State Ex Rel. Coffman v. Public Service Commission

150 S.W.3d 92, 2004 Mo. App. LEXIS 1153, 2004 WL 1773444
CourtMissouri Court of Appeals
DecidedAugust 10, 2004
DocketWD 63133, WD 63134, WD 63135
StatusPublished
Cited by3 cases

This text of 150 S.W.3d 92 (State Ex Rel. Coffman v. Public Service Commission) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Ex Rel. Coffman v. Public Service Commission, 150 S.W.3d 92, 2004 Mo. App. LEXIS 1153, 2004 WL 1773444 (Mo. Ct. App. 2004).

Opinion

EDWIN H. SMITH, Chief Judge.

AT & T Communications of the Southwest, Inc (AT & T), Sprint Communications Company, L.P. (Sprint), and MCI WorldCom Communications, Inc. (MCI) (collectively referred to as the Companies) filed, pursuant to § 392.500, 1 proposed tariff revisions with the Public Service Commission (Commission), seeking to add monthly surcharges that would apply to certain customers in Missouri. The Office of the Public Counsel (OPC) filed several motions objecting to the proposed tariff revisions and seeking hearings thereon, as provided by § 392.230.3. The Commission denied the OPC’s motions and approved the requested tariff revisions of the Companies. The OPC appealed the Commission’s decisions to the Circuit Court of Cole County, which affirmed the actions of the Commission.

The OPC raises five points on appeal in each of which they claim that the Commission erred in approving the proposed tariff revisions requested by the Companies. In Point I, it claims that the Commission erred because its decision violated § 392.200 in that, in approving the requested surcharges, the Commission failed to consider whether they were just, reasonable, and non-discriminatory. In Point II, it claims that the Commission erred because its decision violated § 392.200 in that no reasonable justification was shown by the Companies for the disparate treatment of similarly situated customers with respect to the surcharges. In Point III, it claims that the Commission erred because its finding that the surcharges were just and reasonable were not supported by substantial and competent evidence. In Point IV, it claims that the Commission erred because its decision violated § 254(g) of the Federal Telecommunications Act of 1996, 47 U.S.C. §§ 151 et seq., prohibiting carriers from charging higher interstate rates based on geography and location in that the “surcharges applied to Missouri customers and not to all other state customers and had the impact of Missouri customers paying effectively higher rates for interstate toll.” In Point V, it claims that the Commission erred because its decision was not supported by adequate findings of fact and conclusions of law, as required by §§ 386.420.2 and 536.090, in that it failed to make any findings as to the facts on which its conclusion that the surcharges were just and reasonable was based.

We reverse and remand.

Facts

AT & T’s Proposed Tariff Revisions

On August 14, 2001, AT & T submitted proposed tariff revisions, including:

A monthly service charge will be applied to AT & T customers who are presub-scribed to AT & T for interLATA service. This monthly service charge is applied if a customer has $1.00 or more of billable charges and credits on their bill, including, but not limited to, monthly recurring charges, minimum usage, or single bill fee charges. This charge *95 does not contribute towards the minimum monthly usage charge.
Customers in AT & T’s Lifeline program and Federal Price Protection Plan, as well as those customers making less than $1.00 worth of long distance calls a month, are exempt from this service charge. Customers who have AT & T Local Service are also excluded from this charge
Per Month
Per Account $1.95

At approximately the same time, it sent a postcard to customers who were pre-sub-scribed for inter-LATA long distance, explaining that it was imposing the surcharge on them to recover access charges that it was required to pay to local exchange carriers in Missouri for the use of the local network in completing in-state long distance calls:

Your local telephone company in Missouri currently charges AT & T to carry your in-state long distance calls over their lines. As a result, AT & T will begin to include in your monthly bill a $1.95 In-State Connection Fee, starting September 15, 2001.

On September 4, 2001, the OPC filed a motion asking the Commission to enter an order suspending AT & T’s proposed tariff revisions and to hold evidentiary, public hearings on the matter. In the motion, the OPC alleged that the proposed surcharge was unjust, unreasonable, and discriminatory, in violation of § 392.200, in that it imposed a surcharge “without regard to customer actual usage,” meaning that customers with low-volume toll calling would be assessed the same surcharge as customers with considerable or high-volume toll calling.

On September 7, 2001, the Staff filed a response to the motion, recommending that the Commission approve the proposed tariff revisions. In support of its recommendation, the Staff argued that the proposed surcharge was not discriminatory, noting that customers have the ability to switch service providers, and that the Commission does not typically scrutinize the rate structure of competitive long distance providers beyond compliance with a few limited rate requirements identified in § 392.500. On September 13, 2001, the Commission suspended the proposed tariff revisions until November 17, 2001, and ultimately suspended them until December 22, 2001.

On October 31, 2001, the Commission held a question and answer session on the proposed tariff revisions. At the proceeding, Michael Dandino of the OPC offered additional arguments against the proposed surcharge. Dandino argued that the proposed surcharge would discriminate against rural customers because it would exempt customers with AT & T local service, and AT & T local service is only available to customers in the St. Louis and Kansas City metropolitan areas. Dandino also argued that, although the surcharge was described as an in-state connection fee, “it draws from a charge that applies for any billings for interstate services, too, so, effectively, they are increasing interstate rates,” in violation of § 254(g) of the Federal Telecommunications Act. In addition, Dandino argued that the surcharge would be unreasonably discriminatory if it applied only to residential customers, as there was no rational basis for differentiating between residential and business customers.

On November 13, 2001, AT & T filed a “post-hearing” brief in which it claimed that the exemption of its local customers from the surcharge was not unreasonably discriminatory because “AT & T does not incur that same access expense when AT & T is both the local and the toll provider,” and because AT & T is “waiving the pro *96 posed charge to local customers in an effort to sell more services to customers.” AT & T further argued:

AT & T’s proposed tariff recovers the cost of the interstate and intrastate access differential in the manner in which the costs are truly incurred. AT & T is doing this to avoid unfairly penalizing toll users, especially high volume toll users, who implicitly subsidize low volume and no volume toll customers. Inflating per-minute rates forces these customers to pay a disproportionate amount relative to the actual cost of serving these customers.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
150 S.W.3d 92, 2004 Mo. App. LEXIS 1153, 2004 WL 1773444, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-coffman-v-public-service-commission-moctapp-2004.