The Other Merger Decisions Were Not Precedential

WorldCom bases its Motion on several Commission decisions exempting mergers from § 854(b) and (c) analysis.⁵ Those decisions, WorldCom asserts, have three things in common: They exempt mergers from §§ 854(b) and (c) unless (1) traditionally regulated telephone systems are involved, (2) the Commission exercises traditional rate of return ratemaking regulation over the parties, and (3) the parties have grown with a captive ratepayer base and guaranteed franchise territory.⁶

However, in each of the cited decisions, the Commission took great pains to avoid establishing a hard-and-fast rule. Even in granting the MCI-WorldCom merger - where the Commission perhaps most directly suggested a three-part test - the Commission reasserted its "express policy to grant § 853(b) exemptions from § 854(b) and (c) to merger transactions involving nontraditionally regulated carriers on a case-by-case basis only . . . ." ⁷ Likewise, in passing on the MCI-British Telecom (BT) merger, the Commission stated,

While there may be much merit to the consideration of a blanket exemption from PU Code § 854(b) and (c) for NDIECs, no such blanket exemption has been granted. Instead, any such blanket exemption should be subjected to a separate generic rulemaking with full opportunity to comment and, if we find the statute ambiguous regarding its application to NDIECs, with a full review of the legislative history of the statute. Until convinced otherwise, we stand by our determination that the plain meaning of § 854(b) prevails . . . . The same is true of its counterpart § 854(c). We will not go past the plain meaning of those sections to determine legislative intent with respect to NDIECs as a class of public utility.⁸

WorldCom's failure to acknowledge the Commission's limitations on the precedential value of its decisions granting exemptions from §§ 854(b) and (c) stands in stark contrast to its emphasis of the lack of precedential value in a decision applying §§ 854(b) and (c). WorldCom stresses that the Commission's application of §§ 854(b) and (c) to the AT&T/McCaw merger was expressly deemed not to be precedential.⁹ WorldCom cannot have it both ways. The record demonstrates that the cases both granting and denying application of §§ 854(b) and (c) do not bind the Commission in other cases.