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sales, and the value could be realized only if the conduit was
actually sold.
Qwest hired Coopers & Lybrand LLP (CLC), a professional
consulting firm, to review its 1995 five-year plan. CLC
determined: (1) The demand for long-distance conduit builds had
slowed; (2) the country did not need another nationwide
fiberoptic network; (3) the creation of another network could not
be justified in terms of capacity or cost; (4) Qwest would be at
a cost disadvantage to existing nationwide carriers, such as MCI,
AT&T, and Sprint; (5) Qwest’s installation of additional conduit
would be “very risky”; and (6) Qwest’s revenue projections “may
be optimistic”.
Qwest’s Board of Directors minutes for the period January
22, 1994, through December 23, 1996, do not contain any
resolutions approving any of the five-year plans.
B. Construction Projects
During the years in issue, Qwest engaged in 21 construction
projects, 19 of which were for third-party customers.6 During
the years in issue, Qwest performed the majority of the
construction, only subcontracting out small portions of the work.
In four construction projects, Qwest installed conduit or pulled
fiber for third-party customers without retaining assets for
6 The Cal Fiber and Dallas-Houston projects were not done
for third-party customers.
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Last modified: May 25, 2011