Hollywood Calling v. Public Utility Commission
This text of 805 S.W.2d 618 (Hollywood Calling v. Public Utility Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
Appellant Hollywood Calling filed suit in the district court of Travis County seeking declaratory relief as to the validity of substantive rule 23.32(b)(7) and (8), 16 Tex.Admin.Code § 23.32(b)(7), (8) (West Sept. 1, 1988), of appellee Public Utility Commission. See Tex.Rev.Civ.Stat.Ann. art. 6252-13a, § 12 (Supp.1991). The district court concluded, in pertinent part, that rule 23.-32(b)(7) and (8) is valid and permanently enjoined Hollywood Calling from violating rule 23.32(b)(7). We will reverse the judgment of the district court.
The portion of rule 23.32(b) 1 at issue prohibits the use of automatic dial announcing devices (ADADs) to advertise “Dial 976” telephone services (“976” service). By “976” service, a telephone company provides telecommunications, billing, and collection services for information providers or sponsors, such as Hollywood Calling. Customers dial a number beginning with “976” to hear messages a sponsor provides by way of telephone company lines. The telephone company bills the customers, collects the charges, subtracts a handling fee, and remits the remainder of the charges to the sponsor. ADADs are machines that can be connected to a telephone line and programmed to dial telephone numbers automatically. When a person answers the telephone, the ADAD plays a recorded message. Hollywood Calling uses ADADs in Houston, Dallas, Fort Worth, and San Antonio to advertise its “976” services.
In its first point of error, Hollywood Calling contends that the district court erred in concluding that the Commission did not exceed its authority under the Public Utility Regulatory Act (PURA), Tex. Rev.Civ.Stat.Ann. art. 1446c, § 87B (Supp. 1991), in adopting rule 23.32(b)(7) and (8). Section 87B defines the term “automatic dial announcing device” and provides that a “person may not use an automatic dial announcing device unless” he meets the enumerated criteria. 2
*620 The rule at issue is presumed valid; Hollywood Calling had the burden to show that the Commission did not have the statutory authority to promulgate it. Browning-Ferris, Inc. v. Texas Dept. of Health, 625 S.W.2d 764, 767 (Tex.App.1981, writ ref d n.r.e.). A rule may not impose additional burdens, conditions, or restrictions beyond or inconsistent with the statutory provisions. Bexar County Bail Bond Board v. Deckard, 604 S.W.2d 214, 216 (Tex.Civ.App.1980, no writ). The determinative factor as to whether the Commission exceeded its authority is whether the rule is in harmony with the general objectives of the statute. Gerst v. Oak Cliff Savings and Loan Ass’n, 432 S.W.2d 702, 706 (Tex.1968); State Board of Insurance v. Deffebach, 631 S.W.2d 794, 798 (Tex.App.1982, writ ref d n.r.e.). In making this determination, the reviewing court must look not only to a particular provision of the act but to all applicable provisions. Gerst, 432 S.W.2d at 706.
In rejecting Hollywood Calling’s reliance solely on § 87B, the Commission argues that PURA §§ 2,16, and 18 provide authority for the adoption of rule 23.32(b)(7) and (8). Section 2 provides:
This Act is enacted to protect the public interest in the rates and services of public utilities.... The purpose of this Act is to establish a comprehensive regulatory system which is adequate to the task of regulating public utilities as defined by this Act, to assure rates, operations and services which are just and reasonable to the consumers and to the utilities.
(Emphasis added.) Section 16(a) relates to the Commission’s general powers and provides:
The commission has the general power to regulate and supervise the business of every public utility within its jurisdiction and to do all things, whether specifically designated in this Act or implied herein, necessary and convenient to the exercise of this power and jurisdiction. The commission shall make and enforce rules reasonably required in the exercise of its powers and jurisdiction....
(Emphasis added.) Section 18 refers expressly to telecommunications utilities and provides, in pertinent part:
(a) It is the policy of this state to protect the public interest in having adequate and efficient telecommunications service available to all citizens of the state at just, fair, and reasonable rates. The legislature finds that the telecommunications industry through technical advancements, federal judicial and administrative actions, and the formulation of new telecommunications enterprises has become and will continue to be in many and growing areas a competitive industry which does not lend itself to traditional public utility regulatory rules, policies, and principles; and that therefore, the public interest requires that new rules, policies, and principles be formulated and *621 applied to protect the public interest and to provide equal opportunity to all telecommunications utilities in a competitive marketplace. It is the purpose of this section to grant to the commission the authority and power under this Act to carry out the public policy herein stated.
Clearly, the preceding provisions vest the Commission with a broad grant of power to regulate public utilities, including telecommunications utilities. See Amtel Communications v. Public Utility Comm’n of Texas, 687 S.W.2d 95, 99-100 (Tex.App.1985, no writ). Rule 23.32(b), however, imposes restrictions on a “person,” a “user of an automatic dial announcing device.” In § 87B, the legislature imposed restrictions on a user of an AD AD. Rule 23.32(b) parts (1) through (6), which are not at issue, track the statutory language. In part seven, however, the Commission purports to place an additional restriction on the AD AD user. Notwithstanding that rule 23.32(b)(7) may harmonize with the statute’s general objective to protect the public interest, we find no general grant of authority whereby the Commission may regulate a user of a telecommunication service. See Kelly v. Industrial Accident Board, 358 S.W.2d 874 (Tex. Civ.App.1962, writ ref’d); Bexar County, 604 S.W.2d at 217-18.
The Commission responds that the necessary authority is found in § 87B(b)(l) which requires a person to obtain a permit from the Commission. Again, we find no grant of authority in § 87B or other provisions of PURA whereby the Commission is given authority to impose conditions on the issuance of the permit, other than the provision for an application fee set out in § 87B(e).
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805 S.W.2d 618, 1991 WL 32403, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hollywood-calling-v-public-utility-commission-texapp-1991.