Goldin v. Public Utilities Commission

• Decision Date: 15 March 1979
• Docket Number: S.F. 23714
• Citation: 23 Cal.3d 638,153 Cal.Rptr. 802
• Court: California Supreme Court
• Parties: , 592 P.2d 289 Marvin GOLDIN, Petitioner, v. PUBLIC UTILITIES COMMISSION, Respondent; GENERAL TELEPHONE COMPANY of California, Real Party in Interest.

Page 802

153 Cal.Rptr. 802

23 Cal.3d 638, 592 P.2d 289

Marvin GOLDIN, Petitioner, v. PUBLIC UTILITIES COMMISSION, Respondent;

GENERAL TELEPHONE COMPANY of California, Real Party in Interest.

S.F. 23714.

Supreme Court of California, In Bank.

March 15, 1979.

Paul J. Fitzgerald, Beverly Hills, for petitioner.

Janice E. Kerr, Hector Anninos and Scott K. Carter, San Francisco, for respondent.

Evelle J. Younger, Atty. Gen., Jack R. Winkler, Chief Asst. Atty. Gen., Daniel J. Kremer, Asst. Atty. Gen., Jay M. Bloom and Alan S. Meth, Deputy Attys. Gen., as amici curiae on behalf of respondent.

No appearance for real party in interest.

MANUEL, Justice.

Twelve years ago this court, in the case of Sokol v. Public Utilities Commission (1966) 65 Cal.2d 247, 53 Cal.Rptr. 673, 418 P.2d 265, struck down on constitutional grounds the then existing rule for discontinuance of telephone service used for illegal purposes and announced the standard which any future rule must meet. "(W)hatever new procedure is hereafter devised," we held, "must at a minimum require that the police obtain prior authorization to secure the termination of service by satisfying an impartial tribunal that they have probable cause to act, in a manner reasonably comparable to a proceeding before a magistrate to obtain a search warrant. In addition, after service is terminated the subscriber must be promptly afforded the opportunity to challenge the allegations of the police and to secure restoration of service. A procedure incorporating these measures would provide substantial protection to the subscriber without hindering the enforcement of (the) laws." (65 Cal.2d at p. 256, 53 Cal.Rptr. at p. 679, 418 P.2d at p. 271.)

Following this decision the Public Utilities Commission (Commission) undertook further proceedings directed toward the development of a rule consistent with the aforesaid standard. The result was the present rule, known as rule 31, ¹ the provisions of which are set forth in the margin. ² Generally speaking, rule 31 provides that service shall be refused or disconnected upon receipt by the Commission from any authorized law enforcement official of a writing signed by a magistrate finding "that probable cause exists to believe that the use made or to be made of the service is prohibited by law, or that the service is being or is to be used as an instrumentality, directly or indirectly, to violate or to assist in the violation of the law." The subscriber or any person aggrieved by action taken pursuant to this standard is to receive immediate notice and has the right to immediately file a complaint with the Commission in which he may request interim relief pending proceedings on the complaint; this shall be the exclusive remedy. Any concerned law enforcement agency shall have the right to notice of any hearings and the right to full participation therein in the role of prosecutor. It shall bear the twin burden of proving violation of the rule and of persuading the Commission that the service should be refused or not restored. Each application or contract for communications service is deemed to contain the provisions of the rule, and all applicants for service are deemed to have consented to its provisions.

In the instant proceeding for review we confront an extensive attack, on constitutional as well as other grounds, upon Rule 31 and its application in this case. For reasons to be set forth below, we have concluded that this attack, in light of the circumstances here presented, must be rejected. We affirm the order and decision of the Commission.

I

In the spring of 1975 the Sheriff's Department of Los Angeles County and the Police Department of the City of Los Angeles instituted an investigation of complaints indicating that the business of prostitution was being carried on on an outcall basis through massage parlors and related businesses. In the course of this investigation, which continued through 1976, officers of the said agencies discovered information leading them to believe that certain businesses operated by petitioner as telephone answering services were in fact being used for the indicated illicit purpose. On March 7, 1977, Judge Mary E. Waters of the Los Angeles Municipal Court, having been presented with an extensive affidavit and other materials reflecting this information, signed a document entitled "Finding of Probable Cause" which indicated the existence of probable cause to believe that certain telephone numbers listed in the affidavit and located at two addresses within the county "(were) being utilized for illegal purposes." This document was duly served upon the real party in interest General Telephone Company of California (General), and on March 11, 1977, the company terminated the telephone service with respect to 39 of the indicated telephone numbers as to which General was the supplier and petitioner was the subscriber.

On March 14, 1977, petitioner filed a complaint with the Commission which alleged inter alia that he operated a legitimate telephone answering service business and had not used the subject telephones for any illegal purpose, asserted that Rule 31 and its application herein were unconstitutional and void, and requested an order directing General to immediately restore service or, in the alternative, to grant interim relief pending the conclusion of hearings on the complaint. Pursuant to paragraph A of rule 31 the Commission notified the District Attorney of Los Angeles County, the county sheriff, and the Los Angeles Chief of Police of the filing of the complaint and the date, time and place of the hearing. All of these filed petitions to intervene, and an answer on behalf of the interveners was filed by the district attorney who, inter alia, sought an order denying the request for interim relief.

Hearings on petitioner's complaint were held at which the interveners, over petitioner's objection, were permitted to produce evidence and act as prosecutors. The hearing officer, on motion of the interveners, quashed a subpoena compelling the attendance and testimony of Judge Waters. At the conclusion of the hearings the hearing officer ruled that the procedures authorized by rule 31 were legal and valid, that such procedures had here been followed, that a sufficient basis existed for the finding of probable cause, and that the request for interim relief should be denied.

The question of interim relief was then submitted to the full Commission for decision, and on April 5, 1977, the Commission issued an order granting such relief "to prevent any undue business hardship pending our final determination." It was further ordered that the restoration of service on an interim basis should be subject to the payment of reconnection charges by petitioner.

On July 26, 1977, the Commission issued its final decision. It therein found and concluded inter alia that the provisions of rule 31 were consistent with the requirements set forth by this court in Sokol and moreover were "consistent with the requirements of due process of law, equal protection of the laws, and the right of freedom of speech, as required by the California and United States Constitutions and other laws pertinent thereto"; that the provision of rule 31 had been complied with in all respects; and that the interveners had "satisfied their burden of proof as required by paragraph 4 of Rule 31." It further found and concluded inter alia that petitioner's telephone service was used during the period in question "directly and indirectly, to assist in the violation of the law, to wit, Section 647(b) of the Penal Code (soliciting or engaging in acts of prostitution)." It was ordered that the interim relief previously granted should be terminated, and that General and the Pacific Telephone and Telegraph Company (Pacific) ³ should thereafter "refuse new business service to (petitioner) or any entity in which he has financial or managerial control, at any location in California, without further order of this Commission." ⁴

Subsequent petitions for vacation of the order terminating interim relief and for rehearing were denied. We granted petitioner's application to this court for a writ of review in order to examine rule 31 and its application in light of recent decisions of this court and the United States Supreme Court.

II

A relatively brief statement of the substance of the extensive evidence presented before the Commission will suffice for our purposes.

Twenty male police officers gave evidence on behalf of the interveners. Of these, each of 17 testified in essence that he had placed a call to a telephone number assigned to petitioner which he had obtained from a pictorial newspaper advertisement offering outcall massage or nude modelling services; that as a result of the call a woman was dispatched and arrived at hotel or motel accommodations where the officer was located; that after stating the price of the massage or nude modelling service ($35 to $40) and indicating that she herself received only a small portion ($5 to $10) thereof, the woman (in 16 of the 18 cases detailed) offered to perform various acts of a sexual nature, including sexual intercourse, for a sum ranging from $40 to $100 over and above the cost of the advertised service; and that in these 16 cases the woman was thereupon arrested for violation of Penal Code section 647, subdivision (b).

A female police officer, also appearing for the interveners testified in essence that she telephoned a number assigned to petitioner which she had obtained from a newspaper advertisement which stated "sexy and beautiful girls wanted for outcall massage, $500 a week guaranteed"; that she was directed to and subsequently did meet petitioner at a restaurant to discuss the indicated employment; that in the course of the ensuing conversation petitioner indicated that he was the operator of the service and made several comments (the specifics of which appear in the record)...