Big Sky Excavating, Inc. v. Illinois Bell Telephone Co.

CourtIllinois Supreme Court
DecidedDecember 1, 2005
Docket99380 Rel
StatusPublished

This text of Big Sky Excavating, Inc. v. Illinois Bell Telephone Co. (Big Sky Excavating, Inc. v. Illinois Bell Telephone Co.) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Big Sky Excavating, Inc. v. Illinois Bell Telephone Co., (Ill. 2005).

Opinion

Docket No. 99380–Agenda 24–September 2005.

BIG SKY EXCAVATING, INC., et al. , Appellees, v. ILLINOIS BELL TELEPHONE COMPANY et al. , Appellants.

Opinion filed December 1, 2005.

JUSTICE KARMEIER delivered the opinion of the court:

Plaintiffs brought an action in the circuit court of Madison County challenging the constitutionality of section 13–502.5 of the Public Utilities Act (220 ILCS 5/13–502.5 (West 2002)), which abated proceedings then pending before the Illinois Commerce Commission and mandated that $90 million be refunded to certain customers of telecommunication services. On plaintiffs’ motion for summary judgment, the circuit court declared section 13–502.5 invalid on the grounds that it violated the prohibition against special legislation set forth in article IV, section 13, of the Illinois Constitution of 1970 (Ill. Const. 1970, art. IV, §13) and denied the Illinois Constitution’s guarantees of due process and equal protection (Ill. Const. 1970, art. I, §2). Because the circuit court’s judgment declared a statute of this state invalid, the appeal was taken directly to our court. 134 Ill. 2d R. 302(a). For the reasons that follow, we now reverse.

Telephone companies in Illinois have long been regulated as public utilities. As such, their rates were determined by administrative agencies. Before a telephone company could alter the price of its services, it was required to give 45 days notice to the Illinois Commerce Commission (Commission) and the public. 220 ILCS 5/9–201(a), 13–504(a) (West 2002). The Commission could then suspend the effectiveness of the price change for up to 11 months while deciding whether to approve it. 220 ILCS 5/9–201(b), 13–504(a) (West 2002).

In 1985, the General Assembly enacted the Universal Telephone Service Protection Law of 1985 (220 ILCS 5/13–100 et seq. (West 2002)), which created two classifications of telephone services: “competitive” and “noncompetitive” (220 ILCS 5/13–502 (West 2002)). Generally speaking, noncompetitive services remain subject to the requirements discussed above. See 220 ILCS 5/13–504(a) (West 2002). Under section 13–502(b) of the Universal Telephone Service Protection Law (220 ILCS 5/13–502(b) (West 2002)), however, an incumbent provider is now allowed to declare a service competitive with respect to an identifiable class of customers (such as business customers in a certain geographic area) if “such service, or its functional equivalent, or a substitute service” is “reasonably available from more than one provider.” This categorization is significant because once a service has been declared competitive, prices can be changed immediately simply by filing a new tariff and, in the case of an increase, providing notice to customers. 220 ILCS 5/13–505(a) (West 2002).

The power of telecommunications providers to declare a service competitive is not unrestricted. Section 13–502(b) of the Universal Telephone Service Protection Law confers on the Commission the authority “to investigate the propriety of any classification of a telecommunications service on its own motion” and requires it to investigate the propriety of any classification where a complaint has been filed. 220 ILCS 5/13–502(b) (West 2002). The statute sets forth standards for evaluating whether a service should be reclassified as competitive (see 220 ILCS 5/13–502(c) (West 2002)) and provides that “[i]n any hearing or investigation, the burden of proof as to the proper classification of any service shall rest upon the telecommunications carrier providing the service” (220 ILCS 5/13–502(b) (West 2002)). Where the reclassification of service as competitive is successfully challenged, the Commission has the power to order the carrier to refund any overcharges that may have resulted from the improper classification. It may also order other remedies as authorized by the statute or seek appropriate relief in a court of competent jurisdiction. 220 ILCS 5/13–502(e) (West 2002).

On February 6, 1998, Illinois Bell Telephone Company, doing business as SBC Illinois, filed a tariff with the Commission reclassifying many of the business services it provided to small business customers as competitive. After Illinois Bell reclassified its services, it raised rates for many of those services. Pursuant to the authority conferred on it by section 13–502(b) of the Universal Telephone Service Protection Law (220 ILCS 5/13–502(b) (West 2002)), the Commission initiated an investigation of Illinois Bell’s actions. Hearings were conducted during which a substantial evidentiary record was compiled. The Commission hearing examiners assigned to the matter ultimately submitted a proposed order to the Commission finding that Illinois Bell had wrongfully reclassified many of its small business services as competitive and that such reclassification resulted in unwarranted and significant rate increases. The proposed order, dated March 30, 2001, concluded that Illinois Bell should refund the price increases it had charged affected customers.

In accordance with section 200.830 of title 83 of the Administrative Code (83 Ill. Adm. Code §200.830 (2005) (as amended by 20 Ill. Reg. 10607, eff. August 15, 1996)), the parties were permitted to file exceptions to the proposed order and replies to the exceptions. While the matter was still pending, and before the Commission issued a final order in the case, the General Assembly enacted Public Act 92–22. That legislation made numerous changes to various statutes concerning telecommunications. It repealed section 13–803 of the Universal Telephone Service Protection Law (220 ILCS 5/13–803 (West 2000)), which would have repealed the entire Universal Telephone Service Protection Law as of July 1, 2001, and extended the life of the statute, as amended, until June 30, 2005 (220 ILCS 5/13–803 (West 2002)). (footnote: 1) At the same time, it added an entirely new section to the law, section 13–502.5 (220 ILCS 5/13–502.5 (West 2002)), which declared:

“(a) Any action or proceeding pending before the Commission upon the effective date of this amendatory Act of the 92nd General Assembly [Public Act 92–22] in which it is alleged that a telecommunications carrier has improperly classified services as competitive, other than a case pertaining to Section 13–506.1, shall be abated and shall not be maintained or continued.

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