Opposition — Rosner v. United States

Supreme Court brief1978

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IN THE

Supreme Court of the United States

OCTOBER TERM, 1977

No. 77-420

UNITED STATES INDEPENDENT TELEPHONE ASSOCIATION

Vv.

MCI TELECOMMUNICATIONS CORPORATION, et al.

No. 77-421

AMERICAN TELEPHONE AND TELEGRAPH COMPANY

MCI TELECOMMUNICATIONS CORPORATION, et al.

No. 77-436

FEDERAL COMMUNICATIONS COMMISSION

Vv.

MCI TELECOMMUNICATIONS CORPORATION, et al.

On Petitions for a Writ of Certiorari to the United States

Court of Appeals for the District of Columbia Circuit

BRIEF FOR THE RESPONDENTS IN OPPOSITION

Of Counsel: MICHAEL H. BADER

JOHN R. WoRTHINGTON - nen lg Fm i

1150 - 17th Street, N.W. RAYMOND C. FAY

Washington, D.C. 20036 HALEY, BADER & Ports

(202) 872-1600 1730 M Street, N.W.

October, 1977 Washington, D.C. 20036

(202) 331-0606

WILSON - Eres Printing Co.. Inc. - RE 7.6002 - WASHINGTON. D.C. 20001

TABLE OF CONTENTS

Page

Sy | re. scieeeaseinnemetiatunien 1

STATEMENT OF THE CASES ...~..2.-.-<..--cccccccoccececeesos 2

a etn

TSIEN te Races nee a Se a

, F — ff SENET RSE Sense menses neurone

ARGUMENT AGAINST GRANTING CERTIORARL. 14

BIN —scccicinsceticissieneusihiitniehibuiiiind See eee ar Pe 14

I. The lower court accurately interpreted Section

214 of the Communications Act ........................... 16

II. The FCC’s Specialized Carrier decision did not

result in the imposition of conditions upon MCI’s

SLES ST ESA INE ENE Pe PCN EDIT aT OOS 24

III. There is no conflict with other decisions ......___.... 82

IV. There is no legal question of importance ready

EIEIO 85

I soiicbicticetatescntceiseicneenssinti cided ceaibietieta aie iaaaliaaaieeianlan 40

TABLE OF AUTHORITIES

Judicial Decisions Page

American Telephone and Telegraph Co. v. FCC,

— SJ | ££ 'e. Se 35

Arkansas-Best Freight Systems, Inc. Vv. United

States, 399 F. Supp. 157 (W.D. Ark. 1975),

wee 63S UF). eee 23

Bell Telephone Company of Pennsylvania v. FCC,

503 F.2d 1250 (3d Cir. 1974), cert. denied, 422

U.S. 1026, reh. denied, 423 U.S. 886 (1975) _....32, 33, 34

Bowman Transportation, Inc. Vv. Arkansas-Best

Freight System, Inc., 419 U.S. 281 (1974) ......... 23

FCC v. RCA Communications, Inc., 346 U.S. 86

IED . :aniinessanicabcsnibcinnitenenisinisencdasisineabinaiaanintiiiniiamiaies 24

Hawaiian Telephone Co. v. FCC, 498 F.2d 771

RT eee ee 23-24

Long Island R.R. v. New York Cent. R.R., 281 F.2d

Ge Cy CRI SII i esntrisicehsisicsscistietidedeiebicaiebiidinnaanniiticiiie 16

MCI Communications Corp. v. AT&T, 369 F. Supp.

1004 (E.D. Pa. 1973), vacated, 496 F.2d 214

Sy Gi SITE cccinicicisiiidlaniideinitieteipuciniiialmtiaiannncue 34

National Association of Regulatory Utility Com-

missioners V. FCC, 533 F.2d 601 (D.C. Cir.

TETTTET sncsciccnensssisisareternsasenmsindamatnianaipiaieadantiiianinbiiapinvniaigieiniies 27

New York Dock Ry. v. Pennsylvania R.R., 62 F.2d

1010 (3d Cir.), cert. denied, 289 U.S. 750

TUTE. scccsssemeininainiatansienenciténaieinbaiteiauittiiniinteieinenia 16

Noble v. United States, 319 U.S. 88 (19438) -.......... 22, 23

United Telegraph Workers v. FCC, 436 F.2d 920

Ste CHI MIU -<eincccetinssinesicinebcttiasaniinoenenaietapamensiatineien 18

Washington Utilities and Transportation Commis-

sion V. FCC, 513 F.2d 1142 (9th Cir.), cert. de-

ey 32, 33

Administrative Decisions

American Telephone & Telegraph Co. (WATS), 37

I a OR 21

American Telephone & Telegraph Co. (WATS), 38

FCC 475 (1965) ................. Pa Sed eek ne 21

TABLE OF AUTHORITIES—Continued

Page

Bell System Tariff Offerings, 46 FCC 2d 413

(1974), aff'd, Bell Telephone Co. v. FCC, 503

F.2d 1250 (3d Cir. 1974), cert. denied, 422 U.S.

1026, reh. denied, 423 U.S. 886 (1975) —............. 6

Establishment of Policies and Procedures for Con-

| sideration of Applications to Provide Specialized

| Common Carrier Services in the Domestic Point-

to-Point Microwave Radio Service and Proposed

Amendments to Parts 21, 43 and 61 of the Com-

mission’s Rules, 29 FCC 2d 870 (1971), recon-

sideration denied, 31 FCC 2d 1106 (1971), aff'd

sub nom. Washington Utilities & Transportation

Commission V. FCC, 513 F.2d 1142 (9th Cir.),

cert. denied, 423 U.S. 886 (1975) ............... passim

Establishment of Policies and Procedures for Con-

sideration of Applications to Provide Specialized

Common Carrier Services in the Domestic Point-

to-Point Microwave Radio Service and Proposed

Amendments to Parts 21, 43 and 61 of the Com-

mission's Rules, (Notice of Inquiry), 24 FCC 2d

ERR ere Mer sae ae 3, 20-21

Establishment of Rules Pertaining to the Authori-

zation of new or Revised Classifications of Com-

munications on Interstate or Foreign Common

Carrier Facilities, 39 FCC 2d 131 (1978)

I passim

Microwave Communications, Inc., 18 FCC 2d 953

(1969), reconsideration denied, 21 FCC 2d

190 (1970)

Statutes and FCC Rules

National Environmental Policy Act, 42 U.S.C.

a ee ee 32

Communications Act of 1934:

Sections 201-205, 47 U.S.C. $§ 201-205 __.. 16, 21, 38

Section 214, 47 U.S.C. § 214 ........................ passim

TABLE OF AUTHORITIES—Continued

Interstate Commerce Act, 49 U.S.C. § 1 (18) —......

Motor Carrier Act of 1935, 49 U.S.C. §§ £01, 306

IE Se

Oe a a icrcnicictiiiieiicisaitiatebninincsibptatiiniibininmabniasias

Or a I a cecinliciditnsdsiichncnieinieichliiiiaiain

Or I a catia

fs 8 | Re eee aera

§ ER EN REeL eer oee eeeee

Oe Sa I reid iccciciccnncestisitiitiatincaecniintistiians

47 C.F.R. Subpart I of Part 21 -............... 13, 24,

Miscellaneous

Brief for the Respondents in Opposition at p. 3,

AT&T v. FCC, 422 U.S. 1026 (1975) (Docket

No. 74-1229), denying cert. to Bell Telephone

Co. Vv. FCC, 503 F.2d 1250 (3d Cir. 1974) _......

THE DILEMMA OF TELECOMMUNICATIONS POLICY:

AN INQUIRY INTO THE STATE OF DOMESTIC TELE-

COMMUNICATIONS BY A TELECOMMUNICATIONS

INDUSTRY TASK FoRCE, Part III, 6-7 —............

Hearings before the Subcommittee on Communica-

tions of the Committee on Interstate and Foreign

Commerce of the House of Representatives: Dis-

cussion on Domestic Common Carriers, Septem-

ber 21, 1977, preliminary transcript, pp. 17-77,

SIE acsicecicetapssieaeaiieninladdanelaisa shies eatieiaiae Et teaee raid.

H.R. REPoRT No. 1850, 738d Cong., 2d Sess. 6

SIIIIIED sccochicionneinbaicinhnsteuieadatinstaitiaielbeeasseebianiiae caiman

S. REPorT No. 781, 73d Cong., 2d Sess. § (1934)...

H.R. 8, 59th Cong., Ist Sess. (1977) ..............0000....

S. 530, 95th Cong., Ist Sess. (1977) -........--000000.

S. 3192, 94th Cong., 2d Sess. (1976) -.................... -

H.R. 12323, 94th Cong., 2d Sess. (1976) _.............

Page

16, 22

IN THE

Sipreme Court of the Anited States

OCTOBER TERM, 1977

Nos. 77-420, 77-421 and 77-436

UNITED STATES INDEPENDENT TELEPHONE ASSOCIATION,

AMERICAN TELEPHONE AND TELEGRAPH COMPANY, AND

FEDERAL COMMUNICATIONS COMMISSION,

Petitioners

Vv.

MCI TELECOMMUNICATIONS CORPORATION, MICROWAVE

COMMUNICATIONS, INC., AND N-TRIPLE-C INC.,

Respondents

On Petitions for a Writ of Certiorari to the United States

Court of Appeals for the District of Columbia Circuit

BRIEF FOR THE RESPONDENTS IN OPPOSITION

QUESTION PRESENTED

Whether the Federal Communications Commission has

authority to stop a specialized common carrier from pro-

viding a duly tariffed new communications service on

previously certified lines without making any finding that

the public interest so requires?

STATEMENT OF THE CASE

In the decision below, the lower court held that the

FCC could not, without a finding of public interest, stop

a specialized common carrier from providing to the pub-

lie over previously certified lines a validly tariffed new

communications service.

Petitions for certiorari were filed on September 16,

1977, or shortly thereafter, by the American Telephone

and Telegraph Company (“AT&T”), the United States

Independent Telephone Association (‘‘USITA”, an assoca-

tion of non-AT&T telephone companies which, under var-

ious arrangements, share revenue with AT&T) and the

Federal Communications Commission (the “FCC” or the

“Commission” ). The United States of America, the other

statutory respondent below, has declined to join these

three parties in petitioning for certiorari.

MCI Telecommunications Corporation, Microwave

Communications, Inc. and N-Triple-C Inc. (collectively,

“MCI’) are affiliated communications common carriers,

operating a transcontinental system providing business

and data long distance communications services among

37 metropolitan areas throughout the United States.

Background

In 1963, Microwave Communications, Inc. filed applica-

tions for authority to construct the first specialized com-

mon carrier microwave facilities between St. Louis and

Chicago. The FCC ultimately granted these applications

in 1969 after an extensive evidentiary hearing. Through-

out these very protracted proceedings, AT&T maintained

unrelenting opposition to the competition which would

emerge by grant of the applications, alleging unsuccess-

fully that competition of this nature was, for various

reasons, contrary to the public interest.’

1 Microwave Communications, Inc., 18 FCC 2d 953 (1969), re-

consideration denied, 21 FCC 2d 190 (1970).

After the Microwave decision, many additional poten-

tial competitors to AT&T filed numerous applications for

routes encompassing virtually all of the major business

communities in the United States. The FCC, instead of

addressing each set of applications on an individual basis,

first initiated a broadly based rule-making proceeding to

consider certain questions common to all these applica-

tions, including the question of whether permitting the

entry of new competitors would be in the public interest.

Establishment of Policies and Procedures for Considera-

tion of Applications to Provide Specialized Common Car-

rier Services in the Domestic Point-to-Point Microwave

Radio Service and Proposed Amendments to Parts 21, 43

and 61 of the Commission’s Rules (Docket No. 18920),

29 FCC 2d 870 (1971), reconsideration denied, 31 FCC

2d 1106 (1971), affd sub nom. Washington Utilities &

Transportation Commission v. FCC, 513 F.2d 1142 (9th

Cir.), cert. denied, 423 U.S. 836 (1975).

The Commission’s order instituting the Specialized

Carrier proceeding provided that, once the specifically

enumerated policy questions had been answered, it would

“consider each proposal on its individual merits and fol-

low such procedures as may be necessary to resolve any

remaining questions pertinent to the particular set of ap-

plications.” 24 FCC 2d 318, 327 (1970). The FCC also

invited the parties to suggest additional questions for con-

sideration in the rulemaking proceeding. The proceeding

resulted in the adoption by the FCC of a general policy

encouraging the competitive entry of new carriers in the

intercity business and data communications field.’

One objective stressed by the Commission in reaching

its Specialized Carrier decision was to “provide users

with flexibility and a wider range of choices as to how

they may best satisfy their expanding and changing re-

* 29 FCC 2d at 920.

quirements for specialized communications service.” * The

Commission stated that it was “clear that the proposed

facilities and services of the applicants have several tech-

nical and service offering features which are different

from those now provided by the established carriers.” ‘

From the outset, the new carriers have been expected to

innovate. The Commission agreed with its staff’s earlier

conclusion that the new specialized carriers ‘would be

under pressure to innovate to produce those types of serv-

ices which would attract and retain customers.” °

During the pendency of the Specialized Carrier pro-

ceeding, the Commission instituted another apposite rule-

making proceeding to consider a proposed requirement

that all carriers, before instituting new services on ex-

isting facilities, obtain prior Commission consent. After

deliberation, the FCC concluded, to the contrary, that both

the established and new carriers should be free to in-

stitute new service offerings merely by filing tariff re-

visions rather than being required to obtain prior au-

thorization from the Commission. Establishment of Rules

Pertaining to the Authorization of New or Revised Clas-

sifications of Communications on Interstate or Foreign

Common Carrier Facilities (Docket No. 19117), 39 FCC

2d 131 (1973). The Commission stated, at 135, that:

In connection with possible revisions of our tariff

rules, we recognize that the termination of the rule

making proposed herein will make it possible for

domestic carriers, as a general rule, to offer new

classes or subclasses of communications service over

duly authorized facilities merely by filing of ap-

propriate tariff revisions properly supported by the

cost and other data required by Part 61 and other-

wise in conformity with our rules.

* 29 FCC 2d at 909.

*29 FCC 2d at 919.

° 29 FCC 2d at 910.

After its Specialized Carrier decision, the Commission

undertook detailed review of the individual specialized

carrier applications and disposed of the other questions

that had been raised in the petitions to deny filed by

AT&T and its allies.

It is important to note that MCI’s system, like the sys-

tems of other specialized carriers, is construed to provide

communication capacity only between in-city terminals

MCI has constructed in the cities it serves. It would be

both economically burdensome and wasteful to expect the

specialized carriers each to duplicate the existing facili-

ties of the local telephone monopolies to extend beyond

their in-city terminals out to the points to which their

customers wished their communications brought. MCI

realized, as did AT&T, that MCI would be dependent upon

local telephone companies, primarily those of AT&T, to

provide the required local interconnections between MCI’s

terminals and its customers’ termination points.°

Throughout most of MCI’s initial construction period

during 1972 through mid-1973, MCI engaged in exten-

sive negotiations with AT&T in order to obtain adequate

interconnection. By the fall of 1973, however, it became

abundantly clear that AT&T would not provide MCI

with local interconnections required for certain services,

including a private line service known in the industry as

“FX” or “foreign exchange.” FX is a service which, in

the desired distant city, terminates in a business tele-

phone arrangement, a device which, like a local telephone

line, gives the private line subscriber access to switched

local exchange service in the distant city. For example,

with New York FX service, a businessman in Washing-

ton can reach—and can himself be reached by—all tele-

phone subscribers in New York City.

*In Microwave Communications, Inc., supra, the Commission

had retained jurisdiction in order to assure that AT&T would

live up to its interconnection obligation.

To resolve the local interconnection dispute, the FCC,

in December 1973, initiated a show cause proceeding

against AT&T. While the Commission relied upon the

record compiled in the Microwave Communications, Inc.

and Specialized Carrier proceedings, it also afforded

AT&T a further opportunity to justify its refusal to

supply local interconnection. After extensive pleadings

and oral argument by AT&T and other parties, the Com-

mission reaffirmed AT&T’s obligation to furnish MCI

and the other specialized carriers with the local facilities

needed for the rendition of all their services, including

FX.’

Execunet

On September 10, 1974, MCI filed a tariff revision to

set forth rates for a new category of specialized service

called ‘‘metered use service.”

Metered use service was designed for those business

customers whose communications requirements are not

sufficiently extensive to justify full-time private line serv-

ice.s Metered use service was also designed to enable the

"Bell System Tariff Offerings, 46 FCC 2d 413 (1974), aff'd,

Bell Telephone Company v. FCC, 503 F.2d 1250 (3d Cir. 1974),

cert. denied, 422 U.S. 1026, reh. denied, 423 U.S. 886 (1975).

* For instance, a full-time private line between Washington, D.C.

and Chicago is priced, under MCI’s current tariff, at approximately

$550 per month. By permitting a group of business customers to

share a number of MCI’s intercity circuits, however, MCI is able

to reduce its costs to the point where the price to the customer

of a one-minute Execunet call between Washington and Chicago

is approximately 30¢. Execunet service entails a minimum charge

of $75 per month (plus monthly recurring termination charges

which average approximately $25) with the result that its

market is limited to customers whose communications require-

ments to the limited number of cities served exceed the minimum

charges. If the average distance of calls placed were equal to that

between Washington and Chicago, the customer would have to use

Execunet to the extent of 333 minutes per month. So, while Exe-

cunet service is attractive to a good number of businesses not

having sufficient communications volume to justify a full-time

heavier-volume user to supplement his other MCI services

and thereby obtain a more efficient mix of services match-

ing his specific requirements. Metered use service allows

MCI, through innovative service offerings, to attract new

and supplemental business and thus produce sorely needed

revenues to help offset its substantial fixed costs.

During the 30-day public notice period preceding ef-

fectiveness of MCI’s metered use tariff revision, any com-

peting carrier or otherwise interested party could have

objected. None did so. The Commission also had the

opportunity to question or challenge the tariff but did

not do so. As a result, the revision became effective on

October 10, 1974. After arrival of required special

equipment, MCI began marketing Execunet in January

1975. Execunet permits its users, in effect, to share

FX circuits which terminate in a limited number of

distant cities. One additional innovative feature dis-

tinguishes Execunet from other metered services. In-

stead of requiring that access to the Execunet network

private line, its attractiveness is in turn limited to those businesses

which have substantial requirements among the cities served.

* The FCC states, at page 10 of its instant petition, that, at the

time MCI’s metered use tariff became effective, the staff of the

Commission was seeking clarification of the services the revision

described, the desired inference being that the staff had from the

outset questioned MCI’s authority to provide Execunet service. This

is an inference stated far more bak» in prior writings of the

Commission and its counsel. However, in an affidavit filed with

the lower Court on July 7, 1975, an officer of MCI categorically re-

futed this inference. He reported each conversation that had taken

place between the staff and MCI regarding the tariff and made it

clear that during none of those conversations had it even been

suggested that MCI did not have authority to provide Execunct.

Yet, this factually erroneous inference has surfaced time and time

again. After failing to offer any evidence to the contrary, after

denying MCI’s Request for Admission as irrelevant and after re-

fusing an MCI request for a hearing on the matter, it is inappro-

priate for the FCC to attempt to mislead the Court as to the nature

and significance of the discussions that occurred between repre-

sentatives of MCI and the Commission’s staff.

be accomplished by means of a dedicated local distribu-

tion facility between the customer’s office and MCI’s

terminal—thus limiting the customer’s use of the service

to times when he is in the office—MCI has devised a

means (essentially a pre-programmed computer! which

permits the customer to access Execunet when at the air-

port or at a supplier’s office, for instance. However, de-

spite its advantages to customers, Execunet does have

its limitations.

Execunet is in fact a specialized business communica-

tions service provided to business users in 18 cities. As

the switching hardware used by MCI will not accept

rotary dial signals, Execunmet can be accessed only by

those customers who have, or are willing to incur the

additional expense of installing, push-button phones * or

other special equipment. Execunet is limited to those

customers whose customary calling to the 17 other Execu-

net cities’ is sufficient in quantity to justify: (a) the

payment of a monthly minimum charge of $75, plus both

calling city and distant city termination charges: (b)

a thirty-day commitment to Execunet; and ic) a com-

mitment to terminate Execunet service only upon thirty

days’ notice. Also, the offering of Execunet is restricted

to those customers to whom the other substantial limita-

tions of Execunet (e.g., inability to place person-to-

person, collect, or conference calls) are acceptable.

The MCI facilities used in Execunet service are shared

among its subscribers, who are charged on an as-used,

or metered, basis. Computerized hardware utilized in

1° Only about 16% of telephones are push-button equipped, and

of these, more than 80% are residential telephones. In view of the

economic characteristics of Execunet service, residential users are

highly unlikely to become Execunet customers.

11 While AT&T’s MTS users can reach every other telephone

in the United States through more than 22,000 toll rate centers,

and beyond that, can call 98.3% of the world’s telephones, Execunet

accesses only those telephones in the 17 other Execunet cities.

Execunet service * gives the user, after he has identified

himself as “authorized” to use the service by pulsing in

a preassigned identification code, the first available FX

facility to the city desired. The same computerized hard-

ware enables MCI to provide the customer with a detailed

monthly invoice which lists each usage and its duration

(expressed in tenths of a minute), indicating the number

called and other valuable information permitting Execu-

net customers to allocate their intercity communications

expenses easily and accurately.

The fact that the metered-use-service revision to MCI’s

tariff became effective without opposition encouraged MCI

to acquire and install the substantial capital plant, pri-

marily the computerized hardware apparatus, required

for the provision of Execunet service.

The Agency Proceeding

In the spring of 1975, months after MCI began market-

ing Execunet, AT&T began a surreptitious campaign of

ex parte presentations to members of the Commission and

its staff against MCI’s Execunet service. At the time,

MCI knew nothing of this campaign, but learned of it

only later.** Even now, however, MCI does not know

12MCI’s Execunet hardware is sometimes called “switching

equipment”, but this is inaccurate terminology to the extent that it

conjures up a picture of the immensely complex system of hier-

archical step switching, with alternative routes capacity, used by

AT&T to provide its MTS service. MCI’s equipment merely identi-

fies the city to which a particular call is being placed and then

selects the appropriate direct FX facility.

43 After repeated, largely unsuccessful attempts to put the full

extent of AT&T’s ex parte meetings on the record of this case,

it is now nonetheless known from subsequently submitted affidavits

that AT&T argued its case forcefully. It is known that AT&T used

a tone generator (a device which produces push-button signalling)

and various documentary materials to present its case. It is known

that at least several of the Commissioners were personally in-

volved in receiving AT&T’s presentations. It is known that there

was an arrangement between AT&T and representatives of a major

non-Bell telephone company to obtain an Execunet authorization

every consideration and argument AT&T advanced, and

the Commission has rejected every attempt by MCI to

find out.

MCI’s first notice of potential controversy came in the

form of a brief letter, dated May 19, 1977, from AT&T

to the Commission’s Chairman, which the Chief of the

Commission’s Common Carrier Bureau forwarded to MCI

two days later. The AT&T letter was a scant page and

a half, contained a purported description of Execunet

service, alleged that Execunet was identical to AT&T’s

long distance message telephone service, claimed (with-

out citation to any authority) that Execunet was beyond

MCI’s authority and asked that the Commission “take

appropriate enforcement action to stop the unauthorized

Execunet service.” In forwarding the AT&T letter to

MCI, the Common Carrier Bureau Chief indicated that

MCI’s “comments on this matter would be appreciated.”

MCI responded to the Bureau Chief’s request in a

seven-page letter denying in some detail each of AT&T’s

conclusary allegations. Four days later, MCI wrote a

further letter to the Bureau Chief, stating its belief that

AT&T’s real objections to Execunet, apart from those set

forth in its initial seemingly innocuous letter, had been

presented in an ex parte manner, by telephone and in

person, to members of the Commission and its staff prior

to the time AT&T’s letter had been written. MCI re-

quested the Bureau Chief to obtain from AT&T the names

of all its personnel who had spoken to Commission per-

code for use in offering demonstrative evidence regarding Execunet

to members of the Commission. It is known that one of the parties

to this arrangement stated that: “We will bury MCI.” It is known

that at least one individual who occupies a decision-making position

with the Commission made a remark showing that he had been

influenced into reaching a firm adverse judgment against MCI.

The unprecedented celerity with which the Commission acted in

1975 also makes obvious the effectiveness of AT&T’s ex parte

presentations.

sonnel about Execunet, the names of the people at the

Commission to whom AT&T had spoken, the date and

length of those conversations, the brochures or other ma-

terials used, and the substance of the oral presentations

made. The Bureau Chief rejected MCI’s request.

After a second more detailed AT&T letter, MCI wrote

a third letter to indicate that MCI was preparing a de-

tailed reply. The letter stated MCI’s belief that AT&T,

in its ex parte presentations, had completely pre-sold its

position to the Commission and that, in order to respond

effectively, MCI would have to be informed as to the

scope and content of AT&T’s presentations. MCI also

pointed out that the Commission, in its 1973 decision in

Docket No. 19117, supra, had decided that domestic car-

riers should be free to offer new classes of service merely

by the filing of appropriate tariff revisions.

Less than 24 hours after delivery of MCI’s third letter,

the Commission sent MCI a letter order in which it re-

jected MCI’s tariff “insofar as it purports to offer Execu-

net service.” ** The letter cited no statutory authority

and contained no discussion of, much less any finding

concerning, the public interest.

1%*The Commission’s letter order informed MCI for the first

time that several Commissioners had had questions concerning

Execunet service even before speaking to AT&T's representatives

about it. The letter stated the Commission’s understanding of

Execunet service but failed to state how it had arrived at its

understanding—or to concede that MCI had been given no oppor-

tunity to reply to anything other than AT&T’s initial short con-

clusary letter. On the basis of the Commission’s understanding, and

on the basis of a paraphrase of the arguments set out in AT&T’s

second letter, the FCC declared that, “under the factual situation

presented here,” Execunet is “essentially a switched public message

telephone service rather than private line.” The FCC failed, and its

failure persists to this day, to define “switched public message

telephone service.” Further, without even discussing its decision in

Docket No. 19117, the Commission asserted that MCI was permitted

to operate its facilities only for “private line service” and concluded

Pe MCI must therefore cease providing Execunet within thirty

ays.

On July 3, 1975, MCI filed its petition for review with

the lower court, and on July 7, 1975, it filed a motion

to stay the effectiveness of the Commission’s action. MCI’s

stay motion, which was opposed by the FCC, AT&T and

USITA, was granted. Shortly thereafter, the FCC asked

the lower court to hold its review in abeyance until the

FCC could consider the matter further.

In the supplemental proceeding before the agency, MCI,

in an attempt to be able to address specific alleged vio-

lations of the Communications Act, moved * that the Com-

mission require AT&T, as the complainant in the case,

to specify its objections to Execunet in a sworn formal

complaint in accordance with Commission complaint pro-

cedures.’* The Commission simply ignored MCI’s motion

and proceeded on the basis of permitting interested par-

ties to file comments and then reply comments ten days

later. The Commission denied MCI’s motion for a hear-

ing to discover the nature and import of AT&T’s ex

parte presentations."

After the conclusion of oral argument late in the after-

noon on May 24, 1976, the Commission, in a meeting

which could not have lasted more than a few minutes,

15 Motion to Modify Procedures, December 5, 1975.

16 The Commission’s complaint procedures require that the com-

plainant specifically set forth fully which provisions of the Com-

munications Act, or of Commission rules, orders, or regulations,

have been violated and how they have been violated. 47 C.F.R.

§ 1.722. The responding carrier is entitled to submit an answer

within the time specified in the Commission’s formal notice of

complaint, 47 C.F.R. § 1.730, and may move to make the complaint

more definite and certain. 47 C.F.R. $1.731. In the Execunet

proceeding, however, the FCC totally ignored its own procedural!

rules.

17 The FCC also denied MCI’s motion to depose the AT&T official

who had given an affidavit to the lower court concerning the er

parte presentations and a motion to direct AT&T to preserve evi-

dence concerning the ex parte presentations.

issued a brief public announcement * affirming its 1975

letter order and directed its staff to develop an opinion

supporting its conclusion. The formal opinion was re-

leased on July 13, 1976.

The FCC opinion was premised on the argument that

the certifications of MCI’s lines were subject to an im-

plicit condition limiting the services which could be pro-

vided over these facilities to “private line services.”” The

opinion then proceeded to formulate a new definition for

private line services which excluded MCI’s Execunet

service.*®

** FCC Report No. 11955, entitled “FCC Rules on Execunet

Service”.

+? “Private line service,” which petitioners argue is the permis-

sible service universe for MCI, had never been given any precise

meaning by the FCC prior to the proceeding below. As used in the

industry, the meaning of the term evolved as new services were

introduced. When the FCC stated that up until the Execunet case

“there had been no confusion or debate over the meaning of private

line service,” (FCC App. 6la), it was technically, if not logically,

correct. There had been no confusion because, up to that point,

the definition had never been of decisional significance, and, just as

there had been no debate, there had been no decision on how to de-

fine the term. The first decision definition of private line service

appeared in Paragraph 61 of the FCC’s 1976 Execunet order (FCC

App. 62a), and this definition was created out of thin air. In a

bold stroke, FCC counsel have created yet another definition of

private line service especially for the present petition (pet., p. 6).

This definition, which includes dedication of facilities “in some

meaningful respect” to a customer’s personal use, “instant connec-

tion without the need for dialing,” and charges “at a flat periodic

rate,” contains elements at variance with those services which even

the Commission decision below classifies as private line (FCC

App. 63a; see id. 15la).

AT&T's petition (p. 5, n.&) refers to Section 21.2 of the FCC’s

rules, 47 C.F.R. $21.2 (1976), for a definition of private line

service. This outdated definition is not relied upon by the FCC, as it

does not encompass services, such as FX, which AT&T itself includes

in its own private line tariff. The FCC also classifies FX as a private

line service. The court below (FCC App. 17a) recognized that the

FCC has not applied the definition in Section 21.2 to Subsection I

of Part 21, under the terms of which MCI receives its authorizations.

In the lower court, MCI argued, not only that its

certifications were not subject to pre-existing service

limitations, either explicit or implicit, but also that, even

if it were assumed arguendo that MCI were limited to

“private line” service or “specialized” service, Execunet

would fall within either of these categories. MCI also

argued that it had been deprived of its due process rights

in view of the undisclosed nature of AT&T’s ex parte

presentations and in view of the FCC’s curtailing of its

normal hearing processes. These secondary arguments

were rendered moot when the lower court reached its

decision that there were in fact no pre-existing condi-

tions on MCI’s facility certifications. If the relief re-

quested by petitioners were granted and the lower court

be reversed, it would, of course, be necessary for the lower

court to address these additional questions on remand.

ARGUMENT AGAINST GRANTING CERTIORARI

Summary

The decision below, which was unanimous, is based

upon the court’s interpretation of the unambiguous lan-

guage of Section 214 of the Communications Act of 1934,

47 U.S.C. § 214. The court’s interpretation was clear,

straightforward and correct. There is no constitutional

issue at stake. Further, the decision does not deprive

the Commission of authority or ability to regulate ef-

fectively. Indeed, the decision specifically points out that

the commission is fully empowered to conduct a hearing

on the basic issue of public interest which lies at the

heart of the controversy.

In the proceeding below, the FCC did not purport to

make any public interest determination but, instead,

reached its conclusion on the basis of a contention that

pre-existing implicit restrictions on the certifications of

MCI’s lines obviated any need to consider whether the

public interest required that MCI be prohibited from

using its previously certificated lines to offer Execunet

service. The agency’s contention in this regard is in-

consistent with prior statutory interpretation and ad-

ministrative practice.

The lower court’s decision mooted a number of hotly

contested questions, such as whether MCI’s Execunet

service could be categorized as a “private line service” or

“specialized service”, whether the FCC’s orders had been

tainted by AT&T’s initial ex parte contacts and whether

the Commission’s procedures were otherwise compatible

with the requirements of due process. Instead, the lower

court’s decison permits the Commission to address now

instead the fundamental issue of public interest, rather

than the artificial and sterile question of how to cate-

gorize new and rapidly changing communication services

with outdated and vague terminology.

The lower court’s decision is not at variance with the

holding of any other court decision. The statements

cited by petitioners from decisions by two other courts

are merely prefatory and, not even rising to the status

of dicta, are of no decisional significance. The decision

below is the first and the only judicial decision to con-

sider whether there are implicit restrictions on the

certifications of lines of specialized carriers to limit the

services that can be offered thereon. The lower court’s

holding is based, not upon any ambiguous or conflicting

law, but rather upon the plain and, in fact, inescapable

meaning of the statute.

The lower court’s decision gives AT&T another full

opportunity to demonstrate to the Commission why the

public interest requires that competing common carriers

be restricted from providing certain categories of service.

While the issue of competition’s role in the telecommuni-

cations industry is perhaps an interesting one, the peti-

tions for certiorari do not, and in fact cannot, bring that

issue before this Court in the present case. The lower

court’s decision will also give the current members of

the Commission the opportunity to consider the merits of

AT&T’s public interest contentions, free of any distor-

tions that may flow from a misconception as to what

their predecessors may or may not have intended.

I. The Lower Court Accurately Interpreted Section 214

of the Communications Act

Section 214(a) of the Communications Act, 47 U.S.C.

$ 214(a), provides for certification of “lines,” not serv-

ices. A “line” is defined by Section 214(a) to mean any

“channel of communication established by the use of ap-

propriate equipment ... .” While under Section 214(c)

the Commission may attach “to the issuance” of a cer-

tificate “such terms and conditions as in its judgment

the public convenience and necessity may require,” ab-

sent such terms and conditions, Section 214 does not re-

quire new certification when previously certified lines

are used for new services. A new classification of serv-

ice, not involving the construction, extension, acquisition,

or operation of a new line, is initiated by a tariff filing.

Long Isle 1 R.R. v. New York Cent. RR., 281 F.2d 379

(2d © . 1960); New York Dock Ry. v. Pennsylvania

R.R., 62 F.2d 1010 (3d Cir.), cert. denied, 289 U.S. 750

(1933). Tariff filings designed to offer a new service

over existing facilities are governed by the procedures

and criteria established under Sections 204 and 205 of

the Communications Act, 47 U.S.C. §§ 204 and 205.

Section 214 of the Communications Act was patterned

after Section 1 (18-22) of the Interstate Commerce Act,

49 U.S.C. §1 (18), which was enacted to regulate the

construction or acquisition of railroad lines.*® Under the

Interstate Commerce Act scheme of regulation, the ICC

20 See S. REPORT No. 781, 73d Cong., 2d Sess. 5 (1934): H.R.

REPORT No. 1850, 73d Cong., 2d Sess. 6 (1934).

certified the introduction of new railroad lines and used

tariff procedures to regulate the services provided over

those lines. Railroads did not require new certifications

to introduce new rolling stock or to carry new commodi-

ties. For example, a railroad which had initially justified

the use of a line to carry lumber on flat cars drawn by

steam locomotives might use the same tracks later, with-

out further certification, to carry chemicals in tank cars

or fresh vegetables in refrigerated cars drawn by diesel-

powered locomotives. All these changes could take place

despite the fact that, in initially certifying the line, the

ICC had considered only the carriage of lumber in weigh-

ing the public need for construction of the line. The

same statutory language and practice were carried over

to the communications industry. Thus, it is possible for

a communications common carrier to initiate new com-

munications services on previously certificated lines with-

out further certification. For instance, when AT&T de-

veloped the switching equipment to provide Direct Dis-

tance Dialing, it used previously certificated lines for

the provision of MTS (the universal voice message serv-

ice using the switching technology) without any further

certification. Years later, AT&T introduced its new Wide

Area Telecommunications Service (WATS), again with-

out any new certification of existing lines.

As the court below observed, the primary purpose of

Section 214(a) is the prevention of unnecessary and

uneconomic duplication of facilities and not the regula-

tion of services (FCC App. 21a). For instance, the right

of Western Union Telegraph Company to introduce, with-

out further certification of its existing lines, its new

“Mailgram” service,”* a far greater departure from ear-

21 Western Union provides Mailgram in collaboration with the

U.S. Postal Service. Messages from a number of different Western

Union sources are received by Postal Service teleprinters and then

delivered in the ordinary local mail to the designated recipient.

Needless to say, this service was not even contemplated at the time

most of Western Union’s lines were certificated.

lier services than is MCI’s Execunet service, was upheld

in United Telegraph Workers v. FCC, 436 F.2d 920

(D.C. Cir. 1970).

The obviously limited function of the certification proc-

ess is, indeed, made doubly obvious by the final pro-

vision to Section 214(a) which states expressly that:

nothing in this section [214] shall be construed to

require a certificate or other authorization from the

Commission for any . . . changes in plant, opera-

tion, or equipment, other than new construction,

which will not impair the adequacy or quality of

service provided.

Clearly, the offering of a new service, like any other

change in operation, does not require any further certi-

fication of the line unless the original certification has

been made subject to a lawful condition which precluded

that service.

Section 214(c) of the Communications Act, 47 U.S.C.

$214(c), which controls the imposition of conditions,

provides, in relevant part, that (emphasis added) :

The Commission shall have power to issue such cer-

tificate as applied for, . . . or for the partial exer-

cise only of such right or privilege, and may attach

to the issuance of the certificate such terms and

conditions as in its judgment the public convenience

and necessity may require.

The court below held that the “Commission must strictly

follow the terms of Section 214(c) and it cannot impose

any such restriction unless it has affirmatively determined

that ‘the public convenience and necessity [so] require’ ”’

(FCC App. 24a). In so doing, the court was merely

restating the express command of Section 214(c).

Indeed, the Commission itself implicitly recognized

this legal standard when it took the position, in its 1975

letter order, that explicit conditions had been imposed

on MCI’s certifications (FCC App. 10la). But, in its

1976 Decision, the Commission acknowledged that the

cited language applied only to some of MCI’s authoriza-

tions™ and concluded, effectively abandoning the argu-

ment, that “thus it is necessary to look further” (FCC

App. 49a). It was only after the agency realized that it

would need “to look further” that it developed its novel

theory of implicit conditions, a theory found wanting of

support by the lower court.

In shifting to a theory of implicit restrictions upon

MCI’s facility authorizations, the Commission ignored

its own subsequent and more explicit determination re-

garding the introduction of new services set forth in

Docket No. 19117, Establishment of Rules Pertaining

to the Authorization of New or Revised Classifications

on Interstate or Foreign Common Carrier Facilities, 39

FCC 2d 131 (1973), where it concluded that it “should

not impose at this time any requirement for prior ap-

proval of new or revised service offerings by existing or

new carriers,” 39 FCC 2d at i133. The Commission’s

decision in Docket No. 19117 made “it possible for do-

mestic carriers, as a general rule, to offer new classes or

22 The orders cited involved only a handful of MCI’s lines and

were issued during the period when, prior to the agency decision

in Docket No. 19117, supra, the Commission had, as a tentative

step—contrary to traditional practice—imposed conditions upon

all of its Section 214 certifications of both MCI and AT&T facili-

ties—conditions subsequently removed when the Commission

reached its decision in that proceeding. The cited language, in

any event, was not intended to be restrictive as asserted, but repre-

sented merely a general description of the services proposed by MCI

at that time, analagous to the railroad initially justifying its con-

struction of a new line by reference to the carriage of lumber drawn

by steam locomotive. The interpretation by the 1975 Commission

of that language depended on its own narrow and unsupported

interpretation of the term “private line” used therein, which in any

event was qualified in the language cited by the word “essentially”

and further qualified by the addition of the phrase “and other

communications.”

subclasses of communications service over duly authorized

facilities merely by the filing of appropriate tariff re-

visions,” 39 FCC 2d at 135. Not surprisingly, neither the

FCC nor AT&T in their petitions for certiorari dis-

cussed or even acknowledged the existence of this deci-

sion—despite the fact that it had been treated exten-

sively both by MCI and the Court of Appeals below.

Prior to the Commission’s action of July 2, 1975 with

respect to Execunet, the policy reaffirmed in Docket No.

19117 had governed the telecommunications industry.

Departure from that long standing policy, which appeared

to be the initial thrust of Docket No. 19117, was con-

ceived as a corollary to the Specialized Carrier decision,

supra, in which the Commission, while concluding that

competing carriers should be encouraged to develop new

service offerings, perceived what appeared to be a po

tential danger to its policy. The Commission, in its

Notice of Inquiry in Docket No. 18920, the Specialized

Carrier proceeding, had said, 24 FCC 2d at 331:

We note in this connection that the applicants are

in a disadvantageous competitive position vis-a-vis

AT&T insofar as prompt inauguration of the pro

posed services is concerned. Action on their appli-

cations may be delayed for some time by the neces-

sity of resolving claims in petitions to deny, inter

alia, that the showing of need is inadequate. Since

AT&T has numerous long line facilities, both cable

and radio, and many diverse routes, it generally

has enough flexibility and spare capacity to institute

new services (at least on a limited scale) without

having the immediate necessity of obtaining au-

thorization for new or modified facilities. There-

fore, AT&T need only file a tariff in order to com-

mence providing service on its authorized facilities.

AT&T is thus in a position to offer at any time serv-

ices with many of the ae by the ap-

plicants, while challenging the ings of need made

by would-be new entrants and claiming that hearings

are required on their proposals.

It was to correct this inequity that the Commission began,

as a tentative measure, attaching conditions to facility

authorizations of both the established and new carriers.

In instituting Docket No. 19117, the Commission was

seeking to provide a reasonable opportunity for the com-

petitive development of the market for specialized com-

munications services. On the record made in that pro-

ceeding, however, the Commission reversed its initial di-

rection and determined that it would not treat new serv-

ice offerings as requests for new certification under Sec-

tion 214 of the Communications Act, 47 U.S.C. § 214.

It would, instead, treat tariff filings offering new serv-

ices like any other tariff revisions submitted by carriers

under the provisions of Sections 204 and 205 of the

Communications Act, 47 U.S.C. §§ 204 and 205.

As indicated, the Docket No. 19117 decision restored

the practice that had been traditional in the domestic

common carrier field. When in 1960 AT&T sought to

introduce a new service it called WATS, it did not apply

for any new certifications. It merely filed a tariff which

offered the service over its previously authorized facili-

ties.» The Commission’s decision in Docket No. 19117

not to impose the limitations initially proposed constitutes

a rule of general applicability. The Commission con-

cluded thet it “should not impose at this time any re-

quirement for prior approval of new or revised service

2s Pursuant to Section 204 of the Act, the Commission insti-

tuted an investigation into the lawfulness of the tariff, to determine

whether the offering complied with Sections 201 and 202 of the

Act. However, there is no indication, in either the Common Carrier

Bureau’s recommended decision (37 FCC 688 (1964)), or in the

Commission’s order terminating the WATS proceeding (38 FCC 475

(1965)), that AT&T was subject to any requirement that it obtain

prior authorization for the offering of the new service.

offerings by existing or new carriers.” 39 FCC 2d at 133

(emphasis added) .**

In its petition, the Commission confuses the statutory

provision for certifying communications common carrier

lines found in Section 214 of the Communications Act

of 1934 [which, as noted at footnote 3 (page 3) of the

FCC’s petition, was patterned after Section 1 (18-22)

of the provision of the Interstate Commerce Act reg-

ulating railroads, 49 U.S.C. § 1 (18)] with the disparate

provisions of the Motor Carrier Act of 1935 regulating

motor vehicle common carriers and motor vehicle contract

carriers. The Motor Carrier Act of 1935 has been des-

ignated as Title II of the Interstate Commerce Act and

is found at 49 U.S.C. $301 et seq. The issuance of cer-

tificates-of convenience and necessity to motor vehicle

common carriers is governed by 49 U.S.C. § 306 while

49 U.S.C. § 309 provides for the issuance of permits to

motor vehicle contract carriers to engage in particular

services. As noted in the Court’s decision in Noble Vv.

United States, 319 U.S. 88, 90 (1943), Section 209(b)

of the Motor Carrier Act of 1935, 49 U.S.C. § 309(b),

provides that the “Commission shall specify in the permit

the business of the contract carrier covered thereby and

the scope thereof.” In Noble, the Court observed that

the statutory requirement to specify the “business” of a

contract carrier in a permit meant specifying the scope

of the articles carried. In applying this principle to the

24 Indeed, the Commission specifically pointed to the tariff filed

by Microwave Communications, Inc., to be effective on one day’s

notice, on January 1, 1972, as the kind of tariff which would

have been delayed, contrary to the Commission’s objectives in the

Specialized Carrier proceedings, if it had been subject to the kind

of prior approval requirement under consideration in Docket No.

19117. 39 FCC 2d at 134.

“grandfathering” of a pre-1935 contract carrier opera-

tion, the Court upheld the ICC decision that the grand-

fathering clause of that statute could not be used to “en-

large and expand the business beyond the pattern which

it had acquired prior to July 1, 1935,” and declared that

“the result in the present case would be a conversion for

all practical purposes of the contract carrier into a com-

mon carrier—a step which would tend to nullify a dis-

tinction which Congress has preserved throughout the

Act.” 319 U.S. at 92.% In the present case, the FCC

would convert MCI, for all practical purposes, from a

common carrier into a contract carrier—a category Con-

gress did not create in enacting the Communications Act.

The difficulty petitioners’ counsel have in finding any-

thing even remotely inconsistent in the lower court’s

exposition of the clear meaning of Section 214 is re

flected in their attempt to rely upon Hawaiian Telephone

25 The FCC petition gives the impression that, in Bowman Trans-

portation, Inc. v. Arkansas-Best Freight System, Inc., 419 U.S.

281, 299-300 (1974), this Court made a substantive ruling con-

cerning the lawfulness of a motor carrier certificate to the extent

that it exceeded the scope of the application. This impression is

misleading. This Court reversed a district court decision setting

aside an ICC grant of certificate on other grounds and, since the

district court had not ruled on the claim by several parties regard-

ing the grant of authority in “excess” of that sought in the appli-

cation, remanded the case to the court—noting that the “issue was

not briefed or argued here.” 419 U.S. at 299. Upon remand, the

district court upheld the ICC certificate insofar as it included

service to Montgomery, Alabama despite the fact that service to

Montgomery had not been included in the initial application.

Arkansas-Best Freight System, Inc. v. United States, 399 F. Supp.

157, 162 (W.D. Ark., 1975) aff'd, 425 U.S. 901 (1976). The district

court did overturn the ICC decision to the limited extent of elimi-

nating the possibility of “tacking” or joining the lines being certified

to Bowman in the proceeding under review to other lines certified to

Alabama Highway Express which Bowman acquired subsequent

to the hearing. The question of “tacking”, of course, relates to

the definition of lines being certified and not to the question of

what services may be offered over the lines.

Co. v. FCC, 498 F.2d 771 (D.C. Cir. 1974). The opinion

in that case was written by Judge Wilkey who joined

in the opinion of the court below with Judges Wright

and Tamm. The opinion below pointed out that Hawaiian

Telephone does not “transmogrify” Section 214 so that

carriers must obtain Commission approval before im-

plementing new services (FCC App. 21a-22a).

The reference by FCC counsel to Hawaiian Telephone

and FCC v. RCA Communications, Inc., 346 U.S. 86

(1953) is a non-sequitur. It is of course necessary to

consider proposed services in determining whether there

is a public need for proposed new lines, but such con-

sideration does not imply that the lines can be used

only for service initially proposed. As the lower court

observed, there is “no indication that the Hawaiian Tele-

phone court contemplated such a remarkable result.”

(FCC App. 23a).*

II. The FCC’s Specialized Carrier Decision Did Not Re-

sult In the Imposition of Conditions Upon MCI’s

Authorizations

No conditions limiting service are on MCI’s instru-

ments of authorization. Indeed, MCI’s facility certifica-

tions, like those of AT&T, are issued under Subpart I of

Part 21 of the Commission’s Rules, governing the “Point-

to-Point Microwave Radio Service.” ** Unlike other sub-

parts of Part 21,%* Subpart I imposes no service limi-

tations as to facilities authorized thereunder. In fact,

such facilities are specifically subject to the provision of

47 C.F.R. § 21.705, which states that carriers subject to

26 Indeed, Hawaiian Telephone and RCA, like the decision below,

represent a strong judicial insistence that the FCC make the re-

quired statutory public interest findings.

27 47 C.F.R. §§ 21.700 to 21.713.

*8 See, e.g., 47 C.F.R. §§ 21.903(b), 21.509 and 21.606.

Ne ae Lee

Subpart I are “authorized to render any kind of com-

munication service provided for in the legally applicable

tariffs of the carrier, unless otherwise directed in the

applicable instrument of authorization... .”

In its 1976 decision, the FCC recognizes “the truism

that a carrier need not generally file an application for

each new service it wishes to offer” (FCC App. 55a),

but then proceeds to state that a tariff “cannot be used

to reverse a clearly defined Commission policy.” (Em-

phasis added). In so doing, the Commission tries to jump

the large gap between an explicit condition properly im-

posed pursuant to Section 214(c) to a “clearly defined

Commission policy.” It then attempts yet another large

jump from the notion of a “clearly defined Commission

policy’ to the highly dubious inference it purports to

draw from the Specialized Carrier decision to the effect

that the specialized carriers are to be limited to some

theretofore ill-defined service category called “private

line services.”

The Specialized Carrier decision made clear the Com-

mission’s desire to encourage and stimulate innovation.

In so promoting innovation, the 1971 Commission must

have recognized that the services to be offered by the

new carriers could not realistically be limited within the

narrow ambit of what AT&T chose to include in its

own list of “private line” services. Indeed, the 1971

Commission had before it at the time a novel switched,

metered service proposed by another specialized carrier—

a service which was subsequently initiated anf made

available for several years.**

The Commission, in issuing its Notice initiating the

Specialized Carrier proceeding, stated the following as the

primary issue:

2° See discussion of the service of Data Transmission Company,

29 FCC 2d at 872.

oo eEeEOrnOO7O7”

A. Issue A: Whether as a general policy the pub-

lic interest would be served by permitting new

entry in the specialized communications field; .. .

(29 FCC 2d at 880, emphasis added).

It also noted (Para. 27 of the staff’s analysis, quoted,

29 FCC 2d at 881) that: “In its MCI decision, the Com-

mission granted applications of MCI to provide special-

ized interstate common carrier services... .” (Empha-

sis added). And, in its decision, the Commission stated

its ultimate conclusion as follows:

Findings and conclusions. 103. In light of all of

the foregoing and the record as a whole, we adopt

our staff’s analysis of Issue A, as amplified and

modified herein. We find that: there is a public need

and demand for the proposed facilities and serv-

ices and for new and diverse sources of supply,

competition in the specialized communications field

is reasonably feasible, there are grounds for a rea-

sonable expectation that new entry will have some

beneficial effects, and there is no reason to anticipate

that new entry would have any adverse impact on

service to the public by existing carriers such as to

outweigh the considerations supporting new entry.

We further find and conclude that a general policy

in favor of the entry of new carriers in the spe-

cialized communications field would serve the public

interest, convenience, and necessity. (29 FCC 2d at

920, emphasis added).

In embarking upon and concluding its forward-looking

proceeding to consider the introduction of new carriers,

the Commission was not confining its consideration to

any narrow category of private line services—though it

discussed such services *°“—but rather was dealing with

% The term “private line service’ was used generally in the

context where comparisons were being drawn to AT&T services—

since that term was an AT&T term and it most closely approxi-

mated the types of service initially contemplated by the new

a broader, more general, but undefined, area which it

called ‘the specialized communications field.”

The court below observed that, “to the extent that any

definition of a ‘specialized carrier’ emerges from the

Commission’s discussion, that definition appears to be

simply that a specialized carrier is any carrier that does

not attempt to optimize its service offerings to the voice

communications needs of the general public. See [29 FCC

2d) at 882 (© 29); id. at 906-907 ("7 69-70)” (FCC App.

29a, fn. 68). Indeed, the lower court defined a “special-

ized carrier’, in another case, as one “whose service is

of possible use to only a fraction of the population.”

National Association of Regulatory Utility Commissioners

v. FCC, 533 F.2d 601, 608 (D.C. Cir. 1976). The lim-

ited number and capacity of the transmission facilities

used by specialized carriers assure that their service “is

of possible use to only a fraction of the public.” No con-

dition on certifications was required to establish this limi-

tation, and none was suggested.

In the Specialized Carrier proceeding, the Commission

was addressing specific questions of public policy. Other

questions were left for treatment in the context of action

upon individual applications and, in the case involved here,

for treatment by general rule in Docket No. 19117. The

Commission was not in the Specialized Common Carrier

decision framing conditions which were to be attached,

by any process of implication, to its later grants of spe-

cific authorizations.

carriers. More generally, however, the 1971 Commission used such

terms as “specialized private line services,” “specialized communi-

cations services,” “special communications services,” “customized

communications,” “common carrier communications services,” “com-

petitive common carrier services,” “data communications,” “new

communications services,” “services that are heterogeneous in char-

acter,” and other variations.

Indeed, the Specialized Carrier decision specifically

acknowledged that alleged problems relating to new serv-

ices should be handled in future tariff proceedings:

In the event that adverse consequences to the public

should develop, the Commission can take such action

on the relevant tariff filings as may be necessary

to protect the public. We think that in the context

of the matters now before the Commission involving

proposed new and different services, a question of

this nature is more appropriately considered in con-

nection with the tariffs rather than upon authoriza-

tion of the facilities.”

Petitioners make the new argument that MCI “never

sought authorization beyond private line services.” Quite

the contrary, MCI specifically sought certification of its

lines pursuant to the terms of Subpart I of Part 21 of

the Commission’s Rules, governing the “Point-to-Point

Microwave Radio Services,” which would permit it to

offer any properly tariffed services which its limited

facilities might be capable of providing. See 47 C.F.R.

§ 21.705, supra. MCI proposed no condition upon its cer-

tifications and none was imposed.

In order to demonstrate the need for its facilities, MCI

set forth, in general terms, the types of services it pro-

posed to provide initially.* It did not, however, propose

to limit itself to those services for the indefinite future.

Indeed, MCI dedicated itself from the outset to develop

3129 FCC 2d at 886, note 26.

32 In describing its prospective services MCI sometimes referred

to them as “specialized” or “customized” services and, on relatively

infrequent occasions, it used the term AT&T uses to refer to its

nonuniversal services—“private line services’—as the nearest anal-

ogy in AT&T’s vocabulary to what MCI was proposing to provide.

The use of such broadly descriptive terms, however, was not intended

to reflect a proposal that the Commission should impose restrictions

on MCI’s authorizations so as to inhibit it from developing varia-

tions of traditional services or new services in the future.

new and innovative services as its experience in the mar-

ket and financial capabilities increased. The Commission

clearly shared this expectation.

MCI had not conceived its Execunet service until long

after 1971. Execunet, which is basically a variant of

shared FX service, developed as a logical extension of

MCI’s experience with the dissatisfaction expressed by

customers with the traditional FX service, whether pro-

vided by AT&T or by MCI. Although MCI believes that

Execunet can properly be classified as a private line

service, such a classification is basically irrelevant. MCI’s

purpose in discussing particular types of service in its

applications was to show that there was a public need

which would be fulfilled by construction of the facilities

applied for. But just as the fact that certification of a

new railroad line may have originally been justified by

reference to the public need for the transportation of

lumber does not prevent the railroad, in the future, from

using the same line to provide other services which fu-

ture experience may show the public desires, neither does

the justification of new communications lines on the basis

of the need for one service prevent a communications

common carrier from using the lines for other services

in the future.

The FCC argues that, for purposes of this case, tele-

communications services can be divided on an a priori

basis into two neat categories: private line services, which

are open to competition, and “MTS,” which is not. This

simplistic dichotomy is, by no means, generally accepted.**

*s For example, Lee W. Schmidt of General Telephone & Elec-

tronics, the largest member of USITA, recently stated that: “If you

look at the evolution of technology of MTS and private line in the

future, they are going to become more and more and more (sic)

similar until they are all but indistinguishable.” Preliminary steno-

graphic transcript of the Hearings before the Subcommittee on Com-

munications of the Committee on Interstate and Foreign Commerce

of the House of Representatives: Discussion on Domestic Common

Although neither private line service nor MTS (message

telecommunications service) had ever been defined with

any precision prior to the Execunet case, the agency

based its 1975 decision on its determination that Execu-

net is “identical to MTS” (FCC App. 103a) and its 1976

decision on the assertion that Execunet is “indistinguish-

able from MTS” (FCC App. 64a). From this it should

follow that the FCC had at some point provided a pro-

tected monopoly status for MTS. Yet the FCC points to

no proceeding where this supposed monopoly portion of

telecommunications services was either defined or be-

stowed upon AT&T as a protected sanctuary free from

competition. Indeed, in its petition the FCC states that

the “suggestion in the opinion below that the FCC has

‘granted AT&T a de jure monopoly over MTS and

WATS’... has no foundation in the Execunet decision or

any other FCC action.” (FCC Pet., p. 18, n. 34). Fur-

ther, the Chief of the FCC’s Common Carrier Bureau

recently testified before Congress that: “I am not aware

that any determination has been made that there is a

Carriers, September 21, 1977, pp. 17-77 [hereinafter, “House Carrier

Hearings’ |.

Indeed, the Telecommunications Task Force established by AT&T

together with the four largest “independent” telephone companies

observed that:

. . it has become apparent that no clear distinction can

be made between the competitive “private line service”

and monopoly Message Telecommunications Service market.

In economic terms, the two types of services are strong

substitutes for one another, especially for large volume

business users who constitute a significant portion of the

Message Telecommunications Service market. In _ tech-

nological terms, too, the distinction between “private line

service” and “Message Telecommunications Service” is

rapidly dissipating.

THE DILEMMA OF TELECOMMUNICATIONS POLICY: AN INQUIRY INTO

THE STATE OF DOMESTIC TELECOMMUNICATIONS BY A TELECOMMUNI-

CATIONS INDUSTRY TASK FORCE, Part III, pp. 6-7.

natural monopoly, natural economic monopoly, in any

part or certainly all telecommunications activities.” *

Thus, in view of the absence of any condition upon

MCI’s certifications, it does not have any legal signifi-

cance to liken MCI’s Execunet to AT&T’s MTS service.

But, even if some legal significance could attach, Execu-

net clearly does not deserve being characterized as iden-

tical to or indistinguishable from MTS. The FCC, on an

occasion when joined by the Department of Justice, de-

fined public communications service for this Court as

“. . primarily . . . voice communication service from

and to all points on an integrated national and interna-

tional network, available to the public generally.” Brief

for the Respondents in Opposition at p. 3, AT&T v. FCC,

422 U.S. 1026 (1975) (Docket No. 74-1229), denying

cert. to Bell Yelephone Co. v. FCC, supra. Execunet

clearly does not fall within that definition and indeed

no service that MCI could possibly provide with its pres-

ently certified lines could fall within that definition.”

34 House Carrier Hearings, pp. 17-53.

8° Before the FCC, before the Court below, and in the present

petitions, the petitioners continue to shift terminology and defi-

nitions on what constitutes impliedly a protected monopoly portion

of telecommunications services. The principal reference to MTS

in the petitions is to “ordinary long distance toll service’ (FCC

Pet., p. 5), “ordinary long distance service” (AT&T Pet., p. 3), and

“plain old message telephone service” (USITA Pet., p. 7). None

of these terms is a term of art and none was used in the agency’s

prior decisions.

The FCC’s retreat to the simplistic formula of “ordinary long

distance toll service” continues the Commission’s pattern of shifting

from one imprecise term to another in an attempt to make the

Execunet-MTS equation credible. In the proceeding below, the

Commission did not attempt to counter MCI’s showing of the

absence of MTS characteristics in Execunet by revealing what it

considered to constitute MTS. Instead, the Commission changed its

undefined understanding of MTS in the Execunet-MTS equation

to “basic, station-to-station dial MTS.” Rather than define MTS, the

Commission, when faced with the many critical dissimilarities be-

III. There Is no Conflict With Other Decisions

Petitioners cite Washington Utilities & Transportation

Commission v. FCC, 513 F.2d 1142 (9th Cir.), cert. de-

nied, 423 U.S. 836 (1975), and Bell Telephone Company

of Pennsylvaia v. FCC, 503 F.2d 1250 (3d Cir. 1974),

cert. denied, 422 U.S. 1026, reh. denied, 423 U.S. 886

(1975) as being at variance with the court’s decision be-

low. Petitioners are incorrect. In the first of these cases,

the Ninth Circuit rejected an attempt to reverse the Spe-

cialized Carrier decision and, in the second, the Third Cir-

cuit upheld the Commission’s rejection of AT&T’s at-

tempts to deny interconnections MCI needed for the

provision of its services.-

In Washington Utilities, the scope of the services au-

thorized in the Specialized Carriers decision was not at

issue. The issues in that case were whether the FCC

could authorize competition at all, whether the proce-

dures utilized by the Commission were correct and

whether the FCC violated the National Environmental

Policy Act of 1969. The portion of the Ninth Circuit

opinion referenced in the instant petitions is a simple

tween Execunet and MTS, chose either to disregard MCI’s points or

to whittle away at what constitutes MTS by referring to many of

its characteristics as nonessential “convenience features,” “spe-

cialized, add-on services,” or “billing procedures.” The Commission

further distorted the MTS-Execunet equation by adding WATS

as a decisional factor in its 1976 decision. Unable to legitimately

compare Execunet with MTS only, the Commission was forced to

insert WATS into the final decision, even though there was no prior

indication that WATS was in issue. Indeed, in the only record pre-

sentation on the characteristics of WATS, MCI submitted AT&T

literature which described WATS as a private line service.

In its petition, the FCC goes one step further by urging that

“MTS ... includes . . . wide area telecommunications service

(WATS).” Not even AT&T, which offers the service and created the

terminology in the first place, agrees with the misleading and in-

accurate statement that MTS includes WATS. The Court is left

with a mishmash of undefined and imprecise terms.

general description of the services proposed in the spe-

cific applications then before the Commission. The court

certainly did not observe any limiting conditions on the

authorizations of the specialized carriers. Its description

of the services involved was prefatory only, to indicate

generally the communications needs that were being ad-

dressed, and did not form the basis for any of the court’s

holdings.**

Bell Telephone Co. v. FCC, supra, addressed Bell’s re-

fusal to provide various types of interconnections required

for MCI’s services. Bell’s principal defense was the argu-

ment that it was required only to provide very limited

categories of connecting facilities. Bell’s secondary argu-

ment was that the Commission had not affirmatively

36 It should be noted that the court spoke of “entry of new car-

riers in the specialized communications field,” 513 F.2d at 1155,

1159 and 1166. The court also obviously took a broad view of the

non-static scope of this term, observing, 513 F.2d at 1166, n. 33,

that:

“As the Commission had concluded, the public interest would be

served by offering users flexibility and a wide range of choice.

The applicants were seeking to develop a relatively new and po-

tentially very large market with heterogeneous submarkets. The

proposals reflected differing routes and services. The various sys-

tems might develop along different lines. The number of potentially

successful operations might well depend on the ingenuity, enterprise,

and initiative of the participants in developing new service and

equipment.”

The court did distinguish the services proposed by the new car-

riers “from public exchange and long distance toll telephone service”

and explained that the “latter consists primarily of voice communi-

cations service from and to all points on an integrated national

and international telephone network, available to the public gen-

erally.” 513 F.2d at 1155. The limited nature of the facilities pro-

posed by the specialized carrier applicants, of course, made “com-

munications from and to all points on an integrated national and

international telephone network” out of the question. The limita-

tion noted was a de facto limitation inherent in the physical nature

of the facilities involved and not one flowing from a condition im-

posed on authorizations pursuant to Section 214(c) of the Communi-

cations Act.

determined that it would be in the public interest to

require AT&T to interconnect with MCI for the purpose

of allowing MCI to offer FX service. The Commission’s

determination was that the Specialized Carrier decision

had settled the point, whereas AT&T argued that, since

MCI had never mentioned FX services explicitly in its

$214(a) applications, MCI’s provision of those services

had not been approved. The Third Circuit affirmed that

the Commission in the Specialized Carrier decision had

made an affirmative determination that interconnection

for provision of private line services was, as a general

matter, in the public interest and that MCI was covered

by this general determination. Bell itself had long cate-

gorized FX as private line service.” Bell Telephone there-

fore stands for the proposition that the Commission in

Specialized Carriers decided at least that specialized car-

riers could provide all private line services. As the

court below noted, however, one cannot reason from

this proposition to its converse—that specialized carriers

may offer only private line services—yet the converse is

the issue relevant under § 214(c). Indeed, the converse

appeared to be at least implicitly conceded by AT&T in

Bell Telephone. The Third Circuit observed, 503 F.2d at

1262, that “While there is language in Docket 18920

indicating a concern with new, customized services, we

interpret this language as referring not only to the types

of services provided, but also to the delivery of private

line services to ultimate customers who theretofore had

been unable te obtain private line services fashioned to

their particular needs.”

The so-called “overbreadth argument” advanced by

AT&T in Bell Telephone, is irrelevant here. AT&T’s

argument was that the Commission’s order to intercon-

8st MCI Communications Corp. v. AT&T, 369 F. Supp. 1004, 1013

(E.D. Pa. 1973), vacated on other grounds, 496 F.2d 214 (3d Cir.

1974) ; Bell Telephone Co. v. FCC, supra, 503 F.2d at 1261.

nect services “presently or hereafter” authorized was

overbroad and was directed to the difficulty of ascertain-

ing the types of services to be authorized “hereafter.”

Under that decision, if MCI should in the future be

authorized to build new facilities, so as to provide inter-

national service, for example, AT&T would be required

to furnish interconnection. We are not, however, dealing

here with the question of new authorizations, but rather

the question of whether there are restrictive conditions

on the old authorizations.

IV. There is no Legal Question of Importance Ready for

the Court’s Review

In seeking to convince this Court that the decision of

the court below should be reviewed, petitioners put for-

ward an issue that the Court below did not have before

it and consciously avoided deciding. The issue, as peti-

tioners put it, is whether the public interest requires

that some segment of the telecommunications market be

afforded monopoly protection. This serious distortion of

what the case under consideration involves is in effect an

88 American Telephone & Telegraph Co. v. FCC, 539 F.2d 767

(D.C. Cir. 1976), cited by some of the petitioners, is also inapposite.

In that case, AT&T argued that specialized carriers were not per-

mitted to offer private line services already offered by AT&T, but

rather were limited to new services. There was no dispute con-

cerning the offer of new services such as Execunet. The court

recognized that the Specialized Carrier decision had adopted a

policy in favor of open competition in the “specialized communica-

tions field,” 539 F.2d at 768, and rejected AT&T’s argument that

the Commission could not authorize services “duplicating existing

services.” 539 F.2d at 772. The only matter at issue, and therefore

the only matter addressed by the parties and the court, was the

services that duplicate existing AT&T private line services. There

was no finding that non-duplicative services, such as Execunet, were

forbidden. Quite the contrary, it was tacitly assumed, even by

AT&T, that non-duplicative services by specialized carriers were

permitted. In the present case, AT&T contends the opposite, that

the specialized carriers are limited to essentially duplicative services

already provided by AT&T as “private line services.”

admission by petitioners that the one substantive issue

decided by the lower court—whether MCI’s existing

facility certifications were restricted to prevent its of-

fering of Execunet service—is not of sufficient signifi-

cance to warrant the attention of this Court.

AT&T, USITA and NARUC all offer arguments in

favor of an AT&T-directed monopoly. The arguments

they put forward are perhaps interesting ones, but they

are not before this Court. The Court is being asked to

review a decision where the proponents of monopoly

failed to offer public interest arguments before the Com-

mission and the FCC itself did not purport to act on any

such basis.

A decision by this Court not to review this case will

not have the effect of having petitioners’ pro-monopoly

assertions going unanswered and undecided. The lower

court specifically invited the Commission to initiate a

proceeding to determine where the public interest lies.

In that proceeding, AT&T and its supporters can put

forth the arguments relating to the public interest which

they have prematurely set out in their current petitions.

MCI stands fully ready to meet the arguments AT&T

and its supporters can raise in the Commission’s new pro-

ceeding. Indeed, in the proceeding below, MCI pre-

sented the testimony of one of the country’s foremost

economic authorities in this area’ to rebut AT&T’s

then claims of damage. This probative evidence speaks

far more convincingly than do the unsupported and self-

serving claims of counsel in the instant petitions. MCI

also introduced numerous statements from Execunet users

to explain in practical terms what the service meant to

them.*° MCI attempted to raise the public interest issue

3° See Affidavit of Dr. William H. Melody, Attachment D to MCI's

Comments filed on January 16, 1976 in the FCC proceeding below.

1976 in the FCC proceeding below.

in the Cummission proceedings below, but the FCC chose

to ignore the evidence MCI offered and proceeded instead

to argue that the matter could be determined on an a

priori basis of an alleged interpretation of what the

1971 Commission had decided in its Specialized Carrier

decision.

Petitioners seem almost reluctant to speak about MCI’s

“Execunet” service, speaking instead of “MTS” being

provided by MCI. This fancy ignores the simple fact

that MCI has very limited facilities already authorized—

which serve only a relatively small number of cities and

which have only a small amount of presently unused

capacity. Such facilities are not capable of providing

the universal message service that AT&T calls “MTS”.

The “fear” expressed by petitioners in this regard is

unrealistic.

Petitioners attempt to buttress their feigned fear of

MCI™* by reference to other carriers. But the two other

specialized carriers, Southern Pacific Communications

Company and United States Transmission Systems, each

has fewer transmission facilities certified than does MCI.

Satellite carriers and value-added carriers are also cited,

despite the fact that they were not treated at all in the

1971 Specialized Carrier decision in which the present

Commission purports to find the imposition of certifica-

tion conditions. In any event, they too have only limited

transmission facilities already certified. The offering of

new services by any of these carriers would require the

filing of new tariffs which, under Section 203 of the

*: For the last four quarters, AT&T has reported net income of

more than one billion dollars per quarter. Last quarter, MCI nad

$876,000 in net income—less than one-tenth of one per cent of

AT&T's income. As contrasted to AT&T’s gross revenue of nearly

$33 billion for the year ended December 31, 1976, the total revenues

of all specialized and satellite carriers, as reported to the FCC for

the same period, was less than $80 million—less than one-quarter

of one percent of AT&T’s revenues.

Communications Act, 47 U.S.C. § 203, could require

ninety days’ public notice before becoming effective.

If there were sufficient reason to do so, the Commission

has authority to suspend the effectiveness of such tariffs

for an additional five months pursuant to Section 204

of the Communications Act, 47 U.S.C. § 204.

The FCC adds the rather curious argument that the

decision below casts doubt upon the validity of the grants

already made to MCI. The certifications previously made

are, of course, already final and not subject to further

review. At the time they were made, clearly the burden

of proof with respect to the need for any service re-

strictions lay on the opponents of the grants. The op-

ponents, which are highly experienced and sophisticated,

failed to demonstrate that the public interest required any

service restrictions. The Commission’s expression of con-

cern over MCI’s grants ignores the fact that many of

AT&T’s lines were certified at a time prior to the intro-

duction of “MTS” and “WATS” and received no further

certification when those services were provided over them.

Thus, if the decision below were deemed somehow to “cast

doubt upon the validity of MCI’s certifications in view

of the lack of some affirmative determination of public

interest with respect to Execunet service,” it would cast

just as much doubt concerning the validity of AT&T’s

certifications made prior to the development of direct

distance dialing and WATS in view of the lack of affirm-

ative determination of public interest with respect to

provision of MTS and WATS service over those lines.

Yet the Commission expressed no such doubt. The rea-

son is very simply that it has been interpreting Section

214 one way for AT&T and would interpret it another

way for MCI. Petitioners are making mutually contra-

dictory arguments when they contend, on one hand, that

MCI and similar carriers will in a short period of time

grow to such huge proportions as to seriously challenge

AT&T’s MTS service and, on the other hand, that MCI

will lose all its present authorizations.

The FCC also complains that it will have to decide

whether “to take a chance on open-ended grants or to

limit the grants because the public interest affirmatively

requires limits” (FCC Pet., p. 19). But this was exactly

the question the Commission already decided for both

AT&T and the specialized carriers in Docket No. 19117,

supra. It concluded there that it should make it possible

for domestic carriers as a general rule to offer new classes

or subclasses of communications service over duly au-

thorized facilities merely by filing appropriate tariff re-

visions, 39 FCC at 135.

This Court should note that AT&T for some time has

been employing its substantial political influence to gain

Congressional aid for its efforts to perpetuate its de

facto monopoly and eliminate all competition. It has suc-

ceeded in having introduced proposed legislation to ac-

complish this objective. S. 3192, 94th Cong., 2nd Sess.

(1976); H.R. 12323, 94th Cong., 2nd Sess. (1976); S.

530, 95th Cong., 1st Sess. (1977); H.R. 8, 95th Cong.,

lst Sess. (1977). Among other things, AT&T’s proposed

legislation would prevent MCI and the other specialized

carriers from providing the traditional forms of private

line service to which it contends, in its instant petition,

they should be limited. Indeed, AT&T’s proposed legis-

lation would limit the specialized carriers to services

which cannot be provided by AT&T and would make it

well nigh impossible for MCI to obtain authorization to

do even that much. Both the Senate and House have

held hearings on common carrier competition during the

past year, and are considering a “basement to attic”

revamping of the Communications Act.“

«2 See Press Release of Subcommittee on Communications of the

House Interstate and Foreign Commerce Committee of October 11,

1976. In another press release dated November 16, 1977, the Chair-

Thus AT&T already has, even without review by this

Court, two forums in which to expound its views on the

alleged need for Governmental protection of its monopoly.

In the one forum, AT&T is attempting to change the

statutory standard for certification of competing carrier

lines, and in the other it is being given every opportunity

to meet the existing statutory standard. While such ques-

tions may well at some point in the future be ripe for

review by this Court, they simply are not before the

Court in the present case. The lower court specifically

decided to defer such questions to the Commission as the

appropriate initial forum in which the proponents of

monopoly should put forth their views.

CONCLUSION

The Court should deny the writ of certiorari.

Respectfully submitted,

Of Counsel: MCI TELECOMMUNICATIONS

R.W CORPORATION

JOHN R. WORTHINGTON MICROWAVE COMMUNICATIONS, INC.

1150 - 17th Street, N.W. N-TRIPLE-C. INC

Washington, D.C. 20036 :

(202) 872-1600 MICHAEL H. BADER

KENNETH A. Cox

October, 1977 WILLIAM J. BYRNES

RAYMOND C. Fay

HALEY, BADER & POTTS

1730 M Street, N.W.

Washington, D.C. 20036

(202) 331-0606

Their Attorneys

man of the Subcommittee on Communication, Lionel Van Deerlin,

said “the issue of competition in the telephone industry will be

thoroughly explored.”

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.