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itself (third-party-only projects).7 In 12 projects, Qwest
installed conduit for third-party customers while simultaneously
installing conduit along the same route for its own potential
future use or sale (conduit installation projects). In the
remaining three projects, Qwest pulled fiber using conduit
previously laid and retained by Qwest and granted third-party
customers indefeasible rights of use (IRUs) in a certain number
of fibers (IRU projects).
1. Conduit Installation Projects
In the conduit installation projects, Qwest generally
followed the same procedure: (1) Qwest contracted with a third-
party customer for installation of conduit over a certain route;
(2) conduit was installed along Southern Pacific’s or other
railroad companies’ rights-of-way; (3) Qwest received cash
compensation or DS-3 capacity for installing the conduit; and (4)
Qwest simultaneously installed and retained additional conduits
for its own potential future use or sale. Qwest and the customer
negotiated and agreed to a fixed price, with adjustments possible
under specific circumstances, for Qwest to install conduit over a
particular route. During the years in issue, Qwest charged its
customers approximately $30,000 to $40,000 per conduit mile.
7 The third-party-only projects include: (1) USW Clifton-
Rifle; (2) PAC Bell; (3) USW Romero-Santa Fe; and (4) MFS Denver
IRU. These projects are not directly in issue and will not be
discussed in detail.
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Last modified: May 25, 2011