2. Background

Western Referral operates a business offering referrals of independent contractors who provide nude modeling, entertainment, and escort services. Western Referral's offices are located in San Diego, but Western Referral offers its services in Orange, Los Angeles, Sacramento, and San Francisco counties. Western Referral is accused by the Los Angeles Police Department of using its telephone number to accomplish commercial prostitution and other violations of the Los Angeles Municipal Code.

On July 21, 2000, pursuant to order of Superior Court Judge Maral Injejikian, AT&T disconnected a toll free telephone number used by Western Referral. The court, acting on an affidavit prepared by the Los Angeles Police Department, found probable cause to believe that Western Referral's telephone lines were being used as an instrumentality to violate the law, and that this presented a significant danger to the public health, safety, or welfare. In this complaint, Western Referral seeks reconnection of the telephone line pursuant to Rule 22 of AT&T's tariffs.

Rule 22, entitled "Legal Requirements for Refusal or Discontinuance of Service," governs this case. The rule requires disconnecting service to a customer upon written demand of a law enforcement agency, signed by a magistrate, asserting that there is probable cause to believe that the telephone facilities "have been or are to be used in the commission or facilitation of illegal acts." The character of such acts must pose significant danger to public health, safety, or welfare.

Under Rule 22, a disconnected subscriber may file a complaint with the Commission seeking restoration of service. The Commission is required to schedule a hearing on the complaint within 20 days of filing, and to serve notice on the concerned law enforcement agency. At hearing, the law enforcement agency has the burden of proving that the disconnection of service was based on probable cause, and that service should not be restored.

Rule 22, as amended, was approved by this Commission in Decision (D.) 91188, dated January 8, 1980. The California Supreme Court dismissed constitutional objections to the rule and upheld its validity in Goldin v. Public Utilities Commission (1979) 23 Cal.3d 638.

A hearing in this case was scheduled in the Commission's courtroom in Los Angeles on August 14, 2000, within 20 days of filing of the complaint. Following the hearing, the complainant and AT&T filed initial and reply briefs, and the City of Los Angeles submitted a reply brief only. The case was deemed submitted for Commission consideration on September 15, 2000.

On October 10, 2000, the Presiding Officer issued her Presiding Officer's Decision (POD). On October 20, 2000, the Complainant filed its appeal of the POD. AT&T filed its response in opposition to the appeal on November 8, 2000.