******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) Commercial Leased Access Complaint of ) ) STEPHEN S. SMITH, ) Petitioner, ) vs. ) CSR 5055-L ) TCI CABLEVISION OF TEXAS, INC., ) Respondent. ) MEMORANDUM OP INION AND ORDER Adopted: February 18, 1998 Released: February 20, 1998 By the Deputy Chief, Cable Services Bureau: I. Introduction 1. Stephen S. Smith ("Smith") filed a complaint alleging that TCI Cablevision of Texas, Inc. ("TCI") had failed to provide him with its leased access rates based on the "average implicit fee" formula adopted in the proceeding In re Implementation of Sections of the Cable Television Consumer Protection and Competition Act of 1992: Leased Commercial Access, Second Report and Order and Second Order on Reconsideration of the First Report and Order ("Second Report") which amended our rule Section 76.970, 47 C.F.R.  76.970. The complaint seeks relief from this failure to provide leased access information. TCI filed a response, and Smith did not file a reply. II. Background 2. The Cable Television Consumer Protection and Competition Act of 1992 ("1992 Act") required the Commission to establish maximum reasonable rates that a cable operator may establish for leased access use. In the Report and Order and Further Notice of Proposed Rulemaking ("Report and Order") in the Leased Commercial Access proceeding, we adopted the "highest implicit fee" formula as the method for setting maximum rates. Then, in the Order on Reconsideration of the First Report and Order and Further Notice of Proposed Rulemaking ("Order on Reconsideration"), we re-examined the highest implicit fee formula and tentatively concluded that it overcompensated cable operators. In that Order on Reconsideration, we sought comment on a proposed cost/market rate approach to setting maximum rates. In the Second Report, we adopted the average implicit fee formula as a method of determining the highest fee that a cable operator could charge for leased access. Thus, under our current rules, the maximum commercial leased access rate that a cable operator may charge for full-time placement on a tier exceeding a subscriber penetration of 50 percent is the average implicit fee for full- time channel placement on all such tier(s). Cable system operators must provide a potential leased access programmer the cable operator's leased access rates within 15 calendar days after they are requested. 3. In his complaint, Smith states that through a series of letters and telephone calls he requested copies of TCI's leased access rates under our new average implicit fee formula but that TCI never provided them to him. On February 6, 1997, Smith made a verbal request for rates under the new formula (average implicit fee) to Dennis Moore ("Moore"), a TCI manager. Then on March 5, 1997, Smith sent Moore a letter reminding him of their conversation. In response to Smith's letter to Moore, Marcus Cathey ("Cathey"), TCI's Director of New Business Development, sent Smith by letter dated March 14, 1997 a copy of TCI's rates; however, the rates transmitted in the March 14, 1997 letter were not based on the new formula. Smith renewed his request again by a certified letter to Cathey on March 18, 1997, to which Cathey responded in writing on April 1, 1997 that the new rate calculations had not been completed, that the new rates would be calculated sometime in May and that he would mail Smith the "new rates as soon as they come in." Smith called Cathey at the end of May to remind him to send the new rates, but Cathey never sent them. Smith filed his complaint on June 25, 1997, but did not serve TCI until sometime after July 20, 1997, the date on his certificate of service filed with the Commission. 4. In its response, TCI does not deny that Smith spoke to Cathey by telephone at the end of May, but instead asserts that "Mr. Smith never formally requested the Company's requested rates after May 12, 1997, the effective date of the average implicit formula." Cathey was the appropriate person to whom Smith should have requested rate information as Cathey asserts in his affidavit that he is "responsible for all matters concerning commercial leased access" in his capacity as TCI's Director of New Business Development. TCI asserts that prior to May, it had not calculated the average implicit rates and therefore could not provide them to Smith. By letter dated April 1, 1997, Cathey offered to provide Smith with the new rates when they were calculated, but after one month passed, Cathey, TCI states, forgot to send them. 5. TCI asserts that Section 76.970(h) of our rules requires responses to "written" requests for information within 15 days of the date the request is made. TCI further asserts that under the current rules, "requests for [commercial leased access] information must be in writing" and that the rules do not require a response to an oral request for information. TCI asserts that the first time it received a written request for rate information after the effective date of the amendments to the leased access rules, when the new formula would be effective, was when it received Smith's complaint, which was dated Sunday, July 20, 1997. The Commission received its service copy on July 31, 1997. TCI states that Cathey was out of the office July 21 to July 25, but promptly sent Smith the leased access rates by letters dated August 4, 1997 and August 6, 1997, presumably within 15 days after TCI received the complaint. Accordingly, TCI states that if the Commission treats the complaint as a request, TCI is in compliance with the Commission rules. III. Discussion 6. Based on the facts presented in the pleadings, we find that it is undisputed that Smith made a telephone request to Cathey in late May for TCI's average implicit rates and that Cathey earlier had promised to send Smith the rates by letter dated April 1, 1997. Cathey does not contradict Smith's statement that Smith telephoned him in late May, but rather states that Smith did not make a "formal request." Moreover, Smith had requested the rates on three prior occasions by one telephone call and two letters. Cathey was aware of the two letters because he responded to both of them. 7. We disagree with TCI that requests for leased access information must be in writing because the first sentence of paragraph (h) which addresses requests for four different types of leased access information, including rate information, is silent on the issue. Paragraph (h) reads: Cable system operators shall provide prospective leased access programmers with the following information within 15 days of the date on which a request for leased access information is made: . . . (2) a complete schedule of the operator's full-time and part-time leased access rates. . . . Thus, paragraph (h) does not require that requests for information be in writing. This point is further illuminated later in paragraph (h) which, in contrast to requests for leased access information, explicitly requires that requests for leased access be made in writing: All requests for leased access must be made in writing and must specify the date on which the request was sent to the operator. Moreover, the different purposes of the two requests provide further guidance why one requires a written request and the other does not. The first addresses requests by prospective leased access providers who are merely seeking preliminary information so that they might decide whether to request leased access. The second addresses the actual request for leased access, which appropriately deserves a written document to begin the process for obtaining leased access. Indeed, paragraph (h) sets forth in detail four information requirements that a bona fide written leased access request must contain. 8. Because a request for information under Section 76.970(h) does not have a writing requirement, we find that Smith made a valid request for information under that paragraph for leased access rates when he telephoned Cathey in late May. Smith also established that he spoke to the appropriate person, Cathey, to make a request for leased access rates because Cathey was "responsible for all matters concerning commercial leased access" and accordingly should have forwarded the rates to Smith within 15 days of Smith's request. Moreover, even if Cathey were not the appropriate person to process the request, there should be at least one person in the cable company's office who is capable of complying with such requests as required by our rules and that person should be identified to prospective leased access callers. 9. TCI did not respond to Smith's late May, 1997, request for rates until August 4 and August 6, 1997. Because the TCI responses were clearly not made within 15 days of Smith's request, TCI violated the 15 day requirement of Section 76.970(h) of our rules. 10. Nevertheless, because this is the first proceeding in which we have had the opportunity to decide whether an oral request for information triggers a cable operator's obligation to respond within 15 days under Section 76.970(h), we will not commence an enforcement action against TCI for violating paragraph (h). However, we caution cable operators that in the future we will take enforcement action to ensure that they respond within 15 days to requests for information, oral or written, made pursuant to paragraph (h). 11. With regard to Smith's complaint, even though TCI violated our rules, because TCI has provided Smith with its leased access rates, Smith's request for relief is moot. IV. Ordering Clauses 12. IT IS ORDERED that Smith's complaint is DISMISSED as moot. 13. This action is taken pursuant to authority delegated by Section 0.321 of the Commission's Rules, 47 C.F.R.  0.321. FEDERAL COMMUNICATIONS COMMISSION William H. Johnson Deputy Chief, Cable Services Bureau