COM/LYN/mak ALTERNATE DRAFT H-7a

8/3/2000

Decision ALTERNATE DRAFT DECISION OF PRESIDENT LYNCH (Mailed 7/20/00)

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Application For Authority for AppliedTheory Corporation to Acquire Control of CRL Network Services, Inc. (U-5960-C), a California Corporation, Pursuant to Article 6 of Chapter 4 of the California Public Utilities Code

Application 00-04-015 (Filed April 4, 2000)

OPINION

1. Summary

This decision denies an application seeking retroactive Commission approval of the transfer of control of CRL Network Services, Inc. (CRL) to AppliedTheory Corporation (ATC). ATC acquired control of CRL on January 5, 2000. An unverified application for approval of that transaction was filed on March 2, 2000, and a complete application was re-filed on April 4, 2000. Public Utilities Code sections 852 and 854 prohibit companies from purchasing stock in, and acquiring control of, regulated utilities such as CRL without pre-approval by this Commission. "Any... acquisition without that prior authorization shall be void and of no effect." (Pub. Util. Code § 854.) Because the statute explicitly prohibits ATC's acquisition of CRL and renders the transaction void, we are without authority to approve it.