In re Starpower Communications LLC
| Decision Date | 08 April 2002 |
| Docket Number | EB-00-MD-19,EB-00-MD-20,FCC 02-105 |
| Parties | In the Matter of STARPOWER COMMUNICATIONS, LLC, Complainant, v. VERIZON SOUTH INC., Respondent. STARPOWER COMMUNICATIONS, LLC, Complainant, v. VERIZON VIRGINIA INC., Respondent. |
| Court | Federal Communications Commission Decisions |
Adopted: March 28, 2002
By the Commission: Commissioner Martin approving in part, dissenting in part, and issuing a statement.
1. In this order, pursuant to sections 208 and 252(e)(5) of the Communications Act of 1934, as amended ("Act") [1] we deny a formal complaint that Starpower Communications, LLC ("Starpower") filed against Verizon Virginia Inc. ("Verizon Virginia"), and we grant a formal complaint that Starpower filed against Verizon South Inc. ("Verizon South").[2] In its complaints, Starpower seeks to recover, pursuant to three interconnection agreements with Verizon, payment of reciprocal compensation for the delivery of traffic bound for Internet service providers ("ISPs"). We conclude that the two interconnection agreements between Starpower and Verizon Virginia do not obligate Verizon Virginia to pay reciprocal compensation for ISP-bound traffic. We reach the contrary conclusion (i.e., that reciprocal compensation for ISP-bound traffic must be paid) with respect to the interconnection agreement between Starpower and Verizon South.
2. Starpower is licensed to provide local exchange services in Virginia.[3] Verizon Virginia and Verizon South are incumbent local exchange carriers ("ILECs") also licensed to provide local exchange services in Virginia.[4]
3. Starpower and Verizon interconnect their networks to enable an end user subscribing to Starpower's local exchange service to place calls to and receive calls from end users subscribing to Verizon's local exchange service.[5] Toward this end, Starpower entered into two interconnection agreements with Verizon Virginia and an interconnection agreement with Verizon South.[6] We describe below the relevant terms of each agreement.
4. On July 17, 1996, Verizon Virginia executed an interconnection agreement ("MFS-Verizon Virginia Agreement") with MFS Intelnet of Virginia, Inc. pursuant to section 252(a) of the Act.[7] The MFS-Verizon Virginia Agreement was filed with, and approved by, the
Virginia State Corporation Commission ("Virginia SCC") on October 11, 1996.[8]
5. By letter dated February 4, 1998, and pursuant to section 252(i) of the Act, [9]Starpower notified Verizon Virginia that it elected to obtain interconnection, services, and network elements upon the same terms and conditions as those provided in the MFS-Verizon Virginia Agreement.[10] On February 19, 1998, Verizon Virginia provided Starpower with a draft interconnection agreement based upon the MFS-Verizon Virginia Agreement.[11] At that time, Verizon Virginia expressed its opinion that the "reciprocal compensation provisions set forth in the [MFS-Verizon Virginia Agreement] . . . do not apply to Internet-bound traffic because such traffic is not intraLATA traffic."[12] In a March 4, 1998 memorandum from Starpower to Verizon Virginia, Starpower disagreed with Verizon Virginia's interpretation of the reciprocal compensation provisions of the MFS-Verizon Virginia Agreement.[13] Despite this dispute, in March 1998, Starpower and Verizon Virginia executed an interconnection agreement - the First Starpower-Verizon Virginia Agreement - based on the terms of the MFS-Verizon Virginia Agreement.[14] The First Starpower-Verizon Virginia Agreement was filed with, and approved by, the Virginia SCC on June 17, 1998.[15]
6. Section 1.61 of the First Starpower-Verizon Virginia Agreement defines "Reciprocal Compensation" in the following manner:
As described in the Act and refers to the payment arrangements that recover costs incurred for the transport and termination of Local Traffic originating on one Party's network and terminating on the other Party's network.[16]
According to the First Starpower-Verizon Virginia Agreement, "As Described in the Act" means "as described in or required by the Act and as from time to time interpreted in the duly authorized rules and regulations of the FCC or the [Virginia SCC]."[17] "Local Traffic" is "traffic that is originated by a Customer of one Party on that Party's network and terminates to a
Customer of the other Party on that other Party's network, within a given local calling area, or expanded area service ('EAS') area, as defined in [Verizon Virginia's] effective Customer tariffs . . . ."[18] This language closely resembles the language that the Commission used in April 1996 to describe the type of traffic that was likely subject to reciprocal compensation under section 251(b)(5) of the Act:[19] "The statutory provision appears at least to encompass telecommunications traffic that originates on the network of one LEC and terminates on the network of a competing LEC in the same local service area . . . ."[20]
7. Section 5.7 of the First Starpower-Verizon Virginia Agreement delineates the parties' reciprocal compensation obligations as follows:
These provisions are the only ones in the First Starpower-Verizon Virginia Agreement governing compensation for Local Traffic, [22] and the word "termination" is undefined.[23]
8. After the First Starpower-Verizon Virginia Agreement took effect, the parties exchanged traffic.[24] Starpower subsequently submitted invoices to Verizon Virginia seeking, among other things, compensation for transporting and terminating calls originating with Verizon Virginia's customers and delivered to Starpower's customers, including calls to ISPs and calls accessing the Internet through ISPs served by Starpower.[25] Starpower asserts that such ISP-bound calls from Verizon Virginia customers constitute "Local Traffic" within the meaning of the First Starpower-Verizon Virginia Agreement.[26] Verizon Virginia disagrees, and has paid only a portion of the amounts billed by Starpower.[27]
9. By letter dated April 1, 1999, Verizon Virginia notified Starpower that it had elected to terminate the First Starpower-Verizon Virginia Agreement, according to the agreement's terms.[28] Following Verizon Virginia's notice, the First Starpower-Verizon Virginia Agreement terminated as of July 1, 1999, although the agreement continued in effect pending execution or adoption of a new agreement.[29]
b. The Second Starpower-Verizon Virginia Agreement
10. On June 16, 1997, Verizon Virginia entered into an interconnection agreement ("MCImetro-Verizon Virginia Agreement") with MCImetro Access Transmission Services of Virginia, Inc. pursuant to section 252(a) of the Act.[30] The MCImetro-Verizon Virginia Agreement was filed with, and approved by, the Virginia SCC on July 16, 1997.[31]
11. By letter dated June 10, 1999, Starpower notified Verizon Virginia that, following expiration of the First Starpower-Verizon Virginia Agreement, Starpower wished to adopt the MCImetro-Verizon Virginia Agreement pursuant to section 252(i) of the Act.[32] Effective October 19, 1999, the parties entered into a written agreement, known as the "Adoption Agreement, " memorializing Starpower's adoption of the terms and conditions of the MCImetro-Verizon Virginia Agreement.[33] The Virginia SCC approved the resulting interconnection agreement ("Second Starpower-Verizon Virginia Agreement") on April 25, 2000.[34] The Adoption Agreement contains a clause in which the parties essentially agree to disagree about the applicability of the interconnection agreement's reciprocal compensation provisions to ISP-bound traffic.[35] Specifically, Starpower articulated its belief that the agreement's reciprocal compensation arrangements "apply to Internet traffic, " but acknowledged that Verizon Virginia takes the opposite view and that, by signing the Adoption Agreement, Verizon Virginia does not waive any claims or defenses pertaining to the issue.[36]
12. Part B of the Second Starpower-Verizon Virginia Agreement defines "Reciprocal Compensation" as:
refer[ring] to a reciprocal compensation arrangement between two carriers in which each of the two carriers receives compensation from the other carrier for the transport and termination on each carrier's network facilities of Local Traffic that originates on the network facilities of the other carrier.[37]
According to the agreement, "Local Traffic" is:
traffic that is originated by an end user subscriber of one Party on that Party's network and terminates to an end user subscriber of the other Party on that other Party's network within a given local calling area, or expanded area ("EAS") service, as defined in Bell Atlantic's Tariffs, or, if the Commission has defined local calling areas applicable to all Local...
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