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Two Victories in New York’s Struggle Against Unjust Telephone Contract

Two Victories in New York's Struggle Against Unjust Telephone Contract

by Annette Dickerson, Rachel Meeropol, and Lauren Melodia

Families of those incarcerated by New York State finally won some justice this winter in their fight against a prison telephone contract that charges families of prisoners 630 percent more for collect calls than regular consumer long distance rates. The simultaneous victories came from the highest court of the State and from the newly elected Governor, proving that seemingly intractable forms of oppression are best fought through a campaign that combines litigation with active and effective education and outreach, and takes direction from affected and organized communities.

On January 8, 2007, Governor Spitzer announced that he would eliminate the state commission provision of the New York State Department of Correctional Services (NYSDOCS) prison telephone contract. Governor Spitzer's decision, which will go into effect on April 1, 2007, will immediately reduce the surcharge and per-minute rate of the contract by at least 50 percent -- families will see their phone bills cut in half beginning in April. Governor Spitzer has also guaranteed that the programs previously funded through the contract will remain fully funded through general state funds.

Just over a month later, on February 20, 2007, the New York State Court of Appeals allowed Walton v. New York Department of Correctional Services to move forward, reversing two lower courts and setting the stage for a long overdue review of the constitutionality of New York's prison telephone program.

For over twenty years, New York has had one of the most repressive prison telephone arrangements in the country. Starting in 1985, New York implemented a program to raise revenue to pay for general prison services by overcharging the families, friends, lawyers and counselors of New York State prisoners. New York State prisoners can only make collect calls, and since 1996, MCI/Verizon, has had a monopoly contract to provide all collect calls from the prisons. In exchange for this lucrative contract, MCI passes between 57.5% to 60 % of its profits on to the State. To fund these huge kickbacks, MCI charges recipients of prisoner collect calls a $3 surcharge on each call, and then 16 cents per minute. This means that the average 19 minute call costs about $6, or that less than one hour of conversation a week would result in $72 worth of phone charges per month.

More than $200 million has been put in the State's coffers since the contract began in 1996. That?s $200 million illegally taken from many poor families of color, who often have to choose between keeping in touch with a loved one and putting food on the table. Much of this money is used to provide programs at NYSDOCS facilities like health care and guard training, for which families should not be financially responsible.

Since the late nineties, the Center for Constitutional Rights has challenged New York's and others State's oppressive contracts in the courts. However, lawyers and organizers at the Center realized the need for a broader effort to restore justice to prison phone contracts, one that brings the issue to wider public attention, mobilizes opposition, and utilizes all possible avenues to end this practice.

Toward that end, CCR partnered with the Prison Families Community Forum and Prison Families of New York, Inc. to launch the New York Campaign for Telephone Justice. The goal of the campaign is to achieve more equitable rates for phone calls from prisoners, a high level of consumer choice within the prison telephone system, and fair service without unilateral preemptive cut-offs. The campaign was organized to pursue these objectives on many fronts, including public education through creative and non-traditional marketing strategies such as murals and street theater as well as working with family organizations to advocate for fairer phone services for prisoners and their loved ones. The public education and outreach campaign work was crafted as a complement to ongoing litigation challenging the New York system in federal and state court.

On February 25, 2004, as the campaign was heating up, CCR filed a suit against the New York State Department of Corrections and MCI over its monopoly contract and the exorbitant telephone rates family members and others are forced to pay to speak with their loved ones. The plaintiffs include family, friends, and lawyers of New York State prisoners. The suit, Walton v. New York State Department of Correctional Services, attacks New York's prison telephone system on several constitutional grounds. First, the plaintiffs claim that DOCs' scheme to raise revenue through expensive telephone calls amounts to a tax on recipients of collect calls. As only the legislature may levy a tax, DOCs' actions violate separation of powers under the New York State Constitution.
Moreover, as the resulting tax is discriminatory, and is completely unrelated to any benefit received by the families who pay it, it also violates due process and equal protection. Finally, plaintiffs challenge the burden this tax places on their ability to communicate with their loved ones, friends, and clients inside State prisons as a violation of freedom of speech and association. They argue that this burden serves no penological purpose, as it is completely unrelated to the cost of providing prison telephone service, or any security concerns within the institution.

On October 22, 2004, Judge Ceresia, of Supreme Court in Albany County, dismissed the entire case, holding that the very short statute of limitation that applies to challenges to actions by administrative agencies applied to plaintiffs' claims, and that plaintiffs should have filed the case within four months of the signing of the contract between MCI and NYSDOCS in 2001. The contract runs for 6 years, so his decision meant that the family members, friends, and lawyers of prisoners who entered a New York State prison after 2001, could be forced to pay the unjust telephone tax for years without any opportunity to be heard in court. Plaintiffs appealed to the Appellate Division, but that court affirmed Judge Ceresia's decision in a unanimous opinion issued on January 19, 2006. See: Walton v. New York State Dept. of Correctional Servs., 25 A.D.3d 999, 808 N.Y.S.2d 483, 2006 N.Y. App. Div. LEXIS 428 (3rd Dept 2006). Plaintiffs then sought permission to appeal the case to the highest court of the state, the New York Court of Appeals. The Court granted review, and on January 9, 2007, the Court heard argument on the appeal.

Plaintiffs were joined at the Court of Appeals by hundreds of "Amici" or "friends of the court" who filed briefs in support of plaintiffs' position. The Amici included Betsy Gotbaum, the Public Advocate of the City of New York, dozens of prisoners' rights and prison family organizations, and many individuals affected by the prison telephone system. The Sentencing Project, represented by attorneys at the law firm of Kramer, Levin, Naftalis, and Frankel submitted an analysis of over a hundred years worth of research documenting the importance that communication with one's family and the maintenance of family ties plays in successful reintegration after release, and in limiting recidivism. The Innocence Project and Legal Services for Prisoners with Children provided the Court with information on how New York's system affects the lives of their constituents, and the Legal Aid Society addressed the difficulty of providing legal representation under the current system.

The day before argument was to be heard in Walton, and after only a few days in office, Governor Spitzer announced that he would eliminate the State's huge backdoor tax. It is clear that the Governor acted not just because of the pending lawsuit, but because the family members and communities affected by the tax helped make it a priority for his administration. His decision means that, as of April 1, 2007, New York will not longer look to the families and friends of prisoners to fund general State operations. In practical terms, it means that recipients of collect calls from New York State prisons should see their phone bills cut in half.

Just over a month later, on February 20, 2007, the Court of Appeals reversed the lower courts and reinstated all of the Walton plaintiffs? constitutional claims. The opinion is available on LEXIS, at: Walton v. NYSDOCS, No. 12, 2007 N.Y. LEXIS 165; 2007 NY Slip. Op. 1384 (Feb. 20, 2007). The decision was four -- two, with Judge Smith filing a separate concurring opinion, and Judges Read and Graffeo dissenting. In an opinion written by Judge Pigott, the majority held that the four month statute of limitations does apply to plaintiffs' challenge, but that plaintiffs nonetheless acted in a timely manner.

The Court explained that, in summer of 2003, MCI and DOCS amended the 2001 contract to change the prison telephone rate structure. Some of the plaintiffs, along with the Center for Constitutional Rights, promptly filed comments challenging the kickback system before the Public Service Commission (or "PSC"), the regulatory body that establishes intrastate telephone rates, and is responsible for ensuring that all such rates are just and reasonable. The PSC reviewed the new rate structure and held that it lacked jurisdiction to consider the State kickback. The PSC went on to hold that the 42.5% of the prison telephone rate that is retained by MCI was a "just and reasonable rate" for telephone services.

Plaintiffs filed Walton within four months of that PSC order. The Court of Appeal held that because the PSC could have determined that the entire rate structure, including the commission, was unjust, unreasonable, or discriminatory, plaintiffs acted reasonably in going to the PSC before bringing their case in State Court. The Court explained that it must "take a pragmatic approach" when applying statute of limitations, and that "hindsight cannot be used to determine whether administrative steps were futile." The Court then sent the case back to the Supreme Court, to determine whether Plaintiffs' constitutional claims state a cause of action.

Judge Smith, concurring with the majority opinion, agreed that plaintiffs' claims should move forward, but acknowledged that his decision was "influenced" by the fact that plaintiffs raised "substantial" constitutional claims. He explained that, while families of New York State prisoners could have learned of the Comptroller's approval of the contract between MCI and the State by reading the public record, as a practical matter it is highly unlikely that they would do so. Thus dismissing the case on statute of limitations grounds would bar claims like plaintiffs' before the people entitled to bring those claims could reasonably know they existed. He stated that he had "trouble accepting that agencies can extinguish constitutional rights so easily."

While the Court of Appeals decision is a huge victory, it is far from the end of the battle. The Supreme Court will now decide whether plaintiffs' constitutional claims state a cause of action. If plaintiffs win that next step, they can then move to certify as a class all individuals in New York State who received a phone call from a New York State Prisoner between October 30 of 2003 and March 31, 2007. Finally, plaintiffs will still have to prove the allegations in the petition before the court, to be awarded money damages. The work to be done is critically important even in the context of Governor Spitzer's much-welcomed change in policy, as plaintiffs seek a declaration that the prison telephone kickback violates their constitutional rights, to ensure that New York will never again tax call recipients in this unlawful and discriminatory way.

Moreover, it is not until that decision that plaintiffs and tens of thousands of other New Yorkers can get refunds for years of unfair changes by the State.

Families and friends of prisoners need take no action at the moment to become a part of the class action because the class has not yet been certified. If plaintiffs win certification, all class members will then have an opportunity to decide if they want to take part in the case.

One of the most directly effective ways to achieve permanent change is to become actively involved in the Campaign. To receive updates on Spitzer's decision and Walton v. NYSDOCS and for specific information about how you can play an important role in ending this practice, go to or call 212-614-6481.

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Related legal case

Walton v. NYSDOCS