Procedural Background

In the order instituting this investigation, the Commission stated that it had received a declaration from the CSD staff that alleged that:

· From January to July 1999, USP&C billed for companies responsible for 30% of all complaints regarding billing of unauthorized charges reported to Pacific Bell;

· During 1998 and from January to August 1999, 52% of all amounts billed by USP&C was refunded to customers at the customers' request, indicating to staff that an excessive amount of unauthorized billing was occurring;

· USP&C had failed to respond to staff's data request for over five months;

· USP&C had not identified all the companies for which it was billing; and

· Products and services being billed were not clearly and adequately described on customers' bills.

Based on these factual assertions, CSD further alleged that: (1) USP&C had violated § 2889.9 by failing to provide CSD with requested information, (2) USP&C had violated § 2890 by failing to provide "clear and concise descriptions of all products being billed," and (3) USP&C had violated § 2890 by failing to include on the bill the "name of the party responsible for generating the charge."

On December 1, 1999, the assigned Commissioner and Administrative Law Judge (ALJ) held a prehearing conference (PHC). The respondent appeared as did the Commission's Consumer Services Division (CSD). Pacific Bell, the Latino Issues Forum, and the Greenlining Institute also submitted formal appearances as intervenors at the PHC.

On December 3, 1999, the Assigned Commissioner issued his scoping memo for the proceeding. The scoping memo set out the procedural schedule and indicated that the assigned ALJ would be the presiding officer.

On January 7, 2000, CSD and USP&C filed a joint motion seeking Commission approval of a settlement agreement between them, covering only those issues arising from CSD's allegations that USP&C had violated § 2889.9(f) by failing to provide Commission staff with requested information. The settlement agreement is Attachment A to this decision. The settlement agreement provides that USP&C will pay a fine of up to $114,000 to the General Fund of the State of California. Upon Commission approval of the settlement agreement, USP&C will immediately pay $43,000. The remaining amount, $71,000, would be suspended pending USP&C's compliance with additional data requests in this proceeding.

On February 17, 2000, both CSD and USP&C filed motions stating, as to the matters not covered by the settlement, that there were no disputed issues of material fact. Each party sought a judgment in its favor without hearings. This matter having been heard, both motions are moot and, therefore, are denied.

On April 11 and 12, 2000, the presiding officer conducted evidentiary hearings. CSD presented its Supervisor of the Utility Enforcement Unit, Mark Clairmont, who testified regarding the results of his investigation of USP&C. USP&C presented its Telco Relations Manager, Terry Stock. Stock is an employee of BMSI, Inc., a firm that USP&C has contracted with for daily management functions. She testified that USP&C complied with all requirements for billing imposed by LECs.

Following the conclusion of hearings, the parties, other than Pacific Bell, filed initial briefs, and all parties filed reply briefs.