Qwest Is Violating Merger Laws, AT&T; Says

Qwest Communications International Inc. is violating federal law by selling long-distance phone services in 14 Western U.S. states, rival AT&T; Corp. told the Federal Communications Commission.

When Qwest bought US West Inc. in 2000, the company agreed to sell its long-distance operations in those markets to Touch America Holdings Inc. Qwest has not complied, said AT&T;, the biggest U.S. long-distance phone company.

“It’s our position that Qwest has been deliberately violating,” merger conditions and providing long-distance services illegally, said AT&T; spokeswoman Claudia Jones. Qwest denies wrongdoing.

Qwest can’t sell long-distance services in the 14 states until it proves the local markets are open to competitors. AT&T; and Touch America say Qwest has leased capacity on its long-distance network and never turned over control to Touch America.

Denver-based Qwest is also under investigation by state regulators for failing to disclose agreements that gave local phone rivals cheaper access to its network in exchange for their silence as it sought to sell long distance. Qwest shares fell 19 cents to $4.86 on the New York Stock Exchange. AT&T; dropped 16 cents to $13.70 also on the NYSE.