General Telephone Co. of Southwest v. City of Wellington
This case concerns a temporary injunction sought by General Telephone Company of the Southwest against the City of Wellington to prevent the enforcement of a telephone rate ordinance (No. 333) and a penalty ordinance (No. 332). The telephone company argued that the rates set by the city were confiscatory, yielding less than a 2% return. Both the trial court and the Amarillo Court of Civil Appeals denied the injunction. The Supreme Court reversed this decision, holding that a return of less than 2% was unreasonable, and that the lower courts erred in their interpretation of the 'status quo' and the requirement for separating urban and suburban operations for rate-making purposes. The court concluded that the telephone company had demonstrated a reasonable probability of success on final hearing, irreparable loss, and adequate protection for customers through a bond.