The U.S. Supreme Court agreed Monday to review an antitrust lawsuit brought by several Internet service providers alleging a unit of AT&T Corp. charged unreasonably high prices for access to the company's extensive phone networks.

The AT&T unit, Pacific Bell Telephone Co., was sued by several Internet services providers in 2003, including Linkline Communications Inc., Notelog Inc. and In-Reach Internet Inc.

Under federal law Pacific Bell is required to sell the service providers wholesale access to its telephone network. But the companies allege the prices were too high for them to effectively compete with the AT&T unit's own Internet service.

Last year the Ninth U.S. Circuit Court of Appeals in San Francisco allowed the lawsuit against Pacific Bell to proceed in federal court. In May 2008, the U.S. Solicitor General's office file a court brief suggesting federal antitrust laws don't cover the Internet companies' claims.

"Such a theory of liability could not be reconciled with this court's modern antitrust jurisprudence," U.S. Solicitor General Paul Clement said. He urged the Supreme Court to reverse the Ninth Circuit.

When the lawsuit was filed, the AT&T unit was part of SBC Communications Inc., which has since merged with AT&T. The case is Pacific Bell Telephone Co. v. Linkline Communications Inc., 07-512.

Separately, justices also granted a second appeal filed by AT&T that deals with how the company counted pregnancy leave for its employee benefits purposes prior to a 1979 federal law that bars workplace discrimination against pregnant women. The case was filed on behalf of AT&T employees who took pregnancy leave prior to 1979.

The employees want uncounted pregnancy leave to count toward their retirement and other benefits but they filed their claims starting in 1994 and more than 15 years after the pregnancy law went into effect. The Ninth Circuit also ruled in this case and decided the AT&T workers should get service credit for their pregnancy leave prior to the federal law. "That decision gives an impermissible retroactive effect to the Pregnancy Discrimination Act," Mr. Clement said in a briefing that also urged reversal of the federal appeals court decision.

The case is AT&T v. Hulteen, 07-543. Arguments will be heard in the fall of 2008.