238 F.3d 219 (2nd Cir. 2001), 00-7660, ICOM Holding v MCI Worldcom

Docket Nº:00-7660
Citation:238 F.3d 219
Party Name:ICOM HOLDING, INC., Plaintiff-Appellant, v. MCI WORLDCOM, INC., Defendant-Appellee.
Case Date:January 22, 2001
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

Page 219

238 F.3d 219 (2nd Cir. 2001)

ICOM HOLDING, INC., Plaintiff-Appellant,


MCI WORLDCOM, INC., Defendant-Appellee.

No. 00-7660

United States Court of Appeals, Second Circuit

January 22, 2001

Argued January 2, 2001,

Page 220

PHILIP S. ROSS, Hoffinger, Friedland, Dobrish & Stern, P.C., New York, NY, for Plaintiff-Appellant.

PATRICK C. DUNICAN, JR., Gibbons, Del Deo, Dolan, Griffinger & Vecchione, P.C., New York, NY, for Defendant-Appellee.

Before: SACK, SOTOMAYOR, and KATZMANN, Circuit Judges.

SACK, Circuit Judge:

The plaintiff ICOM, Inc., appeals from an order of the United States District Court for the Eastern District of New York (Joanna T. Seybert, Judge) dismissing its complaint for failure to state a claim upon which relief can be granted. We now affirm the judgment of the district court, agreeing with its holding that the plaintiff's state-law breach of contract claims premised on the defendant's failure to install high-speed telecommunications circuits for the purpose of providing the plaintiff with local access telecommunication service are preempted by the federal Communications Act, 47 U.S.C. §§ 151, et seq., and barred by the filed-rate doctrine.


Through a series of letters dated August 19 through October 27, 1998, the plaintiff ICOM, Inc., and the defendant MCI Worldcom, Inc., entered into a contract under which the defendant agreed to provide the plaintiff with certain telecommunications services and equipment. Among those services were the installation and operation of six DS3 circuits, or high speed network connections, between Manhattan and Westbury, New York, as a means of providing the plaintiff with local access telecommunications service. In return, the plaintiff agreed to pay a lump sum for each circuit's installation and a recurring monthly amount for the system's ongoing operation. The defendant promised to complete the installation of the circuits by November 20, 1998.

Although the plaintiff has tendered all payments and otherwise discharged its duties under the contract, the defendant has not installed the high-speed connections. The plaintiff asserts that as a result

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of this alleged breach, it has been unable to perform contracts with third parties that it executed in reliance on the defendant's promises and has thereby suffered financial losses.

The plaintiff filed suit on June 17, 1999 in the Supreme Court of the State of New York, Nassau County, claiming breach of contract under state law. On July 28, 1999, the defendant removed the case to the United States District Court for the Eastern District of New York, and in a memorandum decision and order dated April 20, 1995, the district court granted the defendant's motion to dismiss the suit, holding that the plaintiff's claims were preempted by the federal Communications Act of 1934, 47 U.S.C. §§ 151, et seq, and barred by the filed-rate doctrine.

This appeal followed.


I. Standard of Review

We review de novo a district court's grant of a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), accepting all allegations in the complaint as true and drawing all inferences in favor of the plaintiff. See Friedl v. City of New York, 210 F.3d 79, 83 (2d Cir. 2000). We may affirm only if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Harris v. City of New York, 186 F.3d 243, 250 (2d Cir. 1999) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 2 L.Ed. 2d 80, 78 S.Ct. 99 (1957)).

II. The Filed-Rate Doctrine

Federal law requires every common carrier of communications services to file with the Federal Communications Commission ("FCC") a list of tariffs, which are "schedules showing all charges . . . and showing the classifications, practices, and regulations affecting such charges." 47 U.S.C. § 203(a). Carriers are forbidden to "extend to any person any privileges or facilities in such communication, or employ or enforce any classifications, regulations, or practices affecting such charges, except as specified" in those filed tariffs. Id. § 203(c). The goal of these provisions is to ensure that all purchasers of communications services receive the same federally regulated rates. See MCI Telecomms. Corp. v. American Tel. & Tel. Co., 512 U.S. 218, 229-30, 129 L.Ed. 2d 182, 114 S.Ct. 2223 (1994).

Interpreting these provisions, the Supreme Court has adopted the filed-rate doctrine, which holds that "'the rate of the carrier duly filed is the only lawful charge'" and that "'deviation from it is not permitted upon any pretext.'" American Tel. & Tel. Co. v. Central Office Tel., Inc., 524 U.S. 214, 222, 141 L.Ed. 2d 222, 118 S.Ct. 1956 (1998) (quoting Louisville & Nashville R.R. Co. v. Maxwell, 237 U.S. 94, 97, 59 L.Ed. 853, 35 S.Ct. 494 (1915)). Under this rule, rates filed with the FCC "bind both carriers and [customers]...

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