Louisiana Law Blog

by Lawrence J. Hand, Jr.

On December 20, 2007, the Federal Energy Regulatory Commission approved a final rule in docket no. RM07-10-000 to require certain natural gas market participants to file an annual report reflecting wholesale, physical natural gas transactions. In a related action, the Commission issued a notice of proposed rulemaking in docket no. RM08-2-000 that would require interstate and certain major, non-interstate pipelines to post daily information on capacity, actual flows and scheduled flows.   Both actions are taken under the Commission’s authority under the Energy Policy Act of 2005 to facilitate transparency of price and availability of supply in natural gas markets. 

by Gordon D. Polozola

The Federal Communications Commission has issued a Report and Order prohibiting cable operators from enforcing or executing any provision in a contract that grants an operator the exclusive right to provide cable services to apartment buildings, condominiums and certain other multiple dwelling units (MDUs) in an effort to bring the benefits of competition to the increasing number of residents living in MDUs.  The FCC found that cable operators’ use of exclusivity clauses in MDU cable service contracts constitutes “an unfair method of competition or an unfair act or practice” proscribed by the federal Communications Act.  

by Lawrence J. Hand, Jr.

The Federal Energy Regulatory Commission has recently issued a notice of proposed rulemaking which seeks to increase the Commission’s oversight over intrastate natural gas pipelines and other non-jurisdictional sellers of natural gas. FERC Docket Nos. RM07-10-000 and AD06-11-000. Specifically, the proposed regulations would require that intrastate natural gas pipelines post, on a daily basis, the capacities of and volumes flowing through major receipt and delivery points and mainline segments. Additionally, the new regulations would require annual filings by buyers and sellers of natural gas in the United States wholesale markets. Traditionally, intrastate natural gas pipelines were not subject to oversight by the Federal Energy Regulatory Commission, unless and to the extent that such intrastate pipeline elected to transport gas in interstate commerce pursuant to the provisions of Section 311(a)(2) of the Natural Gas Policy Act of 1978. The proposed rulemaking marks a significant advancement of FERC’s jurisdiction over non-jurisdictional intrastate pipelines as the proposed rule applies to all intrastate pipelines, not merely those that perform service pursuant to Section 311(a)(2) of the Natural Gas Policy Act of 1978.

by Gordon D. Polozola

The Louisiana Supreme Court issued a unanimous decision clearing the way for the City of Lafayette to issue bonds to finance its Fiber-to-the-Home (FTTP) Project. As described by the Court, FTTH technology delivers telecommunications services via fiber optic cables to every home and business in the covered area. In contrast, a more traditional system delivers services to a distant point, with the remaining distance to each home and business being covered by technically inferior and bandwidth-limiting copper (telephone) wires. The decision ends eighteen months of litigation, starting after the citizens of Lafayette voted 62% to 38% in a July 16, 2005 election to issue up to $125 million in bonds for the Project. Project opponents filing suit to block the bond issuance included the incumbent cable and telephone companies, as well as two Lafayette residents. For additional news articles relating to the decision, see http://www.theadvertiser.com/apps/pbcs.dll/article?AID=/20070223/NEWS01/702230321/1002 and http://www.2theadvocate.com/news/6008236.html  

by Lawrence J. Hand, Jr.

On November 17, 2006, the United States Court of Appeals for the District of Columbia Circuit vacated the Federal Energy Regulatory Commission’s Standards of Conduct as applied to interstate natural gas pipelines. These Standards of Conduct, which are set forth in Order No. 2004 and codified at 18 CFR Part 358, govern the relationship between an interstate natural gas pipeline and various affiliates. The Court found that FERC’s effort to expand the pre-existing standards of conduct beyond relationships between an interstate natural gas pipeline and its marketing affiliates was not supported by record evidence. It is not clear if or when the Commission will revisit Order 2004 and how it will attempt to address the infirmities cited by the Court. It is worth noting that the current Chairman of the Commission, Joseph Kelliher, issued a strong dissent when Order 2004 was originally enacted and argued in favor of keeping the Standards of Conduct applicable only to marketing affiliates of interstate pipelines.

by Gordon D. Polozola

The Louisiana Supreme Court has affirmed an order of the Louisiana Public Service Commission establishing a state universal service fee for telecommunications service providers operating in the state. T-Mobile, a wireless provider operating in Louisiana, appealed the LPSC’s order, arguing that the USF fee constituted a tax and, thus, the LPSC lacked jurisdictional authority to mandate the charge. The Supreme Court disagreed, finding that the charge constituted a fee, not a tax, and that the LPSC had the jurisdiction to impose a USF fee under both the Telecommunications Act of 1996, and the Louisiana Constitution.  A copy of the decision is available at the following link: http://www.lasc.org/opinions/2006/05ca2578.pdf

by Gordon D. Polozola

Governor Kathleen Blanco has reportedly vetoed the controversial Competitive Cable and Video Services Act, House Bill 699. There has been significant disagreement between BellSouth, the proponent of the bill, cable providers, who appeared to turn neutral as to its passage after the bill was amended, and Parish presidents and mayors, who urged the Governor to veto the bill. Of particular concern was the lack of any requirements for telecommunications companies to provide service to consumers in rural and poor neighborhoods, which cable providers typically must do under current franchise agreements. Local officials also argued that the bill would reduce or eliminate local governments' authority to manage their rights-of-way. Under Louisiana law, a bill vetoed by the Governor must subsequently be approved in a veto session by two-thirds of the elected members of both the House and Senate to become law. The bill originally passed both houses by a two-thirds vote before being sent to the Governor. For recent new articles regarding this matter, visit http://www.theadvertiser.com/apps/pbcs.dll/article?AID=/20060712/NEWS01/60712013  and http://www.2theadvocate.com/news/3248951.html?showAll=y

by Gordon D. Polozola

To say there has been consolidation in the telecom market over the last decade would obviously be an understatement. Competitive telecom companies, which entered the market by the hundreds after passage of the federal Telecommunications Act, have merged with each other (or have been acquired) as a means of survival or market penetration. The (then) giants of the telecom world have also consolidated into mega-regional communications companies. SBC acquired Pacific Telesis, Southern New England Telephone, Ameritech (which itself acquired Illinois Bell, Indiana Bell, Michigan Bell, Ohio Bell and Wisconsin Bell), and most recently AT&T. The new AT&T became the largest telecom company in the U.S. Now it is proposing to acquire BellSouth, currently the third largest telecom company in the U.S. (For more information on the history of telecom mergers, visit http://www.fcc.gov/wcb/armis/carrier_filing_history/COSA_History/)