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CFP'93 - Kleiman

CFP'93 - Caller I.D.

by Kathryn Kleiman

Boston University School of Law

Introduction

The telephone system in the United States is changing rapidly: fiber optic lines are being laid and innovative services are being offered. This paper addresses the response of the Pennsylvania Supreme Court to challenges brought against the Bell Telephone Company and the Pennsylvania Public Utility Commission for the introduction of caller identification services.

The push for the Bell Telephone Company of Pennsylvania to develop caller identification services lies in the 1984 decision of Judge Greene of the Federal District Court in Washington, D.C. to separate information services from communication services.1 In its settlement of a long-standing antitrust suit with the Department of Justice, AT&T agreed to divide its facilities and staff into two components: six regional Bell operating companies handling local service and a long distance company with research and manufacturing capabilities.2 One of the prohibitions imposed on the Bell operating companies by Judge Greene was a bar against entry into the information business. Judge Greene laid down a bright line between the companies which provide information services and the local telephone companies who deliver those services to customers via the telephone network.3

The Bell operating companies turned a limitation into an advantage. Barred from providing electronic publishing and information services which provide access to databases for research, banking, and shopping, the Bells created marketable information from the telephone system itself. By dissecting a telephone call and repackaging its parts, the telephone companies derived data which could be sold to subscribers as enhanced telephone services. The Bell Company of Pennsylvania chose to market the caller identification service under the trade name "Caller ID." It created a service which allows call recipients to view the telephone number of the caller by using a special display box. Thus, before the telephone is answered, the recipient receives some information about the caller.4

A debate emerged in Pennsylvania over the issue of blocking; specifically, to what extent could individual callers choose not to participate in the Caller ID tracing? The Pennsylvania Public Utility Commission (PUC) order allowing Bell to offer the Caller ID service allowed no voluntary blocking. "Blocking" allows individuals and organizations to stop the Caller ID trace on all calls made from their telephone line, or selectively on specific calls placed from any telephone. The PUC chose not to allow voluntary blocking available to all users of the telephone system. They created two exceptions to the no-blocking rule: private, non-profit, tax-exempt domestic violence agencies and federal, state and local law enforcement agencies.5 The PUC ordered Bell to provide free blocking to these agencies. Additionally, if an agency head certified that an individual affiliated with the agency faced a risk to her personal safety if Caller ID block was not provided, Bell had to provide blocking for the individual's private telephone line. The PUC envisioned this category of individuals to include victims of domestic violence, undercover police officers, and police informers.6 Thus, only under very limited circumstances could individuals receive the privilege not to participate in the Caller ID trace.7

The Pennsylvania Coalition Against Domestic Violence, the ACLU of Pennsylvania, the Office of the Consumer Advocate, and the Consumer Education and Protective Association, combined legal forces to challenge the PUC's decision to allow Caller ID without voluntary blocking. These organizations argued before the Commonwealth Court of Pennsylvania that Caller ID violated protections of the Pennsylvania Constitution and Pennsylvania statutes. With an order of the PUC allowing Caller ID to be offered in Pennsylvania as early as January of 1990, the public interest groups asked the court for an injunction of the order to prevent the introduction of Caller ID, pending full review of the Caller ID controversy by the Court. On December 29, 1989, Judge Crumlish of the Commonwealth Court granted the requested injunction and directed the PUC not to allow Caller ID to be offered as a general service available to the public prior to the final decision of the Court. The Court created one exception and allowed Caller ID to be obtained by the community providers of emergency services such as 911.8

The Court quickly heard full arguments from both sides of the Caller ID suit. On February 7, 1990, the Commonwealth Court ruled that unrestricted Caller ID could not be offered to the public because the service was unconstitutional and illegal in Pennsylvania.9 Bell and the PUC appealed the decision to the Pennsylvania Supreme Court. On October 24, 1991, the Pennsylvania Supreme Court ("Court") became the highest federal or state court to rule on the arguments of Caller ID and telephone information services. The Court affirmed the decision of the Commonwealth Court and found that the PUC order allowing unrestricted Caller ID in Pennsylvania was illegal.

Constitutional Issues

The question of the constitutionality of Caller ID has been actively debated in academic and legal circles. A seminal article published on the right of privacy and Caller ID by Glenn Chatmas Smith entitled We've Got Your Number! (Is it Constitutional to Give it Out?) was the first article to lay down the constitutional arguments and issues of Caller ID.10 Smith presented a sophisticated analysis of why constitutional privacy protections, normally thought to protect individuals from the invasive actions by the government, could constrain the services offered by the telephone company. He concluded that the actions of a telephone company were so heavily regulated by state public utility commissions that their actions fell with the sphere of "state action."11 Therefore, local telephone companies could be bound by the privacy protections found in federal and state constitutions.

Smith's ideas generated interest in the classroom, and constitutional arguments about Caller ID became a topic of discussion in law schools. Several law review articles were written using the Smith arguments as a framework for constitutional analysis of the privacy and telecommunications issues.12

Smith's ideas also drew attention in the courtroom. In its decision on Caller ID, Barasch v. Pa. Pub. Util. Comm'n, 133 Pa. Commw. 285, 576 A.2d 79 (1990), the Commonwealth Court cited Smith's article with approval and adopted his analysis to show that Caller ID violated the high level of privacy guaranteed to residents of Pennsylvania under the Pennsylvania Constitution. A subsequent law review article labeled the court's constitutional reasoning "the Smith/Barasch rationale." The rationale stood for the proposition that "unrestricted Caller ID invades a legitimate [privacy] interest."

Opposition To The Constitutional Basis For A Caller ID Decision

After the extensive attention given to constitutional issues, the legal and telecommunications communities received a surprise on March 18, 1992, when the Pennsylvania Supreme Court refused to review the constitutional issues of Caller ID. The judges affirmed the decision of the Commonwealth Court, but based their decision on statutory authority. The Court refused to review the constitutional arguments raised by the lower court and cited the doctrine of judicial restraint: "our courts should not decide constitutional issues in cases which can properly be decided on non-constitutional grounds."13 Since the Court found that Caller ID violated the Pennsylvania Wiretapping and Electronic Surveillance Control Act, it affirmed the Commonwealth Court's decision.

The Court's decision not to review the constitutional arguments of Caller ID and privacy appears to be strongly influenced by the arguments of Judge Pellegrini, a judge of the Commonwealth Court. Judge Pellegrini wrote a concurring opinion in which he agreed with the final decision reached by the majority, but disagreed with the legal reasoning. In his opinion, Judge Pellegrini strongly urged the Commonwealth Court not to find a constitutional bar to Caller ID. He argued that in the field of emerging technologies, courts should not "prematurely enunciate a constitutional prohibition."14 Judge Pellegrini saw Caller ID as a new technology in the early stages of development which introduces a new type of telephone use:

Caller ID is a new type of phone service... For the first time, Bell of Pennsylvania (Bell) proposes to universally offer a service that provides more to its subscribers than dial tone... a service that provides information and not merely transmits it.15

He recognized that the technology would introduce legislators, regulators, and judges to a new set of questions and urged caution by the courts in approaching these questions with overly broad answers:

Caller ID is everyone's introduction, for better or worse, to interactive entrepreneurial telecommunications,16 ... therefore, judicial restraint is particularly appropriate in this matter.17

With a premature constitutional ruling barring new technologies, courts could stifle a legislature's power to balance the needs of individuals, government, and industry. With a premature constitutional bar to Caller ID, the Pennsylvania Supreme Court could preempt the Pennsylvania Legislature's power to balance the needs of the growing telecommunications industry and the privacy rights of its citizens. Judge Pellegrini felt that the Legislature should have the opportunity to examine the new information technologies, including Caller ID, and then "to re-establish the balance" between privacy rights and industry needs.18

Therefore, Judge Pellegrini urged courts to examine Caller ID issues within the framework of existing legislation. He found that the Pennsylvania Wiretap Act was an appropriate statute for the court to apply because it provides a "comprehensive legislative scheme" covering "the entire area of interception of both conversations and electronic communications."19 Applying this statute to the facts of the case, he found that "Caller ID is violative of the Wiretap Act" and that "the PUC's order in this matter constitutes an error of law requiring its reversal."20 Therefore, Judge Pellegrini agreed with the majority that the Caller ID service involves illegal trap and trace activities which violate the privacy protections of the Pennsylvania Wiretap Act.

When the Pennsylvania Supreme Court handed down its final decision, it expressly noted its agreement with Judge Pellegrini.21

Decision Of The Pennsylvania Supreme Court

The Pennsylvania Supreme Court affirmed the decision of the Commonwealth Court and overturned the PUC's order allowing unrestricted Caller ID to be offered in Pennsylvania. The Court found that Caller ID violates provisions of the Pennsylvania Wiretap Act. Briefs were presented to the Court by two sets of parties. Bell joined with the Pennsylvania PUC to appeal the Commonwealth Court decision (the "Appellants"). The Pennsylvania Coalition Against Domestic Violence joined with the ACLU of Pennsylvania, the Office of Consumer Advocate, and the Consumer Education and Protective Association to ask the Court to affirm the lower court's decision (the "Appellees"). In its opinion, the Court referred extensively to the arguments presented by the parties in their briefs.

The Court found that Caller ID must be evaluated within the scope of the Pennsylvania Wiretap Act provisions. Appellees argued that the Wiretap Act limits use of trap and trace devices including those which "capture, display, and store for future retrieval the telephone number of the calling party."22 The Court agreed that Caller ID performs in a "trap and trace" manner:

it "captures the incoming electronic or other impulses which identify the originating number of an instrument or device from which a wire or electronic communication was transmitted." 23

The Court noted that all parties to the appeal agreed that Caller ID fit within this trap and trace definition.

The Court found that section E of the Wiretap Act, "Pen Registers and Trap and Trace Devices," limits the use of trap and trace devices. The statute sets out the general rule that "no person may install or use a ... trap and trace device without first obtaining a court order under section 5773. (emphasis added)"24 Thus, the Legislature protects individual privacy on the telephone network. Without special approval, this privacy cannot be violated. Individuals seeking to install trap and trace devices, such as police officers who believe that a telephone conversation may reveal details of a crime, must present their evidence to a judge or independent magistrate who may grant a court order allowing wiretapping devices to be placed on the telephone line. The court order is limited in time and scope: wiretapping and pen register tracing may occur on specified telephone lines for a limited period of time. The Legislature, therefore, balances the privacy rights of Pennsylvanians to use their telephones without fear of frequent or commonplace surveillance with the state's interests in detecting and prosecuting the types of crimes conducted over the telephone, such as organized crime.25

The Pennsylvania Legislature created two exceptions to the requirement of a court order before trap and trace activities. Its first exception, section 5771(b)(1), allows telephone companies to conduct unauthorized traps and traces in the regular course of their operations:

(b) Exception - The prohibition of subsection (a) does not apply...

1. relating to the operation, maintenance and testing of a wire or electronic communication service or to the protection of the rights or property of the provider, or to the protection of users of the service from abuse of service or unlawful use of service...26

Neither the Appellants nor the Appellees contended that Caller ID fell within this normal use/maintenance exception.

The Legislature's second exception allows a telephone provider to use a trap and trace device for more extensive purposes, such as tracing, recording, and reviewing calls to detect fraud or improper use:

2. to record the fact that a wire or electronic communication was initiated or completed in order to protect the provider, another provider furnishing service toward the completion of the wire communication or a user of the service from fraudulent, unlawful or abusive use of service, or with the consent of the user of the service.27

Appellants, the PUC and Bell, strongly argued to the Court that Caller ID fell within this second exception: Caller ID allows Bell to record an element of telephone communication, the telephone number, with the consent of one of the parties to the conversation, the Caller ID subscriber. They also argued that only the telephone company performs the trap and trace function because network computers control the telephone switching, capture the number of an incoming call, and send that number to the subscriber's digital display box. "[L]ike a television or radio or mailbox," the subscriber's Caller ID box is merely a passive device receiving information without any action or interference in obtaining it.28

The public interest groups opposing unblocked Caller ID argued that the service involves an illegal trap and trace performed by the subscribers to Caller ID, and therefore, does not fall within the scope of the exceptions. They showed that Caller ID involves two traps: one trap performed by the telephone company at their offices when "the calling number is placed in the memory of the called party's central office;"29 and a second trap at the site of the subscriber when the display device captures and stores the telephone number of the calling party. Contrary to the passive image presented by the telephone company, Appellees argued that the subscriber's device performs an active, independent trap and trace function in clear violation of the statute.30

The Court agreed and strengthened the reasoning of the Appellees. The judges found that Caller ID involves two traps and that the second trap, performed by the "customer subscriber," violates the trap and trace provisions of the Wiretap Act.31 They also held that the first trap, performed by the telephone company itself, also violates the Wiretap Act when used for the purposes of Caller ID.32 Exemptions of section 5771(b) only allow the telephone company to perform trap and trace functions for specific purposes, such as the detection of "fraudulent, unlawful or abusive use" of telephone services.33 With Caller ID, Bell collects, stores, and uses the originating telephone number for "unlimited purposes."34 This information for unlimited use is obtained without a warrant and violates the Wiretap Act as an improper intrusion into the privacy of individuals.

The Court rejected the Appellants' argument that the consent of the subscriber, one party to the telephone conversation, gives the telephone company license to conduct the trap and trace of Caller ID. The issue of consent and interception was familiar to the Pennsylvania Supreme Court from previous cases, unrelated to Caller ID. In these cases, the Court determined that the term "with the consent of the user of the service," 18 Pa. Const. Stat. Ann. section 5771(b)(2), requires the consent of both parties to the telephone conversation and not a single party.35 The Court found this "two-party consent rule" to be consistent with the high level of privacy protection guaranteed by the Pennsylvania Constitution.36 In the Caller ID situation, the Court applied the "two-party consent rule" to Caller ID, and held that the consent of one party alone, the subscriber, was insufficient to allow the capture and storage of the incoming telephone number without a court order. The judges also noted an irony in the Caller ID set-up: the privacy of the calling party is "being jeopardized, and yet under a system of unblocked Caller ID it [is] the calling party which [is] not given the opportunity to consent to the trace."37

The Supreme Court of Pennsylvania refused to rule directly on the constitutional issues of Caller ID or find that the service violated privacy provisions of the Pennsylvania Constitution. However, the Court interpreted the Wiretap Act in light of the strong privacy protections of the Pennsylvania Constitution. It held that the traditional limitations on police interception applied with equal force to the new interceptions offered by commercial information services.

Conclusion

Some may view the Caller ID decision of the Pennsylvania Supreme Court as very narrow. The Court closely examined the language of the Pennsylvania Wiretap Act, and it interpreted the Act in light of the Pennsylvania Constitution and its privacy protections. Pennsylvania's consent rules are among the strictest in the country. Federal laws and the laws of many states require only "one party consent:" as long as one party to the telephone conversation grants permission to the recording and monitoring of the call, no warrant or court order is required.38 Pennsylvania is joined by eight other states in its requirement of two party consent. California, Delaware, Florida, Illinois, Louisiana, Maryland, Montana, and Washington share the requirement that all parties to a conversation must consent before it can be recorded or transmitted without a warrant.39 Within these states, the Barasch decision can serve as a persuasive precedent when similar issues of Caller ID services arise.

The Pennsylvania decision may also be an important precedent in states with different consent rules, and telephone companies should not anticipate a "green light" for the introduction of information services. The Pennsylvania Supreme Court and the Commonwealth Court of Pennsylvania have provided courts in other states with an analytical approach to commercial communication services and existing interception laws. Both courts broadly interpreted the Pennsylvania Wiretap Act. They found that it included new types of technology: types of trap and traces devices invented long after the Legislature passed the statute. They also found that its limits apply to new groups of actors: commercial information service vendors and telephone providers, in addition to the already regulated law enforcement and police. The courts expressed a willingness to closely examine the details of a new technology, to look beyond general descriptions into actual functioning and operation. This level of inquiry, conducted when an important value such as privacy is in question, provides an important model for other courts.

Finally, the example of judicial restraint is important. The Pennsylvania Supreme Court chose not to lay down any absolute constitutional bars to Caller ID. It worked within the framework of the Wiretap Act, interpreted in light of the Pennsylvania Constitution, to reach its decision. Therefore, the Court left to the Pennsylvania Legislature the primary responsibility and power to determine the balance between individual privacy on the telephone system and the commercial interests wanting to offer telephone information services. These thoughtful decisions provide insight into the types of questions likely to be presented before many state and federal courts in the future, and a model for weighing and closely examining the nature of the problem and the branches of government best able to render the decision.

References

1 United States v. American Tel. & Tel. Co., 552 F.Supp. 131 (D.D.C. 1982), aff'd, Maryland v. United States, 460 U.S. 1001 (1983). (Subsequent extensive appellate history omitted for space considerations.)

2 Id.

3 The regional operating companies appealed their ban from information services. In a 1991 decision, Judge Greene "with considerable reluctance," lifted the information services restriction because of new guidelines by the Court of Appeals. United States v. Western Electric Co., 767 F.Supp. 308, 327 (D.D.C. 1991). This paper deals with the forces in operation between 1984 and 1991 which led to the creation of Caller ID.

4 Pa. Pub. Util. Comm'n, David M. Barasch, Consumer Advocate v. Bell Telephone Co. of Pas., 1989 Pa. PUC LEXIS 198 (Nov. 9 1989) (Pa. PUC's opinion and order allowing Caller ID with extensive descriptions of Caller ID.)

5 Id. at *8.

6 Id. 7 Id. at *1. Blocking is the main privacy protection envisioned for the Caller ID system. Throughout this paper, the term "unrestricted Caller ID" and "unblocked Caller ID" refers to the PUC's plan for Caller ID which had no voluntary Caller ID blocking for the general public.

8 Pennsylvania Coalition Against Domestic Violence v. Pa. Pub. Util. Comm'n, 130 Pa. Commw. 418, 568 A.2d 726 (1989) aff'd sub nom Barasch v. Bell Tel. Co., 529 Pa. 523, 605 A.2d 1198 (1992).

9 Barasch v. Pa. Pub. Util. Comm'n, 133 Pa. Commw. 285, 576 A.2d 79 (1990) aff'd sub nom Barasch v. Bell Tel. Co., 529 Pa. 523, 605 A.2d 1198 (1992). [Hereinafter Barasch v. PUC].

10 37 UCLA L. Rev. 145 (1989).

11 Id.

12 See, e.g., Note, Informational Privacy and Property Rights: Caller ID and the Barasch Court, 13 Geo. Mason U.L. Rev. 447, 461 (1990); Steven P. Oates, Caller ID: Privacy Protector or Privacy Invader?, 1992 U. Ill. L. Rev. 21 (1992); Riley K. Temple and Michael Regan, Recent Developments Relating to Caller ID, 18 W. St. Univ. L. Rev. 549 (1991).

13 Barasch v. Bell Tel. Co., 529 Pa. 523, 605 A.2d 1198 (1992). [Hereinafter Barasch v. Bell].

14 Barasch v. PUC, 576 A.2d 79 at 95 (Pa. Commw. Ct. 1990) (Pellegrini, J., concurring in part and dissenting in part).

15 Id. at 91.

16 Id.

17 Id. at 95.

18 Id.

19 Id.

20 Id.

21 Barasch v. Bell, 605 A.2d at 1203.

22 Joint Brief of Appellees at 13, Barasch v. Bell Tel. Co., 529 Pa. 523, 605 A.2d 1198 (1992). [Hereinafter Appellee Brief].

23 Barasch v. Bell, 605 A.2d at 1201.

24 18 Pa. Const. Stat. Ann. section 5771(a).

25 See, e.g., Pa. Pub. Util. Comm'n, David M. Barasch, Consumer Advocate v. Bell Telephone Co. of Pas., 1989 Pa. PUC LEXIS 198 (Nov. 9 1989) (Comm'r Rhodes, dissenting) (Discussion of the legislative history of Caller ID.)

26 18 Pa. Const. Stat. Ann. section 5771(b)(1).

27 18 Pa. Const. Stat. Ann. section 5771(b)(2).

28 Appellee Brief, 605 A.2d at 1202.

29 Id. at 1201.

30 Appellee Brief at 15.

31 Id.

32 Barasch v. Bell, 605 A.2d at 1202.

33 Appellee Brief at 15.

34 Id.

35 Commonwealth v. McCoy, 275 A.2d 28 at 30 (Pa. 1971) ("Pennsylvania's anti-wiretapping statute clearly demands that the consent of all parties be given before any device for overhearing or recording is installed or utilized.")

36 Appellee Brief at 16.

37 Barasch v. Bell, 605 A.2d at 1202.

38 Note, Informational Privacy and Property Rights: Caller ID and the Barasch Court, 13 Geo. Mason U.L. Rev. 447, 461 (1990).

39 Id.