Gst Tucson Lightwave, Inc. v. City of Tucson, CV 96-326 TUC JMR.

• Decision Date: 19 December 1996
• Docket Number: No. CV 96-326 TUC JMR.,CV 96-326 TUC JMR.
• Citation: 950 F.Supp. 968
• Parties: GST TUCSON LIGHTWAVE, INC., Plaintiff, v. CITY OF TUCSON, Defendant/Counterclaimant, and US West Communications, Inc., Defendant-Intervenor.
• Court: U.S. District Court — District of Arizona

950 F.Supp. 968

GST TUCSON LIGHTWAVE, INC., Plaintiff, v. CITY OF TUCSON, Defendant/Counterclaimant and US West Communications, Inc., Defendant-Intervenor.

No. CV 96-326 TUC JMR.

United States District Court, D. Arizona.

December 19, 1996.

J. Jeffrey Mayhook, GST Tucson Lightwave, Inc., Vancouver, WA, Edward M. Mansfield, Belin Harris Lamson McCormick, Des Moines, IA, Nancy M. Coomer, Tucson, AZ, for Plaintiff.

Richard M. Rollman, Gabroy, Rollman & Bosse, P.C., Tucson, AZ, for Defendant/Counterclaimant.

Gary L. Lane, U.S. West Law Department, Phoenix, AZ, Timothy Berg, Theresa Dwyer, Fennemore Craig, P.C., Phoenix, AZ, Andrew M. Federhar, Fennemore Craig, P.C., Tucson, AZ, for Defendant/Intervenor U.S. West Communications, Inc.

ORDER

ROLL, District Judge.

Under advisement following a hearing on December 4, 1996 are cross-motions for judgment on the pleadings filed by Plaintiff GST Tucson Lightwave, Inc. ("GST") and Defendant/Counterclaimant City of Tucson ("City"), joined in part by Defendant-Intervenor US West Communications, Inc. ("US West"), and related matters.

Plaintiff GST filed this action in May 1996 requesting declaratory and injunctive relief alleging that the City has violated § 253(c) of the Telecommunications Act of 1996 ("Act") by managing its rights-of-way in a competitively biased and discriminatory manner as between GST and US West. 47 U.S.C. § 253(c).¹

For the reasons set forth below, the City's cross-motion for judgment on the pleadings is granted.

CROSS-MOTIONS FOR JUDGMENT ON THE PLEADINGS

GST brings this action for declaratory and injunctive relief pursuant to 47 U.S.C. § 253(c), part of the Telecommunications Act of 1996. Section 253 provides, in part:

Sec. 253 Removal of barriers to entry

(a) In general

No state or local statute or regulation, or other State or local legal requirement, may prohibit or have the effect of prohibiting the ability of any entity to provide any interstate or intrastate telecommunications service.

. . . . .

(c) State and local government authority

Nothing in this section affects the authority of a State or local government to manage the public rights-of-way or to require fair and reasonable compensation from telecommunications providers, on a competitively neutral and nondiscriminatory basis, for use of public rights-of-way on a nondiscriminatory basis, if the compensation required is publicly disclosed by such government.

. . . . .

47 U.S.C. § 253(a) & (c). GST contends that pursuant to 47 U.S.C. § 253(c), the City may only charge competitively neutral and nondiscriminatory license/franchise fees.

Chapter 7B of the Tucson City Code provides that any licensee/franchisee must pay the City an amount equal to 5.5% of gross annual revenues from customers served within the City's corporate limits. The City has applied this provision to two other telecommunications providers, and conditions approval of GST's franchise on acceptance of the provision. However, as the City and US West admit, US West pays no license/franchise fee to the City and has not been subjected to Chapter 7B. Thus, GST asserts, the City is discriminating against GST in favor of US West in violation of § 253(c), and, accordingly, GST's motion for judgment on the pleadings should be granted. The City contends that its cross-motions should be granted because 47 U.S.C. § 253(c) creates no private cause of action, and, accordingly, GST cannot avail itself of it.

Standard for Motion for Judgment on the Pleadings

Pursuant to Rule 12(c), Federal Rules of Civil Procedure, after the pleadings are closed, but within such time as to not delay trial, any party may move for judgment on the pleadings. However, "[a] motion for judgment on the pleadings is a motion for judgment on the merits, and should only be granted if no material issue of fact remains to be resolved, and the movant establishes [entitlement] to judgment as a matter of law." 27 Fed.Proc., L.Ed. 538, § 62:429. Rule 12(c) further provides that if matters outside the pleadings are presented to and not excluded by the Court, the motion must be treated as one for summary judgment and disposed of as provided in Rule 56, Federal Rules of Civil Procedure. Here, in deciding the cross-motions for judgment on the pleadings, the Court has not considered any factual matters presented by the parties outside the pleadings.

Analysis

No express authority for a private right of action appears in the § 253(c). However, whether a private right of action should be implied also must be considered.

The United States Supreme Court's four part test for determining whether a private right of action is implicit in a statute includes: (1) whether the plaintiff is one of the class for whose especial benefit the statute was enacted; (2) whether any explicit or implicit indication of legislative intent exists to create or deny a remedy; (3) whether implication of a remedy would be consistent with the underlying purposes of the legislative scheme; and (4) whether the cause of action is one traditionally relegated to state law, making the inference of a cause of action solely under federal law inappropriate. Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 2087-88, 45 L.Ed.2d 26 (1975).

The City contends that Congress did not intend § 253(c) to be an enforcement provision for telecommunications providers. Instead, Congress intended the provision to be a defense for municipalities against claims that such municipalities have erected barriers to entry. The City refers to the section as a "safe harbor" provision for municipalities. Thus, the requirement that regulation of public rights-of-way must be done on a competitively neutral and nondiscriminatory basis is a condition of the defense, not an element of a violation.

The City supports this argument with reference to the "Nothing in this section affects ..." language at the start of subsection (c), as well as with citations to the legislative history of the Stupak-Barton amendment. The comments made during debate of § 253(c) and the final language approved indicate congressional intent to allow states and municipalities to retain control over local rights-of-way.² Moreover, that amendment constituted rejection of the previously offered "parity" provision.³ The City also asserts that the FCC's decision in In re Classic Tel. Inc., CCBPol 96-10, No. 96-387, opinion and order (FCC, adopted, September 30, 1996, released, October 1, 1996) supports its position. Although Classic Tel. does provide some support for the argument that § 253(c) was intended to benefit state and local governments as a defense mechanism, the FCC did not reach the issue presented before this Court.

Enforcement of § 253 is provided for in § 253(d) and § 257, further indicating an absence of congressional intent that a private right of action be implied.

Section 253(d) provides in relevant part:

(d) Preemption

If ... the Commission determines that a State or local government has permitted or imposed any statute, regulation, or legal requirement that violates subsection (a) or (b) of this section, the Commission shall preempt the enforcement of such statute, regulation or legal requirement to the extent necessary to correct such violation or inconsistency.

Thus, subsection (d) allows the FCC to preempt enforcement of state and local regulations which violate subsections (a) or (b), but makes no mention of subsection (c). The City argues that the exclusion of subsection (c) was deliberate in order to provide judicial relief to municipalities when the FCC goes too far in preemption activities pursuant to subsection (a). Congress created subsection (c), as stated by Representative Stupak, "to protect the authority of local governments to control public rights-of-way and to be fairly compensated for the use of public property." 141 Cong.Rec. H 8460 (August 5, 1995).

Section 257 also provides an enforcement mechanism whereby the FCC is required to identify and eliminate market entry barriers through promulgation of regulations. Additionally, every three years the FCC is required to perform a review of any regulations designed to eliminate barriers, as well as any statutory barriers the FCC would recommend be eliminated.

Moreover, the language of § 253(c) itself, i.e. "Nothing in this section affects ...", as well as its relationship to subsection (a), lends weight to the City's argument that § 253(c) was not intended to create a private right of action. Further, although subsection (c) is not included within the preemption provision of subsection (d), this exclusion does not necessarily indicate congressional intent to provide for private enforcement of subsection (c) by telecommunications providers. Rather, the exclusion simply prevents FCC preemption for a violation. Although discriminatory and non-competitively neutral treatment would violate the statute, it would not result in a private right of action for telecommunications providers. GST's suggested statutory construction would be inconsistent with the underlying purposes of § 253.

The Court finds no private right of action exists pursuant to §...