Staton Holdings Struggles with Pre-Hearing Stipulation in Effort to Win Number Back
Efforts by a clothing distributor to win its toll-free number back may have trouble overcoming language in a pre-hearing agreement that prevents the company from appealing an FCC decision in the case. Dallas-based Staton Holdings lost the number in 2001 after MCI accidentally disconnected it and handed it to Call Interactive. Staton said that it’s since discovered “new” evidence that MCI “routinely” handed numbers to different companies without checking and Staton is entitled to have the number restored.
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During oral argument Friday at the U.S. Court of Appeals for the D.C. Circuit, Judge Merrick Garland pointed out that Staton had already agreed in the early stages of its case against MCI that it would forgo “future appeals” if the FCC determined that MCI had been negligent, but not willful, in reassigning the number. The Enforcement Bureau later found that MCI had been negligent and that Staton hadn’t met the burden to prove that MCI had acted willfully. Per the pre-hearing agreement, Staton was paid $1,000 in damages.
Staton lawyer Christopher McCaffrey said Friday that he has since deposed former MCI employee Denise Nilson and she has offered new evidence that MCI acted willfully. McCaffrey claimed that Nilson admitted she “routinely” transferred numbers upon request. If anyone complained, Nilson said she would simply return the numbers to the original owner, McCaffrey said. “She knows she’s taking someone’s number,” he said. “She just has a Plan B.”
FCC attorney Pamela Smith said Nilson’s name was put on a witness list when the matter was before the agency and Staton didn’t ask to depose her then. The “new” facts McCaffrey said he had discovered were already in an affidavit Nilson submitted as part of the FCC proceeding, Smith said. “Staton had an opportunity before the agency to pursue its theory that Ms. Nilson’s conduct constituted willful conduct and it did not” pursue it, she said. “Staton seems to forget it has to show MCI took those steps in order to cause harm. Nothing in the record shows that MCI acted willfully [sic].” MCI was subsequently taken over by Verizon.
Verizon lawyer Christopher Miller said that Staton’s case is moot because the number has already passed on and because of the stipulation it signed. Garland suggested that since the FCC was still involved in the litigation, Staton may have an argument that it was entitled to equitable relief. “It may be a loser, but at least it’s an argument,” Garland said. Miller acknowledged it was so, but said that Staton had also waived its right to depose Nilson when the case was before the FCC. Garland asked whether it was rare to have depositions in FCC proceedings. Miller said it was rare, but Staton still could have at least asked to depose Nilson.
The number, 888-888-8888, called “All Eights” by the litigants, has since passed through other owners and now is registered to a company in Wisconsin, McCaffrey said. It doesn’t appear to be in use, he added. In that case, Judge Raymond Randolph asked, why doesn’t Staton just petition to have the number reissued to Staton? McCaffrey said that “someone is hoarding it,” probably waiting until Staton’s case has run its course before putting it to use.