AT&T sues Intel for unpaid phone bill

Posted: Saturday, August 14, 1999

NEW YORK (AP) - When Ma Bell gets tough with deadbeat customers, she's not kidding around.

AT&T Corp., the nation's largest telecommunications company, has sued Intel Corp., the world's largest computer chip maker, for allegedly stiffing it on a long-distance phone bill for $5,164.07.

That might seem like pocket change for AT&T, a $64 billion company that is spending more than $100 billion to provide phone service through cable TV lines, or for Intel with $27 billion in annual sales.

AT&T refused to explain why it took such a seemingly trivial matter between corporate giants to court. In its suit filed Wednesday in federal court in San Jose, Calif., AT&T alleged Intel refused to pay a bill for the seven months that ended June 27. It's also seeking attorneys' fees.

"We normally don't comment on legal issues like that," John Heath, a spokesman at the company's headquarters in Basking Ridge, N.J., said on Friday.

Intel, for its part, didn't seem too perturbed. "We're still researching the matter," said Chuck Mulloy, a spokesman for the Santa Clara, Calif.-based chip giant.

Jeffrey Kagan, an industry analyst, said AT&T may want to make an example out of Intel so other corporate customers pay up.

"This may wind up costing them more than they'll pay for it, but they can't afford to have a precedent set," Kagan said.

AT&T probably isn't going to cut off Intel's service, but it has been getting tougher. Last year, for instance, the company began charging residential customers a minimum of $3 a month even if they don't make any long-distance phone calls.