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About litigation involving BBSs in USA.
On January 29th and 31st, a hearing will be held before an
administrative law judge concerning the case of the Variety & Spice
BBS (Gross Point, MI) and Michigan Bell. In March, Michigan Bell
informed the sysop that they would begin charging him business rates
for his phone lines because they determined that his charging for
access does not qualify him for residencial rates.
Several cases of this nature have, or are currently being faught
around the country. These files are being circulated to inform those
who use or run BBS's of pending legislation in Michigan and Indiana.
For more information, or if you would like to testify before the MPSC
on the above date, please contact one of the following sources.
Jerry Cross (voice)313-736-4544
(bbs) 313-736-3920
Variety & Spice BBS
313-885-8377
or check out one of the many Michigan BBS's that carry the Michigan
ECHO message system.
Please send comments or questions to
G.Cross (Genie)
JERRYCROSS (DELPHI)
75046,467 (CompuServe)
Thanks for your support!
GTE TAKES ON INDIANA SYSOPS
(April 5)
Unilateral imposition of business rates on Bulletin Board Systems
continues to spread. BBS operators in Indiana complain that GTE is
forcing them to accept extra-cost business rates rather than the
residential rates they have been paying.
Derry Nelson, sysop of the 1149 BBS in Elkhart, Ind., says that the
changes were a surprise. The worst part of the surprise seems to be the
large jump in monthly rates. A typical BBS would find its monthly bill
increased by almost 200 percent.
"To the best of my knowledge the BBS Community was not aware of the
changes GTE requested in their [new] tariff," Nelson said. "I know that
I personally wasn't aware of anything until I received a letter from GTE
stating that my rate classification was being changed from Residential to
Business. I honestly believe that this [tariff] was `slipped' through."
The Indiana Utility Regulatory Commission (IURC) told Nelson and other
sysops that a tariff approving business rates for home computer lines was
approved in January. The consensus among ELkhart BBS operators seems to
be that the tariff should have considered in open and publicized hearings.
The new tariff appears to give GTE wide-ranging control over its
customers. As an example, the company can limit the length of calls "when
in [GTE's] judgement such action is necessary." GTE claims authority to
change a BBS to business rates because the service is provided "for use
[of] the general public."
Additional information is available from the Utility Consumer Counselor
at 317/232-2494. The 1149 BBS can be reached at 219/293-1149.
--James Moran
----------
FROM: Mike Marotta Area # 9 ( Michigan )
TO: Bbs Users MSG # 130, Apr-7-90 0:31am
SUBJECT: Why Business Rates
These excerpts are from MPSC documents. It is established in
regulatory commission administrative law that the PROVIDER files
a tariff. For instance, it is a principle of regulatory law that
a tariff cannot be effective prior to its filing date. A tariff
that allowed this would "jump out" at a regulator who read it.
Generally, however, the regulators ACCEPT the filing of the
carrier and leave it to competing carriers or clients to file a
complaint.
-----------------------------------------------------------------
Michigan Bell Telephone Company Tariff MPSC No. 7 was issued on
November 21, 1966. Its age alone speaks volumes.
<quote> "Original Sheet 11.
GENERAL REGULATIONS
CLASSIFICATION AND USE OF TELEPHONE SERVICES
A. APPLICATION IS BUSINESS AND RESIDENCE RATES (Formerly Sheet
15)
1. The determination as to whether telephone service is Business
or Residence is based on the character of the Use to be made of
the service. Service is classified as business service where the
use is primarily or substantially of a business, professional,
institutional, or otherwise occupational nature. Where the
business use, if any, is incidental and where the major use is of
a social or domestic nature, service is classified as residence
service if installed in a residence.
"2. Business rates apply at the following locations, among
others:
a. In offices, stores and factories, and in quarters occupied by
clubs, lodges, fraternal societies, schools, colleges, libraries,
hospitals and other business establishments.
b. In residence locations where the place of residence is in the
immediate proximity to a place of business and it is evident that
the telephone in the residence is or will be used for business
purposes; and in the residence locations where an extension is
located at a place where business rates would apply.
c. In the residence of a practicing physician, dentist,
veterinary, surgeon or other medical practioner who has no
service at business rates at another location.
d. In any residence location where there is substantial business
use of the service and the customer has no service elsewhere at
business rates.
"B.1.a.(2). A customer engaged in furnishing services of a
secretarial nature may not use Telephone Company facilities to
receive messages for one party to be forwarded to another party,
unless such forwarding is of a temporary or occasional nature."
<end quote>
---
FROM: Mike Marotta Area # 9 ( Michigan )
TO: All Bbs users MSG # 131, Apr-7-90 0:32am
SUBJECT: more on rates - 2
As a result of the "Variety and Spice BBS" incident of March
1990, the MPSC issued a statement. Excepts follow:
<quote>"FORM LETTER FOR COMPUTER BULLETIN BOARDS
"If bulletin boards or access to bulletin boards is provided to
calling parties at no charge other than that which may be
associated with the telephone call, and are not provided in
conjunction with a business, a profession, an institution or
other occupation, then it would appear that the service should
not be classified as a business. If, however, there is a charge
associated with any level of access to the bulletin board,
whether the charge is rendered to cover costs or produce a
profit, then the service would be considered a business or
classification as such. This would also apply if any of the
previous conditions mentioned were not met." <END QUOTE>
FROM: Mike Marotta Area # 9 ( Michigan )
TO: All Users MSG # 134, Apr-7-90 0:25am
SUBJECT: Michigan Bell and You
04/06/1990 This statement was specially prepared by Michigan
Bell to explain to the bulletin board user community their
position on the question of business rates. The statement was
given to me at my request by Michigan Bell's district manager for
state government. -- Mike Marotta.
<quote>"Telephone Service Classifications
"Recently the question has arisen whether Michigan Bell is
attempting to charge commercial rates to all computer bulletin
boards in the state. Michigan Bell has not instituted a
"program" to impose a specific class of service on any group of
customers, i.e., computer bulletin boards. In fact, the decision
on which class of service is required for computer bulletin
boards is no different than it is for any other service. In
making the decision, Michigan Bell is required to comply with
tariffs approved by the Michigan Public Service Commission, which
cover the matter of appropriate classification of telephone
service.
"The applicable tariffs require Michigan Bell to classify service
primarily in accordance with the use that is to be made of the
service. The tariffs specify the conditions under which a
service is classified, for rate purposes, as business or
residence service. For example, service is classified as
business where the use is primarily that of a business. In the
case of computer bulletin boards, for instance, is there is a
charge associated with any level of access to the board, or money
is solicited in conjunction with the board, that is considered
conducting a business within the meaning of Michigan Bell's
tariffs. The service, therefore, would be classified as business
and business rates would apply. On the other hand, service that
is used primarly for domestic purposes is classified as residence
service. Again, using the example of computer bulletin boards,
if the board is not associated with a business and no charge is
assessed or solicited for access to the board, then service may
be classified as residence in accordance with the application
tariffs." <quote>
STATE OF INDIANA
INDIANA UTILITY REGULATORY COMMISSION
IN THE MATTER OF THE COMPLAINT OF )
TEN INDIVIDUALS AGAINST GTE NORTH ) CAUSE NO. 39005
INCORPORATED PERTINENT TO CERTAIN )
CHARGES FOR TELEPHONE SERVICE )
RENDERED BY GTE NORTH INCORPORATED )
BY THE COMMISSION:
__________________
James R. Monk, Chairman
Mark W. Cooper, Chief Administrative Law Judge
On June4, 1990, Randy Wilson, Derald A. Nelson, Clamies J.
Lambright, David A. Reynolds, Thomas Battler, Don Billey, Jeff
Jacobs, Jean Ludwig, George Himebaugh, Jr., and Delmar Mineard, Jr.
(Complainants") filed a complaint with the Commission pursuant to IC
8-1-2-54 against GTE North Incorporated ("Respondent"). By their
complaint, the Complainants state that certain of the provisions of the
Respondent's tariffs on file with this Commission are unjustly
discriminatory and unreasonable to the Complainants" detriment.
Pursuant to notice duly published as required by law, a
Prehearing Conference was held in this Cause on July 27, 1990 at 1:30
P.M., EST, in Room 908, State Office Building, Indianapolis, Indiana.
At the Prehearing Conference, the parties informally agreed as to
procedural and scheduling matters to be operative in this Cause.
However, counsel for the Respondent indicated that it would be
subsequently submitting a motion to dismiss herein and the Commission
withheld the issuance of the Prehearing Conference Order pending the
submission and ruling upon Respondent's Motion to Dismiss.
On August 10, 1990, the Respondent filed its Answer and Motion
to Dismiss, which filing appears in the following words and figures,
to-wit:
(H.I.)
Based upon the applicable law and the filings of the parties,
the Commission now finds as follows:
1. Commission Jurisdiction. The Respondent is a "public
utility" within the meaning of the Public Service Commission Act, as
amended. IC 8-1-2-54 provides the complaints may be filed against
public utilities with the Commission pertinent to the practices and acts
of those utilities. The complaint initiating this Cause was filed under
the provisions of IC 8-1-2-54 and appears to satisfy the requirements
thereof. The Prehearing Conference was conducted pursuant to notice
duly published as required by law. IC 8-1-2 et seq. and the
Commission's Rules and Regulations of Practice provide the Commission
with the authority to appropriatley adjudicate and dispose of cases
pending before it. Therefore, the Commission has jurisdiction over the
parties and subject matter herein.
2. Commission Discussion and Findings. The Complainants allege
that certain provisions of Respondent's tariffs are unjustly
discriminatory and unreasonable and the Complainants have been caused
harm thereby. The Complainants state that they are customers of the
Respondent and are engaged in the hobby of operating a Computer Bulletin
Board System ("BBS"). The Complainants allege that pursuant to these
tariff provisions the Respondent is billing them at a business rate
rather that a residential rate whic is inappropriate and to their
detriment. The Complainants contend that the operation of a BBS is a
hobby and not a business venture. The Complainants also contend that
applying a business rate to them consititutes a rate change which must
be subjected to public hearing prior to the application thereof.
Respondent points out that the tariff complained of by the Complainants
was approved by the Commission on January 31, 1990 pursuant to IC
8-1-2-42. Respondent also points out there is no dispute between the
parties as to whether this is the appropriate tariff under which the
Complaintant's service should be provided. Complainant citees certain
language set forth at Section 6.5 of the tariff which reads, as follows:
The Company shall determine if business or residence rates apply
to a customer service.
Respondent goes on to set forth additional language from the
tariif which set forth situations under which a business reate is
properly applied. Respondent concludes that BBS clearly fits the
categories set forth by the tariff under which a business rate applies
Respondent goes on to set forth additional language from the
tariif which set forth situations under which a business reate is
properly applied. Respondent concludes that BBS clearly fits the
categories set forth by the tariff under which a business rate applies
and the fact that Complainants allege that BBS is a hobby does not
remove it from the categories as defined within the tariff.
Respondent's Motion to Dismis does not clearly set forth the
authority or rule under which the Motion is brought. Therefore, we must
first determine the precise character of the Motion that we may know the
criteria under which its propriety is to be considered. Although
Respondent's filing is denominated as a "Motion to Dismiss", a review of
that Motion reveals that it does not clearly fall within the parameters
of the familiar request for involuntary dimissal under T.R. 41 or
matters properly raised under T.R. 12 (B). It appears that Respondent's
filing is most akin to a Motion for Judgement on the Pleadings as
provided by T.R. 12(C) or a Motion for Summary Judgement pursuant to
t.R. 56. In any event, a review of T.R. 12(C) directs that a motion
brought under that rule in circumstances such as these should be treated
as one for summary judgement and be disposed of as provided by T.R. 56.
T.R. 56(C) sets forth the standard under which a moving party may
prevail on motion for summary judgement. The Rule provides that the
judgement sought shall be rendered if there is no genuine issue as to
any material fact and that the moving party is entitled to a judgement
as a matter of law. This standard appears to be applicable in this
situation. A review of the Complaint and Respondent's filing indicates
that the parties agree upn the operative facts and that there exist no
genuine dispute as to any material fact. The question remaining to the
Commission is no then fact sensitive but whether Respondent's tariif
provisions which allows the Respondent to bill the Complainants under a
business rate constitutes the improper charging of a reate without prior
Commission approval and/or whether that tariff provision is unjust and
discriminatory. Both of which are conclusions of law for the Commission
as contemplated by T.R. 56 (C).
The Complainants allege that the Respondent's application of a
business rate to the Complainants constitutes a rate change for which
prior Commission approval must be obtained after holding a public
hearing. The cleand and unambiguous terminology of Respondent's tarriff
which was approved by this Commission allows the Respondent to determine
wheter a particular service is appropriatley billed under a residence
rate or a business rate. Clearly the tariff approved by the Commission
authorizes the appropriate rate. The Complainants have not alleged that
Respondent acted in a fashion inconsistent with the tariff. Therefore,
when information comes to the Respondent that leads it to believe that a
particular customer's situation has changed it is authorized under the
tariff to impose a rate change consistent with the terms of the tariff.
The Respondent's review of circumstances and decision to impose a
different rate authorized under the tariff clearly does not constitute a
rate change as contemplated by IC 8-1-2-42. Therefore, considering the
undisputed facts the Complainants would not be entitled to prevail on
this issue.
The Complainants next allege, without specifically stating the
reasons therefor, that Respondents tariff in question is unreasonably
discriminatory. This Commission has for many decades been charged with
the duty to review utility tariffs under the mandate that utility
services should not be discriminator and must serve puble interest. A
review of the official files of the Commission disclosed the provisions
of Respondent's tariff in question are of a standard type and kind for
local exchange telephone service. Further, we note that such tariff
provisons were reviewed by the Commission's Engineering Division which
was properly delegated with the authority to consider the propriety of
that tariff and make ultimate approval or rejection thereof. Base upon
a review of Respondent's tariff, we find that the tariff provisions are
not unreasonable and discriminatory either as written or by their
application. Therefore, we find that the Complainants are not entitled
to prevail upon this issue as a matter of law.
Based on forgoing, we find that Summary Judgement should be
granted in favor of the Respondent and the Complaintants request to
investigate the acts, practices and rates of the Respondent and for the
holding of public hearing on the matter of the imposition of a business
rate to the Complainants should be DENIED.
IT IS THEREFORE ORDERED BY THE INDIANA UTILITY REGULATORY
COMMISSION THAT:
1. The Respondent shall be deemed to have prevailed on the
matters at issue herein and that Complaintants request for an
investigation into the acts, practices and rates of the Respondent and
the holding of public hearing upon the Respondent's imposition of a
business rate upon the Complainants shall be, and hereby DENIED.
2. This Order shall be effective on and after the date of its
approval.
NOV 21, 1990