The Oyez Project: Economic Activity Issues - Federal Public Utilities Regulation, Telephone Company Decisions

AT&T v. Iowa Utilities Board

Does the Federal Communication Commission have authority to implement the competition-inducing guidelines set out in the 1996 Telecommunications Act?

Yes. In a complicated split opinion, the Court held that the FCC has rulemaking authority to uphold those provision of the Act in question. Despite the local nature of some of the LECs involved, the Court emphasized their interconnectivity with regional and national carriers. As such, the FCC could also reach local LEC markets and regulate their competitive business practices. Such regulatory authority would include the ability to tell LECs what portions of their services they had to share with new competitors, allow new competitors to use local networks without having to own them, and forbid incumbent LECs from separating their network elements before leasing them to competitors.

MCI Telecommunications Corp. v. American Telephone & Telegraph Co.

No details yet.

Norfolk Redev. & Housing Auth. v. C. & P. Tel.

No details yet.

Verizon Communications v. FCC

Does the Telecommunications Act of 1996 authorize the Federal Communications Commission to require state utility commissions to set the rates charged by the incumbents for leased elements on a forward-looking basis untied to the incumbents' investment? Does the Act require incumbents to combine such elements at the entrants' request when they lease them to the entrants?

Yes and yes. In an opinion delivered by Justice David H. Souter, the Court held that the FCC can require state commissions to set the rates charged by incumbents for leased elements on a forward-looking basis untied to the incumbents' investment and that the FCC can require incumbents to combine elements of their networks at the request of entrants. Because the incumbents did not meet their burden of showing unreasonableness to defeat the deference due the FCC, the Court reversed the Court of Appeals's ruling insofar as it invalidated TELRIC. "The job of judges is to ask whether the Commission made choices reasonably within the pale of statutory possibility in deciding what and how items must be leased and the way to set rates for leasing them. The FCC's pricing and additional combination rules survive that scrutiny," wrote Justice Souter, rejecting arguments that the FCC did not chose the best way to set rates. Justice Sandra Day O'Connor did not participate in this case.