dan Luis had already addressed it in the press release:

“Although we believed that the new Declaratory Ruling included new definitions and guidelines around compensability of TRS services, particularly regarding use of VRS services by Deaf and Hard of Hearing employees, it was our determination that it was in our best interest that we agree not to challenge the Declaratory Ruling so we could keep our operations and services intact for our customers,”

In other words, due to Purple’s fiscal crisis and need for past due funds owed by FCC, Purple needed to agree to this condition, as doing so meant Purple’s survival as a company.

Personally, this is very good news for me, and the rest of other employees, as it means we get to keep our jobs, and it also is a very good news for customers, as they get to continue using our services!

UPDATE: FCC has also issued an announcement with their own perspective of the agreement. That announcement from the FCC is also included below. I won’t be summarizing that one since they’re pretty much saying the same thing what Purple said.

As promised, here’s the press release from Purple [source (3/9/10)]:

PURPLE COMMUNICATIONS AND FCC REACH INTERIM AGREEMENT

Framework for Global Settlement Achieved – Funds Released

Rocklin, California – March 9, 2010 — Purple Communications™, Inc. (OTC: PRPL) (“Purple”), a leading provider of text and video relay and on-site interpreting services for the Deaf and Hard of Hearing announced that it has reached an interim agreement with the Federal Communications Commission (FCC) regarding payment demands made by the FCC in connection with the FCC’s February 25, 2010 Declaratory Ruling.

The Declaratory Ruling sets forth guidelines for interpreting and applying the FCC’s rules and regulations regarding text and video relay services. The Declaratory Ruling excludes certain types of video relay calls from compensation by the TRS Fund, both prospectively and retroactively. In anticipation of, and contemporaneous with, the Declaratory Ruling, the FCC made immediate payment demands on Purple for reimbursement to the TRS Fund and notified Purple that it would withhold reimbursements to Purple from the TRS Fund. With its current and future revenue stream suspended, Purple appealed the Declaratory Ruling to both the FCC and to the U.S. Court of Appeals for the District of Columbia. Purple’s appeal to the DC Circuit sought an immediate stay of the Declaratory Ruling.

Purple now has reached an interim agreement with the FCC that will enable Purple to continue operating while it continues to work with the FCC to negotiate a broader global settlement. In reaching this interim agreement, Purple agreed to accept and not challenge the Declaratory Ruling and, to assume a debt to the TRS Fund in an amount as much as $20 million. The broader global settlement is expected within 180-days which will include, among other things, a structured repayment plan. Upon execution of the interim agreement, the FCC released funds owing to Purple and Purple withdrew its litigation against the FCC.

“Although we believed that the new Declaratory Ruling included new definitions and guidelines around compensability of TRS services, particularly regarding use of VRS services by Deaf and Hard of Hearing employees, it was our determination that it was in our best interest that we agree not to challenge the Declaratory Ruling so we could keep our operations and services intact for our customers,” said Dan Luis, CEO of Purple. “We at the company were inspired by the support we received and have every intention of continuing to fulfill our mission of serving the deaf community by providing high-quality and innovative services, while working with consumers, other providers, and the FCC to shape the dialogue of our industry.”

“I would like to thank our loyal employees, contractors, and customers for their tremendous outpouring of support for Purple over this last week,” added Ronald E. Obray, Purple’s vice chairman. “The support shown for Purple this last week demonstrates the important role smaller providers like Purple play in ensuring that a competitive environment exists for consumers. Every phone call a consumer makes is like a vote; and when they choose a smaller provider for their phone call, they are voting for choice and competition instead of a market controlled by a single provider.”

About Purple

Purple Communications is a leading provider of onsite interpreting services, video relay and text relay services, and video remote interpreting, offering a wide array of options designed to meet the varied communication needs of its customers. The Company’s vision is to enable free-flowing communication between people, inclusive of differences in abilities, languages, or locations. For more information on the Company or its services, visit www.purple.us, by Internet relay by visiting www.ip-relay.com, or by video phone by connecting to purple.tv.

“i711,” “Purple,” and the Purple logo are registered trademarks of Purple Communications, Inc. “Purple Mail,” “Powered by Purple,” “i711.com,” “My IP-Relay,” “IP-Relay.com,” “One-Tap Redial,” and “P3″ are either registered trademarks, trademarks, or service marks of Purple Communications, Inc. Other names may be trademarks of their respective owners.

—————————-

And now the announcement from the FCC [source (PDF)] :

NEWS

Federal Communications Commission News Media Information 202 / 418-0500445 12th Street, S.W. Internet: http://www.fcc.gov
TTY: 1-888-835-5322

Washington, D. C. 20554

This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action.
See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).

For Immediate Release: News Media Contact:
March 9, 2010 Rosemary Kimball at (202) 418-0511

e-mail: rosemary.kimball@fcc.gov

PURPLE COMMUNICATIONS ACKNOWLEDGES DEBT,
BEGINS PAYBACK TO TELECOMMUNICATIONS RELAY FUND

Washington, DC — Purple Communications, a provider of telecommunications relay
services, has signed an agreement with the FCC that puts in place the framework for repayment
of funds that were inappropriately paid to the company. Under this agreement, Purple
“acknowledges that the FCC [has stated that Purple has] a debt amounting to $18,459,064, and
has determined not to challenge the FCC’s position.” Under the agreement, the funds will be
repaid to the National Exchange Carriers Association (NECA), which administers the
government fund that pays for relay services for deaf and hard-of-hearing consumers. In return
for this commitment, the FCC will instruct NECA to release payment to Purple for relay services
provided in the month of December 2009, and will continue to reimburse for legitimate relay
services provided by Purple month by month.

“We’re pleased that Purple has acknowledged its debt to the government and agreed to
repay it,” said Joel Gurin, Chief of the Consumer and Governmental Affairs Bureau of the FCC.
“Because this agreement enables Purple to continue doing business, it will also benefit Purple’s
customers and employees. We look forward to Purple’s fulfillment of this agreement in the
months ahead.”

This action follows a Declaratory Ruling, issued by the Consumer and Governmental
Affairs Bureau of the FCC on February 25, that reaffirms the FCC’s rules regarding which calls
can be compensated from the government relay fund. Relay services allow people with hearing
disabilities to communicate with hearing people. In video relay service (VRS), this is done
through an interpreter who can translate speech into American Sign Language and vice versa.

The Declaratory Ruling restates that government funds can only be used to pay for relay
service for calls that involve at least one party in the United States. In addition, the Ruling
restates that relay service for any calls made to or from the employees of a VRS provider – for
example, for marketing or other business purposes – cannot be paid for at the minute-by-minute
rate used to calculate payments for relay services provided to consumers. The costs of these
business calls can, however, be submitted by VRS companies as part of the overhead that is used
to calculate how the government will reimburse them.

The FCC calculated that Purple had been inappropriately paid by NECA for $18.4
million in calls that either began and ended outside the U.S., or that were made to or from Purple
employees. Purple has agreed to work with the FCC on a plan to repay this amount over time,
and will have 180 days to develop a repayment plan with the FCC. Purple has also agreed to
make an initial payment after it receives its December payment from NECA. While this
agreement addresses Purple’s debt obligation to the government, it does not affect any possible
government investigations into Purple’s business practices.

- FCC-