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VYVX OF VIRGINIA v. CASSELL, et al.



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VYVX OF VIRGINIA

v.

CASSELL, et al.


September 17, 1999

Record No. 990285

 

VYVX OF VIRGINIA, INC.

v.

JOHN W. CASSELL, ET AL.

 

FROM THE STATE CORPORATION COMMISSION

Present: All the Justices

OPINION BY JUSTICE LEROY R. HASSELL, SR.


I.

In this appeal of an order entered by the State
Corporation Commission ("Commission"), we consider the
validity of a fine that the Commission imposed upon VYVX of
Virginia, Inc. ("VYVX"), and whether the Commission
erred in denying VYVX’s application for authority to construct
and acquire fiber optic telecommunications facilities for
intrastate purposes.

II.

Williams Communication, Inc.
("Williams") is a Delaware corporation which is
licensed to conduct business in Virginia. Williams, through its
subsidiaries, conducts a telecommunications business throughout
the United States and internationally. In 1997, Williams began to
construct a new fiber optic cable system that would extend from
Houston, Texas, to Manassas, Virginia. The cable system would be
capable of transmitting 34,000,000 simultaneous long-distance
telephone calls and would be installed between existing gas
pipelines owned by Williams’ subsidiary, Transcontinental Gas
Pipeline Corporation.

The Federal Communications Commission granted
Williams authority to operate its interstate and international
telecommunications systems. Even though Williams intended to
provide interstate service on its cable system, Williams also
desired to utilize the system to provide intrastate service
within Virginia. In furtherance of its goal to provide intrastate
service within Virginia, Williams created a subsidiary, VYVX,
which was incorporated in Virginia as a public service
corporation.

On April 23, 1997, VYVX filed with the
Commission an application for a certificate of public convenience
and necessity to provide interLATA telecommunication services
within Virginia and to have rates established based on
competitive factors.
[1] VYVX stated in its application
that it "proposes to offer services to the public within
Virginia over its own facilities and through resale of services
provided by other carriers." VYVX requested authority to
construct, acquire, extend, and operate equipment and facilities
to be used in the operation of an intrastate telecommunications
public facility.

VYVX also stated in its application that it
would own the facilities to be constructed in Virginia. VYVX
sought "authority to offer a full range of intrastate
interLATA telecommunications services to the public on a
statewide basis within the Commonwealth of Virginia as a
non-dominant interexchange carrier." VYVX further stated in
its application that: "[VYVX] will build and operate its
fiber optic telecommunications facilities in Virginia as a public
service company. [VYVX] plans to complete construction of the
facilities in Virginia by December 31, 1997, and intends to begin
construction as soon as it has obtained all necessary
governmental authorizations." Finally, VYVX stated that
Williams "and [VYVX] have authorization to construct
interstate telecommunications facilities and to provide
interstate services pursuant to rules adopted by the Federal
Communications Commission. 47 C.F.R. ? 63.07 (1996). [VYVX] is filing the instant application to ensure that it has the
ability to offer intrastate interLATA services as well."

VYVX attached a copy of its amended and
restated articles of incorporation to its application. Article II
of the amended and restated articles of incorporation states:
"The purpose for which the Corporation is formed is to
construct, own and operate telecommunications facilities,
including fiber optic lines, for the purposes of providing audio,
video and data telecommunications transmission services and other
telephone services as a public service corporation, public
utility and communications common carrier."

As required by an order issued by the
Commission, VYVX caused notice of its application to be published
in newspapers having general circulation throughout Virginia and
mailed notices to certain public officials. On January 14, 1998,
the Commission issued an order granting VYVX authority to provide
intrastate, interexchange services subject to certain
restrictions contained in the Commission’s rules governing the
certification of interexchange carriers and certain applicable
statutes. The Commission’s January 14, 1998 order stated that the
Commission would consider separately VYVX’s requested
certification to construct its proposed facilities.

The Commission directed VYVX to publish notice
of its request to construct facilities throughout the localities
in which it proposed to construct those facilities. VYVX
requested an amendment to its application to reflect its desire
to construct a lateral fiber optic telecommunications line. The
Commission granted VYVX’s request and ordered that the public
notice include the areas affected by the construction of the
additional lateral line.

In response to the notice, the Commission
received several comments and complaints. Certain landowners
complained to the Commission because VYVX and its agent, Coates
Field Service, Inc., had threatened the property owners. VYVX and
its agents told the property owners that VYVX would condemn their
properties if the property owners did not consent to give VYVX
easements necessary for the installation of its cable fiber. For
example, Mark E. Decot, a property owner whose land was affected
by the installation of the cable, testified at a hearing before
the Commission that VYVX threatened to condemn a portion of his
land if he refused to convey an easement to it. Diana Orr, who
was employed with Coates Field Service, told Decot that if he did
not sign a document that she had mailed to him, then his property
would be "condemned and . . . taken anyway, so
what [he] should do is go ahead and sign it and get as much money
as [he] can get out of it right now." VYVX filed a
condemnation proceeding against Decot in the Circuit Court of
Orange County. Decot eventually signed a document with VYVX which
gave VYVX the requested easement.

John and Janete Cassell also testified that
they were told by VYVX’s agents that VYVX would condemn their
property if they failed to convey a requested easement. A
stipulation of undisputed facts reveals that VYVX had filed four
condemnation proceedings in various circuit courts to acquire
easements of right-of-way from property owners.

David R. Clossin, an employee of Coates Field
Service, testified that Coates entered into a contract with VYVX
to assist it with the acquisition of easements in Virginia.
Clossin testified: "I work for Coates Field Service, with a
business card that we represent VYVX of Virginia."

In September 1997, the Commission, which was of
the opinion "that the allegations raised by the complaints
constitute ‘substantive objections’ to [VYVX's
application]," ordered VYVX to respond to the landowners’
complaints and directed that VYVX "clarify what
certification(s) it seeks from the Commission and explain whether
. . . since its application seeks authority to
construct, acquire, extend, or operate equipment or facilities
for use in public utility service, certification pursuant to
[Code] ? 56-265.2 . . . should be required."
The Commission ordered that VYVX "demonstrate why it should
not be ordered to cease condemnation activities until it receives
all necessary certificates of public convenience and necessity
from the Commission."

VYVX responded to the Commission’s order and
stated that VYVX proposed to install a fiber optic cable system
in Virginia and asserted that it did not need any certification
before exercising the right of eminent domain. Continuing, VYVX
requested that the Commission issue a certificate of public
convenience and necessity under Code ? 56-265.2 which would
authorize VYVX to provide intrastate interLATA telecommunications
services as a non-dominant interexchange carrier.

On October 17, 1997, the Commission staff asked
the Commission to order VYVX to cease its condemnation activities
because, as of that date, VYVX had filed four condemnation
actions to obtain easements for the installation of its fiber
optic cable, and those proceedings were pending in various
circuit courts. On October 21, 1997, VYVX informed the Commission
that VYVX would not initiate any further condemnation proceedings
until the Commission had acted upon VYVX’s application.
Unbeknownst to the Commission and its staff, VYVX and its parent
corporation, Williams, were constructing the proposed cable
system that was the subject of VYVX’s application.

The Commission, in an order dated November 25,
1997, held that "VYVX is not yet ‘lawfully authorized to
operate’ anywhere in the Commonwealth and . . . its
proposed construction is not an ordinary extension or improvement
of its facilities, and therefore [VYVX] requires
certification," pursuant to Code ? 56-265.2. The
Commission held that VYVX did not have the right to exercise the
power of eminent domain and directed VYVX to "cease
acquisition of property or rights therein, by exercise of, or by
implying its right to exercise, eminent domain authority, until
such time as the Commission has acted upon its application."

On February 9 and 11, 1998, contractors who
were installing the optic fiber cable system severed telephone
cable owned by Bell-Atlantic Corporation. Bell-Atlantic reported
these incidents to the Commission which learned, for the first
time, that construction had already begun on the facilities that
were the subject of the certification proceeding. The Commission
staff filed "a motion for a rule to show cause and a
temporary injunction."

VYVX responded to the motion and acknowledged
that construction of the cable facilities had begun, but asserted
that Williams, and not VYVX, was constructing the facilities.
Continuing, VYVX claimed that Williams was constructing the
facilities pursuant to its federal authority and that the
facilities would be used for interstate service. VYVX stated in
its response that it would use the system to provide intrastate
interLATA telecommunications.

The Commission conducted a hearing on the
motion for a rule to show cause and also considered VYVX’s
request for construction certification pursuant to Code
? 56-265.2. The Commission held VYVX had violated the
Commission’s orders of November 25, 1997 and January 14, 1998
because VYVX had assisted its parent corporation, Williams, with
the construction of facilities that were the subject of the
application.

The Commission entered an order dated October
8, 1998 holding, among other things, that VYVX had essentially
completed construction of the facilities for which such authority
was sought and that such construction was implemented
"knowingly and by design of [VYVX] and, as admitted in the
testimony of its own witnesses . . . such construction
had begun as early as September 1997" and that the requested
construction "is now an accomplished fact."

The Commission implicitly found that VYVX had
made certain misrepresentations and misstatements in its
application, but the Commission explicitly concluded that those
misrepresentations and misstatements did not relate to VYVX’s
ability to provide interexchange services. Rather, the
misrepresentations and misstatements "apply to that part of
the application in which VYVX requests a certificate to construct
facilities." The Commission denied VYVX’s certificate of
public convenience and necessity to construct telecommunications
facilities and imposed a fine in the sum of $197,000 pursuant to
Code ? 12.1-33. The Commission suspended $175,000 of the
fine, conditioned upon VYVX’s compliance with orders or rules of
the Commission or any statute of the Commonwealth for a period of
five years and the payment of court costs. VYVX appeals.

III.

VYVX contends that the Commission’s order
constitutes an unconstitutional burden on interstate commerce.
VYVX argues that Williams has authority to construct facilities
for interstate telecommunications services and that the fiber
optic cable system that was constructed will be used for
interstate commerce. Continuing, VYVX says that the
"Commission ordered a fine as a penalty for construction of
facilities under federal authority to be used in interstate
commerce. This it cannot do." We disagree with VYVX.

The Commerce Clause in the United States
Constitution grants Congress the power "[t]o regulate
commerce . . . among the several states." U.S.
Const. art. I, ? 8, cl. 3. Even though the Commerce Clause
speaks in terms of powers bestowed upon Congress, the Supreme
Court has held that the Commerce Clause limits the power of the
States "to erect barriers against interstate trade." Lewis
v. BT Investment Managers, Inc., 447 U.S. 27, 35 (1980).

Discussing the scope of the Commerce Clause,
the Supreme Court has stated:

"This limitation upon state power, of
course, is by no means absolute. In the absence of
conflicting federal legislation, the States retain authority
under their general police powers to regulate matters of
‘legitimate local concern,’ even though interstate commerce
may be affected. See e.g., Raymond Motor
Transportation, Inc.
v. Rice, 434 U.S. 429, 440
(1978); Great A&P Tea Co. v. Cottrell, 424
U.S. 366, 371 (1976). Where such legitimate local interests
are implicated, defining the appropriate scope for state
regulation is often a matter of ‘delicate adjustment.’ Ibid.,
quoting H.P. Hood & Sons, Inc. v. Du Mond,
336 U.S. [525,] 553 [1949] (Black, J., dissenting). Yet even
in regulating to protect local interests, the States
generally must act in a manner consistent with the ‘ultimate
. . . principle that one state in its dealings with
another may not place itself in a position of economic
isolation.’ Baldwin v. G.A.F. Seelig, Inc., 294
U.S. 511, 527 (1935). However important the state interest at
hand, ‘it may not be accomplished by discriminating against
articles of commerce coming from outside the State unless
there is some reason, apart from their origin, to treat them
differently.’ Philadelphia v. New Jersey, 437
U.S. [617] 626-27 [1978]."

Lewis, 447 U.S. at 36. Accord Maine
v. Taylor, 477 U.S. 131, 137-38 (1986); Kassel v. Consolidated
Freightways Corp.
, 450 U.S. 662, 669-70 (1981).

Applying these principles, we hold that the
Commission’s order which imposed a fine upon VYVX does not
contravene the limitations imposed upon the States by the
Commerce Clause. VYVX filed an application to operate intrastate
facilities.
[2] The Commission imposed a fine
upon VYVX because VYVX participated in the construction of the
facilities even though the Commission had entered orders
informing VYVX that certification was necessary before such
construction could commence. The Commission’s order is directed
solely to violations of VYVX, which is incorporated in Virginia,
and which applied for and was granted a certificate to provide
intrastate interexchange service within Virginia. The fine that
the Commission imposed does not affect Williams, a separate
corporate entity. Williams was not before the Commission, and the
Commission did not impose a fine upon Williams. The Commission’s
order simply does not restrict Williams’ use of its interstate
facilities.
[3]

IV.

A.

VYVX argues that the Commission’s November 25,
1997 order is unenforceable. This order, among other things,
directed that VYVX cease acquisition of real property or rights
therein by the exercise of eminent domain authority until the
Commission acted upon VYVX’s application for certificates of
public convenience and necessity. VYVX contends that the
Commission did not hold a hearing before the entry of that order
and, thus, the order is void. Continuing, VYVX challenges the
legality of the Commission’s subsequent order, dated October 8,
1998, which imposed a fine upon VYVX because, among other
reasons, VYVX failed to comply with the November 25, 1997 order.
VYVX also asserts that the November 25, 1997 order violated
Article IX, ? 3, of the Constitution of Virginia and Code
? 12.1-28.

At the outset, we will not consider VYVX’s
constitutional argument because it was not raised before the
Commission. Rule 5:25.

Code ? 12.1-28 states in relevant part:

"Before the Commission shall enter any
finding, order, or judgment against any person, it shall
afford such person reasonable notice of the time and place at
which he shall be afforded an opportunity to introduce
evidence and be heard."

Our review of the record reveals that the
Commission complied with this statute because the Commission
accorded VYVX numerous opportunities to be heard. As we have
already stated, the Commission entered an order directing VYVX to
respond to complaints that property owners had filed. The
Commission requested that VYVX declare the legal basis upon which
it relied to acquire property by use of eminent domain. VYVX’s
response did not necessitate the taking of evidence, but, rather,
required that VYVX set forth the legal basis for its assertion
that it could acquire easements using the power of eminent
domain.

VYVX did not deny before the Commission, and
does not deny here, that VYVX represented to property owners that
it had the power of eminent domain. VYVX admits that it initiated
condemnation proceedings. In VYVX’s response to the Commission’s
order, VYVX submitted a written explanation of its purported
source of authority to exercise the power of eminent domain.

VYVX did not request an opportunity to present
testimony before the Commission, and such testimony would have
been unnecessary because the Commission’s decision was not
predicated upon factual matters, but, rather, on principles of
law. And, the Commission afforded VYVX a reasonable opportunity
to be heard on the legal questions that were the subject of the
Commission’s order.

Furthermore, the Commission did not impose the
fine upon VYVX until the Commission issued its October 1998
order. Before the entry of that order, VYVX presented evidence,
written depositions, legal memoranda, and oral argument to the
Commission.

B.

We also hold that there is no merit in VYVX’s
contention that the Commission violated Rule 5:6 of the
Commission’s Rules of Practice and Procedure. That Rule states in
relevant part:

"Upon petition of any aggrieved party,
or upon its own motion if necessary for full relief, the
Commission will convert any unresolved valid complaint to a
formal proceeding by the issuance of a rule to show cause, or
by an appropriate order setting a formal hearing, upon at
least ten (10) days notice to the parties, or as shall be
required by statute."

This Rule is not implicated here because VYVX
did not file a petition requesting that the Commission convert
the complaints to a formal proceeding.

C.

Code ? 12.1-33 states in relevant part:

"Any person failing or refusing to
obey any order or any temporary or permanent injunction of
the Commission may be fined by the Commission such sum, not
exceeding $1,000, as the Commission may deem proper; and each
day’s continuance of such failure or refusal shall be a
separate offense."

VYVX contends that the November 25, 1997 order
commanded only that it refrain from exercising and asserting its
power of eminent domain, and that VYVX did so. We disagree.

The Commission’s November 25, 1997 order
stated, among other things, that VYVX must obtain certification
from the Commission before it constructs its facility and
operates as a utility in this Commonwealth. The Commission, in
its October 1998 order, concluded that VYVX violated the November
1997 order because it participated in the construction of the
facilities even though it had not acquired the necessary
certification. The Commission’s finding is amply supported by the
facts contained in Section II of this opinion. And, we have
stated that a finding of the Commission "will not be
disturbed by us ‘unless it is contrary to the evidence or without
evidence to support it.’" Thaxton v. Commonwealth,
211 Va. 38, 43, 175 S.E.2d 264, 268 (1970); Security Bank
& Trust Co.
v. Schoolfield Bank & Trust Co.,
208 Va. 458, 461, 158 S.E.2d 743, 745 (1968). Thus, we hold that
the Commission did not err in concluding that VYVX had violated
the November 25, 1997 order.

V.

A.

VYVX asserts that the Commission did not have
jurisdiction to determine whether a public service company has
the power of eminent domain to acquire easements for
telecommunication facilities. We disagree with VYVX.

We have stated that the "Commission has no
inherent power simply because it was created by the Virginia
Constitution; and therefore its jurisdiction must be found either
in constitutional grants or in statutes which do not contravene
that document." City of Norfolk v. Virginia
Electric & Power Co.
, 197 Va. 505, 514, 90 S.E.2d 140,
146 (1955); Appalachian Power Co. v. John Stewart
Walker, Inc.
, 214 Va. 524, 528, 201 S.E.2d 758, 762 (1974); see
also Commonwealth v. Old Dominion Power Co.,
184 Va. 6, 11-12, 34 S.E.2d 364, 366, cert. denied,
326 U.S. 760 (1945); City of Richmond v. Chesapeake
& Potomac Telephone Co.
, 127 Va. 612, 619, 105 S.E. 127,
129 (1920).

However, Code ? 56-35 states:

"The Commission shall have the power,
and be charged with the duty, of supervising, regulating and
controlling all public service companies doing business in
this Commonwealth, in all matters relating to the performance
of their public duties and their charges therefor, and of
correcting abuses therein by such companies."

Code ? 56-35 confers upon the Commission
the duty and the authority to supervise, regulate, and control
public service companies, including VYVX, in all matters relating
to the performance of their duties and requires that the
Commission correct any abuses by public service companies, such
as VYVX. Here, the Commission had jurisdiction to consider
whether VYVX had abused its status as a public service company by
threatening to exercise the power of eminent domain to acquire
easements from property owners even though VYVX had not yet
received its requested certification from the Commission.
[4]

B.

As we have already stated, the Commission held
that VYVX did not have the power to exercise the right of eminent
domain to acquire easements for its fiber optic lines because it
had not been granted a certificate of public convenience and
necessity. VYVX contends that public service corporations have
the right to acquire easements for facilities to be used in
serving the public and, therefore, it has the right to exercise
the power of eminent domain to acquire such easements. We
disagree with VYVX.

Code ? 56-49(2) states in relevant part:

"A public service corporation which
has not been allotted territory for public utility service by
the State Corporation Commission shall acquire lands or
interests therein by eminent domain as provided in this
subdivision for electric lines, facilities, works or purposes
only after it has obtained any certificate of public
convenience and necessity required for such lines,
facilities, works or purposes under Chapter 10.1
(? 56-265.1, et seq.) of Title 56."

In deciding the meaning of this statute, we
consider the plain language contained therein. Haislip v. Southern
Heritage Ins. Co.
, 254 Va. 265, 268, 492 S.E.2d 135, 137
(1997); Abbott v. Willey, 253 Va. 88, 91, 479
S.E.2d 528, 530 (1997); Barr v. Town & Country
Properties, Inc.
, 240 Va. 292, 295, 396 S.E.2d 672, 674
(1990).

The plain language of Code ? 56-49(2)
does not permit a public service corporation which has not been
allotted territory for public utility service by the Commission
to exercise the power of eminent domain to acquire land or
interests therein for electric lines, facilities, works, or
purposes until the public service corporation has obtained a
certificate of public convenience and necessity from the
Commission. Here, VYVX actually filed condemnation proceedings
against landowners to acquire easements even though it had not
obtained a certificate of public convenience and necessity.

VYVX contends, however, that Code
? 56-49(2) does not apply to it because VYVX "does not
propose to acquire property for ‘electric’ facilities."
Apparently, VYVX believes that the word "electric"
which is contained in the phrase "electric lines,
facilities, works, or other purposes" modifies the words
"facilities, works, or other purposes." VYVX simply
misreads the statute. A plain reading of the statute indicates
that the word "electric" only modifies the word
"lines" because of the punctuation contained in that
sentence. Even though the General Assembly amended Code
? 56-49(2) by eliminating the word "electric"
effective July 1, 1999, such amendment does not affect our
analysis. The deletion of the word "electric" from the
statute simply expands the types of lines that fall within the
scope of the statutory regulatory scheme.

C.

VYVX, relying upon Peck Iron & Metal Co.
v. Colonial Pipeline Co., 206 Va. 711, 146 S.E.2d 169, cert.
denied, 385 U.S. 823 (1966), and Kricorian v. Chesapeake
& Potomac Telephone Co.
, 217 Va. 284, 227 S.E.2d 725
(1976), argues that it acquired the right to exercise eminent
domain by virtue of its incorporation as a public service
company. We find no merit in VYVX’s contention.

In Peck Iron & Metal Co., we held
that a public service corporation was not required under Code
? 56-265.1(b) of the Utility Facilities Act to obtain a
certificate of public convenience and necessity before exercising
the power of eminent domain because the public service company
was not a public utility as defined by Code ? 56-265.1(b). Peck
Iron & Metal Co.
, 206 Va. at 717-18, 146 S.E.2d at 173.
This statute states in relevant part:

"‘Public utility‘ means any
company which owns or operates facilities within the
Commonwealth of Virginia . . . for the furnishing
of telephone service."

Code ? 56-265.2 of the Utility Facilities
Act states in relevant part:

"A. It shall be unlawful for any
public utility to construct, enlarge or acquire, by lease or
otherwise, any facilities for use in public utility service,
except ordinary extensions or improvements in the usual
course of business, without first having obtained a
certificate from the Commission that the public convenience
and necessity require the exercise of such right or
privilege. Any certificate required by this section shall be
issued by the Commission only after opportunity for a hearing
and after due notice to interested parties."

VYVX, unlike the public service corporation in Peck
Iron & Metal Co.
, is a public utility and, therefore, is
subject to the provisions of Code ? 56-265.2 which
prohibits a public utility from performing certain acts without a
certificate of public convenience and necessity issued by the
Commission.

In Kricorian, we held that a public
utility was not required to comply with the provisions of the
Utility Facilities Act by obtaining approval from the Commission
before initiating condemnation proceedings. The utility in Kricorian,
however, unlike VYVX, exercised the power of eminent domain to
acquire property for "ordinary extensions or improvements in
the usual course of business" which is expressly permitted
by Code ? 56-265.2. Kricorian, 217 Va. at 289, 227
S.E.2d at 729. VYVX’s request for the construction and extension
of facilities does not fall within this statutory exception.

VI.

VYVX argues that the Commission erred by
denying VYVX’s request for a certificate of public convenience
and necessity. Continuing, VYVX states that the only reason the
Commission gave for denying the requested certificate was that a
certificate would not be meaningful since the initial phase of
construction had been completed. VYVX also says that this reason
is an erroneous application of Code ? 56-265.2, and that
the Commission’s order discriminates against VYVX in favor of
other telecommunications companies which construct such
facilities in Virginia.

We have held that "[t]he Commission is
given broad discretionary authority in determining whether a
certificate of public convenience and necessity will be
approved." Stafford Serv. Corp. v. State Corp.
Commission
, 220 Va. 559, 562, 260 S.E.2d 226, 228 (1979); Bralley-Willett
Tank Lines, Inc.
v. Holtzman Oil Corp., 216 Va. 888,
890-91, 223 S.E.2d 892, 895 (1976). This Court has also stated
that "[w]e cannot sit as a board of revision to substitute
our judgment for that of the Commission on matters within its
province." Bralley-Willett Tank Lines, Inc., 216 Va.
at 891, 223 S.E.2d at 895; Atlantic Greyhound Lines of Va.,
Inc.
v. Silver Fox Lines, 204 Va. 360, 363, 131 S.E.2d
284, 286 (1963).

The Commission, upon consideration of the facts
and circumstances before it, concluded that the issuance of a
certificate of public convenience and necessity would not be
meaningful because VYVX had participated in the construction of
facilities that were the subject of the application in violation
of the Commission’s orders. Additionally, the Commission made a
specific finding "that the public interest and convenience
do not require the exercise by VYVX of the rights and privileges
under [Code ? 56-265.2]" which include the power to
exercise the right of condemnation to construct, enlarge, or
acquire, by lease or otherwise, any facilities for use in VYVX’s
public utility service. We cannot conclude, based upon the record
before us, that the Commission abused its broad discretion in
determining that the issuance of a certificate would not be in
the public interest, particularly in consideration of VYVX’s
widespread practice of acquiring easements with the threat of the
power of eminent domain when it did not possess such power.

We find no merit in VYVX’s contention that the
Commission’s order discriminates against it in favor of other
telecommunication companies. VYVX ignores the fact that it was
denied a certificate of public convenience and necessity because
of its own acts, and not because of favoritism directed towards
other telecommunications companies that construct facilities in
Virginia. And, the record simply does not support VYVX’s claims
of discrimination.

VII.

We have examined VYVX’s remaining arguments and
hold that such arguments are without merit. Accordingly, we will
affirm the Commission’s order.

Affirmed.

 

FOOTNOTES:

[1] The phrases "interLATA
service" and "LATA" are defined in the
Telecommunications Act of 1996, 47 U.S.C. ? 151, et seq.
"The term ‘interLATA service’ means telecommunications
between a point located in a local access and transport area and
a point located outside such area." 47 U.S.C.
? 153(21)(Supp. III 1997). "The term ‘local access and
transport area’ or ‘LATA’ means a contiguous geographic
area—

(A) established before February 8, 1996, by
a Bell operating company such that no exchange area includes
points within more than 1 metropolitan statistical area,
consolidated metropolitan statistical area, or State, except
as expressly permitted under the AT&T Consent Decree; or

(B) established or modified by a Bell
operating company after February 8, 1996, and approved by the
[Federal Communications] Commission." 47 U.S.C.
? 153(25)(Supp. III 1997).

[2] VYVX states that it "is
immaterial who built the facilities because [VYVX] and Williams
have federal authority to construct facilities for interstate
telecommunications service, and the Commission cannot regulate
such service . . . ." VYVX’s contention is
without merit. VYVX repeatedly stated before the Commission that
it would construct, operate, and own the facilities that would
provide intrastate service within Virginia. We will not permit
VYVX to ignore its representations before the Commission and
assert a contrary position in this Court. Additionally, the
record reveals that VYVX participated in the construction of the
cable network. Decot testified that VYVX personnel participated
in the construction activities that occurred on his property.
Additionally, Clossin, VYVX’s agent, directed construction and
was responsible for resolving disagreements with local property
owners.

[3] We also note that the
Telecommunications Act of 1996, from which Williams derives the
power to construct its interstate telecommunications cable,
recognizes the authority of the States to manage public
rights-of-way. The Act specifically states:

"(b) State regulatory authority

"Nothing in this section shall affect
the ability of a State to impose, on a competitively neutral
basis and consistent with section 254 of this section,
requirements necessary to preserve and advance universal
service, protect the public safety and welfare, ensure the
continued quality of telecommunications services, and
safeguard the rights of consumers.

"(c) State and local government
authority

"Nothing in this section affects the
authority of a State or local government to manage the public
rights-of-way or to require fair and reasonable compensation
from telecommunications providers, on a competitively neutral
and nondiscriminatory basis, for use of public rights-of-way
on a nondiscriminatory basis, if the compensation required is
publicly disclosed by such government."

47 U.S.C. ? 253 (1999).

[4] We reject VYVX’s contention that Code ? 56-35
limits the Commission’s authority to the supervision or
regulation of "the ‘public duties’ of utilities for which
they impose ‘charges’ to the public." VYVX’s interpretation
of the statute is simply contrary to its plain language.

 

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