USA Today and other publications reported a year ago that the National Security Agency had been secretly collecting the phone records of millions of Americans, based on AT&T and Verizon data. Quest, another telecommunication giant, shortly after the initial reports, said it had declined to participate in the program because of concerns over the legal implications.

 

The program doesn't involve recording conversations, but rather uses the data to analyze calling patterns, according to several reports.

The DPUC Thursday said it was indisputable that states have jurisdiction over the regulation of intrastate telecommunications issues, and that if the two companies released millions of calling records to the federal government without subpoena when privacy policies were in place, they would be subject to monetary fines.

As it did in a draft decision, the DPUC rebutted AT&T's assertion that it is pre-empted from conducting this investigation by federal law. The regulatory agency said it is not trying to regulate federal military or intelligence activities.

Renee Redman, legal director of ACLU-CT, which filed the original complaint, said the organization was "very pleased" by the ruling.

"Connecticut consumers have the right to know whether their telecommunications providers are illegally disclosing their customer calling information," she said.

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Several DPUCs across the country have entered the fight, but Connecticut was the first to get this far, she said.

The Office of Consumer Counsel and Attorney General Richard Blumenthal intervened in support of the ACLU's complaint.

"This is between the DPUC and the federal government. We are just stuck in the middle," said Peter Thonis of Verizon Communications.

Seth Bloom of AT&T said he could not comment beyond a statement the company made in 2006. "If and when AT&T is asked by government agencies for help, we do so strictly within the law and under the most stringent conditions. Beyond that, we can't comment on matters of national security," Bloom said.

The companies are under contract with the NSA and allegedly made the records available on a voluntary basis, according to news reports.

In September 2006, the federal government filed suit against the state DPUC, asking that it be prohibited from requiring AT&T and Verizon to respond to its inquiries. That suit has been consolidated with several others across the country in federal district court in San Francisco for a hearing in June.

Redman said the phone companies had asked the DPUC to wait for the federal court to rule on the issues of national security. The DPUC, however, decided that what it was seeking didn't impinge on national security.