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Fights Over Long Distance Rates Restricted to Federal Suits
Description Bulk rate buyer of long-distance service sued AT&T in state court for breach of contract. Supreme Court reversed lower courts holding that, under the Communication Act, AT&T must follow rate filings with the FCC and that any suit regarding rates must be brought under Communication Act provisions.
Topic Constitutional Law
Key Words Interstate Commerce, Communications Act, Common Carrier, Contracts
C A S E   S U M M A R Y
Facts AT&T, a common carrier, must file tariffs with the FCC that contain all its charges for interstate services. The FCC requires carriers to sell long-distance service to resellers under the same rates, terms, and conditions as apply to all such customers. Central buys long-distance service in bulk from AT&T for resale to its customers. It ended up in a dispute with AT&T and sued for breach of contract in Oregon court. Lower courts held for Central; AT&T appealed.
Decision Reversed. The Communication Act tariff requirements preempt state-law claims. The rate a carrier files with the FCC is the only lawful charge. Even if a carrier misrepresents its rate and a customer relies on the misrepresentation, the carrier cannot be held to the rate if it conflicts with the published tariff. If Central is to have a claim against AT&T, it must bring suit for violation of the Communications Act.
Citation American Telephone and Telegraph Co. v. Central Office Telephone, Inc., 118 S.Ct. 1956 (1998)

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