8. Prior Commission Cases

As early as 1998, the Commission recognized that customers were incurring toll charges on their telephone bills as a result of connecting to their Internet provider. On March 2, 1998, the Commission issued a consumer advisory entitled "How to Avoid Unexpected Toll Charges on Your Phone Bill When You Access the Internet." The advisory stated:

[O]ur Consumer Affairs Branch wants you to know that it has received numerous complaints from customers with very large and unexpected telephone bills from their local phone company for calls they assumed were local, and therefore free.

In most instances, consumers either received incorrect information from their Internet service provider about the number to use to access the Internet, or assumed the calls were local because they did not have to dial a "1" first. (In many parts of California, it is not necessary to enter the number "1" before dialing certain toll calls.)

While a local number may be provided and stored in your computer's dial-up program, a problem can also arise if the number is busy and your computer dials an alternate number. If the alternate number is also not a local number, you will end up paying toll charges.

On December 7, 2000, the Commission dealt with the complaint of a consumer who alleged that he had been charged $741 for calls to his ISP when previous calls to the same number had been toll-free. (Mitchell v. Pacific Bell (2000) D.00-12-010.) The customer alleged that a split in the existing area code had caused the access number to become a toll call. The Commission found that the area code split had not caused the problem and concluded instead that:

Complainant simply programmed his computer to dial-up an ISP outside his local calling area, resulting in a local toll call whenever he accessed the Internet. Pacific Bell should not be held liable for its customers' selection of Internet service providers outside their local calling area. (D.00-12-010, at 2-3.)

The Mitchell case was an informal "Expedited Complaint Procedure" (ECP) case. While it is not binding as precedent pursuant to Rule 13.2(i) of the Rules of Practice and Procedure, it and other ECP cases are noted here primarily to indicate the prior history of these matters before the Commission.

Since the Mitchell decision, the Commission has found against the telephone company and in favor of consumers in virtually every complaint alleging unauthorized toll charges for calls to ISP access numbers that the consumers thought were local calls.

In Higginbotham v. Pacific Bell (2002) D.02-08-069, the Commission consolidated five complaint cases and found that when Pacific Bell in the year 2000 eliminated local and toll prefix information in the front of its white pages, it unreasonably restricted the means by which subscribers could determine whether an ISP access number was a local call or a toll call. In the five consolidated cases,⁶ the Commission found that the subscribers had sought unsuccessfully to check ISP access numbers against local toll prefix information that was no longer in the white pages. The Commission in D.02-08-069 required Pacific Bell to resume publication of local and toll prefix information and directed removal of the toll charges in dispute.

In Byrnes v. Pacific Bell (2002) D.02-11-060, another ECP case, the Commission on much the same reasoning required removal of toll charges of $585 against the complainant, concluding:

The facts presented here indicate a serious problem in regard to automatic direct-dialed calls from a computer to an ISP. Because the dial-up is automatic, the user is not alerted to the possibility that the dial-up number is a local toll call rather than a local call....

Pacific Bell's argument that complainant's recourse is with his ISP has no merit. Pacific Bell has made it difficult, inconvenient, and impracticable to get accurate information distinguishing local calls from local toll calls. This information, which at one time was provided in its telephone book, has been deleted from the telephone books with the notation to call the operator. But, as we have found, calling the operator often results in misinformation. (Byrnes, supra, at 3.)

In three recent ECP cases, the Commission followed the reasoning in Higginbotham and Byrnes to order Pacific Bell to remove ISP toll charges of $435 against complainant Ellen Shing (D.03-04-012), $389 against complainant Michael Klein (D.03-04-013), and $314 against complainant Robert Rycerski (D.03-04-014). Pacific Bell sought rehearing of these decisions on grounds that the complainants had not alleged that they tried to obtain prefix information from local directory white pages. Similarly, Pacific Bell disputed a conclusion in those decisions that it had the technical expertise to fix the problem.

In its rehearing decisions, the Commission agreed with Pacific Bell that the record in these three cases did not support conclusions that the complainants were disadvantaged by the absence of information in the white pages or that Pacific Bell had technical expertise to fix the problem. Nevertheless, we affirmed the results of those decisions, concluding that complainants had shown by a preponderance of evidence that they had taken reasonable steps to be sure that their ISP access number was a toll-free call. We held:

[T]he problem experienced by Complainant is not unique and the Commission has received numerous similar complaints. Because both the phone companies and the ISPs are the entities that stand to benefit when a customer is billed for a local toll call instead of a local call when accessing his or her ISP, the Commission believes the responsibility for remedying the situation lies with the phone companies and the ISPs. They are the beneficiaries of the customers' dollars for dial-up Internet access. Individual customers that the Commission finds to be credible in terms of whether they correctly programmed their computers to dial local numbers should not be held responsible for this situation, which appears to be beyond their ability to control or prevent.

Moreover, a telecommunications carrier, like other public utilities, is obliged to provide reasonable service. As demands on the telecommunications system change over time, the carrier must adapt to meet those demands reasonably. SBC has not shown that it has taken reasonable steps to advise customers, such as the Complainant, of unusual toll usage for Internet access purposes or how to prevent such an occurrence. Accordingly, we reject SBC's argument that Complainant should be required to pay for the local toll calls in dispute, where we have found it credible that Complainant took all reasonable steps to avoid dialing a local toll number. (Shing v. SBC Pacific Bell (2003) D. 03-09-024, at 4-5.)

The record in this case suggests that while some complaints about toll charges for ISP connections are made to this Commission, the great majority of such complaints involving AOL go to SBC and AOL. According to UCAN, its data requests to AOL produced "hundreds of pages" of complaints by customers who alleged that they did not dial the access numbers for which they were billed. UCAN states that SBC produced records of 165 informal complaints about such billing since the time this complaint was filed. UCAN itself states that it received 30 complaints (including one by a Commission telecommunications supervisor) in the past three years. UCAN states that, in light of SBC's subsequent survey that uncovered more than 2,000 such incidents in just six weeks, "it is clear that these...records represent the tip of the iceberg" of complaints about ISP toll charges. (UCAN direct testimony, at 17.)