Radio Common Carriers of New York, Inc. v. New York State Public Service Commission

• Decision Date: 03 August 1973
• Citation: 79 Misc.2d 600,360 N.Y.S.2d 552
• Parties: Application of RADIO COMMON CARRIERS OF NEW YORK, INC., et al., Petitioners, For a Judgment under Article 78 of the Civil Practice Law and Rules setting aside an Opinion of the Public Service Commission issued
• Court: New York Supreme Court

Page 552

360 N.Y.S.2d 552

79 Misc.2d 600

Application of RADIO COMMON CARRIERS OF NEW YORK, INC., et al., Petitioners, For a Judgment under Article 78 of the Civil Practice Law and Rules setting aside an Opinion of the Public Service Commission issued August 3, 1973 purporting to assert jurisdiction over persons engaged in the State of New York in business as Radio Common Carriers, and setting aside a Resolution of the Commission made February 1, 1974 establishing certain Regulations covering the business of Radio Common Carriers; or in the alternative, for a Judgment ordering modification of said Regulations, v. NEW YORK STATE PUBLIC SERVICE COMMISSION, Respondent.

Supreme Court, Special Term, Albany County.

Oct. 3, 1974.

Gordon, Frutkin & Rabin, New York City (Myron P. Gordon and Monte Engler, New York City, of counsel), for petitioners.

Peter H. Schiff, Counsel to the Public Service Commission of the State of New York, Albany (John C. Crary and Howard J. Read, Albany, of counsel), for respondent.

A. FRANKLIN MAHONEY, Justice.

This Article 78 proceeding presents the question of whether petitioners' business of providing paging service to subscribers by (a) receiving a telephone message and transmitting same to a subscriber by radio message or tone signal, or (b) receiving a telephone message in its officer and by having its receiving equipment connected to a telephone line transmit said message to a subscriber by radio, or (c) by use of telephone lines normally connected to certain equipment a caller is able to speak via radio to a subscriber who either has a personal radio receiver on his person or installed in his car, is subject to Public Service Commission (hereinafter PSC) regulation.

An affirmative answer to the question posed above shall require inquiry into the following attendant issues:

(1) Did the PSC validly establish and promulgate rules and regulations for the conduct of petitioner's (Radio Common Carriers, hereinafter RCCs) business without holding a public hearing?

(2) Are the rules and regulations promulgated by the PSC lawful in that, as applied, they differ from those imposed upon land-line telephone companies (New York Telephone Company and others)?

(3) Did the PSC violate due process with respect to the petitioning carriers in that it exempted RCCs which were in operation or had applied to the FCC for allocation of radio frequencies prior to October 1, 1973?

(4) Did the PSC act arbitrarily in requiring newly regulated RCCs to conform its system of accounts to that required of land-line telephone companies heretofore authorized to conduct a like business?

A RCC ¹ is a radio station licensed by the FCC to operate on an assigned channel as a public communications service for hire. A RCC provides its subscribers with a small receiving device which can be carried on one's person or installed in a vehicle. The service provided can be either 'connected' or 'interconnected' with a conventional land-line telephone company already controlled, regulated and licensed by the PSC and authorized to engage in a like or similar business or service ². If the service is merely 'connected', a subscriber may communicate with RCCs' control point or with other co-workers or co-principals who are carrying like paging receivers. If the service is 'interconnected', the subscriber may communicate directly with, and be reached by, all persons on the general telephone network.

In the latter case the PSC, as early as 1962, determined that where radio communication service is interconnected with a land-line telephone company, certification as a telephone corporation should be required (Application of Capital Mobile Radio Service, Inc., Case No. 21810, 42 P.U.R. 3rd 433). During the past decade, however, the respondent PSC has refrained from making a like requirement with respect to non-interconnected RCCs.

In August of 1973 the respondent Commission, after reexamination of the radio-telephone industry had indicated that public use of radio-telephone communications had dramatically increased in the decade of the sixties ³, decided to extend plenary jurisdiction over and regulation of non-interconnected RCCs. It is that decision of the PSC that is under review herein.

Refining the issue further is to ask whether the activities of the RCCs are such that it can be said they are engaged in the 'business of affording telephonic communication for hire' (Public Service Law § 2, subd. 17g and for basis of definition and of regulation, Service Law § 2, subd. 17; §§ 5, 90, 94) both with respect to those activities of the petitioning RCCs that have to do with 'interconnected' reliance on the telephone lines of land-based telephone companies and with non-interconnected transmissions? In my view, there can be no doubt that interconnected transmissions are subject to the jurisdiction and regulation of the PSC. Such has been the case for the past decade and without objection of the RCCs regulated. Next, I find nothing in the PSC Opinion nor in the law against which it must be weighed to persuade me to the view that non-interconnected radio transmission of messages is so distinguishable from telephonic transmission of the same, that the former must be excluded from regulation. The PSC is charged with the responsibility of administering the Public Service Law and its determination of the applicability of that law to those areas of communication assigned to it for regulation will not be set aside by the courts if there is a rational basis for the conclusions reached (Rochester Tel. Corp. v. United States, 307 U.S. 125, 146, 59 S.Ct. 754, 83 L.Ed. 1147; Matter of Mounting and Finishing Co. v. McGoldrick, 294 N.Y. 104, 108, 60 N.E.2d 825, 827; Mtr. of Gamewell Co. v. Public Serv. Comm., 8 A.D.2d 232, 235, 188 N.Y.S.2d 107, 109). Telephony is the art of communication and is so invested with public concern that the Legislature has seen fit to regulate it as a public utility. Telephonic communication is by wire. Radio, in its beginnings, was called a 'wireless' and its initial employment was not to communicate in the sense of delivering messages but, rather, to inform and entertain. Yet, even in that relatively unsophisticated posture the Federal Government thought it sufficiently in the public interest to regulate the radio industry to the extent that it assigned radio frequencies. When radio advanced in refinement to the point where it was used to make personal, rather than general, contact so as to transmit material of interest only to the receiver, it invaded the same area of public concern as that occupied by telephonic communicators. The only difference is that one is wireless and the other is not. Next, if non-interconnected radio were not regulated by the PSC the proliferation of RCCs could have an adverse impact on the public interest. Circuits could become overcrowded, duplication of service could develop and trunking of channels so as to provide more efficient service would be impossible. In fact, RCCs, including petitioners, might be handicapped in obtaining radio frequencies from the FCC since that body has repeatedly deferred such assignments of frequencies pending consideration by State regulatory commissions of application for certificates of public convenience and necessity. The FCC could conceivably deny radio frequency assignment absent any showing that a local public interest would be served.

While petitioners fully support regulation under appropriate statutory authority, ⁴ they adamantly contend that no such authority exists in the present law and none can or should be implied (Danna v. Con Edison Co., Inc., 71 Misc.2d 1029, 337 N.Y.S.2d 722; City of New York v....