Iberia Credit Bureau, Inc. v. Cingular Wireless

• Decision Date: 02 November 2009
• Docket Number: Civil Action No. 6:01-2148.
• Parties: IBERIA CREDIT BUREAU, INC., et al. v. CINGULAR WIRELESS, et al.
• Court: U.S. District Court — Western District of Louisiana

668 F.Supp.2d 831 IBERIA CREDIT BUREAU, INC., et al.
v.
CINGULAR WIRELESS, et al. Civil Action No. 6:01-2148. United States District Court, W.D. Louisiana, Lafayette-Opelousas Division. November 2, 2009.

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COPYRIGHT MATERIAL OMITTED

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Theodore Michael Haik, Jr., Haik Minivielle & Grubbs, New Iberia, LA, David Patrick Daniel, Jr., Law Offices of D. Patrick Daniel Jr., Joseph R. Joy, III, Joseph Joy & Assoc., Lafayette, LA, Elizabeth C. Dougherty, Dougherty Law Firm, Baton Rouge, LA, James Robert Davis, Jr., Law Offices of J. Robert Davis, Houston, TX, for Iberia Credit Bureau, Inc.

Joseph E. Leblanc, Jr., Leblanc Bland, Houston, TX, Carl Marquardt, Kelly Twiss Noonan, Mathew L. Harrington, Stokes Lawrence, Seattle, WA, Elizabeth S. Wheeler, Michael David Roche, King Leblanc & Bland, New Orleans, LA, Joseph C. Chautin, III, Mark A. Balkin, Hardy Carey et. al., Mandeville, LA, Ashton R. Hardy, Metairie, LA, Christopher M. Mason, Nixon Peabody, New York, NY, for Cingular Wireless.

ORDER AND REASONS

IVAN L.R. LEMELLE, District Judge.

Defendant, TeleCorp Communications, Inc. d/b/a SunCom ("SunCom") files a Renewed Motion for Partial Summary Judgment and Dismissal (Rec. Doc. No. 372) on the grounds of federal preemption and the

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filed tariff doctrine. The motion is opposed by Plaintiff Claudia Fontenot (Rec. Doc. No. 319, Rec. Doc. No. 406). For the following reasons, IT IS ORDERED that the instant motion is DENIED.

PERTINENT FACTS:

Plaintiffs initially filed this class action on September 11, 2001, asserting various breach of contract claims against several wireless communication service providers.¹ Plaintiffs allege that Defendants failed to "disclose the true nature of the billing and/or trade practices, each of which represents a breach of contract. . . ."² At issue in this motion are the claims and defenses of Plaintiff Fontenot and Defendant SunCom. Fontenot is the only plaintiff in this suit who did business with SunCom, and Fontenot and SunCom are the only parties involved in this motion. However, the legal conclusions regarding preemption and the tariff doctrine are applicable to all parties, unless noted otherwise.

Plaintiff alleges that she contracted for cellular service with SunCom in 2000.³ According to Plaintiff, SunCom promised her 200 talking minutes.⁴ Plaintiff alleges that Defendant breached its oral agreement for cellular service by failing to inform her that the company participated in such practices as rounding up calling time to the next full minute and charging for airtime during non-communication time ("send to end" billing). As a result, Plaintiff got less minutes than what she was promised and than she paid for.⁵ There is a dispute of the facts as to whether or not the contract was oral or written, the terms of the contract, and whether or not Plaintiff was aware of Defendant's billing practices of rounding up and send to end billing.

After several years' worth of pretrial motions and discovery disputes, only two defendants remain in the case, including SunCom. On January 21, 2005, the Court denied without and directed the parties to develop a plan of discovery on the issues relative to the defendants' defenses based on federal preemption and the filed tariff doctrine.⁶ Discovery was limited to these summary judgment issues of law. SunCom now renews its previous Motion for Summary Judgment and Dismissal on these same grounds: 1) the Federal Communications Act preempts challenges as to the reasonableness of wireless carriers' rates and rate practices, including practices such as rounding up and send to end billing; and 2) even if the claims are not preempted, the filed tariff doctrine prohibits litigation of non-rate claims in Louisiana.⁷ Defendant also argues Plaintiffs can no longer forestall summary judgment by claiming that they need more time for discovery. This issue was ruled upon in the Court's Order dated May 19, 2009, and therefore it does not need to be addressed here.⁸

CONTENTIONS OF MOVANT:

SunCom argues that partial summary judgment disposal of Fontenot's state

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claim is proper because it is federally preempted by § 332 of the Federal Communications Act.⁹ Section 332 states (and has been interpreted to mean) that no state or local government has the authority to regulate rates or rate practices of wireless carriers. SunCom contends that the Court's judgment of the case, if it were to go to trial, would constitute a regulation of rates and thus should be preempted. SunCom also argues that in order for the Court to make its ruling, it first must determine the reasonableness of the rates, which is disallowed by § 332.¹⁰

In the alternative, SunCom argues that if the Court should find the claim not to be preempted by the Federal Communications Act, then they are foreclosed by Louisiana's filed tariff doctrine.¹¹ SunCom claims that the filed tariff doctrine bars consumer suits for damages arising out of claims involving other terms and conditions.¹² According to SunCom, the doctrine presumes that customers have knowledge of wireless providers' rates and billing practices that are filed as tariffs, and therefore cannot claim injury or damages.¹³

CONTENTIONS OF RESPONDENT:

Plaintiff contends that their breach of contract claim is not preempted by § 332, as state law claims stemming from state contract or consumer fraud laws governing disclosure of rates and rate practices are not preempted.¹⁴ Plaintiff concedes that state courts have no authority to determine the reasonableness of rates or to participate in rate setting, however, Plaintiff contends that this action is strictly a matter of contract enforcement, and does not involve a determination of reasonableness, nor will it set or directly affect rates. It is Plaintiff's position that this claim will only require the courts to determine the amount of airtime that was promised, and the amount actually provided.¹⁵

Plaintiff also disagrees with Defendant about the existence and the applicability of the filed tariff doctrine. Plaintiff claims that this is doctrine invented by the Defendants to circumvent the filed rate doctrine, which does not apply to wireless providers.¹⁶ Plaintiff alleges that the Defendant's tariff filing with the State is strictly an informational filing with no force of law.¹⁷ Alternatively, Plaintiff argues that if for some reason the Court does find that the filed tariffs have the force of law, they should not be enforced in this case because Defendant failed to adhere to the terms of the filed tariff, therefore forbidding courts from enforcing it.¹⁸

LAW AND ANALYSIS:

A. Standard of Review for Summary Judgment

Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322-323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). A court must be satisfied that no reasonable trier of fact could find for the nonmoving party, or "that the evidence favoring the nonmoving party is insufficient to enable a reasonable juror to return a verdict in her favor."

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Lavespere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). The moving party bears the burden of showing there are no genuine issues of material fact.

If the dispositive issue is one on which the moving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record contains insufficient proof concerning an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325, 106 S.Ct. 2548; See also Lavespere, 910 F.2d at 178. The burden shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See Celotex, 477 U.S. at 324, 106 S.Ct. 2548. The nonmovant may not rest upon the pleadings, but must identify specific facts that establish a genuine issue for trial. See id. at 325, 106 S.Ct. 2548; Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir.1994).

B. Background of Federal Communications Act of 1934 and 1993 Amendment

The Federal Communications Act ("FCA") was first promulgated by Congress in 1934. 47 U.S.C. §§ 151 et seq. The stated purpose of the Act is to regulate wire and radio communication systems to make available a rapid and efficient world-wide communication system at a reasonable charge. 47 U.S.C. § 151. The 1934 Act as applied to telephone services remained principally in place until it was amended in 1993. The 1993 amendment was, in large part, in recognition of the rapid growth of wireless communication methods, in particular cellular phones. Ball et al. v. GTE Mobilnet of Cal. et al., 81 Cal.App.4th 529, 533, 96 Cal.Rptr.2d 801 (2000). The goal of the amended § 332 was to deregulate commercial mobile radio service ("CMRS") providers to encourage development of mobile services. H.R.Rep. No. 103-111, 103rd Cong., 1st Sess. 211, 260 (May 25, 1993); 47 U.S.C. § 332. "Section 332 was designed to promote the CMRS industry's reliance on competitive markets in which private agreements and other contract principles can be enforced." In re Wireless Consumers Alliance, Inc., 15 F.C.C.R. 17021, 17034 ¶ 24 (2000) ("Wireless Consumers"). The specific purpose of implementing the preemption clause was to "help promote investment in the wireless infrastructure by preventing burdensome and unnecessary state regulatory practices that impede the federal mandate for regulatory parity." Second Report and Order, In re Implementation of Sections 3(n) and 332 of the Communications Act Regulatory Treatment of Mobile Services, 9 F.C.C. Rec. 1411, 1411, 1421 (1994). See also Tenore v. AT & T Wireless Serv., 136 Wash.2d 322, 962 P.2d 104, 110 (1998).

C. Preemption

1....