Marketing Research Services, Inc. v. Public Utilities Commission

517 N.E.2d 540, 34 Ohio St. 3d 52, 1987 Ohio LEXIS 440
CourtOhio Supreme Court
DecidedDecember 23, 1987
DocketNo. 86-1883
StatusPublished
Cited by26 cases

This text of 517 N.E.2d 540 (Marketing Research Services, Inc. v. Public Utilities Commission) is published on Counsel Stack Legal Research, covering Ohio Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Marketing Research Services, Inc. v. Public Utilities Commission, 517 N.E.2d 540, 34 Ohio St. 3d 52, 1987 Ohio LEXIS 440 (Ohio 1987).

Opinion

Per Curiam.

This case presents two distinct issues for our review and determination. The first is whether the Supremacy Clause of the United States Constitution (Clause 2, Article VI) and the Federal Communications Act of 1934 (“the 1934 Act”) preclude the PUCO from exercising jurisdiction over a complaint concerning the rendition of interstate communications service provided under interstate tariffs. We hold that the 1934 Act and the Supremacy Clause do preclude PUCO jurisdiction in the case sub judice. The second issue is whether the PUCO may properly exercise jurisdiction over a complaint where the. matter involves a contractual dispute between a utility and a customer. We reaffirm our earlier holdings that the PUCO does not have jurisdiction to entertain complaints over contractual disputes.

I

The PUCO’s August 5, 1986 entry concluded that:

“ * * * [Tjhis matter should be dismissed. The instant controversy involves solely interstate services provided under interstate tariffs. While it is true that those services were contracted for in Ohio, that does not change the fact that this Commission has no jurisdiction over strictly interstate telecommunications services. ” (Emphasis added.)

Although the entry contains no analysis or discussion in support of its conclusion, the motions to dismiss filed by AT&T Communications and Cincinnati Bell raised arguments which essentially stated that the PUCO was precluded from exercising jurisdiction over MRS’s complaint by virtue of the Commerce Clause of the United States Constitution, and because the 1934 Act gave the FCC exclusive jurisdiction over interstate telephone matters.

MRS contends that this case presents circumstances which justify state action overriding the Commerce Clause. MRS does not dispute the PUCO’s proposition that the FCC has broad jurisdiction over matters concerning interstate telecommunications service. MRS argues, however, that the PUCO may still exercise its own powers of supervision and regulation over the essentially local activities of AT&T Communications and Cincinnati Bell in providing that interstate service. Furthermore, MRS submits that such state regulation in this case would not place an “undue burden” upon interstate commerce.

The general rule is that the regulation of interstate commerce is left to the federal government by the United States Constitution. However, states may regulate areas of interstate commerce which are local in nature as long as such regulation does not impose a burden on the flow of such commerce. Thus, the states do have authority over the essentially local concerns of utilities engaged in interstate commerce. See Panhandle Eastern Pipe Line Co. v. Pub. Util. Comm. (1978), 56 Ohio St. [54]*542d 334, 10 O.O. 3d 452, 383 N.E. 2d 1163; and Panhandle Eastern Pipe Line Co. v. Michigan Public Service Comm. (1951), 341 U.S. 329.

Any local interests which would be served by PUCO regulation of the services provided by AT&T Communications and Cincinnati Bell must be balanced against the burden placed on interstate commerce by virtue of such regulation. Regulation by the PUCO would be an impermissible burden if it would seriously interfere with or substantially impede the free flow of commerce between the states. Panhandle Eastern, supra (1978), at 339, 10 O.O. 3d at 454, 383 N.E. 2d at 1166.

MRS submits that a compelling local interest does exist because AT&T Communications’ and Cincinnati Bell’s refusal to provide interstate FX lines had a clear and significant local impact. MRS provides a variety of marketing research services to its customers, primarily involving market surveys by long distance telephone canvassing. MRS employs some one hundred full-time and one hundred fifty part-time employees at its principal place of business in Cincinnati, Ohio. Its clients include a number of large companies with headquarters or major facilities in the Cincinnati metropolitan area. MRS argues that the extent to which AT&T Communications’ and Cincinnati Bell’s provision of interstate FX lines affects citizens of Ohio is sufficient to bring the matters involved in the complaint within the PUCO’s jurisdiction. Furthermore, MRS submits that the relief sought from the PUCO would not be an impermissible burden on interstate commerce.

Under the Supremacy Clause of the United States Constitution, state legislation and regulating authority may be pre-empted in several circumstances: (1) where Congress, in enacting a federal statute, has expressed a clear intent to pre-empt state law; (2) when it is clear, despite the absence of explicit pre-emptive language, that Congress has intended, by legislating comprehensively, to occupy an entire field of regulation and has left no room for the states to supplement the federal law; and (3) when compliance with both state and federal law is impossible or when compliance with state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of the federal policies embodied in the laws at issue. Capital Cities Cable, Inc. v. Crisp (1984), 467 U.S. 691, 699; Cleveland v. Pub. Util. Comm. (1980), 64 Ohio St. 2d 209, 18 O.O. 3d 418, 414 N.E. 2d 718. This case clearly involves a situation where the Congress has preempted state authority.

The 1934 Act established a comprehensive legislative scheme regulating common carriers involved in interstate telecommunications. For example, the 1934 Act pre-empts the regulation of interstate commerce by giving the FCC comprehensive and pervasive powers over the regulation of interstate communications, and over the activities of common carriers engaged in the furnishing of such communications. Sections 151-222, 401-416, 501-510 and 601-609, Title 47, U.S. Code. The 1934 Act also requires carriers to provide adequate service, prohibits unjust, unreasonable and discriminatory practices by carriers, and requires carriers to maintain service tariffs or file with the FCC. Sections 201, 202 and 203(a), Title 47, U.S. Code.

Finally, the 1934 Act also establishes a procedure whereby complaints arising under it may be brought before the FCC and adjudicated. In the alternative, an action may be brought in federal district court to compel car[55]*55riers to determine just and reasonable tariffs, to enjoin violations of tariff provisions and to award damages to persons injured by a carrier’s violation of specific provisions of the 1934 Act. Sections 205-209, Title 47, U.S. Code.

The establishment of this comprehensive regulatory scheme arguably represents an explicit congressional intent to occupy the field of interstate telecommunications regulation. In any event, however, we find that the clear intent of the 1934 Act is to occupy the entire field of interstate regulation over interstate telecommunications and to leave nothing to state regulation.

Furthermore, we believe that the assumption of jurisdiction by the PUCO would create the possibility for substantial disruption or interference with the purpose of assuring uniform and equal telecommunications service throughout the United States. Where uniformity is essential for the functioning of commerce, a state may not interpose its local regulation. Morgan v. Virginia

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Bluebook (online)
517 N.E.2d 540, 34 Ohio St. 3d 52, 1987 Ohio LEXIS 440, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marketing-research-services-inc-v-public-utilities-commission-ohio-1987.