Mci Tele. Corp. v. Value Call Intern., Inc., CIV.A. 96-2509-KHV.
| Decision Date | 17 November 1997 |
| Docket Number | No. CIV.A. 96-2509-KHV.,CIV.A. 96-2509-KHV. |
| Citation | 988 F.Supp. 1376 |
| Parties | MCI TELECOMMUNICATIONS CORPORATION, Plaintiff, v. VALUE CALL INTERNATIONAL, INC., Defendant. |
| Court | U.S. District Court — District of Kansas |
Heather Suzanne Woodson, Stinson, Mag & Fizzell, P.C., Overland Park, KS, John C. Aisenbrey, Russell A. Berland, Stinson, Mag & Fizzell, P.C., Kansas City, MO, for Plaintiff.
J. Nick Badgerow, Spencer, Fane, Britt & Browne, Overland Park, KS, Randall A. Smith, Andrew L. Kramer, L. Tiffany Hawkins Smith, Jones & Fawer, New Orleans, LA, for Defendant.
MCI Telecommunications Corp. filed suit on November 19, 1996, seeking declaratory relief concerning contractual disputes involving its customer, Value Call International, Inc. [Value Call]. Value Call counterclaimed for violations of the Communications Act of 1934, 47 U.S.C. § 203, breach of contract, fraud, tortious interference with contract, and negligence. This matter comes before the Court on Plaintiff's Motion For Partial Summary Judgment (Doc. # 126) filed July 1, 1997. Except as otherwise noted below, the Court finds that MCI is entitled to judgment as a matter of law on both its claim for declaratory relief and Value Call's counterclaims for violations of the Communications Act of 1934, breach of contract, and fraud.
Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Federal R. Civ. P. 56(c); accord Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202 (1986); Vitkus v. Beatrice Co., 11 F.3d 1535, 1538-39 (10th Cir.1993). A factual dispute is "material" only if it "might affect the outcome of the suit under the governing law." Anderson, 477 U.S. at 248, 106 S.Ct. at 2509-10. A "genuine" factual dispute requires more than a mere scintilla of evidence. Id. at 252, 106 S.Ct. at 2512.
The moving party bears the initial burden of showing that there is an absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986); Hicks v. City of Watonga, 942 F.2d 737, 743 (10th Cir.1991). Once the moving party meets its burden, the burden shifts to the nonmoving party to demonstrate that genuine issues remain for trial "as to those dispositive matters for which it carries the burden of proof." Applied Genetics Int'l, Inc. v. First Affiliated Securities, Inc., 912 F.2d 1238, 1241 (10th Cir.1990); see also Matsushita Elec. Indus. Co., Ltd., v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 1355-56, 89 L.Ed.2d 538 (1986); Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d 887, 891 (10th Cir.1991). The nonmoving party may not rest on its pleadings but must set forth specific facts. Applied Genetics, 912 F.2d at 1241.
"[W]e must view the record in the light most favorable to the parties opposing the motion for summary judgment." Deepwater Invs., Ltd. v. Jackson Hole Ski Corp., 938 F.2d 1105, 1110 (10th Cir.1991). Summary judgment may be granted if the nonmoving party's evidence is merely colorable or is not significantly probative. Anderson, 477 U.S. at 250-51, 106 S.Ct. at 2511-12. "In a response to a motion for summary judgment, a party cannot rely on ignorance of facts, on speculation, or on suspicion, and may not escape summary judgment in the mere hope that something will turn up at trial." Conaway v. Smith, 853 F.2d 789, 793 (10th Cir.1988). Essentially, the inquiry is "whether the evidence presents a sufficient disagreement to require submission to the jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson at 251-52, 106 S.Ct. at 2511-12. Ever mindful of these summary judgment standards, the Court now turns to the merits of plaintiff's motion.
The following facts are uncontroverted, or where controverted, viewed in the light most favorable to defendant.
MCI is a common carrier which sells tele-communications services. Value Call buys telecommunications services for resale to end users. In late 1995, Value Call approached MCI about purchasing long distance services for resale. Chuck Long, branch manager of MCI's branch office in Overland Park, Kansas, proposed rates that were attractive to Value Call and in an attempt to obtain a tariff option which would reflect those rates, he directed Tom Archer, an MCI sales manager, to seek approval from MCI's Business Planning, Analysis & Development Group ("Business Development Group"). Long also directed Archer to commit MCI through a Special Customer Arrangement ("SCA")1 and told him to arrange for Value Call to enroll a portion of its proposed usage under a tariff option which MCI had previously created for the Carlson Hospitality Group ("Carlson").2
MCI's Business Development Group did not approve the rates that Long had proposed to Value Call, but in March 1996, Archer nonetheless sent Value Call a proposed SCA, a proposed Carlson Enrollment Form and Agreement, and a proposed guarantee of Value Call's debt by its corporate parent, Saratoga Telephone Company, Inc. [Saratoga]. When Value Call complained that the proposed agreements and enrollment form did not contain the rates which Long had previously quoted, Long told Value Call to draft amendments which reflected the agreed rates. Value Call did so and on March 28, 1996, its president, Evans House, signed an agreement that modified the SCA which MCI had proposed, including its rates. House also signed an agreement which modified the Carlson Enrollment Form which MCI had proposed (including a credit of $90,000 per month) and a 90-day limited guarantee of Value Call's debt by Saratoga.3 For ease of reference these documents are hereafter referred to as "Value Call documents." House also signed the SCA and Carlson Enrollment documents which MCI had originally proposed [hereafter referred to as "MCI documents"] and sent both the Value Call documents and the MCI documents to MCI's branch office.
As of March 28, 1996, when Value Call signed these documents and sent them to MCI, MCI had not signed anything. When MCI received the documents, Archer faxed Saratoga's limited guarantee to the MCI credit analysis department. He sent the MCI documents to MCI's Law and Public Policy department, to initiate the MCI approval process. Acting on instructions from Long, however, Archer signed Long's name to the Value Call documents and faxed them back to Value Call.4 Consequently, MCI and Value Call executed the revisions to the documents which MCI had proposed, but only Value Call signed the underlying documents.
MCI never did sign the documents which it had originally proposed to Value Call. Moreover, it did not file with the Federal Communications Commission ("FCC") any tariff option which reflected the rates, credits, terms, and conditions to which Long and Value Call had agreed in the Value Call documents.
The parties disagree whether Archer accepted Value Call's documents when he signed them on behalf of MCI. MCI claims that he did not. Value Call argues not only that he accepted the revisions on behalf of MCI, but that he also, through operation of an incorporation clause, accepted the agreements which MCI had originally proposed. Value Call also argues that by their very terms, the Value Call documents became effective when Value Call signed them — even if MCI refused to do so. MCI claims that even if Archer accepted the Value Call documents, he lacked authority to execute them on behalf of MCI and MCI never utilized the rates and credits set forth therein. Value Call again disagrees, asserting that Archer had actual or apparent authority to bind MCI and that MCI in fact billed Value Call some of the agreed rates.
The parties agree that the MCI documents did not include the rates and credits which Long had promised. Value Call expected Long to make up the difference between the promised rates and credits, and those contained in MCI's documents, through MCI's "checkbook" program.5
MCI asserts that this case is controlled by the filed rate doctrine,6 which holds that a common carrier tariff — once filed with the FCC — has the force and effect of federal law and exclusively governs the rights and liabilities of the customer and the carrier. MCI argues that under this doctrine, because it did not file any Value Call tariff option with the FCC, the purported agreements could not effectively modify the rates and credits available under MCI's Tariff No. 1. Further, MCI contends that even if the filed rate doctrine does not invalidate the agreements, none of the agreements were executed in conformity with the statute of frauds. MCI therefore seeks summary judgment on its claim that notwithstanding any purported agreement by Long and Archer, MCI tariffs control the rates, credits and terms of service to Value Call. Specifically, MCI contends that it is entitled to judgment declaring that Value Call is liable for nonpayment under the terms of Tariff No. 1. MCI maintains that the filed rate doctrine and statute of frauds also govern Value Call's state law counterclaims for breach of contract and fraud, as well as Value Call's counterclaim that MCI breached the Communications Act by failing to bill Value Call at promised rates.7 MCI therefore asserts that it is entitled to summary judgment on these claims as well.
Value Call responds that the record reveals genuine issues of material fact, but even if the Court finds no genuine issues of material fact, MCI's motion should be denied as a matter of law. Value Call argues that the FCC has recently ordered detariffing of all nondominant carriers and that as a result, the...
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