The enduring history of Tacoma’s click network providing cable and Internet services recently took another turn when the board of directors of Tacoma Public Utilities approved a settlement with Advanced Stream and its CEO, Mitchell Shook.

The settlement enables Advanced Stream to pay a reduced amount of its outstanding balance on the Click Network. In return, Shook has agreed to end all legal disputes it has filed against the city in relation to the network for changes to its operating structure.

According to the Board Action Memo by TPU Director Jackie Flowers: “The recommended rejection is to reduce the effects of the transfer of operational control of the Click! Network to Rainier Connect. “

The memo also states: “Authorizing the reduction would add value to the utility by reducing the ongoing costs of the litigation, reducing uncertainty about the outcome of this litigation, removing barriers to the successful transfer of operational control and the viability of long-term use of the Tacoma Power Commercial Network from Rainier Connect. “

Shook was involved in at least four litigations listed in the settlement, including two in connection with other litigants still active. These cases can continue without a shook by agreement.

The recent transfer of Click Networking operations to Rainier Connect, a local competitor of Shook’s Advanced Stream, was approved in November and went into effect April 1st.

Rainier Connect was selected through a selection process that included both the Tacoma Utilities Board and the City Council.

Opponents, including Shook, have opposed the design of the deal and have repeatedly called for the matter to be submitted to a public vote both in public hearings and in court.

Now, Shook’s part of that fight seems to be over.

According to the board of directors on April 10, the board approved a settlement that would reduce Advanced Stream’s total outstanding balance from “$ 672,799.11” by $ 284,187.22 and $ 108,000 for a total reduction of $ 392,187 . $ 22 with a remaining outstanding balance of $ 280,611.89 “.

When asked by The News Tribune, representatives from the city’s legal department said the amount due was “typical of the amounts owed to Click under the ISP Advantage agreements. The ISPs have 60 days to make payments under the ISP Advantage agreement. “

According to the city, most of the amounts owed by Advanced Stream are not overdue, and no previous collection attempts have been made. The fees represent a fee per customer based on the service level of each customer, of which Advanced Stream collected the retail tariff from the customer and TPU paid the corresponding wholesale tariff. The amounts cover a period from January 20th to March 31st.

In addition, under the Settlement Terms, Shook will “after the effective date of this Agreement and for a period of five years thereafter, this Agreement, the Click Network, the CBTA (Click Business Transaction Agreement), the parties to the CBTA, the transfer of operational control of the Tacoma Power Commercial Network to Rainier Connect North, LLC, and the facts and circumstances underlying the transfer of operational control of the Tacoma Power Commercial Network to Rainier Connect.

“The parties agree and acknowledge that this non-derogatory provision is an essential provision of this agreement, the absence of which would have resulted in the city’s refusal to enter into this agreement.”

The agreement also tells Shook to withdraw all of his public record requests filed with the city since January 1, 2018.

Years of struggle

Last fall, TPU’s board of directors and city council voted to approve agreements with Rainier Connect to operate the city-owned Click, while the network continues to be owned by the city.

The deal included the approval of an excess declaration for anything in the system that is not required for utility purposes, which gave Rainier Connect the right to use excess capacity over the network to provide video and broadband services.

Shook was a vocal critic of the city’s actions, repeatedly arguing that Click was a profitable business for the city.

The city has repeatedly claimed that the network is a money loser and has defended the surplus declaration. In an October 30 statement posted on TPU’s website, Director Flowers said the benefits of the expanded public-private partnership: “Rainier Connect will invest in our aging infrastructure, including expanding the service to equitable 1G service in the entire area within three years. They will also guarantee that Tacoma has at least three service providers to choose from, which is more than is available in most other communities. “

The opposition to the agreement has continued through various legal challenges.

While the deal means Shook and his company are no longer involved in litigation with the city, two cases that have been merged with two of their own are not affected by the settlement.

These include a lawsuit brought against the city by two Click customers, Thomas McCarthy and Christopher Anderson, over the transfer of operations to Rainier Connect, and a petition for review / appeal now in the State Supreme Court filed by Darrel Bowman . Similar arguments were made in both cases, arguing that the Click Network was a separate utility and that the transfer of operations to Rainier Connect needed a public vote.

The agreement states: “In matters consolidated with Bowman and McCarthy / Anderson … the above duty of termination only applies to claims made by Mitchell Shook.”

Meanwhile, when the time to sign a contract with Rainier Connect expired in March, Shook continued to email customers to assure them that there was no need to switch to Rainier Connect.

Advanced Stream and Rainier Connect never made an agreement so that Advanced Stream could continue to operate on the network.

Ultimately, Rainier Connect and TPU Advanced Stream had to repeatedly warn customers that they had to switch to a different service provider and help customers make the switch.

On Friday Shook reached out to The News Tribune: “Yes, I wanted to be on that network. … We did everything to support our customers, but we couldn’t achieve that. ”

When he decided to continue or end his struggle with the city, he said, “I had to do the right thing.”

The decision was made “in the best interest of the community in times of a pandemic. You need to know that their modems are a gift. You can keep your modem. I have a million dollar modems out there, please don’t try to call or return them. You can use your modem in the future; they are already in the system. “

Shook added that the comparison will benefit customers to provide click security.

“We made this decision to turn the page and leave the past behind and look to the future,” he said.

The settlement established a schedule for Advanced Stream to do business with Click. Part of the requirement is that Advanced Stream “E-mail and voice services for customers transferred to Click Network will be shorter by either the 31st period.”

Rainier Connect’s sales and marketing manager Lorie Hills emailed The News Tribune that the company “will honor Advanced Stream prepayments at the same level of service they received with Advanced Stream.”

“However, if the customer doesn’t want our service, they have to work directly with Advanced Stream,” she added.

The cost of handling

Under the agreement with Shook, credits totaling $ 284,187.22 will be awarded in two equal installments; the first involved the final termination of his litigation; the second will apply on June 30th, “provided that Advanced Stream and Mitch Shook’s commitments … have been satisfactorily met. All late penalties, fees and interest on the loan will be suspended from the effective date of this Agreement through June 30, 2020. “

Not everyone on TPU’s board of directors voted for an agreement with Shook. Board member Bryan Flint found the price too high amid the coronavirus pandemic as hundreds of customers ran into financial difficulties.

Flint explained the reason for his no during the April 13 special session. The meeting was held via conference call between members and also broadcast live on TV Tacoma, as ordered by the governor during the coronavirus outbreak.

“The amount we are considering letting go is almost the same amount that we provided utility services to 2,000 of our customers,” said Flint. “I don’t think we should reward bad behavior by signing this agreement, and I encourage Mr. Shook to go the high road to pay his bill, understanding that he fought the good fight and that Click in one new phase has entered. ”

At the meeting, CEO Karen Larkin, who voted for the deal and spoke after Flint, said, “I also believe we could have partnered better with Advanced Stream in this transition, and it has been a difficult process to work through. ”

She added, “I think this is in the best interests of our customers, Advanced Stream customers and our new partner Rainier Connect, to reassure this process … and go ahead with a clean sheet.”

When asked for a response by The News Tribune on Friday, Shook defended the settlement, reiterating the cost of modems, the work his company had done for free in some cases, and what future litigation or judgments may cost the city could have his own litigation.

Shook also said Friday that monthly emails were sent to Advanced Stream customers about the switch, instructing customers to sign up for new services on the Rainier Connect website.

“In the future, Internet access via Click will be provided by Rainier Connect. Nobody will lose their connections during this transition, ”read the email he sent to The News Tribune on Friday.

The email concludes, “Thank you for approving Advanced Stream as an ISP. We enjoyed 20 great years, but everything has to pass. We look forward to your messages of support. Advanced Stream will continue to provide IT support to the community, so keep us in mind when you make these house calls! “

As for next, Shook said, “We tried hard every day as a local ISP in the hometown, and now we’re going to do that work for other communities and states and keep doing it wherever we’re invited.”

This story was originally published April 18, 2020 8:00 a.m.