The California Public Utility Commission (CPUC) slammed Verizon and Frontier Communications as being evasive, deficient, and possibly misleading in answers to the state regulator regarding diversity, equity, and inclusion (DEI) requirements tied to Verizon’s pending $20 billion acquisition of Frontier.

CPUC Commissioner John Reynolds in a filing last week accused Verizon of “replying evasively and deficiently” to a question put forth by the CPUC that asked for clarity in responses the telecom operators recently provided to the Federal Communications Commission (FCC) about their respective DEI policies. That CPUC question asked for clarity in how Verizon’s most recent filings in California tied to that state’s DEI requirements coexist with a more recent Verizon filing with the FCC about dismantling its DEI program.

Reynolds pointed to Verizon responses that claimed the CPUC questions were too broad and that it was “infeasible ... to identify and parse every assertion [Verizon] has made on these issues.”

“This is not an acceptable response,” Reynolds wrote of Verizon’s claim.

The CPUC commissioner also questioned the validity of Verizon’s claims that its DEI program as explained to the FCC remained in compliance with state requirements.

“Verizon’s characterization of these significant policy changes – ‘ending these DEI policies … not in name or in the way they are described, but in substance’ – as merely a ‘different approach’ that maintains ‘longstanding commitments’ raises major questions about the candor of the Joint Applicants, either before this commission, before the FCC, or both,” Reynolds wrote.

Reynolds then turned up the heat by stating, “this commission does not tolerate false statements” and that Verizon and Frontier were required “never to mislead the commission or its staff by an artifice or false statement of fact or law. And Joint Applicants are further reminded that an omission can be misleading. If Joint Applicants provide testimony that is inconsistent with their obligations … the commission will consider appropriate sanctions.”

Verizon’s Frontier plans

The Frontier deal was initially announced in mid-2024, and includes a fiber networking business with 7.2 million fiber locations that serve 2.2 million subscribers across 25 states. Those assets are set to bolster Verizon’s approximately 7.4 million fiber connections across nine states and Washington, D.C., with a combined entity counting approximately 10 million fiber customers across 31 states and Washington D.C., and fiber networks passing more than 25 million premises.

The FCC approved the deal in May, which came shortly after Verizon filed a letter with the government regulator that stated the carrier was eliminating its DEI policies following an evaluation of the practices.

“In doing so, Verizon recognizes that some DEI policies and practices could be associated with discrimination,” Vandana Venkatesh, Verizon EVP and chief legal officer, noted in the letter to FCC Chairman Brendan Carr. “For that reason, Verizon reaffirms its commitment to equal employment opportunity and nondiscrimination and is modifying its practices and ending its DEI-related policies.”

However, the CPUC opened up public comment on the proposed transaction, which would see Verizon acquire one of California’s larger telecom network providers. The CPUC noted that it was looking into Verizon’s commitment in fulfilling legacy Frontier obligations around operating as a carrier of last resort, to provide Lifeline services, and obligations from Frontier’s bankruptcy settlement from 2021.

The state regulatory body also said it was looking into Verizon’s letter to Carr concerning its DEI-related move.

“We will also be looking at Verizon's statements and a letter to the Federal Communications Commission regarding changes it will be making to end its diversity, equity, and inclusion programs, such as in hiring, training, and in leadership and career development,” Reynolds said last month during a public hearing. “We are curious to see whether such changes would be compliant with California laws and orders in maintaining diversity in the utility workforce and supply chain and in the public interest for Californians.”

Verizon CEO Hans Vestberg told investors during the carrier’s most recent earnings call that “the regulatory approval process for our pending acquisition is progressing as planned.” Verizon CFO Tony Skiadas added that the Frontier deal has gained approval from eight states, the Department of Justice (DOJ), and FCC, and remains on track for an early 2026 close.

Investors pressed Verizon’s management for any insight into possible delays on the deal closing, with Skiadas only noting that Verizon is “productively engaged with the remaining state regulatory agencies.”

Verizon’s DEI move followed on the heels of T-Mobile U.S. making similar concessions to close its acquisition of fiber-provider Lumos.