The Viability of Telecommunications Litigation in Light of Case Precedent Limiting Consumer Remedies
Posted: 22 Mar 2014
Date Written: March 21, 2014
Many advocates for less intrusive government oversight of telecommunications support the migration from regulation by an expert agency to the use of judicial remedies largely guided by antitrust/competition policy principles. They believe that reviewing courts can resolve disputes after they have occurred in lieu of having vigilant regulatory agencies like the Federal Communications Commission (“FCC”) available to anticipate and resolve problems before they become acute. Such ex post remedies occur when courts apply legal precedent not necessarily tailored to specific telecommunications cases and controversies.
Advocates for retaining so-called ex ante regulation believe that an expert agency remains essential particularly in light of fast changing market conditions and technological innovations that may not promote sufficiently robust facilities-based competition. They also note that courts have decided to reduce opportunities for consumers to seek remedies by limiting rights to bring suit and to form a class of similarly harmed parties. Additionally they cite case precedent where courts offer no additional competitive safeguards if the expert regulatory agency concludes that rising competition justifies streamlining or eliminating safeguards.
This paper will concentrate on the impact of four Supreme Court cases with an eye toward assessing whether ex post review by courts can provide a suitable alternative to FCC regulation and dispute resolution. In Verizon Communications, Inc. v. Law Office of Curtis V. Trinko, LLP, 540 U.S. 398 (2004) the Supreme Court limited the right of individual consumers to have standing, i.e., the basic right to bring an antitrust claims against a common carrier, telecommunications service provider. Two later cases, AT&T Mobility v. Concepcion, 563 U.S. 321 (2011) and Comcast Corp. v. Behrend, 569 U.S. ____, 133 S. Ct. 1426 (2013) substantially restrict whether and how class action law suits can pursue a remedy based on similar types of harm besetting the entire group of plaintiffs. Additionally Pacific Bell Telephone Co., v. Linkline Communications, Inc., 555 U.S. 438 (2009) largely cuts off substantive antitrust jurisdiction by courts on the simple premise that if the FCC decides that a carrier has no duty to deal, based on a finding of effective competition, then antitrust remedies are unnecessary and largely unavailable.
The paper concludes that courts have little expertise in telecommunications, but willingly find procedural vehicles to preempt legal remedies and even the right of aggrieved parties to receive a hearing. While other nations have bolstered ex post review and the power to remedy anticompetitive practices, the paper finds a distinct unwillingness of courts to provide an appellate forum. The paper concludes that deregulatory advocates can still achieve their goals by supporting the continuing availability of ex ante regulation in light of the FCC’s frequent predisposition to streamline and deregulate.
Keywords: antitrust, competition policy, ex ante regulation, ex post judicial review, consumer protection
JEL Classification: K23, L82, L96, L98
Suggested Citation: Suggested Citation