Cable TV fees fight heads to Md. court

Retroactive law on Comcast's late charges at issue

Telecommunications

September 22, 2000|By Andrea F. Siegel | Andrea F. Siegel,SUN STAFF

The Maryland Court of Appeals has agreed to hear the politically charged challenge to a new law that saves cable television companies from refunding late-fee payments to their customers.

The new law was the General Assembly's way of blunting a June 1999 ruling by the state's highest court that forced Baltimore's cable provider to repay more than $7 million in late fees. In that ruling, the Court of Appeals said that the late fees charged by United Cable of Baltimore were unconstitutional.

The new challenge involves Comcast and its late-fee billings to customers in Baltimore and Harford counties.

The case has implications for thousands of businesses that assess late fees and for their customers, business groups argue. In the spring, while business interests clamored to erase the top court's broad ruling and potential refunds that went along with it, consumer groups opposed the successful effort to make the late-fee law retroactive to 1995.

There also are implications in the case for the relationship between the General Assembly and the courts, which longtime observers said hit a new low in the spring.

Among the reasons: The chief judge disagreed with the Senate president's desire to add a judgeship in St. Mary's County. As a result, the General Assembly authorized no new judgeships. Baltimore's mayor and other public officials hammered the judiciary publicly amid calls to pull city courts from crisis. Legislators, grumbling about judicial activism, wiped out several Court of Appeals rulings with new laws.

The Court of Appeals decided last week to take the late-fee case on appeal from a Baltimore County judge's decision in July that the retroactive $5 late-fee law is valid. Arguments before the Court of Appeals are set for January.

Some observers fear that this case - coupled with continued feuding and an expected challenge to another law enacted in the spring that cancels another Court of Appeals ruling - could exacerbate tension between lawmakers and the judiciary.

"If you have one session, it's an inconvenience, and if you have two it's a problem. But if you have three it's a crisis," said Albert "Buz" Winchester III, legislative relations director for the Maryland State Bar Association. "In the 13 years I have been representing the bar association in Annapolis, this was the worst session I have seen. I don't want it repeated."

House GOP Whip Robert L. Flanagan said he is worried that the relationship will sink lower. "Unless the president of the Senate has a personality transplant, I am afraid we are going to continue along the same lines," he said.

Senate President Thomas V. Mike Miller, a Democrat, said he was not looking for a rerun of the last session's rift, respecting the court's right review the law's constitutionality.

If it's found unconstitutional, he said, "As long as they are interpreting the law based on the Constitution ... I don't have a problem with that decision."

Business groups, the attorney general's office and the lower court believe that the law's retroactive provision is valid. Opponents, including the American Association of Retired Persons, disagree. The state bar association believes retroactivity is bad public policy.

"It really is an issue for thousands of businesses," said Paul A. Tiburzi, lawyer for the Maryland Chamber of Commerce.

He said those without exemptions from the state's 6 percent cap on interest rates, which is in the state constitution, are affected. Lower courts around the state have about two dozen similar challenges on hold while they await the outcome of this case.

In asking the Court of Appeals to bypass the Court of Special Appeals and hear the case, Rockville lawyer Ronald B. Rubin wrote that the new late-fee law tried to belatedly validate "past unconstitutional practices of charging customers late fees in excess of the legal rate of interest." Rubin, who declined to discuss the case, wrote that the law allowed cable providers "to hold onto money illegally collected from Maryland residents in the past."

Comcast attorneys disputed that.

Lawyer Melvin J. Sykes wrote that the new late-fee law was a fair way for companies "to impose upon the late payers, and not consumers generally, the costs of coping with late payments."

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