Name Greg Ottensmeyer | ||
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Gregory Vernon Ottensmeyer, Sr., b. 15 October 1952 in Baltimore, MD is an American entrepreneur and businessperson. Ottensmeyer’s pioneering efforts in the 1970s helped incubate competition in the US telecommunications industry. His actions along with MCI and others[1] contributed to the U.S. Department of Justice mandated breakup of AT&T, (the Bell System monopoly) in 1984, by decree of Harold H. Greene, encouraging a climate that would fuel rapid development of competitive telephony and technological innovations leading to creation of the public Internet.
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Present Business
Today, Ottensmeyer serves as President of TelephoNET, Corp, a technology company founded with partner, D. David Wielech, in April 1996.
TelephoNET [TNET] is a privately held company providing turn-key telephony systems and services - worldwide.
Early Business History
In 1976 Ottensmeyer founded the innovative flat-rate long distance calling service that was contested by AT&T, the Bell System Telephone Company monopoly. The Bell System took steps to destroy the budding AT&T competitor. Ottensmeyer attorneys charged violation of the Sherman Antitrust Act and litigated his right and others, to compete with the century old monopoly.
In 1984 Ottensmeyer and Marvin A. Jolson, PhD formed Shortline Systems, Inc, who was permitted to operate its business undeterred until sold in 2003 to USA Datanet.
Background History
In 1976, while operating the A. A. Telephone Answering Service in Bel Air, MD, Ottensmeyer began patching local phone calls together on a 557B corded switchboard to create flat-rate long distance calls that he resold for 25¢ per-call, far less than the 28¢ to 43¢ per-minute charged at that time by the local telephone company, C&P Telephone Company a division of AT&T – a/k/a Ma Bell - the regulated telephone monopoly. Ottensmeyer and Beryl B. Franklin co-founded Mercury Metro Service believed to be the first application of flat-rate long distance service in the US. Ma Bell attorney’s considered the activity illegal and a violation of tariffs. Bell obtained a warrant from Maryland authorities to search the Answering Service premises and seize telephone equipment used by Ottensmeyer to provide the non-toll calling service.
The Raid
On March 26, 1979, MD State troopers along with AT&T security personnel raided A. A. Answering Telephone Service premises, which doubled as Ottensmeyer’s home. Police confiscated electronic devices used by Ottensmeyer to provide the service. Immediately after the raid, and without charging Ottensmeyer of any crime, C&P Telephone Company (AT&T) sent notice to each of Ottensmeyer's Answering Service clients advising them that they would disconnect their telephone answering bureau services in 30-days. Ottensmeyer v. AT&T, 1979-1985
Antitrust Suit
Mercedes Samborsky, Esq, who was an answering service subscriber and Brian Nash, Esq, represented the Telephone Answering Service interests. Ottensmeyer attorney's filed for injunctive relief in MD District court and petitioned the MD Public Service Commission to stay Bell’s threat to put the budding competitor out-of-business. Against a legion of AT&T attorney’s, Ottensmeyer counsel convinced the court that AT&T should not be allowed to burden answering service clients because Ottensmeyer violated no law by seeking to compete against AT&T's monopolistic long distance service. Bell attorney’s were compelled to reverse their position and ultimately agreed to allow the answering bureau to continue, without the long distance service, provided Ottensmeyer promised not to enter the business premises. Ottensmeyer was advised to agree to AT&T's mandate, even though it resulted in him being evicted from his home.
In 1980, attorneys for Ottensmeyer retrieved the equipment that was confiscated 1-year earlier by MD State Police and AT&T Security personnel and filed Anti-trust charges against AT&T, et al., claiming that the Bell System's actions constituted restraint of trade in violation of the Sherman Act. After years of litigation, the court ruled against Ottensmeyer upholding the telephone company’s claim that his use of Bell telephone lines constituted tariff violations sufficient to justify AT&T’s strong-arm tactics in 1979.
Ottensmeyer appealed before the United States Court of Appeals, Fourth Circuit. [1] and [2] Case No. 84-1068 was argued on December 6, 1984 resulting in affirmation of the lower court ruling.
Leo George, Esq., notable communications attorney, who provided early legal counsel to MCI and its founders Goeken & McGowan, represented Ottensmeyer's case before Judge Greene in the Bell monopoly Divestiture hearings in 1983, wherein it was ruled in the DOJ's Modified Final Judgment (MFJ) that resale of telephone service shall be permitted. Judge Greene's ruling mandated the divestiture of AT&T and broke up the Bell System monopoly by creating seven autonomous Baby Bell companies. Judge Greene's ruling is credited with opening the US telecommunications industry to competitive market forces. Consequently, countries around the world opened their telecoms marketplace to free market competition.