This decision approves a Settlement Agreement between the
Utility Consumers’ Cingular Wireless (AT&T) and dismisses this complaint
with prejudice.  In this complaint, UCAN
charges AT&T with (1) imposing unauthorized international roaming charges
on customers who had not affirmatively enabled the service nor received
adequate notice that AT&T was enabling the service in violation of Public
Utilities Code Section 2890(a), (2) charging customers for calls never placed
while traveling abroad in violation of Section 2890(a), (3) violating General
Order 168 (GO 168) by not resolving customer complaints within 30 days,
and (4) violating GO 168 by refusing to cease collection actions while
conducting an investigation into a charge disputed by its customer.

[1]

Under the Settlement Agreement, attached hereto as Attachment
A, AT&T agrees to provide its customers affirmative notification when it
activates the pay-per-use International Roaming service on a subscriber’s
account, to implement new procedures to allow residential customers to opt-out
or block the service, and to affirmatively manage their usage.

[2]

  In addition, customers will be informed that
under the service, AT&T can charge them for incoming phone calls that go
directly to voicemail when their phone is turned on in a foreign country.

Finally, the two residential customers UCAN discusses in the
complaint have both had their accounts credited in full.  The Settlement is effective on the date it is
approved by the Commission and will terminate one year following AT&T’s
implementation of on-line usage notification or July 1, 2012, whichever is
earlier.

1.                

Background

On August 31, 2007, UCAN filed this complaint and a request
for a cease and desist order against AT&T for imposing unauthorized charges
on subscribers’ cellular phone bills. 
The complaint was calendared on September 10, 2007 and by ALJ
Resolution 176 was categorized as an adjudicatory proceeding.  In its response on October 12, 2007, AT&T
denied the charges in the complaint and on November 20, 2007, it moved to
dismiss the complaint on three grounds: 
lack of jurisdiction over international telecommunications; lack of
jurisdiction over commercial mobile radio service entry regulation; and failure
to state a claim sufficient to establish a state law claim of “cramming” under
Public Utilities Code Section 2890(a).

On November 28, 2007, a prehearing conference (PHC) was held
in San Francisco.  At the PHC,
AT&T requested an opportunity to amend its motion to dismiss to address
issues discussed at the PHC, and both parties asked to extend the 12-month
statutory deadline for the proceeding in order to have additional time to
engage in discovery and to use the Commission’s alternative dispute resolution
procedures.  The parties were referred to
mediation, and a second PHC scheduled.

[3]

  At the next PHC on February 29, 2008, parties
requested to continue settlement discussions and also discussed the scope of
issues and a procedural schedule for evidentiary hearings.

[4]

  On June 27, 2008, the Commission issued
Decision (D.) 08-06-036, an order extending the statutory deadline of this
proceeding to May 29, 2009.

By Administrative Law Judge ruling on August 27, 2008,
AT&T’s motion to dismiss the complaint was denied.  The ruling found that (1) the federal
telecommunications law raised by AT&T in its motion to dismiss does not
preempt the Commission’s jurisdiction to adjudicate this cramming complaint and
(2) in its complaint, UCAN has provided a sufficient showing of potential
violations of Section 2890 and General Order 168 such that the Commission must
now develop the evidentiary record.

A third PHC, scheduled for September 22, 2008, was cancelled
at the request of the parties.  On
October 17, 2008, UCAN and AT&T submitted a joint motion for approval of
the Settlement Agreement.  A scoping memo
has not been issued in this proceeding and no evidentiary hearings were held.

2.                

Proposed Settlement

The Settlement Agreement, attached at Appendix A to this
decision, covers all California non-business customers of New Cingular Wireless
PCS, LLC and its related entities (AT&T), both existing and future
customers.

[5]

2.1.          

Standard of
Review for Settlements

We review the settlement under the requirements set forth in
Rule 12.1(d) of the Commission’s Rules of Practice and Procedure.  The rule provides that, prior to approval,
the Commission must find a settlement “reasonable in light of the whole record,
consistent with the law, and in the public interest.”

2.2.          

Terms of the
Settlement

Under the provisions of the Settlement Agreement, AT&T
agrees to provide notification to existing and future customers when AT&T
activates  pay-per-use International
Roaming that this is a service included in their rate plan and what these
features could mean in potential charges for customers who carry their cell
phone overseas on a trip.

[6]

  AT&T will also provide customers
information regarding methods to manage their usage of this service, including
the right to opt-out or block the service.

AT&T commits to undertake notification of existing
customers through a separate mailing, followed by a prominently displayed alert
on AT&T’s website.  AT&T will continue
to notify customers in at least six bill messages within a 12‑month period and
it will provide notification to future customers by a text message at service
activation; all notices will instruct the customer how he/she may obtain
additional information about the service. 
Further, AT&T commits to placing a restriction on unblocking
International Roaming on a secondary line of a California non-business account
(e.g., Family Talk), unless requested
otherwise by the customer.

Under the new notification process, AT&T will inform
customers that under the International Roaming Service, AT&T can charge
them for incoming phone calls that go directly to voicemail when their phone is
turned on in a foreign country. 
Customers will be provided specific rates per country and an
international customer service number that may be dialed free of charge from
the customer’s wireless phone anywhere in the world that the customer’s
AT&T wireless phone can make calls. 
In addition, AT&T will send California customers with pay-per-use
voice and pay-per-use data international roaming services a free text message
when the customer arrives in a country; this text message will include the
international roaming rate for that country.

[7]

In negotiating the Settlement Agreement, AT&T and UCAN
state that they included the input of technical experts from both parties, and
this produced a creative solution:  the
customer specified on-line usage notification. 
This usage notification tool, when made available to California
customers, will give consumers greater control in managing their international
roaming usage and costs.

[8]

  The tool will allow a customer to request
notification, via a text message and if requested, e-mail, when a certain
threshold of international usage is reached, and to have at least five
threshold options from which to choose. 
At AT&T’s sole discretion, usage thresholds will be set based on a
dollar amount or minutes of usage (MOUs).

The Settlement Agreement does not directly address UCAN’s
assertions that AT&T violated the Commission’s GO 168 by not timely
resolving the complaints of the two customers cited in this proceeding and
ceasing all collections activity while a complaint investigation was
pending.  However, the Settlement
Agreement does provide that one of the customers cited by UCAN will have her
account credited in full to reflect no outstanding balance and will also be
sent a letter documenting that there is no negative report by AT&T to the
credit bureaus.  The account of the other
customer was previously credited in full.

Finally, should a breach of the Settlement Agreement occur in
the future, UCAN agrees to first provide AT&T an opportunity to promptly
cure the breach before filing any complaint with the Commission.

[9]

  The Settlement is effective on the date it is
approved by the Commission and will terminate one year following AT&T’s
implementation of usage notification or July 1, 2012, whichever is earlier.

2.3.          

Discussion of
Proposed Settlement

In its complaint, UCAN asserts that AT&T has violated the
provisions of Public Utilities Code Section 2890(a) by activating a telephone
service, international roaming, without adequate customer notification and by
billing customers for international calls they did not place.   The Settlement Agreement does not make a
finding on whether existing customers, individually or as a class, received
adequate notification or were charged for unplaced calls, but it does adopt a
comprehensive system of improved customer notification that should ensure
non-business customers understand when the international roaming service is
activated and what the features and rates are, and that customers are provided
the means to effectively manage this service by choosing to opt-out, block, or
set specific thresholds of usage.  The
Settlement Agreement also resolves all issues related to charges to the two
individual customers cited in the complaint.

We find the enhanced notification and account management
provisions contained in the Settlement Agreement will be extremely beneficial
for all existing customers since many customers may be unaware that they have
the service and/or the features it contains, thus exposing these customers to
substantial charges when they travel overseas with their cell phones.  The Settlement Agreement is also in the
public interest as it will ensure future customers are fully informed and that
AT&T is quickly alerted to any fraudulent practices that occur while its
customers are overseas.

On the issue of whether AT&T violated the provisions of
GO 168, our record reflects that both parties undertook extensive discovery and
that the two customers UCAN cited in the complaint have had their billing
disputes resolved in full.  We do not
have a sufficient record to make any finding of violations.  Going forward, we find that the enhanced
notification and account management provisions of the Settlement Agreement
should reduce future customer billing disputes related to international roaming
services.

Based on the above discussion, we find that the Settlement
Agreement is reasonable in light of the record as a whole and in the public
interest because it addresses in a comprehensive and innovative manner the
issues raised by UCAN in its complaint. 
The Settlement Agreement is also consistent with the law as it adopts
provisions designed to better ensure compliance with the Commission’s statutes
and regulations.  Therefore, we adopt the
Settlement Agreement.

3.                

Comments on Proposed Decision

The proposed decision of the ALJ
in this matter was mailed to the parties in accordance with Section 311 of the
Public Utilities Code and Rule 14.3 of the Commission’s Rules of Practice and
Procedure.  No comments were filed.

4.                

Assignment of Proceeding

Timothy Alan Simon is the assigned Commissioner and
Christine M. Walwyn is the assigned Administrative Law Judge in this
proceeding.

Findings of Fact

1.    

All parties have agreed to the Settlement
Agreement.

2.    

The Settlement Agreement provides non-business
California customers of AT&T wireless phone services with enhanced
notification of the International Roaming service and effective means to manage
the service by choosing to opt-out, block, or set specific thresholds of usage.

3.    

The enhanced notification and customer tools
provided under the Settlement Agreement are extremely beneficial for all
existing customers since many customers may be unaware that they have
International Roaming service and/or the features it contains.

4.    

The Settlement Agreement is also in the public
interest as it will ensure future customers are fully informed and that
AT&T is quickly alerted to any fraudulent practices that occur while its
customers are overseas.

5.    

Both customers cited by UCAN in this complaint
have had their accounts credited in full and no negative reports made by
AT&T to a credit bureau.

Conclusions of Law

1.    

The Settlement Agreement in this proceeding is
reasonable in light of the whole record, consistent with the law, and in the
public interest.

2.    

Evidentiary hearings are not necessary.

3.    

The Settlement Agreement should be approved, and
should be effective immediately.

4.    

The complaint should be dismissed with
prejudice.

ORDER

IT IS ORDERED that:

1.    

The Settlement Agreement, attached as AttachmentA,
is approved.

2.    

The complaint is dismissed with prejudice.

3.    

Case 07-08-033 is closed.

This order is effective today.

Dated May 7, 2009, at San Francisco, California.

MICHAEL R. PEEVEY

                          President

DIAN M. GRUENEICH

JOHN A. BOHN

RACHELLE B. CHONG

TIMOTHY ALAN SIMON

                     Commissioners