# Opposition Brief — Fox v. Fox

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 1999
- **Citation:** 525 U.S. 1143

## Text

N°. 98-947

In The ~—

Supreme Court of The United States

October Term 1998
a

AT&T WIRELESS SERVICES and
McCAW CELLULAR COMMUNICATIONS, INC..,
Petitioners,
v.

CORYELL TENORE, CHARLES F. PETERSON
and KAREN M. COLE, on behalf of themselves
and all others similarly situated,

Respondents.

¢
Petition For A Writ Of Certiorari
To The Washington Supreme Court
¢

BRIEF OF RESPONDENT IN OPPOSITION

5
STEVE W. BERMAN*
Erin K. Flory
Sean R. Matt
Hagens Berman, P.S.
1301 Fifth Avenue
Suite 2900
Seattle, WA 98101
(206) 623-7292

Attorneys for Respondents
*Counsel of Record

APPELLATE ADVANTAGE
POST OFFICE BOX 7506@KANSAS CITY, MO 64116816-453-2424

QUESTIONS PRESENTED

¥ Whether 47 U.S.C. § 332(c)(3)(A), which
prohibits regulation by the States of “the entry of or the rates
charged” by cellular telephone service providers, preempts
state law claims for injunctive relief and damages based on
deceptive business practices, when Congress specifically
provided that § 332 “shall not prohibit a State from regulating
the other terms and conditions of commercial mobile

services.”

2. Whether, in light of the language of 47 U.S.C.
§ 414 which preserves all “remedies now existing at common
law,” 47 U.S.C. § 332(a)(3)(A) gives AT&T immunity to
deceive consumers and abrogate its contractual promises in

violation of state laws.

RULE 29.6 STATEMENT

Pursuant to Sup. Ct. Rule 29.6, respondents hereby
state that they are individuals and thus have no corporate

parents or subsidiaries.

TABLE OF CONTENTS

Page
QUESTIONS PRESENTED ...........---0--ee eee: i
ATES ES EE PRE EERE ns cis dcccssvoevesvensere il
TABLE OF AUTHORITIES . 2.0... cc ccc ccc cscevens Vv
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED . 2. ee ccc eee nerses l
STATEMENT OF THE CASE ....... cece csccenes |
A. AT 8 Pere tO DISCIOOS ... 5 a eee cease |
B. Proceedings Below .........0.-cecceeeeeeees 3
REASON FOR DENYING THE PETITION .......... 6
I. THERE IS NO CONFLICT AMONG
THE HIGHEST COURTS OF THE
STATES OR BETWEEN A HIGH STATE
COURT AND A COURT OF APPEALS
THAT WARRANTS REVIEW .............. 8
A. There is No Conflict Among the State
High Courts that Deception Claims Are
Not Preemipted ........2 sce eeeeeee 9

B. AT&T’s Review of Intermediate Court
Decisions Do Not Present a Conflict of
Sufficient Magnitude to Warrant Review 11

ill

be If a Conflict Exists it is at Such a
Nascent Stage that Review is Premature . 15

II. THE WASHINGTON SUPREME COURT
OPINION IS HARMONIOUS WITH PRIOR
OPINIONS OF THIS COURT, AND
OTHERS, THAT AN AWARD OF
DAMAGES DOES NOT EQUAL
IMPERMISSIBLE RATE REGULATION ....17

A. The Washington Supreme Court
Decision Is Harmonious With
Supreme Court Precedent ............ 17

B. The Washington Supreme Court
Holding Is In Accord With Numerous
Other Holdings that Damages Are Not
fe Pp ey rey 23

. The Washington Supreme Court
Opinion Follows The Proper Standards
Governing Preemption ............:.:; 24

CATING AE bev aes tank aes VEN seo ae wes ee 28

TABLE OF AUTHORITIES

CASES

AT&T Co. v. Central Office Tel. Inc.,

5G Oe re oo a ie She 14, 19
American Airlines v. Wolens,
SE Ae OP ies bin 98 a eRe ers 26

American Inmate Phone Sys.., Inc. v. U.S.

Sprint Comms. Co., 787 F. Supp. 852

TSR SO) es Ciai ee eevea tanks = c0 ee
Arkansas Louisiana Gas Co. v. Hall,
BESTS CST CAPO) eke en tk seen ees 14

Ball v. GTE Mobilnet of California, Ltd.,

No. 98AS03811 (Cal. Super. Ct.

(Sacramento Cty.) Nov. 17,1998) ........... 12
Bennett v. Alltel Mobile Comm. Of Alabama, Inc.,

Civil Action No. 96-D-232-N, slip op.

(M.D. Ala. May 14, 1996) ........... 10, 21, 22
Carroll v. Cellco Partnership,

Docket Nos. AM-001316-96T3 and

AM-001303-96T3 (N.J. Super. Ct., App.

Ey. Dae 25. Pere a dos wie eas we eos 13
Cipollone vy. Liggett Group,
ETT RTE sos chalk Nene eee 25

In re Comcast Cellular Telecomms.,

— —— a court to assess the reasonableness of the defendant’s
underlying billing practice. /d. Likewise, in Kellerman v.
MCI Telecomms. Corp., 493 N.E.2d 1045, 1051-52 (Ill.), cert.
denied, 479 U.S. 949 (1986), the court ruled that an award of
damages would not interfere with MCI’s rates nor any other
aspect of the FCA’s regulatory scheme. /d. at 1051. Hence,
the court rejected the premise that awarding damages was an
act of rate regulation. The courts in Bennett v. Alltel Mobile
Comm. Of Alabama, Inc., Civil Action No. 96-D-232-N, slip
op. at 9 (M.D. Ala. May 14, 1996) (Res. App. A-1) and
Moultan y. Alltel Mobile Comm. Of Alabama, Inc., CA No.
96-D-89-N, slip op. (M.D. Ala. Aug. 16, 1996) (Res. App. B-
18) also rejected AT&T’s argument and ruled that plaintiffs’
claims for damages were immaterial to the issue of

preemption: “The court finds that the relief sought in the

form of a refund in the difference between the amounts

charged and the amount consumers allegedly though they
were being charged . . . does not relate to the rates charged or
services provided ....” Bennett, slip op at 6, Res. App. A-7.
Finally, in American Inmate Phone Sys., Inc. v. U.S. Sprint
Comms. Co., 787 F. Supp. 852 (N.D. Ill. 1992), the court
concluded that the request for breach of contract damages
“neither conflicts with the provisions of the Communications
Act nor interfere with the regulatory scheme of the Act.” Jd.
at 856.

In short, AT&T’s predicate is false: Legal damages
are not rates, and courts can award damages without
regulating rates or otherwise interfering with a federal
regulatory regime. An award of damages against AT&T for
deceiving customers will leave AT&T’s rates untouched, i.e.,
it will not impose obligations on AT&T that are inconsistent

with any prior decisions of this Court.’

AT&T asserts that the Washington Supreme Court holding
“conflicts with decisions by other courts, which have concluded
that similar claims for damages constitute state rate regulation”
and cites to Simons and Powers to support this proposition. Pet.
22. However, this proposition is simply false. Not only did
Simons and Powers not even address the issue of damages but
Powers suggests that had the allegations in the complaint focused
on “[djefendant’s alleged failure to disclose the ‘teardown time’
charge, [rather than] the legality or reasonableness of such
charges” the claims would have been allowed to proceed. Pet.
App. 69a.

B. The Washington Supreme Court Holding
Is In Accord With Numerous Other
Holdings that Damages Are Not Per Se

Regulation

To further support its claim of conflict, AT&T cites to
San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236
(1959), in conjunction with Black’s Law Dictionary, to press
upon this Court that “damage awards unquestionably can
constitute a form of state rate regulation.” Pet. 21 (emphasis
original). Based on this, AT&T contends that the Washington
Supreme Court opinion is in conflict with Supreme Court
authority. Pet. 22. However, as set forth below, the
Washington Supreme Court holding on this issue is not

adverse to Supreme Court authority.

The Garmon Court stated that “[rjegardless of the
mode adopted, to allow the States to control conduct which is
the subject of national regulation would create potential
frustration of national purpose.” /d. at 244. However, here,
respondents are attempting to punish AT&T for engaging in
a deceptive practice — something which is not the subject of
national regulation. Hence, there is no fear of “frustration of
the national purpose,” because Section 322 explicitly allows
States to enforce consumer protection laws. Hence, Garmon
is distinguishable from the case before this Court. In fact,

dispositive on this issue, and in accord with the Washington

Supreme Court’s finding, 1s Silkwood v. Kerr-McGee Corp.,

fe,

464 U.S. 238 (1984). Like AT&T, the petitioners in Silkwood
were unable to point to any legislative history or anything in
the regulation that indicates that damages for violation of state
laws are prohibited. See id. at 255. And, although allowance
of damages may cause tension, the Supreme Court noted that
such tension does not equate to a wholesale bar of damage
awards:

It may be that the award of damages based on

the state law of negligence or strict liability is

regulatory in the sense that a nuclear plant will

be threatened with damages liability if it so

does not conform to state standards, but that

regulatory consequence was something that

Congress was quite willing to accept.
Id. at 256. By including the “terms and conditions” clause in
Section 332 and by not delineating how states were to deal
with violations of laws in areas which Congress has preserved
their nght to regulate, Congress made clear that an award of
damages here resulting from a violation of consumer
protection laws does not equal impermissible rate regulation.
As a result, there is no conflict and no “compelling reason” to

grant review.

_ The Washington Supreme Court Opinion
Follows The Proper Standards Governing
Preemption

There is a strong presumption against preemption in

areas of traditional state regulation. See New York State Conf.

24

of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514
U.S. 645, 655 (1995);"° see also Cipollone v. Liggett Group,
505 U.S. 504, 516 (1992).'"* The area of consumer protection
is that traditionally regulated by the State. It is for this reason

that consumer protection laws are often listed as part of the
“terms and conditions” that are exempt from Section 332. In
light of the strong state interest in protecting the welfare of its
citizens and in enforcing its state consumer protection laws,
it is hard to believe that AT&T would question the standards
applied by the Washington Supreme Court.

AT&T contends that “nowhere in its decision below
does the court mention . . . the critical role played by the

statutory language.” Pet. 23. This statement is wholly false.

| The Court in Travelers stated: “[W]e have never assumed
lightly that Congress has derogated state regulation, but instead
have addressed claims of pre-emption with the starting
presumption that Congress does not intend to supplant state law.

Indeed, in cases like this one, where federal law is said to bar
state action in fields of traditional state regulation . . . we have
worked on the ‘assumption that the historic police powers of the
States were not to be superseded by the Federal Act unless that was
the clear and manifest purpose of Congress.’” Jd. at 654-55
(citations omitted)

" The Cipollone Court held that the federal law regulating
cigarette warnings and labeling would not preempt state law claims
based upon express warranty, intentional fraud and
misrepresentation, or conspiracy. Jd. at 530-31. The Court
determined that whether federal law is preemptive depends upon
Congress’ intent. /d. at 516. Accord, Freightliner Corp. v.
Myrick, 514 U.S. 280 (1995) (Federal Motor Vehicle Safety
standards did not preempt state-law product-liability cases alleging
wi ral design for failure to require anti-lock brakes on tractor-
trailers).

25

a A ea Ee ia DIS OO ae TD

The court below focused on the critical role of the “terms and
conditions” language which preserves state law causes of
action for deceptive advertising.’ Based on this statutory
language, the court determined that Congress did not intend
to remove states entirely from the wireless telephone industry.
Had Congress intended to completely preempt state law
causes of action, it most assuredly would not have included a

clause which explicitly provides for state regulation.

Additionally, if the intent was to preempt all state law
causes of action, Congress would not have included a savings
clause.'® Indeed, the Supreme Court has consistently found
that savings clauses are further support against preemption.
See e.g., American Airlines v. Wolens, 513 U.S. 219, 232
(1995). In Wolens, the Court was presented with a claim for
violation of the consumer protection act as well as a claim for
breach of contract. American Airlines contended that the
claims were preempted by the Airline Deregulation Act, 49
U.S.C. § 41713, which prohibits state regulation of a price,
route, or service offered by an air carrier. As stated by the
Court, it was not “plausible that Congress meant to channel

into federal courts the business of resolving, pursuant to

See supra, n.2.

- See 47 U.S.C. § 414 (1994) (“Nothing in this chapter . . .
shall in any way abridge or alter the remedies now existing at
common law or by statute, but the provisions of this chapter are in
addition to such remedies.”’).

26

————

a

judicially fashioned federal common law, the range of
contract claims relating to airline rates, routes, or service.” /d.
In addition, “the conclusion that the ADA permits state-law-
based court adjudication of routine breach-of-contract claims
also makes sense of Congress’ retention of the FAA’s savings
clause.” Jd. Hence, the ADA’s preemption clause “read
together with the FAA savings clause, stops States from
imposing their own substantive standards with respect to
rates, routes, or services, but not from affording relief to a
party who claims and proves” that an airline has acted
negligently with respect to other areas. See generally id.

As the Washington Supreme Court found, the same
holds true here. The FCA’s preemption provision read
together with the savings clause, stops states from imposing
standards on “the entry of or rates charged by any commercial
mobile service” but does not prohibit regulation of the “other
terms and conditions of commercial mobile services” such as
deceptive advertising. See generally Pet. App. 3la. This
reasoning of the Washington Supreme Court is harmonious
with Supreme Court precedent and numerous other courts
which have addressed this issue. There is no conflict and,
therefore, no reason to grant review.

27

CONCLUSION

For the reasons set forth above, the petition for a writ

of certiorari should be denied.

Respectfully submitted,

Steve W. Berman*
Erin K. Flory
Sean R. Matt
HAGENS BERMAN
1301 Fifth Avenue
Suite 2900
Seattle, WA 98101
(206) 623-7292

Attorneys for Respondent

* Counsel of Record

APPENDIX A

JNITED STATES DISTRICT COURT FOR THE
MIDDLE DISTRICT OF ALABAMA
NORTHERN DISTRICT

PEE LIAS > PU AA BIOL Ce N R ee Tos 0S rr en ra Re Aan tee nae ~ < are a s ES - Ree Xb yates
Zt. tel Pin doe -

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
NORTHERN DISTRICT

FILED

MAY 14 1996

CLERK

U.S. DISTRICT COURT

MIDDLE DIST. OF ALA.

ROBBYN VAN BENNETT, etc., _)

Plaintiff, )
v. } CIVIL ACTION NO.
ALLTELL MOBILE ) 96-D-232-N
COMMUNICATIONS OF )
ALABAMA, INC.,
Defendant. )
)

MEMORANDUM OPINION AND ORDER

Before the court is the plaintiffs motion, filed

February 28, 1996, to remand this action to the Circuit of
Lowndes County, Alabama, whence it was removed. The
defendant responded in opposition on March 19, 1996.

In the three-count complaint, the plaintiff avers that in
connection with the billing for cellular phone service,
defendant Alltel, through its agents and employees,
misrepresented and failed to disclose its practice of charging

for a full minute of cellular phone air time even if a subscriber

Apdx A - 1

is connected for only a few seconds. The plaintiff also

contends that Alltel has breached its contract with the plaintiff
because Alltel's contract fails to notify the user of the phone
service of its practice of rounding up the amount of air time
used to the next full minute. Subsequently, the defendant
removed this action, asserting federal-question jurisdiction
pursuant. to 28 U.S.C. §§ 1331 and 1441.' The defendant
contends that the plaintiffs claim for relief involves the
application of the communications Act, 47 U.S.C. §§ 151 et
seq., and the Omnibus Budget Reconciliation Act of 1993
(“OBRA”), which amended the Communications Act to
expressly preempt any action by a state to regulate the rates
charged by cellular service providers. In essence, the
defendant contends that while the plaintiff has not pleaded a
violation of the Communications Act or the OBRA, these
Acts still control in this action. The plaintiff asserts,
however, that he is seeking relief only under state law, thus,
precluding removal based upon federal-question jurisdiction.

Because removal jurisdiction raises significant

‘Section 1441 states in part that“... any civil action
brought in a State court of which district courts of the United
States have original jurisdiction, may be removed by the defendant
or the defendants, to the district court of the United States for the
district and division embracing the place where such action is
pending. . .” 28 U.S.C. § 1441(a). Pursuant to 28 U.S.C. § 1331,
a district court has original jurisdiction over all cases “arising
under the Constitution, laws or treaties of the United States.”

Apdx A - 2

federalism concerns, the removal statutes must be strictly
construed. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S.
100 (1941). All doubts must be resolved in favor of a remand
to state court. Stone v. Williams, 792 F. Supp. 749 (M.D.
Ala. 1992); Lambert v. Mail Handlers Benefit Plan, 886 F.
Supp. 830, 833 (M.D. Ala. 1995) (Albritton, J.) (remand of a

removed case is favored where federal jurisdiction is not

absolutely clear) (citing Burns v, Windsor Ins. 31 F.3d 1092,
1095 (11th Cir. 1994)); see also Horn v. Rural Community
Insurance Servs., 903 F. Supp. 1502, 1504 (M.D. Ala. 1995)
(Albritton, J.); Shamrock Oil & Gas Corp. v. Sheets, 313 U.S.

100 (1941). Moreover, “the existence of a federal question

cannot be left to mere speculation.” Bryant v. Blue Cross &
Blue Shield of Alabama, 751 F. Supp. 968, 969 (N.D. Ala.
1990) (citations omitted). As such, the defendant, as the party

removing this action to federal court, has the burden of

establishing federal jurisdiction. Sullivan v. First Affiliated
Secs., 813 F.2d 1368 (9th Cir.), cert. denied, 484 U.S. 850
(1987).

The foregoing is consistent with the basic principle

that federal courts are courts of limited jurisdiction and have
the power to hear only those cases which congress or the
Constitution authorizes them to hear. Lambert, 886 F. Supp.
at 832 (citations omitted); Horn, 903 F. Supp. at 1504 (citing
Gulf Offshore, 453 U.S. at 477-78). Accordingly, “a

presumption (exists) that state courts have concurrent

jurisdiction over claims that involve federal law.” Id.

Apdx A - 3

Whether the complaint states a federal question must

be determined by examining the face of the complaint.

Franchise Tax Bd. v. Construction Laborers Vacation Trust,

463 U.S. 1, 9-11 (1983). As stated by the Supreme Court of

the United States:

[o}|nly state-court actions that orginally could
have been filed in federal court may be
removed to federal court by the defendant.
Absent diversity of citizenship, federal-
question jurisdiction is required. The
presence or absence of federal-question
jurisdiction is governed by the “well-pleaded
complaint rule,” which provides that federal
jurisdiction exists only when a federal
question is presented on the face of the
plaintiff's properly pleaded complaint. See
Gully v. First National Bank, 299 U.S. 109,
112-13 . . . (1936). The rule makes the
plaintiff the master of the claim; he or she

may avoid federal jurisdiction by exclusive

reliance on state law.

Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987)
(internal footnotes omitted); Great Northern R.R. Co. v.

Alexander 246 U.S. 276, 282 (1918) (“[T]he plaintiff may by
the allegations of his [or her] complaint determine the status
with respect to the removability of a case.”); The Fair v.

Kohler Die & Specialty Co. 228 U.S. 22, 25 (1913) (The

Apdx A -4

plaintiff is “master to decide what law he [or she] will rely
upon.”); Burke v. Humana Ins.. Co., No. 95-T-299-N, No. 95-

T-300-N, slip op. at 4 (M.D. Ala. May 11, 1995) (A plaintiff
“has the prerogative to rely on state law alone although both
state and federal law may give him (or her] a cause of
action.”). In other words, “lower federal courts [have]
jurisdiction to hear, originally or by removal from a state
court, only those cases in which a well-pleaded complaint
establishes either that federal law creates the cause of action
or that the plaintiff's nght to relief necessarily depends on
resolution of a substantial question of federal law.”’ Franchise
Tax Bd., 463 U.S. at 27-28. The Supreme Court has narrowly
construed the test to restrict removal by holding that simply
because a claim implicates a federal issue, or involves
construction of federal law does not necessarily give rise to a
federal question and confer removal jurisdiction on a federal
court. Mernll Dow Pharmaceuticals, Inc. v. Thompson, 478
U.S. 804 (1986).

Here, the orginal complaint neither mentions the

Communications Act, as amended, nor invokes any other
federal statute. Moreover, it does not mention a constitutional
provision or a treaty. Hence, the complaint does not refer to
any matter which allows access to a federal court under §
1331.

In making this determination, the court rejects the
defendant's argument that the plaintiff's complaint necessarily

implicates the filed rate doctrine which raises a federal

Apdx A - 5

question. See Def.’s Opp. to Remand at 18-20. Specifically

, the court finds that the defendant's reliance on T&G Express,
Inc. v. Webster Indus., 93-D-1127-N, slip op. at 3 (Jan. 12,
1994) (DeMent, J.) (attach. as Ex. G), is misplaced. In T&G
Express, this court did state that “[w]hen the tariff of a

common carrier is challenged or recovery is predicated on the
existence of a valid tariff, the case involves a federal question
under 28 U.S.C. § 1331, which may be removed to federal
court from a state court upon a filing of a notice of removal

pursuant to § 1446 by the defendant.” T&G Express, slip op.

at 3. However, T&G Express is distinguishable from the
instant case because the T&G Express plaintiff asserted a

tariff claim, in addition to contract claims, which was the

basis for removal. Thus, in T&G Express, the face of the

complaint set forth a federal claim. The court interprets T&G
Express as merely holding that when recovery is specifically
predicated on the existence of a valid tariff as a specific count
in the plaintiff's complaint, then the issue is one of federal
law. In this case, on the other hand, the plaintiff predicates
recovery solely on common law contract grounds. The tariff
issue is raised as a defense by the defendant. Consequently,
because the plaintiff is the master of his or her complaint, the
court finds that T&G Express does not support the existence
of removal jurisdiction in the instant case.

In addition, the court does not believe that the
plaintiff's nght to relief necessarily depends on a resolution of

a substantial question of federal law, in that federal law is a

Apdx A - 6

necessary element of one of the well-pleaded claims. The
court finds that the relief sought in the form of a refund in the
difference between the amounts charged and amount
consumers allegedly thought they were being charged does
not confer the court with federal-question jurisdiction in that
it does not relate to the rates charged or services provided,
particularly when a commonsense reading of the complaint
reflects the pleading of state law claims. The causes of action
are, supported by alternative theories of state law, and the
Communications Act, as amended, is not essential to any of
those theories. The alternative theories of state law include
breach of contract, fraud, misrepresentation, suppression of
material facts, and engaging in deceptive practices. These are
state law claims the determination of which must be left to the
state court system. Moreover, retaining jurisdiction over this
action would interfere with a state court's right to decide and
interpret its own law as applied to the federal acts of this case.
Accordingly, the court finds that the causes of action do not
arise under federal law.’

The court recognizes that the preemptive force of
some federal statutes can provide a legal basis for removal of
a case from state to federal court even if a plaintiff has framed

the complaint to allege violations of only state law.

*The court notes that it is not persuaded by the defendant's
“artful pleading” argument. Here, the plaintiff has not merely
failed to plead federal questions, but rather, the substance of the
plaintiff's complaint involves state law.

Apdx A - 7

Metropolitan Life Ins.. Co. v. Taylor, 481 U.S. 58, 65 (1987).

For example, the Supreme Court of the United States has
determined that issues involving the Labor Management
Relations Act, 29 U.S.C. § 1001, et seg., and the Employment
Retirement Income Security Act, 29 U.S.C. § 185, et seq.,
transform state-law claims into ones arising under federal law
for purposes of the well-pleaded complaint rule. Caterpillar,
Inc., 482 U.S. at 393-94.

In determining whether complete preemption exists,

the court focuses on congressional intent. Lambert, 886 F.
Supp. at 836. The court is highly persuaded by Justice

Brennan's concurrence in Metropolitan Life, wherein he

stated: “In future cases involving other statutes, the prudent
course for a federal court that does not find a clear
congressional intent to create removal jurisdiction will be to

remand the case to state court.” Metropolitan Life, 481 U.S.

at 68 (Brennan, J., concurring) (quoted in Lambert, 886 F.
Supp. at 837). Thus, as stated in Horn v. Rural Community
Ins.. Servs., 903 F. Supp. 1502 (M.D. Ala. 1995) (Albritton,

J.), “[a]bsent a finding of clear Congressional intent to

preempt the state courts from hearing the actions, the court
must presume that complete preemption does not apply. Id. at
1504.

The defendant first relies on 47 U.S.C. § 332(c)(3)
(A), as amended by OBRA, to support a finding of complete
preemption under the Communications Act, as amended.
Section 332 (c) (3) (A) _ states in pertinent part:

Apdx A-8

“Notwithstanding sections 152(b) and 221(b) of this title, no
State or local government shall have any authority to regulate
the entry of or the rate charged by any commercial mobile
service. ... 47 U.S.C. § 332(c)(3)(A). In comparison with
the language of ERISA, the court finds that § 332(c)(3)(A) is
not as broad in scope. See Lambert, 886 F. Supp. at 836
(similar finding involving the Federal Employees Health
Benefits Act). As set forth above, the Communications Act,
as amended, expressly provides for preemption only where
state law regulates “the entry of or the rates charged by... .
commercial mobile service” providers, such as Alltel. 47
U.S.C. § 332(c) (3) (A). On the other hand, “ERISA's
preemption clause states that the law ‘shall supersede any and
all state laws insofar as they may now or hereafter relate to an
employee benefit plan.’ Lambert, 886 F. Supp. at 836
(discussing ERISA's jurisdictional and preemption clause)
(emphasis added).

Clearly, Congress could have completely preempted
state law by stating that § 332 (c) (3) (A) would preempt any
state law that related to the rates charged by commercial
mobile service providers, if it so desired. However, Congress
chose to only prohibit the regulation of those rates by the
states. In fact, § 332 (c) (3) (A) does not seek to vindicate the
same interests upon which the plaintiff's state cause of action
seeks relief. See Bryant, 751 F. Supp. at 972 (citing Allstate
Ins.. v. 65 Security Plan, 879 F.2d 90, 93 (3d Cir. 1989))

(stating requirement for complete preemption includes

Apdx A -9

vindication of same interests). Here, the plaintiff is not

contesting the rate charged, but rather is challenging Alltel's
failure to disclose in its contract with consumers its practice
of “rounding up” charges for air time. Hence, this action will
not affect the rates charged; instead, it may, depending on the
outcome, affect the disclosure of the rates charged. In other
words, there is not a federal remedy directed to the matter of
disclosing the basis behind the rate charged. Given that
jurisdiction is not directly conferred by a cause of action
concerning cellular services, the court finds that the
preemptive force in § 332 (c) (3) (A) is not so powerful as to
displace entirely any state cause of action within the ambit of
the federal cause of action.

The defendant also points the court to §§ 47 U.S.C.
201(b) and 207 to suggest that the complete preemption
doctrine applies to the Communications Act, as amended,
thereby rendering any claim federal in nature.* Section 201(b)
provides that any “charge, practice, classification or
regulation that 1s unjust or unreasonable is declared to be
unlawful. . . .” 47 U.S.C. § 201(b). Section 207 vests
exclusive jurisdiction over claims arising under § 201(b) in
either the federal courts or the Federal Communications
Commission:

Any person claiming to be damaged by any

common carrier subject to the provisions of

-OBRA did not amend either § 201(b) or § 207.

Apdx A - 10

this chapter may either make complaint to the
Commission . . . or may bring suit for the
recovery of the damages in any district court
of the United States. . . .
47 U.S.C. § 207.
In In_re Long Distance _Telecommunications
Litigation, 831 F.2d 627 (6th Cir. 1987), the Sixth Circuit

remanded a case similar to the instant case. Therein. the

plaintiffs' fraud claims were based on the defendants' failure
to disclose their practice of charging long distance customers
for unconpleted calls, ring time and holding time. The Sixth
Circuit held that the plaintiffs’ state law claims for fraud and
deceit, based on the defendants' alleged failure to notify
customers of the practice of charging for uncompleted calls,
were not preempted:
We believe the district court erred in holding
that the state law claims for fraud and deceit,
based on the defendants’ failure to notify
customers of the practice of charging for
uncompleted calls, were pre-empted by the
Communications Act. These claims, unlike
those based on Section 201 of the Act, do not
require agency expertise for their treatment
and are “within the conventional experience of
judges.”
831 F.2d at 633-34 (citing Far East Conference v. United
States, 342 U.S. 570, 574 (1952)) (emphasis added).

Apdx A - 11

In In re Long Distance Telecommunication ions
Litigation, the court also distinguished Ivy Broadcasting Co.
v. American Telephone & Telegraph Co., 391 F.2d 486 (2d
Cir. 1968), relied on by the defendant in this case. The Sixth
Circuit distinguished Ivy

Broadcasting as follows:

[In Ivy Broadcasting,]. . . the complaint

charged negligence and breach of contract in

the rendition of interstate telephone service.

The Ivy court held that the claims were

preempted by federal common law even

though they did not charge violations of

specific provisions of the Communications

Act. However, the alleged torts involved the

level of service provided by the defendants,

not a failure to notify customers of a practice

[as in this case].
Id, at 634. The court finds, contrary to the defendant's
assertion and consistent with the court's discussion of §
332(c) (3) (A), that § 332 (c) (3) (A) does not alter the

analysis or holding in Ivy Broadcasting. Moreover, as

discussed supra, the court finds, similar to the Ivy

Broadcasting court, that a commonsense reading of the
complaint in this case suggests that the state law claims relate
to the failure to disclose rather than rates or service.

More importantly, though, §§ 201(b) and 207 must be

read in conjunction with the savings clause in § 414, which

Apdx A - 12

States in pertinent part:
[nJothing in this chapter contained shall in any
way abridge or alter the remedies now
existing at common law or by statute, but the
provisions of this chapter are in addition to
such remedies.
47 U.S.C. § 414 (emphasis added). The court finds that it
logically follows from this savings clause that the
Communications Act, as amended, did not preempt the entire
field of commercial mobile services. See Hudson Ins..

Company v. American Electric Corp., 748 F. Supp. 837, 844

(M.D. Fla. 1990) (similar finding concerning the
comprehensive Environmental Response Compensation and
Liability Act of 1980), affd, 957 F.2d 826, cert. denied, 506
U.S. 955 (1992). In other words, the court finds that the

savings Clause indicates a lack of intent by Congress to extend

the Communications Act, as amended, to all matters
somehow related to those known to be preempted. Based on
the foregoing, the court concludes that nothing in the
Communications Act, as amended, gives the explicit
suggestion necessary to infer that Congress intended to rely
on a body of federal common law to interpret all actions

involving commercial mobile services.* Cf. Hudson Ins.. Co.

“In making this determination, the court rejects the
defendant's argument that Sprint Corp. v. Evans, 818 F. Supp. 1447
(M.D. Ala. 1993) (Albritton, J.) lends support to the proposition
that the Communications Act completely preempts the entire field

Apdx A - 13

v. American Electric Corp., 748 F. Supp. 837, 843 n.5 (M.D.

Fla. 1990) (reaching same conclusion regarding the
Comprehensive Environmental Response Compensation and
Liability Act of 1980); National Audubon Soc. v. Department
of Water, 869 F.2d 11964 1201-03 (9th Cir. 1988) (reaching

same conclusion regarding Clean Water Act).

If the court were to find otherwise, it would be
allowing federal common law to implement precisely that
which Congress determined was not necessary. Moreover,
this case does not involve unique federal interests; rather,
allowing a state court to hear this contract and fraud dispute
between private parties will not frustrate federal policy. In
fact, given that Congress enacted the savings clause, it
obviously thought state courts could adequately handle
matters in this area. As such, the court emphasizes that it
“will not broaden the language of [any federal] statute without
some clear indication from Congress that this was [its]
intent.” Horn, 903 F. Supp. at 1505 (citing Hyzer v. Cigna
Property & Cas. Ins., Co., 884 F. Supp. 1146, 1151 (E.D.
Mich. 1995)).

of mobile commercial services. The court'reads Sprint as
completely preempting the field of interstate message
transmissions. Here, though, the plaintiff is not attempting to
regulate interstate message transmissions; rather, he is merely
questioning a mobile service provider's disclosure policy to
consumers. While the causes of action in this case may very well
be preempted by a federal statute, the whole field is not preempted
to constitute complete preemption.

Apdx A - 14

The court finds that absent “complete preemption” of
State causes of action, the defendant cannot establish that a
federal court has original jurisdiction by arguing preemption
as a defense:
Ordinarily, federal pre-emption is raised as a
defense to the allegations in a plaintiff's
complaint. Before 1887, a federal defense
such as pre-emption could provide a basis for
removal, but, in that year, Congress amended
the removal statute. We interpret that
amendment to authorize removal only where
original federal jurisdiction exists. Thus, it is
now settled law that a case may not be
removed to federal court on the basis, of a
federal defense, including the defense of pre-
emption, even if the de. se is anticipated in
the plaintiffs complaint, and even if both
parties concede that the federal defense is the
only question truly at issue.

Caterpillar Inc., 482 U.S. at 393-94 (internal citations

omitted) (emphasis in original). The court notes that its
ruling on “complete preemption has no preclusive effect on
the state court's consideration of the substantive preemption
defense.” Bryant, 751 F. Supp. at 973 (quoting Whiteman v.
Raley's, Inc. 886 F.2d 1177, 1180-81 (9th Cir. 1989))

(internal quotations omitted). In fact, the court has no

jurisdiction to rule on the substantive preemption defense

Apdx A - 15

because complete preemption is lacking. Id. “Th{e] court has
no doubt that the Alabama state courts are perfectly capable
of correctly applying the preemption defense. . . . Horn, 903
F. Supp. at 1506.

CONCLUSION

Because the plaintiff's complaint only involves state
law claims and does not involve a substantial question of
federal law, because the complete preemption doctrine does
not convert the plaintiffs’ state claims into claims under the
Communications Act, as amended, and because a defendant
may not remove a case based upon a federal preemption
defense, the court finds that the defendants have failed to
establish that at the complaint pleads a federal question.
Thus, the court does not have original jurisdiction over this
action.

Accordingly, it is CONSIDERED and ORDERED
that the plaintiff's motion to remand be and the same is hereby
GRANTED and this cause be and the same is hereby
REMANDED to the Circuit Court of Lowndes County,
Alabama. The clerk is DIRECTED to take all steps necessary
to effect said remand.

DONE this /s/ ]4th day of May, 1996.

/s/ Jan DeMent
UNITED STATES DISTRICT JUDGE

Apdx A - 16

APPENDIX B

UNITED STATES DISTRICT COURT FOR THE
MIDDLE DISTRICT OF ALABAMA
NORTHERN DISTRICT

BS A 8 Nel ee ar Le ON

SS ae Me SR PR Ee a,

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
NORTHERN DIVISION
FILED
AUG 16 1996
CLERK
U.S. DISTRICT COURT
MIDDLE DIST OF ALABAMA
ROBERT MOULTON, III __ )

on behalf himself and all )
others similarly situated )
Plaintiff, )

V. ) CIVIL ACTION NO.
ALLTELL MOBILE ) 96-D-89-N
COMMUNICATIONS OF __)

ALABAMA, INC., )

Defendant. )

ORDER
Before the court is defendant's request for a ruling on

the plaintiffs motion to remand filed August 12, 1996, which

the court construes as to include a motion to reconsider the
decision of the clerk to close this case based on the plaintiff's
notice of dismissal filed on June 20, 1996. For good cause
shown, it is CONSIDERED and ORDERED:

(1) That the defendant's motion for reconsideration be
and the same is hereby GRANTED because pursuant to Rule

Apdx B - 17

23 (e) of the Federal Rules of Civil Procedure a plaintiff must

obtain the court's approval of a dismissal of any potential
class action as well as provide notice to all class members of
such a dismissal.

(2) That this action be and the same is hereby
REINSTATED.

(3) That pursuant to the authority of_Robbyn Van

Bennett, et al. v. Alltel Mobile Communications of Alabama,
Inc., Civil Action No. 96-D-232-N (M.D. Ala. May 14, 1996)
(DeMent, J.) (A copy of the order is attached hereto.) and 28

U.S.C. §1447(c), the plaintiff's motion to remand be and the
same is hereby GRANTED and that this cause be and the
same is hereby REMANDED to the Circuit Court of
Montgomery County, Alabama. The clerk 1s DIRECTED to
take all steps necessary to effectuate paid remand.
DONE this /s/ / 6th day of August, 1996.
/s/ Jan DeMent
UNITED STATES DISTRICT JUDGE

APPENDIX C

SUPERIOR COURT
OF THE
STATE OF WASHINGTON
FOR KING COUNTY

4

SUPERIOR COURT OF THE STATE OF WASHINGTON
FOR KING COUNTY

MICHAEL LAIR and DAVE
MANWEILER,

individually and on behalf of

NO. 95-2-26309-7-SEA

all others similarly situated,
Plaintiffs,
VS.
U.S. WEST NEW VECTOR
GROUP d/b/a U. S. WEST
CELLULAR
Defendant.

This Notice May Affect Your Rights.
Please Read It Carefully. :

TO: ALL SUBSCRIBERS OF U. S. WEST
NEWVECTOR WHO PARTICIPATED ON A
PAYING BASIS IN A FULL-MINUTE CELLULAR
CALLING PLAN AT ANY TIME DURING THE
PERIOD JULY 1, 1994 THROUGH MAY 1, 1996,
EXCEPT FOR (A) SUBSCRIBERS WITH
TALKALONGS™ CALLING PLANS OR CALLING
PLANS OFFERED TO CALIFORNIA
SUBSCRIBERS, OR (B) SUBSCRIBERS WHOSE

BR eh i ear ta te ee

Apdx C - 19

ACCOUNTS WERE TERMINATED BY
NEWVECTOR FOR NON-PAYMENT
INTRODUCTION

l. lhis Notice is given pursuant to an order of the
Superior Court of Washington for King County. The purpose
of this Notice is to inform you of the pendency of a class
action and the proposed settlement of a class action that is
pending on your behalf against U.S. WEST NewVector
Group d/b/a U.S. West Cellular (““NewVector’’), and to inform
you how this lawsuit and the settlement may affect your nghts
and what steps you may take in relation to it. This Notice is
not an expression of any opinion by the Court as to the merits
of the claims or defenses by any of the parties to this class
action.

DESCRIPTION OF THE CASE

es Michael Lair and Dave Manweiler are the
persons bringing this lawsuit (the “Plaintiffs”). Plaintiffs’
claim relates to NewVector’s method of billing cellular air
time. For certain subscribers, NewVector rounds air time for
billing purposes, to the next highest minute. This is also
called “rounding up” or full-minute billing. For example, a
call that lasts one minute and five seconds is rounded up to
two minutes for billing and air time calculation purposes.
This case is about whether this method of billing was

adequately disclosed and was otherwise appropriate.

Apdx C -20

PLAINTIFFS' CONTENTIONS

oy

3. The complaint alleges that NewVector offers

customers a range of billing plans in each of its service areas.
These plans offer a fixed-charge per month for a specified
period of air time, (e.g., thirty, sixty, seventy-five or two
hundred minutes). For any air time beyond the fixed-charge
time allotted under each plan, the subscriber is charged at
various rates “per minute,” depending on the plan and
whether the call is made during peak or off-peak hours.

4. Plaintiffs allege that the plain import of the
language describing these plans is that a customer receives a
set amount of air time.

5. Once a customer has selected the billing plan,

lewVector requires that each customer sign a Service
rreement which identifies the plan selected. Plaintifis
contend that these Service Agreements contain all of the
terms and conditions of the customers' agreement with
NewVector. Plaintiffs contend that missing from the billing
terms is the fact that NewVector rounds up air time to the
next highest full minute.

6. Plaintiffs contend that © NewVector's
“rounding” practice is not fully disclosed or referenced in
NewVector's point of sale documents, /.e., brochures and rate
plans.

7. Plaintiffs contend that rounding up air time

damages Settlement Class Members by preventing customers

from receiving the specified fixed-charge air time under their

plans. For example, if a plan provides thirty minutes of air

time, a customer may actually be on the air for less than thirty
minutes but might begin paying on a per-minute basis due to
rounding up.

8. In their complaint Plaintiffs allege that
NewVector's method of billing constitutes a violation of the
Washington State Consumer Protection Act (and/or other
consumer protection statutes in other states), negligent
misrepresentation, common law fraud and a breach of
contract. Plaintiffs seek monetary damages for the injury
caused to class members, treble damages under the
Washington Consumer Protection Act, and costs of the suit

including attorneys’ fees.

DEFENDANT'S CONTENTIONS

9. NewVector denies all allegations of
wrongdoing and liability. As explained more fully herein,
NewVector contends that full-minute billing was fully
disclosed in NewVector's advertising brochures, bills, service
agreements and by information available to consumers in the
marketplace and was legally permissible and appropmiate.
NewVector also contends that its advertising and sale of
cellular service were not the cause of damages to consumers,
since NewVector changed its billing plans in response to
consumer feedback and lowered rates to provide additional

savings to subscribers. Further, even if subscribers were

Apdx C - 22

unaware of NewVector's advertising brochures and the
standard industry method of full-minute billing, the method
of billing would have been fully disclosed by the first bill,
representing one of numerous ways in which potential

damages would be limited.
CLASS CERTIFICATION

10. For the purposes of Settlement, NewVector
has stipulated to a Settlement Class. A “class” is a legal
mechanism whereby one or more individuals can represent all
those who are similarly situated with respect to defendant's
alleged conduct.

11. The Settlement Class consists of the following
members: All subscribers of U. S. WEST NewVector who
participated on a paying basis in a full-minute cellular calling
plan at any time during the period July 1, 1994 through May
1, 1996 (the “Settlement Class Period”), except for (a)
subscribers with TalkAlong™ calling plans or calling plans
offered to California subscribers, or (b) subscribers whose
accounts were terminated by NewVector for non-payment (an

“involuntary deactivation’).

Your receipt of this notice, therefore, does not
necessarily mean that you are a class member. You are a
class member only if you fit within the class definition set out

above.

LRN GIA IRE ALG LE TOE EE IO NLP GOI LOE LEGS SALI TS

rs

TE CN AOR

SATIRE RA

ISTE ALERTS RT RID GM TNE LON is

TERMS OF THE SETTLEMENT

12. Class Counsel have thoroughly investigated
the facts and applicable law regarding the claims of the
persons on whose behalf they are acting and potential
defenses thereto. Based on this, Plaintiffs and Class Counsel
believe that the proposed settlement set forth below is fair,
reasonable and adequate, and in the best interests of the
Settlement Class. Class Counsel also conducted extensive
negotiations with counsel for NewVector prior to arriving at
this settlement, taking into account the relevant facts and law.
The following description of the proposed settlement is only
a summary, and reference is made to the text of the
Stipulation of Settlement, on file with the Court, for a full
statement of its provisions:

(a) NewVector will fully and _ fairly
disclose “rounding up” or full-minute billing in contracts,
service agreements and all point-of-sale collateral documents,
when it is occurring.

(b) NewVector acknowledges that in
response to this litigation, it has already changed some or all
of its disclosures regarding full-minute billing.

(c) NewVector will compensate members
of the Settlement Class according to 1) a member's average
monthly cellular usage during the Settlement Class Period
(measured in terms of minutes of usage or “MOUs’”) and ii)

whether the member is an active NewVector subscriber. or

Apdx C - 24

whether the member's cellular service was terminated

voluntarily by the member, or involuntarily by New Vector:

SETTLEMENT AWARDS

Customer Usage Groupings

Highest ‘250 MOU/Month
High 150-250 MOU/Month
Medium 60-150 MOU/Month
Low <60 MOU/Month

Settlement Awards -- ACTIVE SUBSCRIBERS (z2.e.,

current customers)

Bill Credit (Highest Usage) $26
Bill Credit (High Usage) $18
Bill Credit (Medium Usage) $ 9
Bill Credit (Low Usage)

Settlement Awards -- VOLUNTARY DEACTIVATION
(meaning you elected to terminate your services, i.e., you are

a former customer).

Bill Credit or cash (Highest Usage) $26
Bill Credit or cash (High Usage) $18
Bill Credit or cash (Medium Usage) oe
Bill Credit or cash (Low Usage) $ 3
(d) Former subscribers whose cellular

Apdx C - 25

service was terminated by NewVector for nonpayment (1.e.,

involuntary deactivations) are not included within the
Settlement Class.

(e) Each Settlement Class Member 1s

entitled only to one settlement award. The average monthly

‘llular usage and resulting settlement award for Settlement
Class Members with more than one qualifying cellular line of
service will be calculated using an average of the applicable
MOvws for all qualifying lines of service. Active Settlement
Class Members who also have one or more separate
voluntarily deactivated lines of service will receive their
settlement award as an Active Subscriber. Settlement Class
Members with more than one voluntarily deactivated line of
service, and no active line of service, will be eligible to
reactivate one cellular line of service.

(f) The value of the consideration set forth
above is estimated to be approximately $8.4 million.
NewVector's total obligation may vary with the final
accounting, but the value for each class member remains the
same.

(g) NewVector will pay all notice and
administration costs, including but not limited to the costs of
printed and published notice, publication of summary notice,
identification of class members, and calculation and payment
of claims.

(h) [f a Settlement Class Member within

the voluntary deactivation category reactivates with

Apdx C - 26

NewVector and elects the bill credit option, that class member
i) has the right to waiver of the activation fee, and 11) can opt
for a month-to-month contract if reactivation is with his or her
own phone. If NewVector supplies the cellular phone, then
a standard twelve-month service agreement is required.

(1) In exchange, if the Settlement is
approved, the Court will enter a final judgment dismissing
this action with prejudice, and dismissing with prejudice all
claims, demands, and causes of action against NewVector, its
subsidiaries, affiliates, agents, predecessors, successors and
assigns, as their respective representatives, that were or could
have been asserted by Plaintiffs and the Settlement Class
Members who do not elect to exclude themselves from the
class and its benefits arising out of the facts and
circumstances alleged in this action. If the proposed
settlement is approved, all members of the Settlement Class
who do not elect to exclude themselves from the class and its
benefits will be personally barred and enjoined from
instituting or prosecuting, indirectly or directly any and all
actions or proceedings that they had or have, known or
unknown, arising out of or based upon the facts set forth in
the Complaint. All members of the Settlement Class who do
not elect to exclude themselves from the class, whether or not
they file a claim form, will be bound by the terms of the
settlement and releases of claims and any order of the Court
dismissing the litigation

16. Plaintiffs took into account all of the foregoing

bead

Apdx C-2

factors in agreeing to the proposed settlement. Although

Plaintiffs believe they would have overcome these defenses,

there 1s no certainty that this, in fact, would occur.

HOW CLAIMS WILL BE PROCESSED

1? Accompanying this Notice 1s a Proof of Claim
and Release (“Proot of Claim”) which must be filled out in
order to take part in the settlement. Settlement Class
Members must indicate a) whether they are active or former
subscribers as of the date they mail the Proof of Claim, and b)
if they are former subscribers, whether they elect to reactivate
or receive a cash award. The Proof of Claim must be mailed
on or before October 20, 1997 to: NewVector Claims
Administration, P.O. Box 4068; Portland, OR 97208-4068.
All claims will be administered within 120 days of the final

approval of the Settlement by the Court.

ELECTION BY CLASS MEMBERS
Ls If you are a member of the class, you have a
right to elect whether or not to exercise your nght to exclude
yourself from the class. Your choice will have certain
consequences that you should understand before making this

decision.

[IF YOU WISH TO REMAIN IN THE CLASS, YOU

NEED NOT RESPOND TO THIS NOTICE IN ORDER TO
DO SO BUT YOU SHOULD FILL OUT A CLAIM FORM.

IF YOU DO NOT WISH TO REMAIN IN THE
CLASS, 4 OU MUST RESPOND TO THIS NOTICE.

CONSEQUENCES OF EXCLUSION FROM THE
CLASS

19. If you do not wish to remain a member of the
class, you must request to be excluded. If you request
exclusion, you will not be entitled to share 1n the settlement.
However, if excluded, you may present any claims you have

against NewVector by filing your own lawsuit.

20. If you do not wish to remain a member of the
class, you must mail a written request for exclusion,
postmarked no later than August 18, 1997, to: Steve W.
Berman, Hagens & Berman, 1301 Fifth Avenue, Suite 2929,
Seattle, WA 98101 and Barry Kaplan, Perkins Coie, 1201
Third Avenue, 40th Floor, Seattle, WA 98101.

21. Requests for exclusion must refer to Lair v.

U.S. West NewVector, No. 95-2-26309-7 SEA and must

provide your name and address. For the sake of convenience,
please also provide your current or former NewVector cellular

account numbers. All requests for exclusion must be signed

Apdx C - 29

and expressly state that you wish exclusion from the class.

THE HEARING

22. A hearing (the “Settlement Hearing’’) will be
held before the Honorable R. Joseph Wesley at 8:30 a.m. on
August 25, 1997, in Room W905 of the Superior Court of the
State of Washington for King County, at 516 Third Avenue,
Seattle, WA, for the purpose of determining whether the
proposed Settlement is fair, reasonable and adequate and
whether it should be approved by the Court; whether
judgment should be entered dismissing the actions on the
merits and with prejudice as against Defendant. The
Settlement Hearing may be continued or adjourned from time
to time by the Court at the Settlement Hearing or any
continued or adjourned session thereof without further notice.

Bo. Settlement Class Counsel will apply to the
Court at the conclusion of the Settlement Hearing for an
award of attomeys' fees and costs of $1,686,000, which

represents approximately 20% of the monetary value of the

iF)

ettlement. This amount will be paid by NewVector in
addition to the previously described amounts being offered to
the Settlement Class. Plaintiffs will also seek approval of
payments to the two plaintiffs of $10,000 each, as payment
for the time and expense in prosecuting this case on behalf of

the Settlement Class.

Apdx C - 30

24. Any member of the Settlement Class who has
not requested exclusion may appear at the Settlement Hearing
to show cause why the proposed Settlement should not be
approved, the Class Action should not be dismissed on the
merits with prejudice as against the Defendant, and to present
any opposition to the application of Settlement Class Counsel
for attorneys’ fees, costs and expenses, or to the application
for an award to the plaintiffs, provided, however, that no such
person shall be heard, unless his or her objection or
opposition is made in writing and is filed, together with
copies of all other papers and briefs to be submitted by him or
her to the Court at the Settlement Hearing, with the Court no
later than ten days prior to the hearing, and showing due proof
of service on:

Settlement Class Counsel:

Steve W. Berman
Hagens & Berman
1301 Fifth Avenue, Suite 2929
Seattle, WA 98101
and Counsel for Defendant:
Barry Kaplan
Perkins Coie
1201 Third Avenue, 40th Floor
Seattle, WA 98101-3099

Unless otherwise ordered by the Court, any member of the

Settlement Class who does not make his or her objection or

Apdx C - 31

opposition in the manner provided shall be deemed to have
waived all objections and opposition to the fairness,
reasonableness and adequacy of the proposed settlement, or
to the request of Settlement Class Counsel for attorneys’ fees,

costs and expenses,

ADDITIONAL INFORMATION

25. This notice is not all-inclusive. Any questions
you have concerning the matters contained in this notice (and
any corrections or changes of name or address) should not be
made to the Court but should be directed in wniting to

Settlement Class Counsel at the address listed below.

26. If you wish to communicate with Settlement
Class Counsel as your attorney in this litigation, you may do
so by writing to Steve W. Berman at the firm of Hagens &
Berman, P.S., 1301 Fifth Avenue., Suite 2929, Seattle, WA
98101.

Please do not contact the court for further information
at this time.
DATED: July 8,1997.

Apdx C - 32

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386018_0979%3A3. Public record. Not legal advice.
