Dollar A Day Rent A Car Systems, Inc. v. Mountain States Tel. & Tel. Co.

• Decision Date: 03 October 1974
• Docket Number: CA-CIV,No. 1,1
• Citation: 526 P.2d 1068,22 Ariz.App. 270
• Parties: , 6 P.U.R.4th 494 DOLLAR A DAY RENT A CAR SYSTEMS, INC., a corporation, Appellant, v. The MOUNTAIN STATES TELEPHONE AND TELEGRAPH COMPANY, a corporation, and American Telephone and Telegraph Company, a corporation, Appellees. 2118.
• Court: Arizona Court of Appeals

Page 1068

526 P.2d 1068

22 Ariz.App. 270, 6 P.U.R.4th 494

DOLLAR A DAY RENT A CAR SYSTEMS, INC., a corporation, Appellant, v. The MOUNTAIN STATES TELEPHONE AND TELEGRAPH COMPANY, a corporation, and American Telephone and Telegraph Company, a corporation, Appellees.

No. 1 CA-CIV 2118.

Court of Appeals of Arizona, Division 1, Department B.

Oct. 3, 1974.

Rehearing Denied Nov. 6, 1974.

Snell & Wilmer, by Mark Wilmer, Kenneth R. Reed, Warren E. Platt, Phoenix, for appellant

Fennemore, Craig, von Ammon & Udall, by Roger C. Mitten, Michael Preston Green, Phoenix, for appellees.

OPINION

EUBANK, Judge.

This appeal raises the question of whether the telephone company as a public utility can regulate the content of advertisements in its classified directory, and if so, whether advertisements under the name 'Dollar A Day Rent A Car Systems' constitute price advertising which the telephone company may properly refuse. ¹

Appellant, Dollar A Day Rent A Car Systems, Inc., is a corporation engaged in leasing and renting automobiles to the public in Arizona and nationally. The appellee, Mountain States Telephone & Telegraph Company (hereafter Mountain States), is a public utility engaged in the general telephone business in Arizona and seven other western states where it enjoys a monopoly of that business in most of the areas served. The appellee, American Telephone & Telegraph Company, (hereafter A.T. & T.) is a corporation engaged in the general telephone business which owns a controlling interest in Mountain States as well as controlling interests in other telephone companies which make up the Bell System.

In connection with its business, Mountain States publishes and distributes to each of its subscribers a directory listing the name, address, and telephone number of subscribers desiring to be listed. The directory consists of two parts, the White Pages which is an alphabetical listing of telephone subscribers, and the Yellow Pages which is a classified listing of businesses and services, containing advertisements for those commercial subscribers willing to pay an additional fee. The Yellow Pages may include extra lines of advertising copy immediately following the directory listing or display advertising located on the same or nearby pages. In both the Yellow and White Pages, Mountain States will, for an additional charge, print the telephone subscriber's name in bold face type font, rather than in a normal light face font.

Mountain States has an announced policy concerning the content of advertising copy published in its classified directory. Its Directory Practice Book I, part J, section 3 (Rev.Oct.1966), establishes standards for Yellow Pages advertising copy content and provides in pertinent part:

'o. Prices--Percentages

Publishing of prices, price ranges, percent reductions or percent discounts, interest and repayment tables in directory copy is not accepted. This avoids the possibility of embarrassment because of changes in these figures during the issue period of the directory. Care should be exercised to avoid price advertising being obtained by circumvention through choice 'of firm names, trade or service marks, or by use of digits in cuts which would be understood as price information by users of the directory. Some examples of unacceptable copy:

'Rooms $3.50 and up' 'Guaranteed 4% interest'

'Service calls $2.50' 'Mortgages 5 1/2%'

'50% discount on older 'Lowest loan rates--

models' $36.38 per month per

'10% discount--cash and $1,000'

carry'

A White Pages listing, which as copy would be contrary to advertising copy regulations on price, may appear in the white pages and yellow pages only as a free listing. No advertising, including extra-line matter, is acceptable in connection with any such listing, and no such listing is acceptable as copy in any form in advertising.

A brand name, trade or service name or mark, which as copy, drawing or illustration would be contrary to advertising copy regulations on prices, is not acceptable as either part of a trade name listing or trade mark heading, or as copy, drawing or illustration in advertising.

The criterion for determining the acceptability of reference to specific monetary denominations in advertising is whether a price quotation is actually made or implied. Cases may arise occasionally which refer to specific amounts of money but which do not constitute express or implied quotation of price. For example, where a customer's listed name is 'Ben's Five and Ten Cent Store,' this name would be permitted in advertising since this is a common term used to describe a type of business and the language used therein is not meant to be nor does it imply a price quotation.'

Mountain States' policy in prohibiting any form of price advertising is intended to avoid misleading, deceiving, or confusing situations and discourage practices such as 'bait' advertising which are not in the public interest. Pursuant to this policy, appellant has been allowed to have a free listing as 'Dollar A Day Rent A Car Systems' in the alphabetical index under 'Automobile Renting and Leasing' in the Yellow Pages. Appellant, however, has been denied the opportunity to purchase extra line or display advertising under that name or bold face type print using that name. As a result, appellant advertises in the classified directory as 'Dollar Systems Rent A Car' and brought this action in the Superior Court seeking declaratory judgment as to its right to advertise in the Yellow Pages under its true name 'Dollar A Day Rent A Car Systems'. The trial court found that no genuine issue of material fact was presented and granted Mountain States and A. T. & T. summary judgment, ruling, in effect, that advertisements under the name 'Dollar A Day Rent A Car Systems' constituted price advertising which the telephone company could properly refuse.

Appellant's initial contention is that the use of the trade name 'Dollar A Day Rent A Car Systems' does not constitute price advertising within the meaning of the regulatory policy of Mountain States, or if it is price advertising, this is a question of fact inappropriate for resolution by summary judgment. In support of this argument, appellant emphasizes its expenditures in excess of one million dollars on a promotional compaign designed to give its trade name national exposure. The result, appellant contends, is that the name 'Dollar A Day Rent A Car Systems' now has a primary meaning other than price advertising. The fact that the trade name of a business contains a price quotation does not make the telephone company's rejection of advertisements under that name improper. In Frank v. New York Telephone Co., 34 Misc.2d 395, 228 N.Y.S.2d 536 (1962), it was held that the telephone company was not arbitrary and unreasonable in refusing advertisements under the name 'Dollar Fifty Trailer Rental' where company regulations prohibited the use of competitive prices in directory advertising. In $5 A Day 5cents A Mile Rent-A-Car Co. v. Michigan Bell Telephone Co., No. U--665 (Mich.P.S.C.1961), it was held that names which constitute price advertising, such as $5 a Day 5cents a Mile Rent-A-Car', are inherently misleading and the telephone company could properly refuse advertisements under such trade names. Appellant attempts to distinguish these cases as involving small local businesses and not an established multimillion dollar national corporation with in excess of one million dollars invested in the promotion of its trade name. This is a distinction without difference. The issue which we must decide is whether the name 'Dollar A Day Rent A Car Systems' constitutes...