Pink Dot, Inc. v. Teleport Communications Group

Appellant Pink Dot, Inc. (Pink Dot), a grocery delivery service which relied heavily on customers’ telephone orders, sued respondent Teleport Communications Group (Teleport), alleging that when negotiating for a centralized telephone system Teleport falsely represented its reliability and falsely claimed the ability to implement Caller ID. Pink Dot further complained that after it disputed a bill and sought a new telephone service provider, Teleport retaliated by intentionally discontinuing its telephone numbers without a forwarding number and by informing all callers that Pink Dot’s number had been disconnected. We reverse the judgment in favor of Teleport and permit the matter to proceed to trial, since the tariff filed with the California Public Utilities Commission (PUC) allows limited recovery for any gross negligence by Teleport and cannot restrict liability for fraud and intentional misconduct.

Factual and Procedural Summary

In late 1995, Pink Dot negotiated with Teleport, a public utility regulated by the PUC, to install and service a centralized telephone system. One of the important features Pink Dot required in its telephone system was Caller ID. During…