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corresp

May 19, 2005

VIA EDGAR AND OVERNIGHT COURIER

United States Securities and Exchange Commission

Division of Corporation Finance

450 Fifth Street, NW

Washington, D.C. 20549

Attention: Michael E. Henderson

    Re:

    Pac-West Telecomm, Inc. (the “Company”)

Form 10-K for the fiscal year ended December 31, 2004, filed March 30, 2005

Dear Mr. Henderson:

             This letter responds to your letter, dated April 21, 2005, relating to comments of the Staff
(the “Staff”) of the Securities and Exchange Commission (the “Commission”) in connection with the
above referenced submission. The responses to the Staff’s comments are numbered to relate to the
corresponding comments in the above referenced letter:

Form 10-K for the fiscal year ended December 31, 2004

Item 6. Selected Financial Data, page 24

    1.
    See footnote 4. Disclose the substantive reasons for you [to] believe the presentation of
Adjusted EBITDA provides useful information to investors regarding your capacity to meet your
obligations and how you use it as an internal management tool. Also expand your liquidity
discussion in your MD&A to discuss Adjusted EBITDA.

             The Company respectfully proposes that it will no longer present Adjusted EBITDA as a
financial measure in future filings with the Commission.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Year ended December 31, 2004 Compare[d] to year ended December 31, 2003, page 31

    2.
    Please tell us the nature of your supplier credits and how you account for them.

             The nature of our supplier credits include (i) invoices paid but formally disputed, and
credited at a later point in time upon the subsequent resolution between the Company and the
supplier; (ii) invoices paid then credited at a later point in time due to incorrect billing issues
discovered after the invoice was paid; (iii) invoice amounts disputed and not paid, then
subsequently resolved via negotiation with the supplier; and (iv) volume discount credits.

U.S. Securities and Exchange Commission

May 19, 2005

Page 2

             We account for supplier credits based upon the nature of the credit received. Supplier credits
received for bills paid and then credited, and for volume discounts received upon meeting
predetermined volume levels, are recognized in accordance with SFAS No. 5 Accounting for
Contingencies as gain contingencies, which are not recorded until realized. The volume discount
credits include certain criteria in addition to the minimum purchase volume levels that must
be met before the credits are granted to the Company. Accordingly, the Company does not recognize
these volume credits until the supplier has notified us that the credit has been approved. Invoice
amounts disputed and not paid are treated as loss contingencies under SFAS No. 5, in which the
Company records a liability equal to the estimated amount the Company believes is probable to be
paid. During the negotiation process to resolve the dispute, the Company monitors its original
estimate and refines its estimate by recording a gain or expense as necessary. If the final dispute
negotiation results in an amount that differs from the Company’s most recent estimate, the Company
records the additional expense or credit when known.

    3.
    Per page 18, we note that your material active leases expiring between 2006 and 2010. Please
tell us the rationale for the changes in useful lives of the leasehold improvements.

             During the first quarter of 2003, the Company changed the estimated useful lives of some
leasehold improvements to more closely match the expected terms of the underlying leases. Per page
18, Item 2 of the Company’s Annual Report on Form 10-K, each of the leases associated with our
material facilities include options to extend the lease term, which the Company determined in 2003
that it intended to exercise. Therefore, for those facility leases where the option to extend the
lease term was expected to be exercised, the Company changed the estimated useful lives of the
associated leasehold improvements to match the anticipated total lease term for the related
facility, which in some cases is up to 20 years.

Item 8. Financial Statements and Supplementary Data

Consolidated Statements of Operations, page F-5

    4.
    See your line item, “Network expenses.” Please comply with SAB 11(B).

             In future filings the Company will change the line item “Network expenses” to “Network
expenses (exclusive of depreciation shown separately below)” to comply with SAB 11(B).

U.S. Securities and Exchange Commission

May 19, 2005

Page 3

Note 6. Restructuring Charges, page F-17

    5.
    Tell us what the remaining $.4 million liability related to the Utah facility represents.

             The $0.4 million liability does not relate to the Utah facility. As
noted in the last paragraph on page F-17 of the Company’s Annual Report on Form 10-K, there is no
remaining accrued restructuring charge for the Utah facility. The remaining $0.4 million
restructuring liability is related to estimated rent expense, net of
estimated sublease income, for the Company’s sales offices in San Diego and San Francisco, which
the Company vacated in 2001. We will clarify this in future filings with the Commission.

Note 16. Unaudited Quarterly Consolidated Financial Data, page F-31

    6.
    If your gross margin excludes depreciation for your switching equipment that is directly
attributable to the generation of revenue, it is not appropriate to present gross profit since
it results in a figure for income before depreciation, which is prohibited by SAB 11(B).
Revise accordingly.

             As reflected on its Consolidated Statements of Operations on page F-5, the Company does not
disclose gross profit based upon industry standards. However, per Item 302(a) of Regulation S-K,
companies must furnish the following selected quarterly financial data: net sales, gross
profit and per-share amounts of after-tax income (loss) before extraordinary items and the
cumulative effects of accounting changes. Hence, the Company disclosed net sales less network
expenses for its gross profit. In future filings the Company will not present gross profit since
it results in a figure for income before depreciation, which is prohibited by SAB 11(B), and will
present income from operations.

*    *    *    *

U.S. Securities and Exchange Commission

May 19, 2005

Page 4

             In connection with this response to the Commission’s comments to the above-referenced filing,
the Company acknowledges that:

    •
    the Company is responsible for the adequacy and accuracy of the disclosure
in the filing;

    •
    Staff comments or changes to disclosure in response to Staff comments do
not foreclose the Commission from taking any action with respect to the filing; and

    •
    the Company may not assert Staff comments as a defense in any proceeding
initiated by the Commission or any person under the federal securities laws of the
United States.

             We sincerely appreciate your timely consideration of these matters. If you or others have any
questions or would like more information, please do not hesitate to contact either H. Ravi Brar,
Chief Financial Officer of the Company, at (209) 926-3250, or Peggy McGaw, Vice President, Finance.

    Very truly yours,

    /s/ H. Ravi Brar

    H. Ravi Brar

    Chief Financial Officer

(Principal financial officer)

cc:      Larry Spirgel

           Dean Suehiro