9. Request for Review and Appeal of Presiding Officer's Decision

1. § 451

The request for review focuses on the tariffs and asks two questions: (1) whether deception or intent to deceive are necessary elements of a violation of § 451; and (2) if violation of § 451 requires only unreasonable conduct, does defendants' action rise to that level.

In construing the requirements of § 451, the Commission has required, consistent with a large body of case law, that utility behavior be reasonable, that a utility charge rates that are just and not unreasonably discriminatory, and that those charges be consistent with its tariffs. Deception is not a necessary element of a cause of action for violation of § 451; neither is intent to deceive. The POD concludes that defendants' A5 and D3 tariffs are not user friendly but that they do contain the charges complainants argue are unauthorized and illegal - the business line usage charges assessed when call forwarding routes an incoming business call to a voice mailbox or when a customer uses a business line to retrieve a message from the mailbox. The POD finds no violation of § 451. We have revised the POD's summary and further explain our rationale here to remove any unintended impression that the lack of deception or intent to deceive forms the basis for our determination on this issue.

Answering the second question, whether the cumbersome nature of the tariff drafting rises to the level of a violation of § 451, requires reexamination of the record in this proceeding and our precedents. Greenlining's first ground for appeal - does the POD misapply the drafting standard applicable to tariffs -- requires a similar review, so we address these questions together. The POD concludes that though the tariffs meet "a bare minimum level of drafting competency", certain revisions, including better cross-referencing between the A5 and D3 tariffs, would be helpful to the reader.

In essence, both questions come down to this: do defendants' tariffs violate § 451 because the business line usage charges associated with voicemail are located in the A5 tariff and not repeated in the D3 tariff? The POD concludes that failure to restate the business line usage charges in the D3 tariff or provide an express cross-reference to them does not rise to the level of a violation of statute - the business line usage charges are authorized charges.

Greenlining's appeal argues that the POD is inconsistent with the principle that tariff ambiguity is construed against the drafter. Since the A5 tariff's business line usage charges are not repeated in the D3 tariff, Greenlining reiterates, we necessarily must conclude that the D3 tariff is ambiguous and that the business line usage charges have been illegally assessed and collected.

We disagree. The POD demonstrates that the tariffs, read together, are not ambiguous. As one of the cases Greenlining relies upon illustrates, the POD does not follow an unusual practice in reading several tariffs together. In Z.I.P., Inc. v. Pacific Bell the Commission examined three different Pacific tariffs (A2, A7 and A9) and concluded, in that case, that an ambiguity did exist. (See D.92-07-019, (1992) 45 CPUC2d 40, 1992 Cal. PUC LEXIS 611.) Complaint cases, however, are highly fact-dependent and review of Z.I.P does not reveal an inconsistency with the POD. In Z.I.P, the tariff ambiguity turned on the meaning ascribed to different words in the different tariffs used to describe the point at which a customer is assessed charges for incoming "800" service calls routed through its Centrex system by means of a uniform call distributor (or UCD) purchased from Pacific. The Commission construed a result favorable to customers.

Likewise distinguishable on its facts, is MCI v. Pacific Bell, where the Commission examined the impact of Pacific's Centrex tariffs on the ability of customers who have certain optional services (flexible route selection [FRS] or automatic route selection [ARS]) to have Pacific direct toll calls to competing intraLATA carriers without dialing a ten-digit access code. The tariffs did not expressly exempt this more favorable treatment, and the Commission construed the tariffs' silence against the utility. (See D.95-05-020, (1995) 59 CPUC 2d 665.)

In both decisions the Commission recognized the need customers have for accurate information about rapidly changing telecommunications offerings and stated "telephone utilities must be vigilant to insure that their tariffs are comprehensive and clear, so that customers are unquestionably placed on notice of the charges for which they will be held responsible after they order a new service. (Z.I.P, supra, see also MCI, supra at p. 683, citing Z.I.P.) The POD does not abandon this standard.

Absent a violation of § 451, may we nonetheless order revisions of defendants' tariffs? The answer is quite clear: yes. Section § 490(a) specifically authorizes us to order any tariff change that we determine "expedient". We need not find, before doing so, that the existing tariff is ambiguous or otherwise violative of law. In this case, the POD concludes that the existing tariffs can be made more "user friendly" and we agree.

2. § 2890

As a second ground for appeal, Greenlining argues the POD improperly construes the bill disclosure requirements of § 2890(e). Greenlining's argument focuses in part on Pacific's practice, consistent with its tariff, of aggregating charges for all local, direct-dialed business line calls. Such calls include business line usage charges for forwarding a call from a business line to the voice mailbox and for retrieving voice mailbox messages from a business line. Greenlining ignores Pacific's uncontroverted testimony that most of its switches cannot distinguish among the various reasons for business line usage. For example, whether a business customer calls another party, calls a voice mailbox, or uses call forwarding to transfer an incoming call from a business line to a voice mailbox, the calls are indistinguishable and are measured the same way.

Greenlining also inserts a new argument - that defendants are improperly "bundling" or "packaging" voicemail with call forwarding on their bills. We must disregard this argument since it rests on allegations Greenlining did not plead and which neither party addressed on the record in this proceeding. The record focuses on business line usage charges, not on the monthly charges for voicemail or call forwarding.

3. Print Advertising

Greenlining's third ground for appeal largely reiterates positions asserted in its opening and reply briefs and asks the Commission to reweigh the evidentiary record. For reasons explained above, we disregard Greenlining's new arguments about defendants' alleged bundling and packaging practices, as these issues are outside the scope of the complaint. We have, however, revised the POD's discussion of the Business and Professions Code allegations to more completely address those issues.

4. Consistency with the POD in C.98-04-004 et al.

Greenlining's fourth ground for appeal is that the POD in this proceeding is inconsistent with the POD in C.98-04-004 et al, the complaints of Utility Consumers Action Network (UCAN) and others against Pacific for abusive marketing and improper sales practices in connection with a number of residential services. Greenlining's appeal fails to recognize marked differences in the facts of each case as well as the different causes of action which frame them. Greenlining reiterates its new bundling theory in an attempt to infuse greater similarity between the two proceedings and then argues, moreover, that the facts are more egregious in this case. As we have already noted, there is no record on this issue in this case; Greenlining's post-submission appeal raises the issue for the first time.

Greenlining's fifth ground for appeal asserts that "the presiding officer erred in denying the complaint simply to avoid restitution to consumers when her underlying findings showed a violation of law and substantial monetary [damages] to consumers." (Appeal, p. 29.) Our independent review is that the POD denied the complaint because no violation of law had been shown. Having reviewed the record, including the appeal and request for review, we conclude that the denial was proper.

Findings of Fact

1. PBIS' voicemail products are among the "Category III Services" tariffed in Pacific's D3 Tariff, specifically Schedule D3.2.

2. PBIS' "Series 50" voicemail is a "direct-dial message line," with a number different from the customer's business telephone line, and does not require call forwarding. However, a customer can combine call forwarding with Series 50 voicemail to transfer calls to the voice "mailbox" when the customer's business line is busy or unanswered.

3. PBIS' "Series 50 Plus" voicemail is not only a direct-dial message line, but because it includes Pacific's call forwarding service, it also transfers calls from the business line to the voice mailbox.

4. PBIS' "Series 100" voicemail must be used with call forwarding since it has the same number as the customer's business line. When the business line is busy or unanswered, calls are forwarded to the voice mailbox.

5. PBIS' "Series 100 Plus" voicemail includes Pacific's call forwarding service as well as a service called "Message Waiting Indicator."

6. Message retrieval is the same for each of these voicemail products: the customer calls a seven-digit number to gain access to the mailbox.

7. Customers can obtain a call forwarding service for use with Series 50 or Series 100 from Pacific or another "competitive local exchange carrier" (CLC).

8. The call forwarding included with Series 50 Plus or Series 100 Plus is a "complementary network service" which Pacific offers to enhanced service providers (ESPs), like PBIS.

9. Each time an incoming call is transferred from a customer's business telephone line to an associated voice mailbox, Pacific bills the transfer itself as an outgoing call on the customer's business line (a "business line usage" charge).

10. Pacific bills a call from the customer's business line to the associated voice mailbox for the purpose of retrieving any messages as an outgoing business call (a "business line usage" charge).

11. Charges for call forwarding and for message retrieval from a business telephone line are assessed at the rates in Pacific's A5 Tariff, specifically Schedule A5.2.

12. Call forwarding usage charges are described in Pacific's A5 Tariff, specifically Schedules A5.4 and A5.11.

13. A business customer who labored thorough Pacific's A5 and D3 tariffs could piece together the total package of costs for ordering a voice mailbox from PBIS and using it.

14. The relevant portions of the A5 and D3 tariffs are not user friendly in several respects:

a. While the D3 tariff discussion of necessary equipment is very clear, the discussion of necessary and optional call forwarding services is less explicit.

b. The D3 tariff does not expressly advise that capitalized terms such as "Call Forwarding" are the names of products or services that PBIS and Pacific offer, and that descriptions and rates for them are listed in other Pacific tariffs.

c. The D3 tariff does not readily distinguish between "generic" call forwarding available from CLCs and Pacific's call forwarding service.

d. The D3 tariff makes no express mention of the message retrieval process; consequently any intended cross-reference to the business line usage rates in the A5 tariff (Schedule A5.2) is obscure.

15. Direct mail predominated among the print advertising PBIS used to market voicemail between 1995 and 1998, but only a small portion of sales is attributable to direct mail.

16. Prior to 1998, PBIS did not routinely include business line usage disclosures in its direct mail.

17. Defendants' claim that voicemail (i.e., the voice mailbox) is not usage sensitive is technically accurate.

18. Customers can only subscribe to voicemail by talking with a Pacific or PBIS customer service representative.

19. Defendants' customer service representatives are trained to make disclosures of business line usage charges at the time of sale, and their performance is monitored.

20. Greenlining's witness Gamboa relied upon his residential sales experience as a Pacific employee more than 20 years ago when he testified that pressure to make sales discourages customer sales representatives from making disclosures.

21. Following a voicemail sale, defendants' customer service representatives are trained to send the customer "sales collateral" which include disclosures of business line usage charges.

22. Greenlining's survey attempts to impose a subjective test upon what ultimately must be an objective assessment.

23. Greenlining's survey respondents were not qualified in any way and we do not know if they actually purchase business telecommunications services.

24. The print advertising shown to Greenlining's survey respondents contains no disclosures.

25. Five business voicemail customer witnesses were unaware that any business line usage charges are associated with voicemail and could not remember any oral or written disclosures.

26. None of the customers stated they had received PBIS' direct mail solicitations or subscribed to voicemail on the basis of those advertisements.

27. Several of the customers were not in the position to receive one or both of the disclosures.

28. If after receipt of the sales collateral a customer does not want a service or product like voicemail, defendants' customer service representatives are trained to remove it from the customer's account and adjust all recurring and non-recurring charges.

29. There is no reference, or cross-reference, to business line usage charges on the portion of the bill which contains PBIS' monthly voicemail charge.

30. There is no reference to the inclusion of call forwarding charges or mailbox retrieval charges in Pacific's direct-dialed call summary.

31. Business customers have measured rate service, and Pacific's A5.2 local exchange tariff provides that local direct-dialed charges (i.e., for local, extended area, and Zones 1 and 2 calls) are summarized on the bill.

32. Under defendants' current billing format, a customer who is unaware of the business line usage charges associated with voicemail would not be apprised they exist when he or she reviews the bill.

33. At present, defendants do not have the capability to separate out those local direct-dialed charges attributable to call forwarding and mailbox message retrieval from other local direct-dialed charges.

Conclusions of Law

1. The relevant portions of Pacific's A5 and D3 tariffs are neither unjust and unreasonable, within the meaning of § 451, nor ambiguous as a matter of law. The tariffs meet a bare minimum level of drafting competency.

2. Revision of the relevant portions of defendants' A5 and D3 tariffs is warranted, nonetheless, to make them clearer and less cumbersome.

3. Revision of the relevant portions of defendants' A5 and D3 tariffs, and keeping them current, will not result in undue administrative burden.

4. It is defendants' business practice to make disclosures of business line usage charges associated with voicemail orally at the time of sale and in writing via the sales collateral sent afterwards.

5. It is defendants' business practice to monitor their sales representatives' performance.

6. In reliance upon Evidence Code § 1105, we infer defendants routinely follow these business practices. It is not certain, but merely more likely than not, that defendants followed their business practices.

7. Greenlining's survey is of limited value as proof.

8. The testimony of the five customers is credible but is insufficient to rebut evidence that defendants routinely follow their business practices.

9. Because defendants' print advertisements are technically accurate and because defendants' business practices require additional disclosures, we conclude defendants have minimally complied with § 2896(a).

10. Greenlining has not established a violation of Pacific's Tariff Rule 12 in this proceeding.

11. Defendants' billing format does not violate § 2890(e).

12. Revisions of defendants' billing format is warranted, nonetheless, to improve the quality of the information provided to customers.

13. Greenlining abandons its separate cause of action under §17500 and relies on § 17200, which defines unfair competition to include deceptive, untrue, or misleading advertising under Bus. & Prof. Code § 17500.

14. We do not, in this proceeding, adjudicate Greenlining's claim under Bus. & Prof. Code § 17200.

15. In order to ensure expeditious compliance with the ordering paragraphs, this decision should be effective immediately.

ORDER

IT IS ORDERED that:

1. Pacific Bell and Pacific Bell Information Services (Defendants) shall prepare revisions of their A5 and D3 tariffs to provide greater clarity on the points identified in Finding of Fact 14. Defendants shall submit their proposed revisions by advice letter within 60 days of the effective date of this decision.

2. Defendants shall ensure up-front disclosure of all business line usage charges associated with voicemail is made in all further voicemail promotions, written or otherwise, as well as in all sales contacts with customers.

3. Defendants shall ensure all disclosures of business line usage charges associated with voicemail are made in clear, unambiguous language and shall avoid explanations which use technical jargon or unexplained technical names.

4. Defendants shall ensure that their future training of customer service representatives on the business line usage charges associated with voicemail is consistently comprehensive and uniformly followed.

5. Defendants shall ensure that disclosure of all business line usage charges associated with voicemail is made not only at the time a customer first applies for voicemail but also every time a customer moves, changes, or adds to the voicemail and the services associated with it.

6. Defendants shall revise their bill format, as follows:

7. Defendants shall submit revisions responsive to Ordering Paragraph 6 to the Director of the Telecommunications Division, within 30 days of the effective date of this decision, for compliance review and approval. Upon approval, defendants shall use the revised bill format for all billings, beginning with the first billing cycle practicable.

8. The claims based on alleged violation of Public Utilities Code and Tariff rule 12 are denied. The Commission declines to adjudicate the claim brought pursuant to Business & Professions. Code § 17200.

9. This proceeding is closed.

This order is effective today.

Dated April 19, 2001, at San Francisco, California.

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