IV. Assignment of Proceeding

Michael Peevey is the Assigned Commissioner and Michael Galvin is the assigned ALJ in this proceeding.

Findings of Fact

1. The complaints of AT&T and Pacific were consolidated on April 13, 2000.

2. AT&T and Pacific resolved differences between themselves and requested their complaints be dismissed without prejudice. However, we declined to do so based on our concern that the public interest may be implicated by those complaints.

3. CPSD recommends that Pacific retain an outside auditor to provide a detailed report on the accuracy of Pacific's process for tracking and billing LPIC disputes, currently and for 1999-2000.

4. CPSD confirmed from a random sample of LPIC dispute customers identified by Pacific that some of the customers had been slammed in 1999.

5. CPSD found Pacific's process of tracking and billing LPIC disputes flawed.

6. The slamming allegations in this proceeding arose out of billing disputes. Neither of the complainants alleged that any customer ever paid a higher rate than the customer otherwise would have paid as a result of an alleged slam.

7. AT&T and Pacific did not at all times comply with the independent TPV requirements in 1999.

8. From May 1999 through October 1999, Pacific did not use TPV to confirm a residential subscriber's decision to change his or her local toll service when Pacific had a signed letter of authorization from that residential subscriber authorizing such change.

9. AT&T provided TPV on all but a very few of its residential accounts.

Conclusions of Law

1. The CPSD report should remain under seal to the extent that such information, if released, would place the utilities at a competitive disadvantage, disclose disaggregated information, or disclose specific customer information.

2. Pacific's process of tracking and billing 1999 LPIC disputes was flawed and contributed to customer confusion.

3. Public interest requires confirmation that the switching of customers' LPIC service is done only upon specific request of customers and confirmation that confidential LPIC dispute reports being provided by Pacific to CPSD provide accurate information.

4. Public interest requires an independent audit and verification of Pacific's current process of tracking and billing LPIC disputes.

5. To the extent that information placed under seal is germane to the issues before us and, if revealed, would not place the utilities at a competitive disadvantage, disclose disaggregated customer information or disclose specific customer information, such information should be discussed in this order.

6. It is premature to issue an investigation into Pacific's LPIC process.

7. This proceeding should be closed conditioned upon an independent audit of Pacific's current process for tracking and billing LPIC disputes.

ORDER

IT IS ORDERED that:

1. Pacific Bell (Pacific) shall retain an independent auditor to conduct an operational audit and validation of Pacific's current process for tracking and billing Local Primary Interexchange Carrier (LPIC) disputes. That independent auditor shall, without Pacific oversight, prepare and submit a report on the scope and results

of the audit to the Commission's Consumer Protection and Safety Division (CPSD) within 120 days after the effective date of this order. The independent auditor and all of the auditor's work papers shall be available to CPSD. Pacific shall correct any deficiencies discovered by the independent auditor within 30 days after completion of the audit report, and shall report any corrective action taken to CPSD within 15 days after correction.

2. To the extent that CPSD is not satisfied with the audit results or corrective action required by Ordering Paragraph 1, CPSD will prepare an order instituting investigation into the tracking and billing of Pacific's LPIC disputes for our consideration.

3. All data placed under seal in this proceeding shall remain sealed. The sealed data shall not be made accessible or disclosed to anyone other than Commission staff. However, the sealed data may be disclosed upon the execution of a mutually acceptable nondisclosure agreement or on further order or ruling of the Commission or the Administrative Law Judge then designated as the Law and Motion Judge.

4. Cases 99-12-029 and 00-02-027 are closed. Any failure of Pacific in complying with Ordering Paragraph 1 shall result in the reopening of this proceeding and setting of hearings upon the filing of a petition by CPSD.

Dated October 3, 2002, at San Francisco, California.

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