WASHINGTON-A Federal Communications Commission ruling on liability could be issued within weeks, with the completion of a staff proposal that is expected to steer clear of specific litigation issues and instead provide general guidance for state courts evaluating consumer claims against wireless carriers.
“Our goal is to provide some legal clarification … about what is and what is not pre-empted,” said an FCC official.
In 1993, Congress pre-empted states from rate and entry regulation of commercial wireless carriers. States, however, still retain jurisdiction over terms and conditions of commercial wireless services.
The issue is now squarely before courts across the country.
Mobile-phone firms sued by angry consumers argue as a standard defense that state courts cannot award monetary damages because to do so would invariably affect rates charged to subscribers, something barred by the 1993 law.
The Wireless Consumer’s Alliance says that is an overly broad interpretation of the law that works against consumers. Last July, WCA asked the FCC to rule the 1993 law does not preclude state courts from awarding monetary relief against wireless carriers for violating consumer protection laws that prohibit false advertising and other fraudulent business practices.
With the growing popularity of mobile phones and the accompanying customer complaints, the stakes for mobile-phone industry are huge. About a week ago, The Des Moines Register reported the Iowa attorney general’s office had received hundreds of complaints about alleged overcharges, gaps in coverage areas and other matters.
California state regulators say they’ve heard from scores of any wireless customers and are looking into the matter.
The attorneys general of California, Connecticut and Wisconsin and Texas public utility regulators told the FCC they supported WCA’s stance.
In recent weeks, mobile-phone firms and the Cellular Telecommunications Industry Association have been meeting with FCC officials. Their defense: Courts agree with the industry on the broad reach of federal pre-emption of states.
“Numerous federal and state courts have rejected state court claims for damages against carriers where the award of damages would effectively constitute impermissible state regulation,” CTIA told the FCC late last month.
A federal appeals court in California ruled early this month that the 1993 law shields GTE Mobilnet from liability for rounding charges up to the nearest minute. But the court also said the 1993 law does do not pre-empt a plaintiff from suing in state court for alleged failure to disclose a particular rate or practice.
The FCC in a November 1999 decision involving Southwestern Bell Mobile Systems Inc. (now SBC Communications Corp.), ruled much the same way. The agency said billing information, practices and disputes that could fall under state contract or consumer-fraud laws fall within the state’s purview.
“Our intent is to provide some clarification that will allow this sort of wrangling to be minimized,” said the FCC official.
