*Pages 1--6 from Microsoft Word - 37936* Federal Communications Commission DA 04- 1172 Before the Federal Communications Commission Washington, D. C. 20554 In the Matter of World Communications Satellite Systems, Inc. Complaints Regarding Unauthorized Change of Subscriber’s Telecommunications Carrier ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) IC Nos. 02- B0003014 02- B0007177 02- B0010833 02- B0011336 03- B0053910S 02- S67819 02- S68674 02- S72022 02- S72428 02- S72726 02- S74500 02- S76984 02- S77076 02- S77149 02- S77379 02- S79541 02- S80207 02- S80213 02- S80560 02- S81203 02- S81907 03- S82211 03- S82326 03- S82646 03- S83242 03- S84995 ORDER Adopted: April 28, 2004 Released: April 29, 2004 By the Deputy Chief, Policy Division, Consumer & Governmental Affairs Bureau: 1. In this Order, we consider the complaints 1 alleging that World Communications Satellite Systems, Inc. (WCSS) changed Complainants’ telecommunications service providers without obtaining authorization and verification from Complainants in violation of the Commission’s rules. 2 We conclude that WCSS’s actions did result in an unauthorized change in 1 See Appendix A. 2 See 47 C. F. R. §§ 64.1100 – 64.1190. (continued….) 1 Federal Communications Commission DA 04- 1172 2 Complainants’ telecommunications service providers and we grant Complainants’ complaints. 2. In December 1998, the Commission released the Section 258 Order in which it adopted rules to implement Section 258 of the Communications Act of 1934 (Act), as amended by the Telecommunications Act of 1996 (1996 Act). 3 Section 258 prohibits the practice of “slamming,” the submission or execution of an unauthorized change in a subscriber’s selection of a provider of telephone exchange service or telephone toll service. 4 In the Section 258 Order, the Commission adopted aggressive new rules designed to take the profit out of slamming, broadened the scope of the slamming rules to encompass all carriers, and modified its existing requirements for the authorization and verification of preferred carrier changes. The rules require, among other things, that a carrier receive individual subscriber consent before a carrier change may occur. 5 Pursuant to Section 258, carriers are absolutely barred from changing a customer's preferred local or long distance carrier without first complying with one of the Commission's verification procedures. 6 Specifically, a carrier must: (1) obtain the subscriber's written or electronically signed authorization in a format that meets the requirements of Section 64.1130 authorization; (2) obtain confirmation from the subscriber via a toll- free number provided exclusively for the purpose of confirming orders electronically; or (3) utilize an independent third party to verify the subscriber's order. 7 3. The Commission also has adopted liability rules. These rules require the carrier to absolve the subscriber where the subscriber has not paid his or her bill. In that context, if the subscriber has not already paid charges to the unauthorized carrier, the subscriber is absolved of liability for charges imposed by the unauthorized carrier for service provided during the first 30 3 47 U. S. C. § 258( a); Telecommunications Act of 1996, Pub. L. No. 104- 104, 110 Stat. 56 (1996); Implementation of the Subscriber Carrier Selection Changes Provisions of the Telecommunications Act of 1996; Policies and Rules Concerning Unauthorized Changes of Consumers’ Long Distance Carriers, CC Docket No. 94- 129, Second Report and Order and Further Notice of Proposed Rule Making, 14 FCC Rcd 1508 (1998) (Section 258 Order), stayed in part, MCI WorldCom v. FCC, No. 99- 1125 (D. C. Cir. May 18, 1999); First Order on Reconsideration, 15 FCC Rcd 8158 (2000); stay lifted, MCI WorldCom v. FCC, No. 99- 1125 (D. C. Cir. June 27, 2000); Third Report and Order and Second Order on Reconsideration, 15 FCC Rcd 15996 (2000), Errata, DA No. 00- 2163 (rel. Sept. 25, 2000), Erratum, DA No. 00- 2192 (rel. Oct. 4, 2000), Order, FCC 01- 67 (rel. Feb. 22, 2001); Third Order on Reconsideration and Second Further Notice of Proposed Rule Making, 18 FCC Rcd 5099 (2003); Order, FCC 03- 116, (rel. May 23, 2003). Prior to the adoption of Section 258, the Commission had taken various steps to address the slamming problem. See, e. g., Policies and Rules Concerning Unauthorized Changes of Consumers' Long Distance Carriers, CC Docket No. 94- 129, Report and Order, 10 FCC Rcd 9560 (1995), stayed in part, 11 FCC Rcd 856 (1995); Policies and Rules Concerning Changing Long Distance Carriers, CC Docket No. 91- 64, 7 FCC Rcd 1038 (1992), reconsideration denied, 8 FCC Rcd 3215 (1993); Investigation of Access and Divestiture Related Tariffs, CC Docket No. 83- 1145, Phase I, 101 F. C. C. 2d 911, 101 F. C. C. 2d 935, reconsideration denied, 102 F. C. C. 2d 503 (1985). 4 47 U. S. C. § 258( a). 5 See 47 C. F. R. § 64.1120( b). 6 47 U. S. C. § 258( a). 7 See 47 C. F. R. § 64.1120( c). Section 64.1130 details the requirements for letter of agency form and content for written or electronically signed authorizations. 47 C. F. R. § 64.1130. 2 Federal Communications Commission DA 04- 1172 3 days after the unauthorized change. 8 Where the subscriber has paid charges to the unauthorized carrier, the Commission’s rules require that the unauthorized carrier pay 150% of those charges to the authorized carrier, and the authorized carrier shall refund or credit to the subscriber 50% of all charges paid by the subscriber to the unauthorized carrier. 9 Carriers should note that our actions in this Order do not preclude the Commission from taking action, if warranted, pursuant to section 503 of the Act. 10 4. We received Complainants’ complaints alleging that Complainants’ telecommunications services providers had been changed from their authorized carriers to WCSS without Complainants’ authorization. 11 Pursuant to Sections 1.719 and 64.1150 of our rules, 12 we notified WCSS of the complaints and WCSS responded. 13 WCSS did not submit a third party verification or letter of agency, as required by our rules. 14 WCSS has failed to produce clear and convincing evidence that Complainants authorized carrier changes. 15 Therefore, we find that WCSS’s actions resulted in unauthorized changes in Complainants’ telecommunications service providers and we discuss WCSS’s liability below. 16 5. WCSS has removed all charges incurred for service provided to Complainants for the first thirty days after the alleged unauthorized change in accordance with the Commission’s liability rules. 17 We have determined each Complainant is entitled to absolution for the charges incurred during the first thirty days after the unauthorized change occurred and that neither the authorized carriers nor WCSS may pursue any collection against Complainants for those charges. 18 Any charges imposed by WCSS on each subscriber for service provided after this 8 See 47 C. F. R. §§ 64.1140, 64.1160. Any charges imposed by the unauthorized carrier on the subscriber for service provided after this 30- day period shall be paid by the subscriber to the authorized carrier at the rates the subscriber was paying to the authorized carrier at the time of the unauthorized change. Id. 9 See 47 C. F. R. §§ 64.1140, 64.1170. 10 See 47 U. S. C. § 503. 11 See Appendix A. 12 47 C. F. R. § 1.719 (Commission procedure for informal complaints filed pursuant to Section 258 of the Act); 47 C. F. R. § 64.1150 (procedures for resolution of unauthorized changes in preferred carrier). 13 See Appendix A. 14 See 47 C. F. R. § 64.1120- 64.1130. 15 See 47 C. F. R. § 64.1150( d). 16 If Complainant is unsatisfied with the resolution of this complaint, Complainant may file a formal complaint with the Commission pursuant to Section 1.721 of the Commission’s rules, 47 C. F. R. § 1.721. Such filing will be deemed to relate back to the filing date of Complainant’s informal complaint so long as the formal complaint is filed within 45 days from the date this order is mailed or delivered electronically to Complainant. See 47 C. F. R. § 1.719. 17 See 47 C. F. R. § 64.1160( b). 18 See 47 C. F. R. § 64.1160( d). (continued….) 3 Federal Communications Commission DA 04- 1172 4 30- day period shall be paid by each subscriber to its authorized carrier at the rates each subscriber was paying to its authorized carrier at the time of each unauthorized change. 19 6. Accordingly, IT IS ORDERED that, pursuant to Section 258 of the Communications Act of 1934, as amended, 47 U. S. C. § 258, and Sections 0.141, 0.361 and 1.719 of the Commission’s rules, 47 C. F. R. §§ 0.141, 0.361, 1.719, the complaints filed by Complainants 20 against WCSS ARE GRANTED. 7. IT IS FURTHER ORDERED that, pursuant to Section 64.1170( d) of the Commission’s rules, 47 C. F. R. § 64.1170( d), Complainants are entitled to absolution for the charges incurred during the first thirty days after the unauthorized change occurred to the relevant Complainant and neither the authorized carriers nor WCSS may pursue any collection against Complainants for those charges. 8. IT IS FURTHER ORDERED that this Order is effective upon release. FEDERAL COMMUNICATIONS COMMISSION Nancy A. Stevenson, Deputy Chief Policy Division Consumer & Governmental Affairs Bureau 19 See 47 C. F. R. §§ 64.1140, 64.1160. 20 See Appendix A. 4 Federal Communications Commission DA 04- 1172 5 INFORMAL COMPLAINT NUMBER 02- B0003014 02- B0007177 02- B0010833 02- B0011336 03- B0053910S 02- S67819 02- S68674 02- S72022 02- S72428 02- S72726 02- S74500 02- S76984 02- S77076 02- S77149 02- S77379 02- S79541 02- S80207 02- S80213 02- S80560 02- S81203 02- S81907 Appendix A DATE OF COMPLAINT April 20, 2002 August 14, 2002 October 7, 2002 October 10, 2002 July 31, 2003 March 25, 2002 March 7, 2002 March 14, 2002 April 12, 2002 March 22, 2002 April 17, 2002 June 6, 2002 April 4, 2002 June 18, 2002 March 13, 2002 July 8, 2002 July 11, 2002 August 19, 2002 September 18, 2002 October 16, 2002 December 4, 2002 DATE OF CARRIER RESPONSE January 28, 2003 December 19, 2002 April 10, 2003 July 2, 2003 February 12, 2004 January 28, 2003 February 12, 2004 February 12, 2004 February 12, 2004 February 12, 2004 August 5, 2003 July 2, 2003 October 9, 2002 February 12, 2004 February 12, 2004 July 2, 2003 November 14, 2002 December 17, 2002 January 28, 2003 January 28, 2003 April 10, 2003 5 Federal Communications Commission DA 04- 1172 6 Appendix A INFORMAL DATE OF DATE OF COMPLAINT RESPONSE CARRIER NUMBER RESPONSE 03- S82211 December 3, 2002 February 12, 2004 03- S82326 July 16, 2002 May 2, 2003 03- S82646 February 12, 2003 May 2, 2003 03- S83242 March 27, 2003 January 14, 2004 03- S84995 August 29, 2003 February 12, 2004 6