Law and Regulation of Common Carriers in the Communications Industry

By Daniel L. Brenner | Go to book overview

8
LINE OF BUSINESS RESTRICTIONS

THE DECREES

UNITED STATES V. WESTERN ELECTRIC
592 F. Supp. 846 ( D.D.C. 1984) HAROLD H. GREENE, District Judge.The Regional Holding Companies,1. have requested the Court to waive the "line of business" restrictions in section II(D) of the decree so that they may pursue ventures other than the provision of local telephone service. These motions raise the question whether and the extent to which these companies shall be permitted to engage in new business enterprises--perhaps the most important issue to have arisen since the AT&T Plan of Reorganization was approved last year.2.Section II(D) of the decree mandates thatAfter completion of the reorganization . . . , no [Operating Company] shall, directly or through any affiliated enterprise:
1. provide interexchange telecommunications services or information services;
2. manufacture or provide telecommunications products or customer premises equipment (except for provision of customer premises equipment for emergency services); or
3. provide any other product or service, except exchange telecommunications and exchange access service, that is not a natural monopoly service actually regulated by tariff.
____________________
1.
The twenty-two Operating Companies, the successors of the local affiliates of the Bell System, provide local telecommunications services and certain other services and products pursuant to the decree. Each of these local companies is now a subsidiary of one of seven Regional Holding Companies established by Part IV(A)(6) of the Plan of Reorganization. The Plan itself was approved by the Court on July 8, 1983. United States v. Western Electric Co., 569 F.Supp. 1057 ( D.D.C. 1983), aff'd sub nom. California v. United States,--U.S.--, 104 S.Ct. 542, 78 L.Ed.2d 719 ( 1983).
2.
As one party has put it, resolution of this issue may represent the "'second phase' restructuring of the American telecommunications industry." Department of Justice Memorandum of April 5, 1984, at 56.

-168-

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