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ARGUMENT SCHEDULED FOR JANUARY 19, 1996 IN THE UNITED STATS COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT No. 95-5137 and consolidated cases UNITED STATES OF AMERICA, Plaintiff -Appellee- Cross-Appellant, WESTERN ELECTRIC CO., INC., et al, Defendants-Appellees, PACIFIC TELESIS GROUP, et al., Appellants. ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA BRIEF FOR THE UNITED STATES AS APPELLEE AND CROSS-APPELLANT ANNE K. BINGAMAN Assistant Attomey General DAVID S. TURETSKY Deputy Assistant Attorney Genexal DONALD 3. RUSSELL NANCY M. GOODMAN CATHERINE G. 0'SULLIVAN DAVID F. SMUTNY NANCY C. GARRISON BRENT E. MARSHALL Attorneys orn: U.S. Department of Justice ions 1. Antibrust Division Force =Rm._322. ice Washington, D.c, 20530 Antitrust Division 202) 514-1531 CERTIFICATE AS TO PARTIES, RULINGS AND RELATED CASES To counsel's knowledge, the information required by Rule’ - 28(a) (1) is provided in the Brief for the Bell Company Appellants and the Brief for Appellants BellSouth Corporation and SBC Communications Inc., except that, 1) on August 31, 1995, after those briefs were filed, the district court denied the July 7, 1995 motion of four of the BOCs for clarification of the April 28, 1995 order that is the subject of this appeal, and 2) several other motions concerning the interpretation and application of the new section VIII(L) (2) (a) also are pending in the district court. pang Crome Nancy C. Garrison Counsel for the United States TABLE OF CONTENTS STATEMENT OF SUBJECT MATTER AND APPELLATE JURISDICTION ., ISSUES PRESENTED FOR REVIEW. 2... 1-20 ee eee STATUTES AND REGULATIONS ........ STATEMENT AOR. THE CASS 3 200s ese ee A. Nature of the Case and Proceedings in the District Court... 2. ee ee eee Statement Of facts) 2). ee 1. The Decree Provisions at Issue... . ~~ 2 hel Services at Issue] @ cee) ets 3. The BOC Motions .......--2---5 4, The Relief Granted and the Conditions Imposed by the Court at the United States’ Request ..... . 5. The Court’s Sua Sponte "Bypass" Condition and Its Effects .....-.-.--. SUMMARY OF ARGUMBWE ce] ft) te De) STANDARDS OF REVIEW) 0 ge ee II. THE DECREE APPLIES TO BOC WIRELESS SERVICES .. . . III. THE DISTRICT COURT PROPERLY DENIED BELLSOUTH'S AND SBC’S MOTIONS TO REMOVE ALL DECREE RESTRICTIONS ON WIRELESS SERVICES... - eee ett tt eee A. The BOCs Are Not Entitled To Termination of Their Equal Access and Nondiscrimination Obligations as Long as Those Decree Provisions Are Necessary To Protect Interexchange Competition . 2... ee ee ee ee ee B. Absent Equal Access Safeguards, BOC Market Power in Cellular Exchange Service Could Have Anticompetitive Effects in the Market for Interexchange Service to Cellular Customers.