[Federal Register Volume 61, Number 249 (Thursday, December 26, 1996)]
[Proposed Rules]
[Pages 67978-67990]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32322]



[[Page 67978]]

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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 0 and 1

[CC Docket No. 96-238; FCC 96-460]


Formal Complaints Filed Against Common Carriers

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: The Commission adopted a Notice of Proposed Rulemaking 
(``NPRM'') seeking comment on proposed changes to the rules for 
processing formal complaints filed against common carriers. The NPRM 
proposes rules necessary to implement certain provisions contained in 
the 1996 Act that prescribe deadlines ranging from 90 days to 5 months 
for resolution of certain types of complaints against common carriers. 
The proposed rules require or encourage complainants and defendants to 
engage in certain pre-filing activities, change service requirements, 
modify the form of initial pleadings, shorten filing deadlines, 
eliminate certain pleading opportunities that do not appear useful or 
necessary, and eliminate or modify the discovery process.

DATES: Written comments by the public on the NPRM and the proposed and/
or modified information collections are due January 6, 1996. Reply 
comments are due on January 31, 1996. Written comments by the Office of 
Management and Budget (OMB) on the proposed and/or modified information 
collections on or before February 24, 1997.

ADDRESSES: Comments and reply comments should be sent to the Office of 
the Secretary, Federal Communications Commission, 1919 M Street, N.W., 
Suite 222, Washington, D.C. 20554, with a copy to Anita Cheng, Federal 
Communications Commission, Enforcement Division, 2025 M Street, N.W., 
Room 6008, Washington, D.C. 20554. Parties should also file one copy of 
any documents filed in this docket with the Commission's copy 
contractor, International Transcription Services, Inc., 2100 M Street, 
N.W., Suite 140, Washington, D.C. 20037. In addition to filing comments 
with the Secretary, a copy of any comments on the information 
collections contained herein should be submitted to Dorothy Conway, 
Federal Communications Commission, Room 234, 1919 M Street, N.W., 
Washington, DC 20554, or via the Internet to [email protected] and to 
Timothy Fain, OMB Desk Officer, 10236 NEOB, 725--17th Street, N.W., 
Washington, DC 20503 or via the Internet to [email protected].

FOR FURTHER INFORMATION CONTACT: Anita Cheng, Enforcement Division, 
Common Carrier Bureau, (202) 418-0960. For additional information 
concerning the information collections contained in the NPRM contact 
Dorothy Conway at (202) 418-0217, or via the Internet at 
[email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's NPRM 
in CC Docket No. 96-238, adopted on November 26, 1996 and released 
November 27, 1996. The full text of the NPRM is available for 
inspection and copying during normal business hours in the FCC 
Reference Center, Room 239, 1919 M Street, N.W., Washington, D.C. The 
complete text of this decision may also be purchased from the 
Commission's duplicating contractor, International Transcription 
Services, 2100 M Street, N.W., Suite 140, Washington, D.C. 20037 (202) 
857-3800.

Paperwork Reduction Act

    The NPRM contains a proposed or modified information collection. 
The Commission, as part of its continuing effort to reduce paperwork 
burdens, invites the general public and the Office of Management and 
Budget (OMB) to comment on the information collections contained in the 
NPRM, as required by the Paperwork Reduction Act of 1995, Public Law 
No. 104-13. Public and agency comments are due at the same time as 
other comments on the NPRM; OMB notification of action is due February 
24, 1997. Comments should address: (a) whether the proposed or modified 
information collection is necessary for the proper performance of the 
functions of the Commission, including whether the information shall 
have practical utility; (b) the accuracy of the Commission's burden 
estimates; (c) ways to enhance the quality, utility, and clarity of the 
information collected; and (d) ways to minimize the burden of the 
collection of information on the respondents, including the use of 
automated collection techniques or other forms of information 
technology.
    OMB Control Number: 3060-0411.
    Title: Formal Complaints Against Common Carriers, Sections 1.720 - 
1.735.
    Type of Review: Revised collection.
    Respondents: Individuals or households; business or other for-
profit, including small business; not-for-profit institutions; state, 
local or tribal government.

----------------------------------------------------------------------------------------------------------------
                                                                                   Est. time per                
                         Section/Title                              Number of        response      Total annual 
                                                                   respondents       (hour(s))    burden (hours)
----------------------------------------------------------------------------------------------------------------
a. Designation of Agent for Service............................            4,965              .5         2,482.5
b. Joint Statement of Stipulated Facts and Pleading Content                                                     
 Requirements..................................................              760               3           2,280
c. Orders Memorializing Rulings at Status Conferences..........              760               1             760
d. Complaint Intake Form.......................................              760              .5             380
                                                                                                 ---------------
    Total Annual Burden:.......................................  ...............  ..............         5,902.5
----------------------------------------------------------------------------------------------------------------

    Estimated cost per respondent:
0.
    Needs and Uses: The information has been and is currently being 
used by the FCC to determine the sufficiency of complaints and to 
resolve the merits of disputes between the parties.
    The NPRM proposes to require all carriers subject to the 
Communications Act of 1934, as amended, to file in writing and 
electronically, a designation of agent for service of process with the 
Commission, to facilitate service of process in all Commission 
proceedings.
    Regarding changes to the pleading requirements, the NPRM proposes 
that complaints must contain complete statements of relevant facts and 
supporting documentation; certification that each complainant has 
discussed the possibility of settlement with each defendant prior to 
filing of the complaint; copies or descriptions of documents relevant 
to the complaint; name, address and telephone number of all individuals 
with information relevant to the complaint; a computation for any 
damages claimed. The NPRM also proposes that answers must be filed 
within 20 days of service of the formal complaint and must contain 
complete statements of relevant facts and supporting documentation; 
copies or descriptions of documents

[[Page 67979]]

relevant to the pleadings; name, address and telephone number of all 
individuals with information relevant to the pleadings; and proposes to 
prohibit general denials. The NPRM proposes to require all pleadings to 
be accompanied by copies of relevant tariffs. The NPRM proposes to 
prohibit replies unless authorized by the Commission and when 
permitted, replies must contain copies or descriptions of documents 
relevant to the pleadings; name, address and telephone number of all 
individuals with information relevant to the pleadings. The NPRM 
proposes to require all motions seeking Commission orders must be 
accompanied by proposed orders in both hard copy and on computer disk. 
The NPRM proposes to prohibit amendments to complaints to add new 
claims or requests for relief. The NPRM further requires parties to 
submit a joint statement of proposed stipulated facts and key legal 
issues within 5 days after the answer is filed, as well as requiring 
all relevant facts and documentation to be contained in each pleading. 
These proposals will promote agreement on a significant number of 
disputed facts and legal issues, as well as serving to better inform 
the Commission of the factual and legal areas in dispute.
    The NPRM also proposes to require parties to memorialize jointly, 
in writing, Commission rulings made in a status conference and to 
submit such writing, within 24 hours, to the Commission staff person 
who made such rulings. This proposal would remove the burden of 
memorializing oral rulings made in status conferences from the 
Commission to the parties.
    Finally, the NPRM proposes to require a complainant to submit a 
completed intake form with its formal complaint to indicate that the 
complaint meets the threshold requirements for stating a cause of 
action. This requirement would help to prevent the filing of 
procedurally insufficient complaints.

Initial Regulatory Flexibility Analysis

    Pursuant to Section 603(a) of the Regulatory Flexibility Act, 5 
U.S.C. Section 603(a) (1981), the Commission concluded that the 
proposals in the NPRM may have some economic impact on small business 
entities, due to the proposals to require or encourage complainants and 
defendants to engage in certain pre-filing activities, change service 
requirements, modify the form of initial pleadings, shorten filing 
deadlines, eliminate certain pleading opportunities that do not appear 
useful or necessary, and eliminate or modify the discovery process. 
Public comment is requested on the Initial Regulatory Flexibility 
Analysis set forth fully in the NPRM. These comments must be filed in 
accordance with the same filing deadlines set for comments on the other 
issues in this NPRM but they must have a separate and distinct heading 
designating them as responses to the Initial Regulatory Flexibility 
Analysis.
    Need for and Objectives of the Proposed Rules: The Commission is 
issuing this Complaint NPRM to implement certain complaint provisions 
contained in the Telecommunications Act of 1996 and to improve 
generally the speed and effectiveness of its formal complaint process.
    Legal Basis: The Complaint NPRM is adopted pursuant to Sections 1, 
4(i), 4(j), 207 - 209, 260, 271, 274, and 275 of the Communications Act 
of 1934, as amended, 47 U.S.C. Secs. 151, 154(i), 154(j), 207 - 209, 
260, 271, 274, 275.
    Description and Number of Small Entities Which May be Affected: The 
proposals in this proceeding may have a significant impact on a 
substantial number of small businesses as defined by Section 601(3) of 
the Regulatory Flexibility Act. Under the Small Business Act, a ``small 
business concern'' is one that: (1) is independently owned and 
operated; (2) is not dominant in its field of operation; and (3) meets 
any additional criteria established by the Small Business 
Administration (SBA). SBA has defined a small business for Standard 
Industrial Classification (SIC) categories 4812 (Radiotelephone 
Communications) and 4813 (Telephone Communications, Except 
Radiotelephone) as those which have fewer than 1,500 employees.

1. Telephone Companies (SIC 481)

    Estimate of Potential Complainants that may be Classified as Small 
Businesses. Section 208(a) provides that formal complaints against a 
common carrier may be filed by ``[a]ny person, any body politic or 
municipal organization.'' The FCC has no control as to the filing 
frequency of complaints, nor as to the parties that will file 
complaints. The filing of complaints depends entirely upon the 
complainant's perception that it possesses a cause of action against a 
common carrier subject to the Communications Act of 1934, as amended, 
and it is the complainant's decision to file its complaint with the 
FCC. Therefore the Commission is unable at this time to estimate the 
number of future complainants that would qualify as small business 
concerns under SBA's definition.
    Estimate of Potential Defendants that may be Classified as Small 
Businesses. The United States Bureau of the Census (``the Census 
Bureau'') reports that, at the end of 1992, there were 3,497 firms 
engaged in providing telephone services, as defined therein, for at 
least one year. This number encompasses a broad category which contains 
a variety of different subsets of carriers, including local exchange 
carriers, interexchange carriers, competitive access providers, 
cellular carriers, mobile service carriers, operator service providers, 
pay telephone operators, PCS providers, covered SMR providers, and 
resellers. It seems certain that some of those 3,497 telephone service 
firms may not qualify as small entities or small incumbent LECs because 
they are not ``independently owned and operated.'' For example, a PCS 
provider that is affiliated with an interexchange carrier having more 
than 1,500 employees would not meet the definition of a small business. 
It seems reasonable to conclude, therefore, that fewer than 3,497 
telephone service firms are small entity telephone service firms or 
small incumbent LECs that may be affected by this Order. The Commission 
seeks comment on this conclusion. The Commission estimates below the 
potential defendants affected by this order by service category. The 
Commission seeks comment on these estimates.
    Wireline Carriers and Service Providers. SBA has developed a 
definition of small entities for telephone communications companies 
other than radiotelephone (wireless) companies. The Census Bureau 
reports that, there were 2,321 such telephone companies in operation 
for at least one year at the end of 1992. All but 26 of the 2,321 non-
radiotelephone companies listed by the Census Bureau were reported to 
have fewer than 1,000 employees. Thus, even if all 26 of those 
companies had more than 1,500 employees, there would still be 2,295 
non-radiotelephone companies that might qualify as small entities or 
small incumbent LECs. Although it seems certain that some of these 
carriers are not independently owned and operated, the Commission is 
unable at this time to estimate with greater precision the number of 
wireline carriers and service providers that would qualify as small 
business concerns under SBA's definition. Consequently, the Commission 
estimates that there are fewer than 2,295 small entity telephone 
communications companies other than radiotelephone companies that may 
be affected by the decisions and rules adopted in this Order.
    Local Exchange Carriers. Neither the Commission nor SBA has 
developed a definition of small providers of local

[[Page 67980]]

exchange services (LECs). The closest applicable definition under SBA 
rules is for telephone communications companies other than 
radiotelephone (wireless) companies. The most reliable source of 
information regarding the number of LECs nationwide of which the 
Commission is aware appears to be the data that it collects annually in 
connection with the Telecommunications Relay Service (TRS). According 
to the Commission's most recent data, 1,347 companies reported that 
they were engaged in the provision of local exchange services. Although 
it seems certain that some of these carriers are not independently 
owned and operated, or have more than 1,500 employees, the Commission 
is unable at this time to estimate with greater precision the number of 
LECs that would qualify as small business concerns under SBA's 
definition. Consequently, the Commission estimate that there are fewer 
than 1,347 small incumbent LECs that may be affected by the decisions 
and rules adopted in this Order.
    Interexchange Carriers. Neither the Commission nor SBA has 
developed a definition of small entities specifically applicable to 
providers of interexchange services (IXCs). The closest applicable 
definition under SBA rules is for telephone communications companies 
other than radiotelephone (wireless) companies. The most reliable 
source of information regarding the number of IXCs nationwide of which 
the Commission is aware appears to be the data collected annually in 
connection with TRS. According to the Commission's most recent data, 97 
companies reported that they were engaged in the provision of 
interexchange services. Although it seems certain that some of these 
carriers are not independently owned and operated, or have more than 
1,500 employees, the Commission is unable at this time to estimate with 
greater precision the number of IXCs that would qualify as small 
business concerns under SBA's definition. Consequently, the Commission 
estimates that there are fewer than 97 small entity IXCs that may be 
affected by the decisions and rules adopted in this Order.
    Competitive Access Providers. Neither the Commission nor SBA has 
developed a definition of small entities specifically applicable to 
providers of competitive access services (CAPs). The closest applicable 
definition under SBA rules is for telephone communications companies 
other than radiotelephone (wireless) companies. The most reliable 
source of information regarding the number of CAPs nationwide of which 
the Commission is aware appears to be the data that it collects 
annually in connection with the TRS. According to the Commission's most 
recent data, 30 companies reported that they were engaged in the 
provision of competitive access services. Although it seems certain 
that some of these carriers are not independently owned and operated, 
or have more than 1,500 employees, the Commission is unable at this 
time to estimate with greater precision the number of CAPs that would 
qualify as small business concerns under SBA's definition. 
Consequently, the Commission estimates that there are fewer than 30 
small entity CAPs that may be affected by the decisions and rules 
adopted in this Order.
    Operator Service Providers. Neither the Commission nor SBA has 
developed a definition of small entities specifically applicable to 
providers of operator services. The closest applicable definition under 
SBA rules is for telephone communications companies other than 
radiotelephone (wireless) companies. The most reliable source of 
information regarding the number of operator service providers 
nationwide of which the Commission is aware appears to be the data that 
it collects annually in connection with the TRS. According to the 
Commission's most recent data, 29 companies reported that they were 
engaged in the provision of operator services. Although it seems 
certain that some of these companies are not independently owned and 
operated, or have more than 1,500 employees, the Commission is unable 
at this time to estimate with greater precision the number of operator 
service providers that would qualify as small business concerns under 
SBA's definition. Consequently, the Commission estimates that there are 
fewer than 29 small entity operator service providers that may be 
affected by the decisions and rules adopted in this Order.
    Pay Telephone Operators. Neither the Commission nor SBA has 
developed a definition of small entities specifically applicable to pay 
telephone operators. The closest applicable definition under SBA rules 
is for telephone communications companies other than radiotelephone 
(wireless) companies. The most reliable source of information regarding 
the number of pay telephone operators nationwide of which the 
Commission is aware appears to be the data that it collects annually in 
connection with the TRS. According to the Commission's most recent 
data, 197 companies reported that they were engaged in the provision of 
pay telephone services. Although it seems certain that some of these 
carriers are not independently owned and operated, or have more than 
1,500 employees, the Commission is unable at this time to estimate with 
greater precision the number of pay telephone operators that would 
qualify as small business concerns under SBA's definition. 
Consequently, the Commission estimates that there are fewer than 197 
small entity pay telephone operators that may be affected by the 
decisions and rules adopted in this Order.
    Wireless (Radiotelephone) Carriers. SBA has developed a definition 
of small entities for radiotelephone (wireless) companies. The Census 
Bureau reports that there were 1,176 such companies in operation for at 
least one year at the end of 1992. According to SBA's definition, a 
small business radiotelephone company is one employing fewer than 1,500 
persons. The Census Bureau also reported that 1,164 of those 
radiotelephone companies had fewer than 1,000 employees. Thus, even if 
all of the remaining 12 companies had more than 1,500 employees, there 
would still be 1,164 radiotelephone companies that might qualify as 
small entities if they are independently owned and operated. Although 
it seems certain that some of these carriers are not independently 
owned and operated, the Commission is unable at this time to estimate 
with greater precision the number of radiotelephone carriers and 
service providers that would qualify as small business concerns under 
SBA's definition. Consequently, the Commission estimates that there are 
fewer than 1,164 small entity radiotelephone companies that may be 
affected by the decisions and rules adopted in this Order.
    Cellular Service Carriers. Neither the Commission nor SBA has 
developed a definition of small entities specifically applicable to 
providers of cellular services. The closest applicable definition under 
SBA rules is for telephone communications companies other than 
radiotelephone (wireless) companies. The most reliable source of 
information regarding the number of cellular service carriers 
nationwide of which the Commission is aware appears to be the data that 
it collects annually in connection with the TRS. According to the 
Commission's most recent data, 789 companies reported that they were 
engaged in the provision of cellular services. Although it seems 
certain that some of these carriers are not independently owned and 
operated, or have more than 1,500 employees, the Commission is unable 
at this time to estimate with greater precision the number of cellular 
service carriers that

[[Page 67981]]

would qualify as small business concerns under SBA's definition. 
Consequently, the Commission estimates that there are fewer than 789 
small entity cellular service carriers that may be affected by the 
decisions and rules adopted in this Order.
    Mobile Service Carriers. Neither the Commission nor SBA has 
developed a definition of small entities specifically applicable to 
mobile service carriers, such as paging companies. The closest 
applicable definition under SBA rules is for telephone communications 
companies other than radiotelephone (wireless) companies. The most 
reliable source of information regarding the number of mobile service 
carriers nationwide of which the Commission is aware appears to be the 
data that it collects annually in connection with the TRS. According to 
the Commission's most recent data, 117 companies reported that they 
were engaged in the provision of mobile services. Although it seems 
certain that some of these carriers are not independently owned and 
operated, or have more than 1,500 employees, the Commission is unable 
at this time to estimate with greater precision the number of mobile 
service carriers that would qualify under SBA's definition. 
Consequently, the Commission estimates that there are fewer than 117 
small entity mobile service carriers that may be affected by the 
decisions and rules adopted in this Order.
    Broadband PCS Licensees. The broadband PCS spectrum is divided into 
six frequency blocks designated A through F. As set forth in 47 CFR 
Sec. 24.720(b), the Commission has defined ``small entity'' in the 
auctions for Blocks C and F as a firm that had average gross revenues 
of less than $40 million in the three previous calendar years. The 
Commission's definition of a ``small entity'' in the context of 
broadband PCS auctions has been approved by SBA. The Commission has 
auctioned broadband PCS licenses in Blocks A, B, and C. The Commission 
does not have sufficient data to determine how many small businesses 
bid successfully for licenses in Blocks A and B. There were 90 winning 
bidders that qualified as small entities in the Block C auction. Based 
on this information, the Commission concludes that the number of 
broadband PCS licensees affected by the decisions in this Order 
includes, at a minimum, the 90 winning bidders that qualified as small 
entities in the Block C broadband PCS auction.
    At present, no licenses have been awarded for Blocks D, E, and F of 
broadband PCS spectrum. Therefore, there are no small businesses 
currently providing these services. However, a total of 1,479 licenses 
will be awarded in the D, E, and F Block broadband PCS auctions, which 
are scheduled to begin on August 26, 1996. Of the 153 qualified bidders 
for the D, E, and F Block PCS auctions, 105 were small businesses. 
Eligibility for the 493 F Block licenses is limited to entrepreneurs 
with average gross revenues of less than $125 million. There are 114 
eligible bidders for the F Block. The Commission cannot estimate, 
however, the number of these licenses that will be won by small 
entities under this definition, nor how many small entities will win D 
or E Block licenses. Given that nearly all radiotelephone companies 
have fewer than 1,000 employees and that no reliable estimate of the 
number of prospective D, E, and F Block licensees can be made, the 
Commission assumes for purposes of this IRFA, that all of the licenses 
in the D, E, and F Block Broadband PCS auctions may be awarded to small 
entities under the Commission's rules, which may be affected by the 
decisions and rules adopted in this Order.
    SMR Licensees. Pursuant to 47 CFR Sec. 90.814(b)(1), the Commission 
has defined ``small entity'' in auctions for geographic area 800 MHz 
and 900 MHz SMR licenses as a firm that had average annual gross 
revenues of less than $15 million in the three previous calendar years. 
This definition of a ``small entity'' in the context of 800 MHz and 900 
MHz SMR has been approved by the SBA. The rules adopted in this Order 
may apply to SMR providers in the 800 MHz and 900 MHz bands that either 
hold geographic area licenses or have obtained extended implementation 
authorizations. The Commission does not know how many firms provide 800 
MHz or 900 MHz geographic area SMR service pursuant to extended 
implementation authorizations, nor how many of these providers have 
annual revenues of less than $15 million. The Commission assumes, for 
purposes of this IRFA, that all of the extended implementation 
authorizations may be held by small entities, which may be affected by 
the decisions and rules adopted in this Order.
    The Commission recently held auctions for geographic area licenses 
in the 900 MHz SMR band. There were 60 winning bidders who qualified as 
small entities in the 900 MHz auction. Based on this information, the 
Commission concludes that the number of geographic area SMR licensees 
affected by the rule adopted in this Order includes these 60 small 
entities. No auctions have been held for 800 MHz geographic area SMR 
licenses. Therefore, no small entities currently hold these licenses. A 
total of 525 licenses will be awarded for the upper 200 channels in the 
800 MHz geographic area SMR auction. However, the Commission has not 
yet determined how many licenses will be awarded for the lower 230 
channels in the 800 MHz geographic area SMR auction. There is no basis, 
moreover, on which to estimate how many small entities will win these 
licenses. Given that nearly all radiotelephone companies have fewer 
than 1,000 employees and that no reliable estimate of the number of 
prospective 800 MHz licensees can be made, the Commission assumes, for 
purposes of this IRFA, that all of the licenses may be awarded to small 
entities who, thus, may be affected by the decisions in this Order.
    Resellers. Neither the Commission nor SBA has developed a 
definition of small entities specifically applicable to resellers. The 
closest applicable definition under SBA rules is for all telephone 
communications companies. The most reliable source of information 
regarding the number of resellers nationwide of which the Commission is 
aware appears to be the data that it collects annually in connection 
with the TRS. According to the Commission's most recent data, 206 
companies reported that they were engaged in the resale of telephone 
services. Although it seems certain that some of these carriers are not 
independently owned and operated, or have more than 1,500 employees, 
the Commission is unable at this time to estimate with greater 
precision the number of resellers that would qualify as small business 
concerns under SBA's definition. Consequently, the Commission estimates 
that there are fewer than 206 small entity resellers that may be 
affected by the decisions and rules adopted in this Order.

2. Cable System Operators (SIC 4841)

    Cable Systems: SBA has developed a definition of small entities for 
cable and other pay television services, which includes all such 
companies generating less than $11 million in revenue annually. This 
definition includes cable systems operators, closed circuit television 
services, direct broadcast satellite services, multipoint distribution 
systems, satellite master antenna systems and subscription television 
services. According to the Census Bureau, there were 1,323 such cable 
and other pay television services generating less than $11 million in 
revenue that were in operation for at least one year at the end of 
1992.

[[Page 67982]]

    The Commission has developed its own definition of a small cable 
system operator for the purposes of rate regulation. Under the 
Commission's rules, a ``small cable company,'' is one serving fewer 
than 400,000 subscribers nationwide. Based on the Commission's most 
recent information, the Commission estimates that there were 1,439 
cable operators that qualified as small cable system operators at the 
end of 1995. Since then, some of those companies may have grown to 
serve over 400,000 subscribers, and others may have been involved in 
transactions that caused them to be combined with other cable 
operators. Consequently, the Commission estimates that there are fewer 
than 1,439 small entity cable system operators that may be affected by 
the decisions and rules adopted in this Order.
    The Communications Act also contains a definition of a small cable 
system operator, which is ``a cable operator that, directly or through 
an affiliate, serves in the aggregate fewer than 1 percent of all 
subscribers in the United States and is not affiliated with any entity 
or entities whose gross annual revenues in the aggregate exceed 
$250,000,000.'' The Commission has determined that there are 61,700,000 
subscribers in the United States. Therefore, the Commission found that 
an operator serving fewer than 617,000 subscribers shall be deemed a 
small operator, if its annual revenues, when combined with the total 
annual revenues of all of its affiliates, do not exceed $250 million in 
the aggregate. Based on available data, the Commission finds that the 
number of cable operators serving 617,000 subscribers or less totals 
1,450. Although it seems certain that some of these cable system 
operators are affiliated with entities whose gross annual revenues 
exceed $250,000,000, the Commission is unable at this time to estimate 
with greater precision the number of cable system operators that would 
qualify as small cable operators under the definition in the 
Communications Act.
    Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements: Section 1.721 of the proposed rules would 
require all complainants to complete and submit a Formal Complaint 
Intake Form with their complaints. The intake form requirement is 
designed to help complainants avoid procedural and substantive defects 
that might affect the staff's ability to quickly process complaints and 
delay full responses by defendant carriers to otherwise legitimate 
complaints. In addition, the completed form should enable the staff and 
the defendant carriers to quickly identify the specific statutory 
provisions under which relief is being sought in the complaint. Because 
the proposed form would solicit information that would be already 
contained in the body of the formal complaint, no additional 
professional skills would be necessary to complete the form.
    Potential Impact: Some of the proposed requirements in this 
Complaint NPRM may have a significant economic impact on small business 
entities. Generally, this Complaint NPRM proposes to require or 
encourage complainants and defendants to engage in certain pre-filing 
activities, change service requirements, modify the form of initial 
pleadings, shorten filing deadlines, eliminate certain pleading 
opportunities that do not appear useful or necessary, and modify the 
discovery process.
    Pre-Filing Activities and Discovery: The Commission proposes to 
require a complainant to do the following: certify that it discussed 
the possibility of settlement with the defendant carrier's 
representative(s) prior to filing the complaint and attach certain 
written documentation. The Commission seeks comment on limiting 
discovery. The Commission also seeks comment on the feasibility of 
allowing the parties to a complaint proceeding to agree among 
themselves to a cost-recovery system as a basis for facilitating the 
prompt identification and exchange of information. While these proposed 
rules may place a greater burden on a small business entity to provide 
better legal and factual support early in the process, the Commission 
tentatively concludes that it does not significantly alter the level of 
evidentiary and legal support that would be ultimately required of 
parties in formal complaint actions pursuant to the current rules. It 
may, however, make it more difficult for all complainants, including 
small business, to gather the information needed to prevail on their 
complaints. Potentially higher initial costs may be somewhat offset by 
the prompt resolution of complaints and the avoidance of protracted and 
costly discovery proceedings and briefing requirements. It has been 
noted, for example, that the overall litigation costs of ``rocket 
docket'' cases in the U.S. District Court for the Eastern District of 
Virginia are lower than the costs of cases that take longer to resolve. 
Indeed, by requiring better and more complete submissions earlier in 
the process, this proposed rule reduces the need for discovery and 
other information filings, thereby significantly reducing the burden on 
small business entities. The Commission seeks comment on this tentative 
conclusion and any other potential impact of these proposals on small 
business entities.
    Format and Content Requirements and Other Required Submissions: The 
Commission proposes to require parties to submit a joint statement of 
stipulated facts and key legal issues five days after the answer is 
filed. The Commission also proposes to require all pleadings that seek 
Commission orders, as well as the orders themselves, to contain 
proposed findings of fact and conclusions of law, with supporting legal 
analysis, and to require these submissions to be in both hard copy and 
on computer disks in ``read only'' mode and formatted in WordPerfect 
5.1 for Windows, or as otherwise directed by the staff in particular 
cases. The Commission also proposes to require the complaint, answer, 
and any authorized reply to include: (1) the name, address and 
telephone number of each individual likely to have discoverable 
information relevant to the disputed facts alleged in the pleadings, 
identifying the subjects of information; and (2) a copy of, or a 
description by category and location of all documents, data 
compilations and tangible things in the possession, custody, or control 
of the party that are relevant to the disputed facts alleged with 
particularity in the pleadings. While these proposed rules may place a 
greater burden on a small business entity to provide better legal and 
factual support early in the process, the Commission tentatively 
concludes that it does not significantly alter the level of evidentiary 
and legal support that would be ultimately required of parties in 
formal complaint actions pursuant to the current rules. It may, 
however, make it more difficult for all complainants, including small 
business, to gather the information needed to prevail on their 
complaints. Potentially higher initial costs may be somewhat offset by 
the prompt resolution of complaints and the avoidance of protracted and 
costly discovery proceedings and briefing requirements. It has been 
noted, for example, that the overall litigation costs of ``rocket 
docket'' cases in the U.S. District Court for the Eastern District of 
Virginia are lower than the costs of cases that take longer to resolve. 
Indeed, by requiring better and more complete submissions earlier in 
the process, this proposed rule reduces the need for discovery and 
other information filings, thereby significantly reducing the burden on 
small business entities. The Commission seeks comment on this

[[Page 67983]]

tentative conclusion and any other potential impact of these proposals 
on small business entities.
    Damages. The Commission proposes to allow bifurcation of liability 
and damages issues by permitting a complainant to file a supplemental 
complaint for damages after a finding of liability. In such a case, the 
Commission would defer adjudication of all damages issues until after a 
finding of liability. The Commission also proposes to require, in 
certain cases after liability has been found, defendants to place a sum 
of money in an interest-bearing escrow account, to cover part or all of 
the damages for which they may be found liable. While the bifurcation 
of liability and damages issues may require small business entities to 
postpone litigation of damages issues, any increased costs will be 
somewhat offset by the prompt resolution of the liability issues in 
complaints and the avoidance of protracted and costly discovery 
proceedings and briefing requirements in the initial proceeding. The 
proposal to require defendants to place a sum of money in an interest-
bearing escrow account may have a significant economic impact on 
defendants that are small business entities without sufficient funds. 
The Commission seeks comment on this tentative conclusion and any other 
potential impact of these proposals on small business entities.
    Significant Alternatives to the Proposed Rules Which Minimize 
Significant Economic Impact on Small Entities and Accomplish Stated 
Objectives: The Commission has included a proposal to waive many of the 
proposed pleading requirements with respect to complainants and other 
entities that can demonstrate good cause. Upon an appropriate showing 
of financial hardship or other public interest factors, the Commission 
proposes to waive format and content requirements under Section 1.721 
of the rules. Furthermore, the proposed rules apply only to Section 208 
complaints that are filed with the Commission. Complainants wishing to 
assure themselves of the ability to utilize full discovery, for 
example, are not precluded from filing their complaints in federal 
district court. The impact on small business entities of the proposal 
to require defendants to place a sum of money in an interest-bearing 
escrow account would be minimized by the fact that this measure would 
be implemented under standards similar to those used for determining 
whether a preliminary injunction is appropriate, e.g., likelihood of 
success on the merits, irreparable harm, etc. In addition, the 
Complaint NPRM solicits comments on a variety of alternatives.
    Federal Rules that May Overlap, Duplicate, or Conflict with the 
Proposed Rules: None.

Summary of Notice of Proposed Rule Making

I. Background

    1. In February 1996, Congress passed and the President signed the 
``Telecommunications Act of 1996'' (``1996 Act''). The 1996 Act 
prescribes deadlines ranging from 90 days to 5 months for the 
resolution of certain types of complaints against the Bell Operating 
Companies (``BOCs'') and other telecommunications carriers that are 
subject to the 1996 Act's requirements. The complaint provisions added 
by the 1996 Act that are relevant to this NPRM are Sections 208, 255, 
260, 271, 274, and 275. This NPRM proposes rules necessary to implement 
those complaint resolution provisions.

II. Discussion

    2. The NPRM seeks comment on changes to the Commission's current 
rules for processing formal complaints against carriers that would: (1) 
require or encourage complainants and defendants to engage in certain 
pre-filing activities designed to resolve or narrow issues and compile 
and/or exchange better factual information before resort to the 
complaint process; (2) eliminate delays in serving complaints on 
defendant carriers; (3) improve the format and content of complaints, 
answers and other pleadings filed by parties; (4) eliminate certain 
pleading opportunities that do not appear useful or necessary; and (5) 
limit or eliminate discovery.
A. Pre-Filing Procedures and Activities
    3. The Commission asks interested parties to identify specific pre-
filing activities available to potential complainants and defendants 
that could serve to settle or narrow disputes, or facilitate the 
compilation and exchange of relevant documentation or other information 
prior to the filing of a formal complaint with the Commission. The 
Commission proposes to require a complainant to certify that it 
discussed the possibility of settlement with the defendant carrier's 
representative(s) prior to filing the complaint.
    4. The Commission also seeks comment on whether a committee 
composed of industry members would serve a needed role or useful 
purpose in addressing disputes over technical and other business 
disputes, before such disputes are brought before the Commission in the 
form of formal complaint actions that must be resolved under expedited 
procedures. Participation in a proceeding before such a committee would 
be strictly voluntary.
B. Service
    5. The primary goal of the Commission in proposing changes to the 
current service procedures is to prevent the delay caused by those 
procedures, which implement the Section 208 requirement that the 
Commission serve formal complaints on defendant carriers. The 
Commission proposes to authorize or require a complainant to effect 
service simultaneously on the following persons: the defendant carrier, 
the Commission, and the appropriate staff office. The complainant would 
also be required to serve a copy of the complaint and associated 
attachments directly on the Chief of the division or branch responsible 
for handling the complaint. The Commission proposes to provide for a 
separate lock box at the Mellon Bank in Pittsburgh for complaints 
against wireless telecommunications service providers to help ensure 
the prompt receipt and handling of such complaints by the Wireless 
Telecommunications Bureau. The Commission also proposes to establish 
and maintain an electronic directory, available on the Internet, of 
agents authorized to receive service of complaints on behalf of 
carriers that are subject to the provisions of the Act.
    6. In applying the requirement in Section 208 of the Act that the 
Commission serve the complaint on the defendant carrier, the staff 
routinely reviews complaints in the first instance and determines 
whether they meet the requirements under the Act and the Commission's 
rules. To accomplish this objective while eliminating the delay caused 
by having the Commission serve the defendant, the Commission also 
proposes to require a complainant to submit a completed intake form 
with any formal complaint as part of the filing requirement to indicate 
that the complaint meets the various threshold requirements for stating 
a cause of action under the Act and the Commission's rules. Finally, 
the Commission proposes to require parties to serve all subsequent 
pleadings by facsimile to be followed by mail delivery, or by overnight 
delivery.
C. Format and Content Requirements
    7. The 1996 Act's complaint resolution deadlines necessitate 
substantial modification of the content requirements for pleadings 
filed in formal complaint proceedings. These

[[Page 67984]]

modifications must have the effect of creating complete records for the 
disposition of formal complaints. The Commission's overall goals are to 
improve the utility, quality, and content of the complaint, answer, and 
other filings submitted by parties in formal complaint cases and to 
expedite the issuance of orders that resolve procedural and substantive 
issues.
    8. The Commission proposes to require any party to a formal 
complaint proceeding, in its complaint, answer, or any other pleading 
required during the complaint process, to include full statements of 
relevant facts, and to attach to such pleadings supporting 
documentation and affidavits of persons with knowledge of the facts 
stated in the pleadings. The Commission also proposes to require all 
pleadings that seek Commission orders, including complaints, answers, 
briefs, reply briefs, and motions, as well as the orders themselves, to 
contain findings of fact and conclusions of law, and to require these 
submissions to be in both hard copy and on computer disks in ``read 
only'' mode and formatted in WordPerfect 5.1 for Windows, or as 
otherwise directed by the staff in particular cases. In recognition of 
the fact that many of the proposed pleading requirements could be 
unduly burdensome on certain individuals or parties, the Commission 
proposes to waive format and content requirements upon an appropriate 
showing of financial hardship or other public interest factors. The 
Commission also proposes to require parties to append copies of 
relevant tariffs or tariff provisions that are relied upon in a 
pleading.
D. Answers
    9. The Commission proposes to reduce the permissible time for a 
defendant to file an answer to a complaint from 30 to 20 days after 
service or receipt of the complaint.
E. Status Conferences
    10. The Commission proposes to require that, unless otherwise 
ordered by the staff, an initial status conference take place in all 
formal complaint proceedings 10 business days after the defendant files 
its answer to the complaint. At the status conference, the Commission 
and parties may discuss claims and defenses, settlement possibilities, 
scheduling, whether discovery shall be permitted, and if so, a 
discovery plan. The parties would be required to memorialize jointly, 
in writing, any Commission rulings made during these status 
conferences.
F. Discovery
    11. The Commission's goal in modifying the discovery rules is to 
limit or eliminate discovery while still permitting parties the 
opportunity to develop a sufficient record for resolution of their 
dispute. It is the Commission's belief that while the parties should 
continue to bear the burden of developing an adequate record, that 
burden should be borne earlier in the proceeding, upon the filing of 
the initial pleadings rather than upon discovery. Therefore the 
Commission seeks comment on limiting or eliminating discovery as a 
matter of right. It is anticipated that the proposed requirements for 
complaints, answers, and proposed stipulated facts will, in a majority 
of cases, present a sufficient factual record to enable the Commission 
to rely upon the initial pleadings alone to determine the outcome of 
the case. The Commission also seeks comment on the feasibility of 
allowing the parties to a complaint proceeding to agree among 
themselves to a cost-recovery system as a basis for facilitating the 
prompt identification and exchange of information.
    12. The Commission also proposes to authorize the Bureau, on its 
own motion, to refer certain disputes to an administrative law judge 
for expedited hearing on factual issues.
G. Cease, Cease-and-Desist Orders and Other Forms of Interim Relief
    13. The Commission sought comment on the legal and evidentiary 
standards necessary for obtaining cease or cease-and-desist orders 
pursuant to Title II of the Act and other forms of interim relief in 
Section 208 formal complaint cases, in order to expedite the issuance 
of cease or cease-and-desist orders within the 1996 Act's deadlines and 
to create more certainty regarding the legal and factual basis for 
granting interim relief.
H. Damages
    14. The Commission's goal is to eliminate or minimize the delay 
endemic to the resolution of damages issues. The Commission proposes to 
allow bifurcation of liability and damages issues by permitting a 
complainant to file supplemental complaint for damages after a finding 
of liability. In such a case, the Commission would defer adjudication 
of all damages issues until after a finding of liability. This approach 
would enable the Commission to make a liability finding within the 
statutory deadline and still preserve the complainant's right to a 
damage award. The Commission also proposes to require that any 
complaint seeking an award of damages contain a detailed computation of 
damages, such that the Commission's adjudication of damages would end 
with a determination about the sufficiency of the computation formula 
submitted by the complainant rather than a finding as to the exact 
amount of damages, if any, owed to the complainant. The Commission also 
proposes to establish, following a finding of liability, a limited 
period during which the parties could engage in settlement negotiations 
or submit their damage claims to voluntary alternative dispute 
resolution mechanisms in lieu of further proceedings before the 
Commission. The Commission also seeks comment on a proposal to refer 
damages issues to an administrative law judge for decision once 
liability for damages has been determined by the Commission or if the 
parties agree to mediation by an administrative law judge. The 
Commission proposes to require, in certain cases after liability has 
been found, defendants to place a sum of money in an interest-bearing 
escrow account, to cover part or all of the damages for which they may 
be found liable.
I. Cross-Complaints and Counterclaims
    15. The Commission proposes to allow compulsory counterclaims, 
those arising out of the same transaction or occurrence that is the 
subject matter of the opposing party's claim, only if the defendant 
files them concurrently with the answer. If a defendant fails to file 
such a compulsory counterclaim with its answer, it will be barred. A 
defendant may, but is not required to, file permissive counterclaims 
(those not arising out of the same transaction or occurrence) against 
the complainant. In addition, a defendant may, but is not required to, 
file cross-claims that arise out of the same transaction against co-
parties. To the extent that the defendant elects to file such 
permissive counterclaims and cross-claims, it must file these pleadings 
concurrently with its answer. The defendant always has the option of 
filing any barred permissive counterclaims or cross-claims in a 
separate proceeding, provided that the statute of limitations has not 
run.
    16. In addition, the Commission will revise its rules to clarify 
the applicability of filing fees to both complaints and cross-
complaints.
J. Replies
    17. The Commission proposes to prohibit replies to oppositions to 
motions. The Commission also proposes to prohibit replies to answers 
unless

[[Page 67985]]

specifically authorized by the Commission, generally upon a 
complainant's motion showing that there is good cause to reply to 
affirmative defenses that are supported by factual allegations that are 
different from any denials also contained in the answer.
K. Motions
    18. In cases where discovery is conducted, the Commission proposes 
to require parties filing Motions to Compel to certify that they have 
made a good faith attempt to resolve the matter before filing the 
motion, in order to limit Commission involvement in conflicts that 
should be easily resolved. The Commission also proposes to make failure 
to file an opposition to a motion possible grounds for granting the 
motion, as well as shorten the deadline for filing oppositions to 
motions from ten to five business days. Finally, the Commission 
proposes to prohibit amendment of complaints except for changes 
necessary under 47 CFR Sec. 1.720(g), which requires that information 
and supporting authority be current and updated as necessary in a 
timely manner.
L. Confidential or Proprietary Information and Materials
    19. The Commission proposes to allow parties to designate as 
proprietary any materials generated in the course of a formal 
complaint, and not limit such designation to materials produced in 
response to discovery. The Commission also seeks comment on whether 
additional protections are needed in light of the short complaint 
resolution deadlines in the 1996 Act and the Commission's proposals in 
this NPRM to eliminate certain pleading and discovery opportunities.
M. Other Required Submissions
    20. The Commission proposes to require parties to submit a joint 
statement of stipulated facts and key legal issues five days after the 
answer is filed. The Commission feels that drafting such a statement 
would promote agreement on a significant number of the disputed facts 
and legal issues, and that the statement itself would serve as a guide 
for the Commission to determine whether discovery is necessary in a 
particular case. Additionally, the Commission seeks comment on 
streamlining the current briefing process by prohibiting the filing of 
briefs in cases where discovery is not conducted, by continuing to 
allow the parties to file briefs, but permitting the staff to limit the 
scope of such briefs, or by shortening the deadline by which briefs are 
due. The Commission proposes to limit the page length of briefs to 25 
pages for initial briefs and 10 pages for reply briefs.
N. Sanctions
    21. The Commission seeks comment on what sanctions and/or remedies 
would be necessary or appropriate to ensure full compliance with and 
satisfaction of the proposed rule requirements.
O. Other Matters
    22. The Commission seeks comment on two matters presented by 
certain language in Section 271 relative to other complaint provisions 
in the Act. First, the Commission sought comment on its tentative 
conclusion that the phrase ``act on'' as used in Section 271(d)(6)(B) 
encompasses actions taken by the Bureau and need not necessarily be 
final action by the Commission. Second, the Commission noted that the 
90-day complaint resolution deadline for Section 271(d) complaints 
applies only in the absence of an agreement otherwise by the parties to 
the complaint action. The Commission sought comment on specific 
procedures and timetables that could be employed to ensure early 
notification to the Commission of waivers or extension agreements under 
Section 271(d)(6)(B) and to avoid the unnecessary expenditure of time 
and resources by the staff and parties to such a complaint action.

III. Comments and Ex Parte Requirements

    23. Pursuant to Sections 1.415 and 1.419 of the Commission's rules, 
47 CFR Secs. 1.415, 1.419, all interested parties may file comments on 
the matters discussed in the NPRM and on proposed rules contained in 
the appendices by January 6, 1997 and reply comments on or before 
January 31, 1997. Parties are also invited to submit, in conjunction 
with their comments or reply comments, proposed text for rules that the 
Commission could adopt in this proceeding. Specific rule proposals 
should be filed as an appendix to a party's comments or reply comments. 
Such appendices may include only proposed text for rules that would 
implement proposals set forth in the parties' comments and reply 
comments in this proceeding, and may not include any comments or 
arguments. Proposed rules should be provided in the format used for 
rules in the Code of Federal Regulations, and should otherwise conform 
to the Comment Filing Procedures set forth in this NPRM.
    24. To file formally in this proceeding, participants must file an 
original and six copies of all comments, reply comments, and supporting 
comments. If participants want each Commissioner to receive a personal 
copy of their comments, they must file an original and nine copies. In 
addition, participants are encouraged to submit two additional copies 
directly to the Common Carrier Bureau, Enforcement Division, Room 6008, 
2025 M Street, N.W., Washington, D.C. 20554. Comments and reply 
comments should be sent to the Office of the Secretary, Federal 
Communications Commission, 1919 M Street, N.W., Room 222, Washington, 
D.C. 20554. Parties should also file one copy of any documents filed in 
this docket with the Commission's copy contractor, International 
Transcription Services, Inc., 2100 M Street, N.W., Suite 140, 
Washington, D.C. 20037. Comments and reply comments will be available 
for public inspection during regular business hours in the FCC 
Reference Center, 1919 M Street, N.W., Room 239, Washington, D.C. 
20554.
    25. In order to facilitate review of comments and reply comments, 
both by parties and the Commission, comments and reply comments should 
include a summary of the substantive arguments raised in the pleading.
    26. Parties are also asked to submit comments and reply comments on 
diskette. Such diskette submissions would be in addition to the formal 
filing requirements addressed above. Parties submitting diskettes 
should submit them to Anita Cheng, Common Carrier Bureau, Enforcement 
Division, Room 6008, 2025 M Street, N.W., Washington, D.C. 20554. Each 
disk must be a standard 3\1/2\'' magnetic disk, formatted to be 
readable by high-density 1.44 MB floppy drives operating under MS-DOS 
(3.X or later versions). Participants are encouraged to submit 
documents formatted in WordPerfect 5.1 for Windows. Otherwise, parties 
must submit the documents formatted in both ASCII and any word 
processing program. The diskette should be submitted in ``read only'' 
mode. The diskette should be clearly labelled with the party's name, 
proceeding, type of pleading (comment or reply comments) and date of 
submission. The diskette should be accompanied by a cover letter.
    27. This is a non-restricted notice and comment rule making 
proceeding. Ex parte presentations are permitted, except during the 
Sunshine Agenda period, provided they are disclosed as provided in 
Commission rules. See

[[Page 67986]]

generally 47 CFR Secs. 1.1202, 1.1203, and 1.1206(a).

IV. Conclusion

    28. In this NPRM, the Commission proposes to amend its rules 
governing the filing of formal complaints to implement certain 
complaint provisions in the 1996 Act and establish procedures necessary 
to facilitate the full and fair resolution of complaints filed under 
such provisions within the deadlines established by the 
Telecommunications Act of 1996. The Commission's goal is to establish 
rules of practice and procedure which, by providing a forum for prompt 
resolution of complaints of unreasonable, discriminatory, or otherwise 
unlawful conduct by telecommunications carriers, will foster rather 
than impede robust competition in all telecommunications markets.

VI. Ordering Clauses

    29. Accordingly, it is ordered that pursuant to Sections 1, 4, 201-
205, 208, 215, 218, 220 of the Communications Act of 1934, as amended, 
47 U.S.C. Secs. 151, 154, 201-205, 208, 215, 218 and 220, a notice of 
proposed rulemaking is hereby adopted.
    30. It is further ordered that the Chief of the Common Carrier 
Bureau is delegated authority to require the submission of additional 
information, make further inquiries, and modify the dates and 
procedures if necessary to provide for a more complete record and a 
more efficient proceeding.
    31. It is further ordered that the Secretary shall cause a copy of 
this NPRM, including the Initial Regulatory Flexibility Analysis, to be 
sent to the Chief Counsel for Advocacy of the Small Business 
Administration in accordance with Section 603(a) of the Regulatory 
Flexibility Act, 5 U.S.C. Section 603(a) (1981). The Secretary shall 
also cause a summary of this Notice to appear in the Federal Register.

List of Subjects

47 CFR Part 0

    Organization and functions (Government agencies).

47 CFR Part 1

    Communications common carriers.

Federal Communications Commission.
Shirley S. Suggs,
Chief, Publications Branch.

Rule Changes

    Parts 0 and 1 of Title 47 of the Code of Federal Regulations are 
proposed to be amended as follows:

PART 0--COMMISSION ORGANIZATION

    1. The authority citation for Part 0 continues to read as follows:

    Authority: Sec. 5, 48 Stat. 1068, as amended, 47 U.S.C. 155, 
225, unless otherwise noted.

    2. Section 0.291 is proposed to be amended by revising paragraph 
(d) to read as follows:


Sec. 0.291  Authority delegated.

* * * * *
    (d) Authority to designate for hearing. The Chief, Common Carrier 
Bureau shall not have authority to designate for hearing any formal 
complaints which present novel questions of law or policy which cannot 
be resolved under outstanding precedents or guidelines. The Chief, 
Common Carrier Bureau shall not have authority to designate for hearing 
any applications except applications for facilities where the issues 
presented relate solely to whether the applicant has complied with 
outstanding precedents and guidelines.
* * * * *

PART 1--PRACTICE AND PROCEDURE

    3. The authority citation for Part 1 continues to read as follows:

    Authority: 47 U.S.C. 151, 154, 303, and 309(j) unless otherwise 
noted.

    4. Section 1.47 is proposed to be amended by revising paragraph (b) 
and adding new paragraph (h) to read as follows:


Sec. 1.47  Service of documents and proof of service.

* * * * *
    (b) Where any person is required to serve any document filed with 
the Commission, service shall be made by that person or by his 
representative on or before the day on which the document is filed.
* * * * *
    (h) Every carrier subject to the Communications Act of 1934, as 
amended, shall designate an agent in the District of Columbia, upon 
whom service of all notices, process, orders, decisions, and 
requirements of the Commission may be made for and on behalf of said 
carrier in any proceeding pending before the Commission. Such 
designation shall be filed, and updated as necessary, in writing and 
electronically in the office of the secretary of the Commission. 
Service of all notices, process, orders, decisions, and requirements of 
the Commission may be made upon such carrier by leaving a copy thereof 
with such designated agent at his office or usual place of residence in 
the District of Columbia. If a carrier fails to designate such an 
agent, service of any notice or other process in any proceeding before 
the Commission, or of any order, decision, or requirement of the 
Commission, may be made by posting such notice, process, order, 
requirement, or decision in the office of the secretary of the 
Commission.
    5. Section 1.720 is proposed to be amended by revising the 
introductory paragraph and paragraph (h) to read as follows:


Sec. 1.720  General pleading requirements.

    Formal complaint proceedings are generally resolved on a written 
record consisting of a complaint, answer, and statement of stipulated 
facts, but may also include other written submissions such as briefs 
and responses to written interrogatories. The Bureau in its discretion 
may designate formal complaint proceedings for resolution by hearing 
before an Administrative Law Judge, or where appropriate, it may refer 
certain issues of fact to an Administrative Law Judge for expedited 
hearing, while responsibility for the overall resolution of the 
proceeding is retained by the responsible Bureau. All written 
submissions, both substantively and procedurally, must conform to the 
following standards:
* * * * *
    (h) Specific reference must be made to any tariff provision relied 
on in support of a claim or defense. Copies of relevant tariffs or 
relevant portions of tariffs that are relied upon in a pleading shall 
be appended to the pleading.
* * * * *
    6. Section 1.721 is proposed to be amended by revising paragraphs 
(a)(5), (a)(6), (a)(7), (a)(8), adding paragraphs (a)(9), (a)(10), 
(a)(11), (a)(12), and adding paragraph (c) to read as follows:


Sec. 1.721  Format and content.

    (a) * * *
    (5) A complete statement of facts which, if proven true, would 
constitute such a violation. All facts must be supported, pursuant to 
Sec. 1.720(c), by relevant affidavits and documentation, including 
copies of all applicable agreements, offers, counter-offers, denials, 
or other relevant correspondence.
    (6) Complete detailed explanation of the manner in which a 
defendant has violated the Act, Commission order, or Commission rule in 
question, including identification or description and relevant time 
period, of the communications, transmissions, services, or other 
carrier conduct

[[Page 67987]]

complained of and nature of the injury sustained;
    (7) The relief sought, including recovery of damages and the amount 
of damages claimed, if known;
    (8) Certification that each complainant has discussed the 
possibility of settlement with each defendant prior to the filing of 
the formal complaint;
    (9) Whether suit has been filed in any court or other government 
agency on the basis of the same cause of action, or whether the 
complaint itself seeks prospective relief identical to the relief 
proposed or at issue in a notice-and-comment proceeding that is 
concurrently before the Commission;
    (10) A copy of, or a description by category and location of all 
documents, data compilations and tangible things in the complainant's 
possession, custody or control that are relevant to the disputed facts 
alleged with particularity in the complaint. The complaint may also 
include an explanation of why any relevant documents are believed to be 
confidential.
    (11) The name, address and telephone number of each individual 
likely to have discoverable information relevant to the disputed facts 
alleged with particularity in the complaint, identifying the subjects 
of information; and
    (12) A completed Formal Complaint Intake Form.
* * * * *
    (c) Upon showing of good cause by the complainant, the Commission 
may waive any of the requirements of this section.
    Section 1.722 is proposed to be amended by revising the 
introductory text of paragraph (b) and adding paragraphs (c) and (d) to 
read as follows:


Sec. 1.722  Damages.

* * * * *
    (b) Damages will not be awarded upon a complaint unless 
specifically requested. Damages may be awarded, however, upon a 
supplemental complaint as described more fully in paragraph (c) of this 
section, based upon a finding of the Commission in the original 
proceeding. Provided that:
* * * * *
    (c) In all cases in which recovery of damages is sought, it shall 
be the responsibility of the complainant to provide a computation of 
each and every category of damages for which recovery is sought, along 
with an identification of all relevant documents and materials or such 
other evidence to be used by the complainant to determine the amount of 
such damages.
    (1) Where the recovery of damages is sought on the original 
complaint, such original complaint must include the computation of 
damages and identification of documents, materials and other evidence 
to be used in such computation described in paragraph (c) of this 
section.
    (2) A complainant electing to seek damages upon a supplemental 
complaint as provided in paragraph (b) of this section must clearly and 
unequivocally state such election in the original complaint. In cases 
in which a complainant clearly and unequivocally states its election to 
seek damages upon supplemental complaint, the computation and 
identification of all relevant documents, materials and other evidence 
described in paragraph (c) of this section need not be provided until 
such time the complainant files its supplemental complaint.
    (3) Where a complainant voluntarily elects to seek the recovery of 
damages upon a supplemental complaint, the Commission will resolve the 
liability complaint within the relevant complaint resolution deadlines 
contained in the Act and defer adjudication of the damage complaint 
until after the liability complaint has been resolved.
    (d) Where a complainant elects in its original complaint to seek 
the recovery of damages upon a supplemental complaint, the following 
procedures may apply in the event the Commission determines liability 
based upon its review of the original complaint:
    (1) If the parties agree, issues concerning the amount, if any, of 
damages may be submitted for mediation to a Commission Administrative 
Law Judge. Such Administrative Law Judge shall be chosen in the 
following manner:
    (i) By agreement of the parties and the Chief Administrative Law 
Judge; or
    (ii) In the absence of such agreement, the Chief Administrative Law 
Judge shall designate the Administrative Law Judge.
    (2) After the defendant has been determined to be liable in such 
bifurcated proceeding, the Commission may order the defendant to 
deposit into an interest bearing escrow account a sum equal to the 
amount of damages which it finds, upon preliminary investigation, is 
likely to be ordered after the issue of damages is fully litigated, or 
some lesser sum which may be appropriate, provided the Commission finds 
that the grant of this relief is favored on balance upon consideration 
of the following factors:
    (i) Complainant's potential irreparable injury in the absence of 
such deposit;
    (ii) The likelihood that the amount of damages ordered at the 
conclusion of litigation will be equal to or greater than the amount 
deposited;
    (iii) The balance of the hardships between complainant and 
defendant; and
    (iv) Whether public interest considerations favor the ordering of 
the deposit.
    8. Section 1.724 is proposed to be amended by revising paragraphs 
(a), (b), and (c) and adding new paragraphs (f), (g) and (h) to read as 
follows:


Sec. 1.724  Answers.

    (a) Any carrier upon which a copy of a formal complaint is served 
under this subpart shall answer within 20 days of service of the formal 
complaint, unless otherwise directed by the Commission.
    (b) The answer shall advise the complainant and the Commission 
fully and completely of the nature of any defense, and shall respond 
specifically to all material allegations of the complaint. Every effort 
should be made to narrow the issues in the answer. Any defendant 
failing to file and serve an answer within the time and in the manner 
prescribed by this part may be deemed in default and an order may be 
entered against the defendant in accordance with the allegations 
contained in the complaint.
    (c) The defendant shall state concisely its defenses to each claim 
asserted and shall admit or deny the averments on which the complainant 
relies. If the defendant is without knowledge or information sufficient 
to form a belief as to the truth of an averment, the defendant shall so 
state and this has the effect of a denial. When a defendant intends in 
good faith to deny only part of an averment, the defendant shall 
specify so much of it as is true and shall deny only the remainder. The 
defendant may make its denials as specific denials of designated 
averments or paragraphs. General denials are prohibited.
* * * * *
    (f) The answer shall include a copy of, or a description by 
category and location of all documents, data compilations and tangible 
things in the defendant's possession, custody or control that are 
relevant to the disputed facts alleged with particularity in the 
pleadings. The answer may also include an explanation of why any 
relevant documents are believed to be confidential.
    (g) The answer shall also list the name, address and telephone 
number of each individual likely to have discoverable information 
relevant to the disputed facts alleged with particularity

[[Page 67988]]

in the pleadings, identifying the subjects of information.
    (h) Upon showing of good cause by the defendant, the Commission may 
waive any of the requirements of this section.
    9. Section 1.725 is proposed to be revised to read as follows:


Sec. 1.725  Cross-complaints and counterclaims.

    (a) Compulsory counterclaims, those claims arising out of the 
transaction or occurrence that is the subject matter of the complaint 
and does not require for its adjudication the presence of third parties 
of whom the court cannot acquire jurisdiction, must be filed 
concurrently with the answer or it will be barred.
    (b) Permissive counterclaims, those claims not arising out of the 
transaction or occurrence that is the subject matter of the complaint, 
must be filed concurrently with the answer in order to be resolved in 
the same proceeding. If not filed concurrently with the answer, 
however, the defendant will not be barred from filing such claim in a 
separate proceeding, provided that the statute of limitations has not 
run.
    (c) Cross-complaints, claims by one party against a co-party 
arising out of the same transaction or occurrence that is the subject 
matter of either the complaint or counterclaim therein or relating to 
any property that is the subject matter of the original matter, must be 
filed concurrently with the answer in order to be resolved in the same 
proceeding. If not filed concurrently with the answer, however, the co-
party will not be barred from filing such claim in a separate 
proceeding, provided the statute of limitations has not run.
    10. Section 1.726 is proposed to be revised to read as follows:


Sec. 1.726   Replies.

    (a) Replies are prohibited unless authorized by the Commission for 
good cause shown. If no reply is submitted, the complainant will be 
deemed to have denied the affirmative defenses.
    (b) A complainant wishing to submit a reply must, within five days 
after the service of the answer, file a motion seeking leave to do so. 
A copy of the complainant's proposed reply should accompany its motion. 
A complainant's reply shall respond only to the specific factual 
allegations made by the defendant supporting its affirmative defenses. 
Replies which contain other allegations or arguments will not be 
accepted or considered by the Commission.
    (c) Replies shall be accompanied by a copy of, or a description by 
category and location of all documents, data compilations and tangible 
things in the complainant's possession, custody or control that are 
relevant to the disputed facts alleged with particularity in the 
pleadings. The reply may also include an explanation of why any 
relevant documents are believed to be confidential. Replies shall also 
include the name, address and telephone number of each individual 
likely to have discoverable information relevant to the disputed facts 
alleged with particularity in the pleadings, identifying the subjects 
of information.
    11. Section 1.727 is proposed to be amended by revising paragraphs 
(b), (c), (d), and (e) and adding new paragraphs (g) and (h) to read as 
follows:


Sec. 1. 727   Motions.

* * * * *
    (b) Motions that the allegations in the complaint be made more 
definite and certain are prohibited.
    (c) The moving party shall provide a proposed order for adoption, 
which appropriately incorporates the basis therefor, including proposed 
findings of fact and conclusions of law relevant to the pleading. The 
proposed order shall be clearly marked as a ``proposed order.'' The 
proposed order shall be submitted both as a hard copy and on computer 
disk in accordance with the requirements of Sec. 1.734(d). The proposed 
order format should conform to that of a reported FCC order.
    (d) A party opposing any motion shall also provide a proposed order 
for adoption, which appropriately incorporates the basis therefor. The 
proposed order shall be clearly captioned as a ``Proposed Order.'' The 
proposed order shall be submitted both as a hard copy and on computer 
disk in accordance with the requirements of Sec. 1.734(d). The proposed 
order format should conform to that of a reported FCC order.
    (e) Oppositions to motions may be filed within five days after the 
motion is filed. Oppositions shall be limited to the specific issues 
and allegations contained in the motion; when a motion is incorporated 
in an answer to a complaint, an opposition to the motion shall not 
address any issues presented in the answer that are not also 
specifically raised in the motion. Failure to oppose any motion may 
constitute grounds for granting of the motion.
* * * * *
    (g) All motions must contain proposed findings of fact and 
conclusions of law, with supporting legal analysis, relevant to the 
content of the pleading. All facts relied upon in motions must be 
supported by documentation or affidavits pursuant to Sec. 1.720(c), 
except for those facts of which official notice may be taken. 
Assertions based on information and belief are prohibited.
    (h) Amendments or supplements to complaints to add new claims or 
requests for relief are prohibited. Parties are responsible, however, 
for the continuing accuracy and completeness of all information and 
supporting authority furnished in a pending complaint proceeding as 
required under Sec. 1.720(g).


Sec. 1.730   [Removed]

    12. Section 1.730 is proposed to be removed.
    13. Section 1.731 is proposed to be amended by revising the section 
heading and paragraph (a) to read as follows:


Sec. 1.731   Confidentiality of information produced or exchanged by 
the parties.

    (a) Any materials generated in the course of a formal complaint 
proceeding may be designated as proprietary by that party if the party 
believes in good faith that the materials fall within an exemption to 
disclosure contained in the Freedom of Information Act (FOIA), 5 U.S.C. 
552(b) (1) through (9). Any party asserting confidentiality for such 
materials shall so indicate by clearly marking each page, or portion 
thereof, for which a proprietary designation is claimed. If a 
proprietary designation is challenged, the party claiming 
confidentiality shall have the burden of demonstrating, by a 
preponderance of the evidence, that the material designated as 
proprietary falls under the standards for nondisclosure enunciated in 
the FOIA.
* * * * *
    Section 1.732 is proposed to be amended by revising paragraphs (b), 
(c), and (d) and adding new paragraph (h) to read as follows:


Sec. 1.732   Other required written submissions.

* * * * *
    (b) In cases when discovery is not conducted, briefs shall be filed 
concurrently by both complainant and defendant within 90 days from the 
date a complaint is served. Such briefs shall be no longer than 25 
pages.
    (c) In cases when discovery is conducted, briefs shall be filed 
concurrently by both complainant and defendant at such time designated 
by the staff, typically within 30 days after discovery is completed.
    (d) Reply briefs may be submitted by either party within 20 days 
from the

[[Page 67989]]

date initial briefs are due. Reply briefs shall be no longer than 10 
pages.
* * * * *
    (h) Within 5 days after the answer is filed, the parties shall 
submit a joint statement of stipulated facts and key legal issues.
    15. Section 1.733 is proposed to be amended by revising paragraphs 
(a) introductory text, (a)(2), (a)(4), (a)(5), (a)(6), (b), and (c) to 
read as follows:


Sec. 1.733  Status conference.

    (a) In any complaint proceeding, the Commission may, in its 
discretion, direct the attorneys and/or the parties to appear before it 
for a status conference. Unless otherwise ordered by the Commission, an 
initial status conference shall take place within ten business days 
after the answer is filed, unless otherwise directed by the staff. A 
status conference may include discussion of:
* * * * *
    (2) The necessity for or desirability of additional pleadings or 
evidentiary submissions;
* * * * *
    (4) Settlement of all or some of the matters in controversy by 
agreement of the parties;
    (5) Whether discovery is necessary and, if so, the scope, type and 
schedule for any discovery;
    (6) The schedule for the remainder of the case and the date for 
further conferences; and
* * * * *
    (b) In addition to the status conference referenced in paragraph 
(a) of this section, any party may also request that a conference be 
held at any time after the complaint has been filed.
    (c) During a status conference, the Commission may issue oral 
rulings pertaining to a variety of interlocutory matters relevant to 
the conduct of a formal complaint proceeding including, inter alia, 
procedural matters, discovery, and the submission of briefs or other 
evidentiary materials. Within 24 hours after a status conference, the 
parties in attendance, unless otherwise directed, must submit a joint 
proposed order memorializing the oral rulings made during the 
conference to the Commission. Commission staff will review and make 
revisions, if necessary, prior to signing and filing the submission as 
part of the record. Parties may, but are not required to, tape record 
the Commission's summary of its oral rulings. Alternatively, parties 
may use a stenographer to transcribe the oral presentations and 
exchanges between and among the participating parties, insofar as such 
communications are not ``off-the-record.'' The cost of such 
stenographer will be shared equally by the parties.
* * * * *
    16. Section 1.734 is proposed to be amended by revising paragraph 
(c) and adding new paragraph (d) to read as follows:


Sec. 1.734   Specifications as to pleadings, briefs, and other 
documents; subscription.

* * * * *
    (c) The original of all pleadings and other submissions filed by 
any party shall be signed by that party, or by the party's attorney. 
The signing party shall state his or her address, telephone number, 
facsimile number and the date on which the document was signed. Copies 
should be conformed to the original. Except when otherwise specifically 
provided by rule or statute, pleadings need not be verified. The 
signature of an attorney or party shall be a certificate that the 
attorney or party has read the pleading, motion, or other paper; that 
to the best of his or her knowledge, information, and belief formed 
after reasonable inquiry, it is well grounded in fact and is warranted 
by existing law or a good faith argument for the extension, 
modification, or reversal of existing law; and that it is not 
interposed solely for purposes of delay or for any other improper 
purpose.
    (d) All proposed orders shall be submitted both as hard copies and 
on a 3.5 inch diskette formatted in an IBM compatible form using MS-DOS 
5.0 and WordPerfect 5.1 software. The diskette should be submitted in 
``read only'' mode. The diskette should be clearly labelled with the 
party's name, proceeding, type of pleading, and date of submission. The 
diskette should be accompanied by a cover letter. Parties who have 
submitted copies of tariffs or reports with their hard copies need not 
include such tariffs or reports on the magnetic disk.
    17. Section 1.735 is proposed to be amended by revising paragraphs 
(b), (d) and (e) to read as follows:


Sec. 1.735   Copies; service; separate filings against multiple 
defendants.

* * * * *
    (b) The complainant must file an original plus three copies of the 
complaint, accompanied by the correct fee, in accordance with subpart G 
of this part. See 47 CFR 1.1105(1)(c). However, if a complaint is 
addressed against multiple defendants, the complainant shall pay a 
separate fee and supply three additional copies of the complaint for 
each additional defendant. For complaints filed with the Common Carrier 
Bureau, the complainant must also serve a copy on the Chief, Formal 
Complaints and Investigations Branch. For complaints filed with the 
Wireless Telecommunications Bureau, the complainant must also serve a 
copy on the Chief, Enforcement Division. For complaints filed with the 
International Bureau, the complainant must also serve a copy on the 
Chief, Telecommunications Division. The requirements of this paragraph 
also apply to defendants filing cross-complaints.
* * * * *
    (d) The complainant shall serve the complaint on the named 
defendant's registered agent for service of process. If filing a cross-
complaint, the defendant/cross-complainant shall serve such cross-
complaint on the named cross-defendant's registered agent for service 
of process and all counsel of record in the complaint proceeding.
    (e) All subsequent pleadings and briefs filed in any formal 
complaint proceeding, as well as all letters, documents or other 
written submissions, shall be served either by overnight delivery or by 
facsimile and followed by mail, by the filing party on the counsel of 
record of all other parties to the proceeding, together with a proof of 
such service in accordance with the requirements of Sec. 1.47(g).
* * * * *
    18. Section 1.1105 is proposed to be amended by revising the entry 
(1)(c), and adding (1)(d) to read as follows:


Sec. 1.1105   Schedule of charges for applications and other filings in 
the common carrier services.

                                                                                                                                                        
                                                                           Payment                                                                      
                  Action                     FCC form No.    Fee amount   type code                                 Address                             
                                                                                                                                                        
1. * * *                                                                                                                                                
c. Formal Complaints/Cross-Complaints and    Corr. and 159          150  ...........  CIZ Federal Communication Commission, Common Carrier Enforcement, 
 Pole Attachment Compaints/Cross-                                                      P.O. Box 358120, Pittsburgh, PA 15251-5120.                      
 Complaints, except those relating to                                                                                                                   
 wireless telecommunications services,                                                                                                                  
 Filing Fee..                                                                                                                                           

[[Page 67990]]

                                                                                                                                                        
d. Formal Complaints/Cross-Complaints        Corr. and 159          150          CIZ  Federal Communications Commission, Wireless Telecommunications    
 relating to wireless telecommunications                                               Bureau, P.O.Box 358128, Pittsburgh, PA 15251-5120.               
 services, including cellualr telephone,                                                                                                                
 paging, personal communications                                                                                                                        
 services, and other commercial mobile                                                                                                                  
 radio services, Filing Fee..                                                                                                                           
                            *                  *                  *                  *                  *                  *                            
                                                                                                                                                        

Attachment to the Proposed Rule

FORMAL COMPLAINT INTAKE FORM

Case Name:-------------------------------------------------------------

Complainant Name, Address, Phone and Facsimile Number:

----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------

Complaint alleges violation of the following provisions of the 
Communications Act of 1934, as amended:--------------------------------

Answer (Y)es, (N)o or N/A to the following:

____ Complaint conforms to the specifications prescribed by 47 CFR 
Secs. 1.49, 1.734.
____ Complaint complies with the pleading requirements of 47 CFR 
Sec. 1.720.
____ Complaint conforms to the format and content requirements of 47 
CFR Sec. 1.721:
    ____ Complaint contains a detailed explanation of the manner in 
which the defendant violated the provisions of the Communications 
Act of 1934, as amended.
    ____ Relevant documentation and/or affidavits is attached, 
including agreements, offers, counter-offers, denials, or other 
relevant correspondence.
    ____ Contains certification that complainant has discussed the 
possibility of settlement with each defendant prior to the filing of 
the formal complaint.
    ____ Suit has been filed in another court or government agency 
on the basis of the same cause of action. If yes, please explain: 
________
    ____ Seeks prospective relief identical to the relief proposed 
or at issue in a notice-and-comment proceeding that is concurrently 
before the Commission. If yes, please explain: ____________
    ____ If damages are sought, contains specified amount and nature 
of damages claimed.
    ____ Contains a copy of, or a description by category and 
location of all documents, data compilations and tangible things in 
the complainant's possession, custody or control that are relevant 
to the disputed facts alleged with particularity in the complaint.
    ____ Contains the name, address and telephone number of each 
individual likely to have discoverable information relevant to the 
disputed facts alleged with particularity in the complaint, 
identifying the subjects of information.
____ All reported FCC orders relied upon have been properly cited in 
accordance with Section 1.14 of the Commission's Rules, Title 47 
Code of Federal Regulations, 47 CFR Sec. 1.14.
____ Copies of cited non-FCC authority are attached.
____ Copy of complaint has been served on defendant's registered 
agent for service in accordance with [to be amended] 47 CFR 
Sec. 1.47(b).
____ If more than 10 pages, the complaint contains a table of 
contents as specified in 47 CFR Sec. 1.49(b).
____ The correct number of copies, required by 47 CFR 
Sec. 1.51(c)(2) and 47 CFR Sec. 1.51(c)(2) if applicable, have been 
filed.
____ Complaint has been properly signed and verified in accordance 
with 47 CFR Sec. 1.52.
____ $150.00 filing fee specified in 47 CFR Sec. 1.1105(1)(c) is 
attached.
____ If complaint is by multiple complainants, it conforms with the 
requirements of 47 CFR Sec. 1.723(a).
____ If complaint involves multiple grounds, it complies with the 
requirements of 47 CFR Sec. 1.723(b).
____ If complaint is directed against multiple defendants, it 
complies with the requirements of 47 CFR Sec. 1.735 (a)-(b).

[FR Doc. 96-32322 Filed 12-24-96; 8:45 am]
BILLING CODE 6712-01-P