In CMC Telecom v Mich Bell Telephone Co, No 09-2239 (pdf), the Sixth Circuit ruled that AT&T could not rely on privacy protections as grounds to withhold the terms of its individualized telecommunications service contracts. The Court held AT&T could redact the contracts before disclosure, as long as the disclosed portions of the contract allowed competitors to ascertain the services and pricing being offered by AT&T to its customers. Notably, the Court required disclosure even if redaction does not fully obscure AT&T's customer's identity.

Under the Federal Telecommunications Act ("FTA"), AT&T is required to offer the retail telecommunications services AT&T provides to its own customers to AT&T's competitors at a wholesale price. 47 U.S.C. 251. AT&T argued that the FTA did not require it to disclose its individualized contracts because the FTA also requires providers to protect individually identifiable customer information, except to the extent disclosure is required by law. See 47 U.S.C. 222(c)(1). Rejecting this argument, the Court held that the disclosure required in the FTA is disclosure "required by law," so privacy considerations did not trump the disclosure requirement.

The Court noted that its decision is consistent with two earlier rulings--one by the Northern District of California and one by the FCC that is charged with implementing the FTA.ICG Communications, Inc. v. Allegiance Telecom, 211 F.R.D. 610, 614 (N.D. Cal. 2002) (holding that the FTA's privacy conditions allowed disclosure when required by the Federal Rules of Civil Procedure); In the Matter of Implementation of the Telecomms. Act of 1996: Telecomms. Carriers' Use of Customer Proprietary Network Info. and Other Customer Info., 21 FCC Rcd. 9990 (2006) (holding that the FTA's privacy requirements were trumped by laws requiring the reporting of suspected child pornography).

AT&T also argued that withholding the entire contract is warranted for at least some of its individualized contracts that are so unique that the customer's identity could likely be discerned, even AT&T redacted the contract. The Court had little sympathy for this argument that it considered based largely in AT&T's self-interest of protecting its customer base. Instead, the Court held that the FTA required that such contracts be disclosed.

The Court's resolution of the balance between customer privacy and the fostering of competition is an important development for telecom providers who may consider asserting the FTA's privacy provisions as grounds for non-disclosure in the face of an argument that the disclosure is required by law.