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TELEPHONE NEWS SYSTEM v. ILLINOIS BELL TELEPHONE

October 23, 1962

TELEPHONE NEWS SYSTEM, INC., AN ILLINOIS CORPORATION, PLAINTIFF,
v.
ILLINOIS BELL TELEPHONE COMPANY, AN ILLINOIS CORPORATION, DEFENDANT, UNITED STATES OF AMERICA, DEFENDANT-INTERVENOR.



The opinion of the court was delivered by: Will, District Judge.

The Court, having examined the pleadings, the Stipulations of Facts, and the documents admitted as evidence in this case, and having heard the arguments of and examined the briefs filed by counsel, makes the following Findings of Fact and Conclusions of Law:

Findings of Fact

1. Telephone News System, Inc. (hereinafter called "plaintiff") is an Illinois corporation organized and existing since 1954. All of the issued and outstanding shares of said corporation are owned by Raymond J. MacMahon and Berneice MacMahon. Raymond J. MacMahon is president of the plaintiff, Berneice MacMahon is secretary and treasurer, and the three directors of plaintiff are Raymond J. MacMahon, Berneice MacMahon and Wilbur Hirtzer.

2. Plaintiff has been engaged in the business and activities hereinafter set forth since 1956 and maintains its office and principal place of business at 81 West Van Buren Street, Chicago, Illinois.

3. The defendant, Illinois Bell Telephone Company (hereinafter referred to as "Telephone Company"), is an Illinois corporation with its principal place of business at 212 West Washington Street, Chicago, Illinois. It is the only utility furnishing telephone service in the Chicago, Illinois area.

4. Plaintiff leases from United Press International News Service (hereinafter referred to as "United"), a device known as a "Sports Printer" through which it receives daily information and results of various sporting events.

5. The interval between the time the results and mutuels on a horse race at any given track become official and the time such information is transmitted by United over its Sports Printer service varies from a minimum of twelve minutes to a maximum of thirty minutes.

Prior to April 30, 1962, information concerning the scratches was disseminated by recording, in the same manner as heretofore described, beginning at approximately 9:30 A.M. each racing day.

7. These recordings are transcribed on an electronic device leased from Telephone Company, and from approximately 1:00 P.M. until 6:00 P.M. daily, except Sundays, said recordings are revised and brought up to date on an average of four or five times per hour in order to reflect the results of later races after information concerning the same is received by plaintiff over the United Sports Printer. The results are transcribed on an average of five or ten minutes after they are received by plaintiff over the United Sports Printer.

8. The recorded racing information as hereinabove described is available daily without charge, and may be obtained by any person who telephones WEbster 9-1900. The aforesaid exchange is listed in the Chicago Telephone directory and is serviced by and consists of 70 trunk lines. This is the only manner in which any facilities of Telephone Company are employed by plaintiff for dissemination of the aforedescribed racing information.

9. Plaintiff's only source of income for the aforedescribed services in the operation of its business is derived from payments received from Illinois Sports News of $600 per week. Said payment is for spot advertising commercials, which messages are transcribed on the same recordings which disseminate the results and mutuel price paid by the winning horse as aforesaid.

10. Plaintiff's facilities were utilized by LeRoy Retelle of Lansing, Michigan from May of 1960 until October of 1961 on the average of six days a week. During that time Retelle was engaged in the business of receiving wagers or bets on horse races as an agent of one, Maurice Ramont. He telephoned WEbster 9-1900 either from pay telephones in and about Lansing, Michigan, or from his residence telephone IVanhoe 4-9617. Information obtained by Ratelle pursuant to such calls was used by him in connection with the receiving and paying off of bets on horse races.

11. Neither plaintiff nor its employees accepts bets or wagers either by telephone or telegraph or otherwise.

12. The general regulations of the Illinois Bell Telephone Company applicable to general local exchange tariffs provide in part as follows:

    "USE OF SERVICE FOR UNLAWFUL PURPOSES — The
  service is furnished subject to the condition that
  it shall not be used for the purpose of making or
  accepting bets, furnishing information, or for any
  other purposes in connection with any gambling
  scheme, business or device, or for any similar
  unlawful purpose. Any subscriber whose service is
  to be discontinued or any applicant to whom service
  is to be denied under this regulation will be
  notified by the Telephone Company of his right to a
  hearing by the Illinois Commerce Commission to
  determine whether or not such service is being used
  or will be used in violation of this rule. Upon
  complaint to the Commission by any applicant or
  subscriber who is affected by the refusal or
  discontinuance of service in accordance with this
  rule, such service will be provided, continued or
  restored if the Commission shall determine that the
  service has not

  been used or is not intended to be used in
  violation of this rule."

13. The general regulations of the American Telephone and Telegraph Company applicable to message toll telephone service provide, in part, as follows:

    "USE OF SERVICE FOR UNLAWFUL PURPOSES — The
  service is furnished subject to the condition that
  it will not be used for an unlawful purpose."

14. The facilities of the Telephone Company are indispensable to the operations of plaintiff's business and the discontinuance of such services would force plaintiff out of business.

15. Under date of April 25, 1962, the United States Department of Justice, over the signature of Herbert J. Miller, Jr., Assistant Attorney General, wrote to the Telephone Company as follows:

  "Mr. Floyd Brown
  "Security Department
  "Illinois Bell Telephone Company
  "212 West Washington ...

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