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X. Outmoded Eminent Domain Law?

Telecommunications carriers have the right to condemn access for fiber optic cable through private property, to run cable through risers to office and multi-family residential buildings, to erect rooftop antenna rights on tall buildings or water towers, and conceivably, to lay cable on the ocean bottom. For example, in California Public Utilities Code Section 616 provides that “a telephone corporation may condemn any property necessary for the construction and maintenance of its telephone line.” In 1990, the California Public Utilities Commission, CPUC, held that a long-distance carrier with certificates of public convenience and necessity had a right to condemn access to private property.

Deregulation of telecommunications has brought many benefits to customers, but also, some unforeseen problems. What is not broadly understood is that the newer market-driven system of pricing telecommunications property rights co-exists with eminent domain law that was originally fashioned in response to the older regulated monopoly model. Indeed, the cardinal concepts of “fair market value,” “public use,” “highest and best use for all available uses,” and “severance damages” all originally emanated from classic railroad and utility takings case law. What is less known, is that the evolution of eminent domain law from the “before and after” Federal Rule to the “Take Plus Damages” State Rule came about over the issue of how to value easements. Especially problematic were inconspicuous, innocuous, easements that have little or no effect on the use of the land on which they are located.

Technological advances, deregulation, and marketization of property rights in the telecommunications industry mean that eminent domain law itself has become problematic. Historically, antitrust laws were developed to prevent trusts or cartels from having excessive market power. For instance, democratic government would not normally conceive of giving unregulated private corporations eminent domain powers that could be used to “take", obstruct, or onerously condition open access to network industry corridors or buildings. With telecommunication deregulation, however, that is effectively what has occurred.

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