Bryant v. Arkansas Public Service Com'n, CA

• Decision Date: 06 November 1996
• Docket Number: No. CA,CA
• Citation: 55 Ark.App. 125,931 S.W.2d 795
• Parties: Winston BRYANT, Attorney General, Appellant, v. ARKANSAS PUBLIC SERVICE COMMISSION, Appellee. 95-109.
• Court: Arkansas Court of Appeals

Page 795

931 S.W.2d 795

55 Ark.App. 125

Winston BRYANT, Attorney General, Appellant, v. ARKANSAS PUBLIC SERVICE COMMISSION, Appellee.

No. CA 95-109.

Court of Appeals of Arkansas.

Nov. 6, 1996.

Winston Bryant, Atty. General, Shirley Guntharp, Dep. Atty. General, Suzanne Antley, Asst. Atty. General, Little Rock, for Appellant.

Arthur H. Stuenkel, Little Rock, for PSC.

Ann E. Meuleman, Garry S. Wann, H. Edward Skinner, Little Rock, for SWB.

STROUD, Judge.

This appeal is brought by the Attorney General of the State of Arkansas from Orders No. 52, 56, 61, 62, 63, and 64 issued by the Arkansas Public Service Commission in Docket # 92-260U and results from the Commission's refusal to compel Southwestern Bell Telephone Company (SWB) to respond to discovery propounded by the Attorney General. The Attorney General argues that, in denying his discovery requests, the Commission failed to pursue its authority regularly and abdicated its responsibility to regulate SWB. We conclude that the Commission has regularly pursued its authority and has not abused its discretion in denying the Attorney General portions of his requested discovery. The orders of the Commission are affirmed.

In Docket # 92-260U, the Commission approved a stipulation entered into by SWB, the Staff of the Public Service Commission (Staff), and twenty other parties. This Stipulation resulted from an investigation conducted by Staff of SWB's earnings that found SWB's rates had produced earnings of $33 million in excess of SWB's reasonable revenue requirement. The Stipulation disposed of the issues raised by the excess earnings by providing that SWB would make incremental investments of $231 million over a three-year period to upgrade its infrastructure in Arkansas in lieu of potential rate reductions. The Commission approved the Stipulation in Order No. 38, but Order No. 38 also required SWB to establish a deferred account and to file quarterly reports so that the Commission could monitor the implementation of the upgrades. Order No. 38 further provided that the Commission would on an annual basis formally review the status of the deferred account, the investments made and projected investments remaining, and the revenues generated by those investments.

SWB filed a motion to clarify the procedure for developing the investment monitoring reports and also advanced a "Plan Investment Monitoring Report" form to be adopted on an interim basis. Staff supported the motion with some proposed modifications and also recommended that SWB's monitoring report form be adopted. The Attorney General objected to SWB's motion, but he did not raise any specific objection to the adoption of SWB's proposed format for the plan investment monitoring reports, nor did he propose any additions to the format or request that any additional information be included in the monitoring reports. Commission Order No. 40 adopted SWB's motion as modified by specific provisions of Staff's response.

On April 21, 1994, and August 19, 1994, SWB filed its first and second-quarter infrastructure reports, its plan investment monitoring reports, and monthly reports and work papers as required by Orders No. 38 and 40. The Attorney General then served SWB with thirty-six interrogatories, most containing five to six subparts, and thirty-one requests for production of documents that sought extensive and specific discovery of the information contained in the infrastructure reports. SWB objected to the Attorney General's discovery requests, contending that the information sought was irrelevant and immaterial, beyond the scope of the docket, and unduly burdensome and oppressive. The Attorney General filed a motion to compel responses to his discovery and also served SWB with a second set of interrogatories and production of documents that requested detailed information about the infrastructure report filed by SWB on October 21, 1994. SWB again objected to the Attorney General's requests, and the Attorney General moved to compel SWB to respond to his requests.

The Commission denied the Attorney General's motions in Order No. 52. It held that the monitoring reports contain extensive information on the infrastructure investments that are available to the Attorney General, and that the Attorney General has not cited any specific reason for his extensive discovery requests nor identified a specific flaw in the reports necessitating such extensive discovery. The Commission did provide, however, that, if the Attorney General knew of a specific deficiency or problem with the monitoring reports, he should bring it to the Commission's attention.

The Attorney General petitioned for rehearing of Order No. 52. He argued that the infrastructure reports did not reflect the information that Order No. 38 indicated would be necessary, i.e., whether the infrastructure upgrades are being implemented in a timely manner and in a manner which is most beneficial to the public. He also argued that the reports did not provide the information necessary for the Commission to supervise and regulate SWB to ensure compliance with its orders. In Order No. 56, the Commission denied the Attorney General's petition for rehearing, stating that the Attorney General has not responded to Order No. 52 by citing any specific problems or deficiency in the monitoring reports or in the implementation of the infrastructure investment. The Commission noted that the Attorney General continues to argue the inadequacy of the monitoring reports adopted by Order Nos. 38 and 40, even though he had the opportunity to raise this issue during the extensive proceedings that led to the entry of Order No. 38 or to raise the issue in a petition for rehearing of that Order.

The Attorney General appealed Orders No. 52 and 56, and during this period, the Commission entered Order No. 55. ¹ In response to this order, Staff and SWB each filed separate annual reports regarding the implementation of the Stipulation. The Commission then entered Order No. 58, which scheduled a public hearing to address and consider the proposed adjustments and modifications recommended by SWB and Staff to the Stipulation investments and infrastructure upgrades. The Attorney General sought additional discovery from SWB regarding its annual report. SWB answered some of the interrogatories and referred the Attorney General to its monthly infrastructure reports filed under seal with the Commission for the answers to others. SWB also filed separately its objections to the Attorney General's interrogatories and requests for production of documents.

The Commission addressed the parties' motions in Order No. 61:

1. Interrogatories No. 1(a), 2(a), 3(a), 4(a), 5(a), 6(a) and 7(a).

SWBT responded to each of these Interrogatories by referring the AG to information contained in the Monthly Infrastructure Reports....

The information sought by the AG can be obtained from the Monthly Infrastructure Reports. Pursuant to Rule 13.08(c), SWBT's answers to the above referenced Interrogatories [are] sufficient. If the AG or the AG's experts require guidance to interpret the contents of the Monthly Infrastructure Reports, the AG has the option to depose the appropriate employee of SWBT to explain the contents of the Reports.

2. Interrogatories No. 1(b)-(g), 2(b)-(g), 3(b)-(g), 4(b)-(g), 5(b)-(g), 6(b)-(g) and 7(b)-(g), and Requests for Production No. 1, No. 2, No. 3, No. 4, No. 5, No. 6 and No. 7.

In each of the above referenced interrogatory subparts the AG requests extensive and specific information on the investments which are the subject of the interrogatory, including all payees, the amounts of each payment, dates of payments and specific equipment received for expenditures....

....

The information sought by the AG does not appear on its face to be relevant to the issues which are the subject of the scheduled hearing and it is questionable whether the interrogatories are designed to lead to information relevant and material to those issues. However, the information may be relevant to the Report filed on March 10, 1995, and some of the requested information may be peripherally related to the issues which are the subject of the hearing. The task of compiling the extensive and detailed information which might be responsive to the AG's Interrogatories and Requests in one location would be burdensome and unreasonable. It is a sufficient response to allow the AG to inspect the information at the location of the information....

3. Interrogatories No. 10, No. 11, No. 12, No. 13, No. 14, No. 15, No. 16 and No. 28 and Requests for Production No. 8, No. 9, No. 10, No. 11, No. 12, No. 13 and No. 14.

In each of these Interrogatories the AG seeks "the amount of revenue that has been generated for SWB to date as a result of expenditures made pursuant to Order No. 38 ..." and other information. SWBT responded that the Quarterly Plan Investment Monitoring Reports filed with the Commission and provided to the AG track the revenue generated on a monthly basis.

Pursuant to Rule 13.08(c), SWBT has adequately responded to the Interrogatories by specifying the records in the possession of the AG from which the answers may be derived. If the AG needs to have the records interpreted or explained, the proper course of action is to depose the appropriate SWBT employee to interpret the records.

Order No. 61 denied the Attorney General's motion to compel answers to Interrogatories No. 17 through 27 and Requests for Production No. 15 through 28. The Commission held that these interrogatories and requests for production were not relevant to the Report filed March 10, 1995, or the issues scheduled for hearing on May 9, 1995.

The Attorney General filed an additional discovery motion that complained that SWB was withholding from discovery contracts it had with certain vendors. Order No. 62 allowed the Attorney General to inspect the contracts SWB had with various vendors on the conditions stated by the...