I think this is an application to....Gyrator?
http://en.wikipedia.org/wiki/Gyrator
Yep, as the wiki says they are popular in phone circuits, called DAA (modems, fax machines) and FXO (Foreign eXchange Office) which is the phone end of the circuit, which may in actuality be a physical phone connected to a central office (CO), or the line cards in the racks at the customer premises of a private business exchange(PBX) that go to a CO... basically the FXO is your end of the line to the CO... the CO end is called an FXS (although a PBX served by a digital line these days may have local FXS line cards that go to local POTS phones that are then the FXO end.
The gyrator used in the DAA/FXO holds the DC line current , so the DC current doesn't have to flow through the transformer that is actually on the line. This allows the transformer to be made smaller and cheaper, and thus more line cards can fit in a rack. By the way.. more old terminology.. this is called "wet" and "dry" ... "wet" means the transformer is designed to carry the DC current without saturating , "dry" means it does not. All modern telephone circuits use dry transformers and a gyrator circuit for the DC current loop.