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Cable Television of Ill. v. Commerce Com.

OPINION FILED APRIL 3, 1980.

CABLE TELEVISION COMPANY OF ILLINOIS ET AL., PETITIONERS-APPELLANTS-CROSS-APPELLEES,

v.

ILLINOIS COMMERCE COMMISSION ET AL., RESPONDENTS-APPELLEES-CROSS-APPELLANTS.



APPEAL from the Circuit Court of McHenry County; the Hon. ROLAND HERRMANN, Judge, presiding.

MR. PRESIDING JUSTICE SEIDENFELD DELIVERED THE OPINION OF THE COURT:

• 1 In question is whether the Illinois Commerce Commission (ICC) has authority to regulate the rates, terms and conditions of "pole attachment" agreements *fn1 between a utility company and cable TV operators. We conclude that the ICC possesses that authority and, further, that in its exercise the ICC may consider the interest of cable TV subscribers together with the interests of utility consumers.

The petitioners are 24 cable television companies (hereinafter referred to as Cable TV) which have brought an action seeking to enjoin ICC from exercising jurisdiction over pole attachment agreements entered into by petitioners and various public utilities. These companies provide cable television to communities throughout Illinois. In the operation of this business, space is leased on utility poles in order to string transmission cables. Petitioners enter into contracts with public utilities, referred to as pole attachment agreements, whereby they lease the needed space on utility owned poles. Under a recently amended Federal statute the Federal Communications Commission is given jurisdiction to regulate the conditions, terms, and rates of pole agreements; but the statute allows States to retain jurisdiction by certifying that they regulate the rates and terms of such agreements and in so doing have authority to consider and do consider the interests of cable television subscribers as well as the interests of utility consumers. 47 U.S.C.A. § 224(c)(1978 Supp.).

ICC issued a resolution and certification on April 5, 1978, stating that it met the criteria specified under the Federal statute as amended. Cable TV filed a complaint for declaratory and injunctive relief on June 29, 1978, challenging the certification on the ground that ICC has no authority to regulate pole agreements or to consider the interests of cable subscribers. ICC filed a motion to dismiss on August 3, 1978, alleging the court lacked jurisdiction to entertain the suit because petitioners failed to pursue their administrative remedies under sections 65 and 68 of the Public Utilities Act. Ill. Rev. Stat. 1977, ch. 111 2/3, pars. 69, 72.

After the action for declaratory and injunctive relief was filed, Illinois Power Company, a public utility in central Illinois, was informed by respondent that before its pole agreements with American Television and Communications Corporation, a cable operator in Champaign-Urbana, could be approved, a joint petition must be filed by the utility and cable operator and a hearing held to determine the economic impact the annual rental rates would have on cable subscribers. In response to this immediate exercise of jurisdiction, a petition was filed for a preliminary injunction on August 29, requesting that ICC be enjoined from considering pole agreements by any standard not applied previous to April 5, 1978. After a hearing on September 6, 1978, the trial court denied respondent's motion to dismiss and issued the preliminary injunction.

On September 27, 1978, ICC filed an answer to the complaint alleging it had authority to regulate pole agreements and to issue the "resolution and certification"; and further arguing that section 224 of the Communication Act of 1934 (47 U.S.C.A. 224(c)(1978 Supp.)) is unconstitutional in that it attempts to regulate activities which are entirely intrastate. Both sides moved for judgment on the pleadings after which the trial judge held that ICC has authority to regulate pole agreements under section 27 of the Public Utilities Act (Ill. Rev. Stat. 1977, ch. 111 2/3, par. 27); and in so doing has the authority to consider the interests of cable TV subscribers. He further concluded that section 224 of the Communications Act is constitutional.

In arguing that the petition should have been dismissed for failure to exhaust administrative remedies the ICC relies on section 68 of the Public Utilities Act, which provides as relevant:

"No circuit court shall permit a party affected by any rule, regulation, order or decision of the Commission to intervene or become a party plaintiff or appellant in such court who has not taken an appeal from such rule, regulation, order or decision in the manner as herein provided." Ill. Rev. Stat. 1977, ch. 111 2/3, par. 72.

• 2 Cable TV is contesting the assertion of jurisdiction by ICC over pole attachments. An attack on administrative agencies' assertion of jurisdiction "on its face and in its entirety on the ground that it is not authorized by statute" excuses compliance with the procedures of the Administrative Review Act and with the requirement that administrative remedies must be exhausted. (Landfill, Inc. v. Pollution Control Board (1978), 74 Ill.2d 541, 551.) The rule applies to proceedings under the Public Utility Act. Getto v. City of Chicago (1979), 77 Ill.2d 346, 356; see also City of Chicago v. Illinois Commerce Com. (1979), 70 Ill. App.3d 655, 658.

Resolution of the question raised as to the authority of the ICC to assume jurisdiction of the rates, terms, and conditions of pole attachments, requires an analysis of both Federal and State statutes. Section 224 as amended provides in relevant part as follows:

"(c)(1) Nothing in this section shall be construed to apply to, or to give the Commission jurisdiction with respect to rates, terms, and conditions for pole attachments in any case where such matters are regulated by a State.

(2) Each State which regulates the rates, terms, and conditions for pole attachments shall certify to the Commission that —

(A) it regulates such rates, terms, and conditions; and

(B) in so regulating such rates, terms and conditions the State has the authority to consider and does consider the interests of the subscribers of cable television services, as well as the ...


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