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MCI TELCOMS. CORP. v. AMERI-TEL

March 29, 1995

MCI TELECOMMUNICATIONS CORPORATION, Plaintiff,
v.
AMERI-TEL, INC., Defendant. and AMERI-TEL, INC., Third-party Plaintiff, v. ILLINOIS BELL TELEPHONE COMPANY, Third-party Defendant.



The opinion of the court was delivered by: RUBEN CASTILLO

 On May 9, 1994, the Court entered summary judgment in favor of plaintiff MCI Telecommunication Corporation ("MCI") and against defendant/third-party plaintiff Ameri-Tel, Inc. ("Ameri-Tel") in MCI's collection action against Ameri-Tel. See MCI Telecommunications Corp. v. Ameri-Tel, Inc., 852 F. Supp. 659, Mem. Op. & Order (N.D. Ill. 1994). *fn1" The Court's May 9, 1994, Order awarded MCI $ 124,064.84 plus attorneys' fees and costs allowable under MCI's tariff. *fn2" The $ 124,064.84 award represented charges incurred by Ameri-Tel for allegedly fraudulently placed operator assisted international long-distance calls originating from pay telephones owned by Ameri-Tel.

 Ameri-Tel filed a timely third-party complaint against Illinois Bell Telephone Company ("Illinois Bell") *fn3" alleging that the calls for which MCI sought payment should have been blocked or screened pursuant to an agreement Ameri-Tel had with Illinois Bell. *fn4" Ameri-Tel's and Illinois Bell's cross-motions for summary judgment are presently before the Court.

 FACTS

 The following undisputed facts are gleaned from the parties' respective Local Rule 12 statements of material facts and accompanying exhibits. *fn5"

 Ameri-Tel is an Illinois corporation in the business of owning and operating coin-operated pay telephones ("payphones"). At all relevant times, Ameri-Tel owned and operated over 1,000 payphones within Chicago and the surrounding metropolitan areas. Ameri-Tel subscribed to MCI long-distance service from December, 1989 to January 26, 1991. Illinois Bell is a telecommunications carrier providing customer owned pay telephone service ("COPTS") to Ameri-Tel pursuant to Illinois Bell's Customer Owned Pay Telephone Service Tariff ("COPTS Tariff") on file with the Illinois Commerce Commission, Tariff Ill. C.C. No. 5. Illinois Bell was also MCI's billing agent for the Ameri-Tel account during all times relevant to this lawsuit.

 MCI terminated its long-distance service to Ameri-Tel on January 26, 1991, because of Ameri-Tel's nonpayment of certain long-distance charges incurred on its payphones. Thereafter, MCI brought the underlying action against Ameri-Tel to collect $ 128,923.84 in charges for long-distance calls placed on Ameri-Tel payphones. *fn6" The majority of long-distance calls for which MCI sought recovery in the underlying debt collection action were operator assisted international long-distance calls. See MCI Telecommunications Corp. v. Ameri-Tel, Inc., 852 F. Supp. 659, May 9, 1994 Mem. Op. & Order at 17; see also Illinois Bell's Local Rule 12(M) Facts P 13.

 Ameri-Tel has conceded that it is solely responsible for payment of all international calls made through MCI from its payphones prior to June 1, 1990. Thus, the only time period relevant to the third party action is June 1, 1990 to January 26, 1991, the date on which MCI terminated its long distance service to Ameri-Tel. Illinois Bell's Local Rule 12(M) Facts P 11.

 Beginning in June of 1990, pursuant to its revised COPTS Tariff, Illinois Bell offered an optional blocking service entitled International Direct Distance Dialed ("IDDD") Blocking which blocked direct dialed international calls; operated assisted international calls were not blocked by the IDDD blocking service. As of June 1, 1990, Ameri-Tel ordered IDDD blocking service for all new lines ordered by Ameri-Tel. *fn7"

 In addition to IDDD blocking, Ameri-Tel also subscribed to and paid for outgoing screening for some of its phones. *fn8" Relying, inter alia, on Illinois Bell's Customer/Vendor Information Handbook, Ameri-Tel contends that under Illinois Bell's outgoing screening service, "calls placed through an operator are restricted to those charged to the number called, a third number or a calling card." *fn9" Ameri-Tel's 12(M) Facts P 17. Illinois Bell, in contrast, maintains that "Ameritech's outgoing screening only blocked operator assisted, international calls placed through an Ameritech operator. Calls that were placed through an alternate operator service or through an MCI operator were not blocked by outgoing screening." Illinois Bell's 12(N) Facts P 17.

 Mervyn Dukatt, Ameri-Tel's president, and Gina Lubrano, Ameri-Tel's "main contact" for Illinois Bell's billing representative from April 1990 to April 1991, both attested that no one from Illinois Bell ever informed them that either the IDDD blocking service or the outgoing call screening were less than 100% effective. See Dukatt Aff. P 4; Lubrano Aff. P 5. However, Wendy Schutts, Illinois Bell's billing representative responsible for the Ameri-Tel account, attested that she advised "Ms. Lubrano on a vast number of occasions of the fact that Ameritech's blocking and screening services did not block the type of operator assisted long-distance calls that were being made from Ameri-Tel's payphones." Schutts Aff P 8. *fn10" In particular, Schutts attested that she:

 
informed Ms. Lubrano that the outgoing screening service and the IDDD service were not 100% effective in that payphone customers could get around the blocking and screening mechanisms in a variety of ways including . . . 1) bypassing [the] Ameritech system by dialing the long distance carrier operator; 2) by using an alternate operator service; 3) by dialing an access code that went directly to the long distance carrier . . . .

 Id. P 9.

 Ms. Lubrano also testified as to the procedures followed by Ameri-Tel in ascertaining whether the revenues collected by each Ameri-Tel payphone covered the amount of the Illinois Bell invoice, and in resolving billing discrepancies. Ms. Lubrano testified that if a discrepancy involved an international call, Ameri-Tel would not pay that portion of the bill. She further testified that Ms. Schutts informed her that Ameri-Tel did not have to pay international call--that "all of that should be stopped with the blocking." Lubrano Dep. at 29. Ms. Lubrano testified that when she discovered billing discrepancies involving international calls, she would compile sheets consisting of information concerning the disputed charge (e.g., date, amount, and payphone line) and then transmit the information to Illinois Bell. In turn, Illinois Bell removed the contested charges from Ameri-Tel's bill and sent Ameri-Tel a confirmation that an adjustment to its long distance bill had been made. Id. at 25-32. Illinois Bell's actions in removing the contested charge were taken pursuant to an agreement between MCI and Illinois Bell under which Illinois Bell acted as MCI's billing agent. Schutts Aff. P 10. On each occasion that an adjustment ...


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