June 26, 2006

WASHINGTON - The Supreme Court on Monday agreed to consider an appeal by the largest U.S. telephone carriers aiming to dismiss a class-action antitrust suit against them.

The high court granted the companies' petition to review an appeals court ruling that held the class-action suit filed against Verizon Communications Inc., BellSouth Corp., Qwest Communications International Inc. and AT&T Inc. could proceed even without evidence to back up claims of an anti-competitive conspiracy.

The Supreme Court will hear arguments in the case and then issue a decision during its upcoming term, which begins in October.

The lawsuit said the telecommunications companies conspired not to compete against one another in their respective geographic markets for local telephone and high-speed Internet services and prevented competitors from entering those markets.

A federal judge in New York dismissed the case for failing to state a claim for which relief could be granted. The judge ruled the lawsuit failed to allege sufficient facts from which a conspiracy can be inferred.

But a U.S. appeals court ruled the judge had used the wrong standard in reviewing the sufficiency of the allegations and sent the case back for further proceedings.

The telecommunications companies appealed to the Supreme Court.

They said the lawsuit under U.S. antitrust law alleges the companies engaged in parallel conduct and participated in a conspiracy, but failed to include any allegations that would establish the existence of a conspiracy under the applicable legal standard.

A number of business groups and companies supported the appeal.