Pacific Bell v. California State & Consumer Services Agency

The California Department of General Services (DGS) announced its intent to award a contract worth over $109 million to GTEL, a California corporation, for the acquisition of a new state telecommunications system known as CALNET. Pacific Bell then filed a petition for writ of mandate and complaint for declaratory relief, seeking invalidation of that award and other related relief. Judgment was entered denying the petition, and Pacific Bell has appealed. At issue is whether the DGS violated Public Contract Code section 12102, subdivision (c), when it solicited proposals for acquisition of the system by purchase only and excluded any proposals for acquisition by lease. We conclude that the DGS complied with statutory requirements, and affirm the judgment.

Factual and Procedural Background

The telecommunications division of the DGS is responsible for telecommunication services to state departments and other public agencies. Among the service networks it has provided through contracts is the automatic telecommunications switching system (ATSS), serving over 200,000 users in 120 agencies through 3 network switches. The ATSS system has been operated under a lease agreement…