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October 9, 1981

UNITED STATES of America, Plaintiff,
AMERICAN TELEPHONE AND TELEGRAPH COMPANY; Western Electric Company, Inc.; and Bell Telephone Laboratories, Inc., Defendants

The opinion of the court was delivered by: GREENE


Defendants have stated that they are planning to call as witnesses several former and present officials and employees of the Federal Communications Commission and of the United States Department of Justice. The government has interposed objections based on relevancy and privilege and the FCC has adopted and submitted to the Court a formal resolution raising privilege claims. *fn1" Proffers have been submitted by the defendants and briefs have been filed by the various interested parties.


 It should be noted initially, that it is not easy to discern exactly what is embraced in defendants' proffer. On five occasions defendants have stated what they intend to ask the various new *fn2" witnesses; but with almost every proffer *fn3" the rationale for calling the witnesses and the substance of their proposed testimony changed drastically. *fn4" This uncertainty casts substantial doubt on the actual need of defendants for this evidence. That doubt is deepened by their failure to list most of the witnesses now sought to be called either in the pretrial period or during the first six months of the trial. *fn5" The almost inescapable conclusion to be drawn from these events is that defendants had no real basis for calling these witnesses, and that, when they did decide to call them, they had no substantial need for their testimony. *fn6"

 As for the Federal Communications Commission, its posture is likewise puzzling. Several of its former employees have testified in this case for the government *fn7" or have been listed as witnesses for many months, *fn8" without any objection from the Commission. Other employees have testified for plaintiffs in other lawsuits brought against AT&T, *fn9" several of them with the direct permission of the Commission. *fn10" Yet the Commission is now here for the first time with a formal claim of privilege, asserting, inter alia, that testimony by these individuals in this case would "result in a "chilling effect' which would injure the Commission's decision-making processes." No explanation has been forthcoming why those processes were not chilled when the Commission's officers and employees testified previously on similar subjects or why any privilege in that regard should not be deemed waived. *fn11"

 For these reasons, the Court would be justified in disposing of this entire matter without considering the merits, simply rejecting either defendants' request on the ground that it comes too late and is too ill-supported or that of the FCC on the basis that the agency seeks to assert privilege on a selective basis, depending upon the lawsuit and the party that may be involved. *fn12" In the exercise of its discretion, and in order to insure maximum ventilation of the facts, the Court will not dispose of the subject before it in this summary fashion. *fn13" In passing upon the merits of the claims of the various entities, however, the Court will, of necessity, also take into account the circumstances which generated these claims.


 The issues raised by defendants' proffers and the conflicting claims of the various interested parties fall under three headings: (1) relevance, (2) privilege, *fn14" and (3) Rule 403 issues. *fn15" It is obviously difficult to decide precisely in advance what specific questions will be asked and what rulings will be appropriate in the event objection is made or a claim of privilege is interposed, and the Court will not attempt to do so here. *fn16" However, for the guidance of the interested parties, the Court has grouped the proffered proof (to the extent that it can be pieced together from defendants' descriptions) into separate categories in terms of subject matter, it has examined within each category such obstacles to admission as appear to exist, and it will set forth below the standards it intends to apply in disposing of the various claims.


 With respect to several matters, defendants' proffer will be rejected and the testimony will not be allowed.

 1. In one such category are questions that tend to probe the mental processes of the individual members of the Federal Communications Commission, calling either for the reasons underlying various decisions of the Commission or for their understanding of what these decisions meant. *fn17" These matters are part of the agency's deliberative process and as such are clearly privileged. See United States v. Morgan, 313 U.S. 409, 422, 61 S. Ct. 999, 1004, 85 L. Ed. 1429 (1941); United States v. Nixon, 418 U.S. 683, 705, 94 S. Ct. 3090, 3106, 41 L. Ed. 2d 1039 (1974); Chicago B & Q Ry. Co. v. Babcock, 204 U.S. 585, 593-94, 27 S. Ct. 326, 327, 51 L. Ed. 636 (1907); SEC v. National Student Marketing Corp., 68 F.R.D. 157, 160-61 (D.D.C.1975), aff'd, 176 U.S. App. D.C. 56, 538 F.2d 404 (D.C.Cir.1976). As the Supreme Court has said, disclosure of intra-agency deliberations and advice is injurious to the government's consultative function *fn18" because it would tend to inhibit the frank and candid discussion that is necessary for an effective operation of government. *fn19"

 It is likewise clear that inquiry into such matters would not yield relevant evidence. The FCC has asserted-and the Court agrees-that that body acts officially only "through the adoption of rules, orders, policy statements which reflect its views and commands." FCC Order of September 30, 1981, par. 8. These statements are not subject to interpretation by an FCC Commissioner or employee (past or present) any more than a judicial decision is subject to elaboration or interpretation by way of the subsequent testimony of the judicial officer who rendered it. See SEC v. National Student Marketing Corp., supra; Thill Securities Corp. v. New York Stock Exchange, 57 F.R.D. 133 (E.D.Wis.1972); MCI v. FCC, 169 U.S. App. D.C. 154, 515 F.2d 385 (D.C.Cir.1974); Sterling Drug Inc. v. FTC, 146 U.S. App. D.C. 237, 450 F.2d 698 (D.C.Cir.1971). In short, it makes no difference-it is not relevant-what a particular Commissioner or staff member might say today about what he understood a particular decision to mean: *fn20" the decision speaks for itself.

 Defendants' basic proposition which they presumably wish to buttress through the testimony of the Commissioners-that they acted reasonably in light of FCC decisions and policies-must be tested against the expressed views of the Commission (and perhaps the further illumination of these views by subsequent FCC or judicial decisions) not through the testimony of Commissioners. See SEC v. National Student Marketing Corp., supra. *fn21" Extrinsic evidence as to how and why the FCC reached its decisions and what it intended thereby-either by Commissioners speaking in their individual capacities or by employees of the FCC-are irrelevant to the question whether defendants' compliance was reasonable.

  Thus, both on grounds of privilege and on grounds of lack of relevancy the Court will uphold objections to questions seeking to elicit the thought processes or the intentions of FCC officials or employees to elucidate the official decisions themselves.

 2. Defendants also seek to question the FCC Commissioners concerning facts found by the Commission in its various opinions (such as the facts relating to the actual and potential harm inflicted upon the network through direct interconnection of customer-provided terminal equipment). *fn22" Defendants are, of course, entirely correct when they state that these findings, "like any other piece of evidence, are subject to contradiction, qualification, and clarification through other evidence." *fn23" Indeed, the Court has already heard over thirty witnesses on defendants' terminal equipment claims, much of whose testimony served to contradict, qualify, and clarify the findings of the FCC that were admitted into evidence, *fn24" and it has admitted into evidence numerous documents to the same effect. Clearly, defendants have had, and will still have, ample opportunity to rebut the government's evidence about the telecommunications network, whether it was introduced in the form of findings by the FCC or otherwise.

 But their opportunity in that regard is not unlimited. Specifically, it does not include the right to question the individual Commissioners relating to this subject matter, and the Court will exclude such testimony for three separate reasons. First, it would be difficult (if not impossible) to question these officials concerning their perceptions of the network at the time of the Carterfone decision without at the same time opening up the deliberative process of the Commission as a whole to judicial scrutiny. Such questioning would be fraught with implications of privilege, *fn25" and it should therefore be avoided if it is possible to do so consistently with defendants' legitimate rights and interests. Second, questioning the individual Commissioners as to the factual basis each had for the findings he supported would not be unlike examining the Commission's decision to determine whether it was supported by substantial evidence. Such an inquiry is a matter for the court charged by statute with the review of final FCC action-the U.S. Court of Appeals-and it is not within the jurisdiction of this Court. Third, given the fact that the defendants have introduced what by all measures is a substantial amount of evidence on this subject, the Court finds that they will not be prejudiced if the FCC Commissioners are not also permitted to testify with regard to these matters. See Rules 403, 611, Federal Rules of Evidence.

 3. Defendants will likewise not be permitted to call several Department of Justice lawyers on the basis of the proffers they have made.

 In the first place, defendants have wholly failed to demonstrate the "good cause" required for adding these individuals to their witness list at this late date. *fn26" Perhaps even more than is true with respect to the FCC officials, the reasons provided by defendants for calling the Department of Justice employees are conflicting, *fn27" confusing, and tenuous, and they are utterly inadequate to support the present request.

 Originally defendants indicated that they wanted to inquire of the Department of Justice witnesses regarding the reasons for the withdrawal by the Antitrust Division of its opposition to the post-Carterfone tariffs. But those reasons are fully articulated in the Department's briefs. In the exercise of its discretion under Rule 403, the Court will not allow defendants, on this tangential issue, to call the lawyers who wrote that brief to provide their additional views and impressions, especially since the proposed testimony would implicate both the deliberative process and the work product privilege, *fn28" without any persuasive countervailing considerations.

 In another proffer defendants made regarding the Department of Justice employees they stated that they wished to establish through these individuals what the Department of Justice knew, thought, or believed with regard to possible harms to the network from the direct interconnection of equipment, and the impact of interconnection on the telecommunications industry. The individuals involved are, of course, lawyers, not engineers or economists; their "expert" opinions as to what interconnection would do to the network, either from a technical or from an economic perspective, would therefore be of little benefit to the Court. Furthermore, again, both work-product and deliberative process privileges would directly be implicated by their testimony, *fn29" and the public interest in upholding these privileges far outweighs the minimal probative value of their testimony. See United States v. Leggett & Platt, supra; SEC v. National Student Marketing Corp., supra. *fn30" No constructive purpose whatever would be served by requiring these Department of Justice attorneys to relate what the Department of Justice "believed," "knew," "had sufficient experience with," *fn31" and in the absence of the citation of precedent for this extraordinary request, the Court will deny it.


 Defendants will be permitted to elicit the following testimony, either because it does not involve a privilege or because the applicable privilege is overridden by other considerations.

 1. An exception to the general thought-process rule is made where there are allegations of misconduct or misbehavior, and evidence to that effect is not privileged. *fn32" Such evidence would also be relevant. If it could be shown that various FCC decisions were the product of staff manipulations, these decisions, and the findings they embody, would on that basis at a minimum be entitled to less weight than would be true otherwise.

 Accordingly, when defendants have intimated at various times that improper or undue influence may have been exerted upon the Commission through some staff members, the Court has always taken the position that defendants may confront such members with these allegations during their case in chief. The Court will now permit these staff members to be called and questioned by defendants on the issue of whether their influence on the Commission exceeded the bounds set by the rules or the customary practices of that agency. If examination of these staff members reveals impropriety on the part of Commissioners, *fn33" the Court will entertain a motion to call them as well for further examination.

 2. Defendants will also be permitted to question FCC witnesses, both Commissioners and others, on various aspects of the terminal equipment certification program. In their several proffers, defendants have made three contentions they wish to prove in this regard through the examination of the FCC witnesses: (1) that the members of the Commission were not prepared in 1968 to have the FCC undertake the task of formulating and administering such a program; (2) that the FCC's experience with registration or certification was such that safe standards were not likely to be available in the late 1960s or early 1970s; and (3) that intra-FCC rivalries were responsible for the delays in the program's development.

 Testimony by FCC witnesses on each of these three topics clearly or arguably raises questions of privilege. However, the government has consistently contended that AT&T unreasonably either failed to implement its own certification program after the Carterfone decision was handed down or to petition the FCC to do so, and that implementation of the program was delayed because of AT&T's obstructionism. Defendants are clearly entitled to refute these contentions, and it appears that, in important respects, the FCC witnesses are the only-or a very significant-source of the necessary evidence. *fn34" After balancing the interest in non-disclosure *fn35" with defendants' need for the evidence (see note 14, supra), the Court has concluded that defendants will be permitted to examine these FCC officials with respect to these topics. *fn36"

 3. The Court will likewise allow questions directed to the Commissioners (or other FCC employees) on the effectiveness of that agency in regulating the conduct of the Bell System. The government has squarely put in issue through various FCC employees (including the former chief of its Common Carrier Bureau) the question whether the Commission is capable of regulating effectively an entity of the scope, complexity, and power of AT&T. *fn37" Defendants are entitled, and they will be permitted, to rebut that charge. Moreover, since the individuals most expert about the functioning of the Commission are the former Commissioners themselves as well as other high-level Commission employees, their testimony would be highly relevant, material, and in a sense necessary to defendants' case. The acute need of defendants to put on such testimony, in view of the government's proof and the unique expertise of the former FCC Commissioners in these matters, clearly outweighs any privilege problem *fn38" -especially since questions with regard to the general ability of the FCC to regulate can be crafted so as not to delve into the Commissioners' privileged deliberations in specific proceedings. *fn39" Accordingly, defendants may inquire of the Commissioners and other listed FCC witnesses regarding this subject. *fn40"

 4. With regard to the questions to be posed to the members of Federal-State Joint Board established by the FCC in Docket No. 19528, a distinction may appropriately be drawn between the members of the board who were FCC Commissioners and those who were state commissioners, for the simple reason that no privilege has been asserted with respect to the latter, while the FCC has asserted privilege on behalf of the former. On that basis, the state commissioner named by defendants will be required to testify with regard to those portions of defendants' proffer which appropriately deal with the Joint Board. However, no such requirement will be imposed on those members of the board who were FCC Commissioners.

 The Court could not, in a practical way, compel these officials to answer questions as if they were only members of a board making recommendations to the final decision-maker, and ignore the fact that they were also members of the Commission which considered the recommendations and made that decision. Since the testimony of the federal members would, in any event, be merely cumulative of that of the state member, the Court, taking into account the privilege problem, has determined that it is unnecessary and inappropriate to require these members to provide additional evidence on this point. Rule 403, Federal Rules of Evidence.

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