AT&T;, Verizon Win Case

AT&T; Inc. and Verizon Communications Inc. don’t have to lease local phone lines to competitors at reduced rates, a U.S. appeals court unanimously ruled Friday.

The U.S. Court of Appeals in Washington agreed with a December 2004 Federal Communications Commission order that phone companies no longer must provide discounts to rivals trying to compete for residential lines. Some business discounts continue.

The ruling may let AT&T; and Verizon, the two biggest U.S. phone companies, and other large carriers regain lost sales after price controls opened the $118.5-billion local market to competitors who have won 15 million customers. The commission adopted the order in a 3-2 vote, with Republican members backing it and Democrats dissenting.

The 2004 order marked the fourth try by the FCC to implement parts of the 1996 Telecommunications Act that required regional Bell companies including AT&T; and Verizon to let competitors use some lines that connect their networks to homes and businesses. The appeals court rejected the three previous orders.

The FCC’s “fourth try is a charm,” U.S. Circuit Judge David Sentelle wrote for the court.

The ruling “provides long-awaited certainty for the telecommunications industry and consumers,” an FCC spokesman said.

Established carriers had appealed portions of the FCC order that required them to continue leasing parts of their local networks at reduced rates. Covad Communications Group Inc. and other newer carriers also appealed certain aspects of the ruling. The appeals court denied all the petitions.