# Opposition — Rosner v. United States

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition
- **Published:** January 1, 1978
- **Citation:** 434 U.S. 1015

## Text

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
V.
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

II

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

Il

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

Iv

TABLE OF AUTHORITIES—Continued

Interstate Commerce Act, 49 U.S.C. § 1 (18) —......
Motor Carrier Act of 1935, 49 U.S.C. §§ £01, 306

a
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

24

31

30

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?

2
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.

4

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.

5

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.

6

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

7

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.

8

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.

9

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

10

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.

11

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.

12

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.

13

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.

14

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

15

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

16

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).

17

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.

18

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

=

19

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.”

20

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

21

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.

22

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.

23

“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.

24

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

25

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”

26

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

27

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.

28

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.

29

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

30

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.

31

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-

32

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.

34

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.

35

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.”

36

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.

“© See Attachment C to MCI’s Comments filed on January 16,
1976 in the FCC proceeding below.

37

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.

38

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

39

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-

40

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.”

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385004_2551%3A02. Public record. Not legal advice.