by Peter Huber
"The limitations the proposed modification places on the divested BOCs are predicated on the existence of the BOCs' status as regulated monopoly carriers. Technological change presently underway, however, may cause the local distribution function of the divested BOCs to lose its monopoly character and, perhaps, eventually result in its deregulation. . . .The Department of Justice intends to give careful attention to changing technical, competitive, and regulatory conditions as they may apply to the divested BOCs, to review carefully suggestions by a BOC that there is no longer a sound economic and antitrust basis for the complete retention of the restrictions imposed by Section II, and, if appropriate, to join in requests for modification. Whether or not the Department joins in any such proposal for modification, it remains within the power of the Court to remove any restrictions it determines are no longer necessary to effectuate the purposes of the proposed modification and that are contrary to the public interest."
"In order to ensure that the Court is fully apprised of developments in this area, the Department will undertake to make a formal report to the Court on the continuing need for the restrictions on the third anniversary of the date of divestiture, and every third year thereafter so long as the restrictions remain in force. In the event that the Department concludes in its report that the state of competition and technology is such that any or all of the restrictions should be lifted, it will move the Court for a modification of the Judgment to permit such activity by the BOCs. The Department believes that this procedure will assure both continuing scrutiny of the factors underlying the restrictions and, as well, limit the duration of the restrictions to the minimum period required by the state of technology and competition.
"United States v. Western Electric Co., Inc., et al.(3) The parties accepted the section II(D) and section VIII(C) modifications required by the Court. It was also understood that the restrictions would be removed altogether if the rationale therefor became outmoded by technical developments or changes in competitive conditions. On that basis, the Department of Justice was required to report to the Court every three years concerning the continuing need for the retention of the restrictions."
1. United States v. Western Electric Co., Inc., et al.; Competitive Impact Statement in Connection With Proposed Modification of Final Judgment, 47 Fed. Reg. 7170, 7176-7 (Feb. 17, 1982).
2. United States of America v. Western Electric Co., Inc., et al., Response of the United States to Public Comments on Proposed Modification of Final Judgment, 47 Fed Reg. 23,320, 23,337 (May 28, 1982).
3. 592 F. Supp. 846, 852-53 (D.D.C. 1984).