Ohio Bell Tel. Co. v. Pub. Utilities Comm'n of Ohio

Decision Date06 January 2012
Docket NumberCase No. 2:09–CV–00918.
Citation844 F.Supp.2d 873
CourtU.S. District Court — Southern District of Ohio


Mary Katherine Fenlon, Mary Ryan Fenlon, Jon F. Kelly, AT&T, Columbus, OH, J. Tyson Covey, Chicago, IL, for Plaintiff.

William Lewis Wright, Thomas Gerard Lindgren, Samuel Neal Lillard, McNees Wallace & Nurick L.L.C., Columbus, OH, Barbara A. Miller, Edward A. Yorkgitis, Steven A. Augustino, Washington, DC, Craig W. Donaldson, Intrado Communications, Inc., Longmont, CO, for Defendants.


ALGENON L. MARBLEY, District Judge.


This matter is before the Court for merits review of the claims brought by the Plaintiff Ohio Bell Telephone Company, AT & T Ohio (AT & T). In its Initial Brief on the Merits, AT & T challenges the final determinations of Defendant Public Utilities Commission of Ohio (PUCO) on the arbitration petition brought by Defendant Intrado Communications, Inc. (“Intrado”). AT & T alleges that the requirements in the “interconnection agreement” between AT & T and Intrado are contrary to the Telecommunications Act of 1996, 47 U.S.C. §§ 151 et seq. (the Act).

Count One of AT & T's Complaint contends that the Defendant Commissioners of PUCO 1 violated the Act by finding that Intrado's service qualified as a telecommunications carrier offering “telephone exchange service” under the Act. Counts Two and Three allege that PUCO lacked authority to order AT & T to establish a “point of interconnection” (or “POI”) on Intrado's network as part of the interconnection agreement. Count Four seeks invalidation of certain terms ordered by PUCO in the arbitration award that are necessarily related to the point of interconnection being established on Intrado's network. Finally, AT & T's Counts Five and Six challenge the lawfulness of PUCO's orders requiring established frameworks for certain transfer arrangements with third party customers, and the rates to be charged to Intrado for any services or products AT & T provides that are not contained in the agreement.

For the reasons provided below, the Court finds that PUCO's decisions in its Arbitration Award were consistent with the Act, and were not arbitrary or capricious.


Plaintiff AT & T is a provider of local telephone services in the state of Ohio and meets the definition of an “incumbent local exchange carrier” (or “ILEC”) under the Act. See47 U.S.C. § 251(h); 47 C.F.R. § 51.5. ILECs are the telephone companies which held monopolies in local telephone markets prior to the passing of the Act, which was enacted to encourage competition in those markets by imposing several duties on the incumbent carriers. One part of AT & T's operations as an ILEC in Ohio is its 9–1–1 emergency telephone services. Defendant Intrado is a 9–1–1 emergency service provider for end users of wireline and wireless carriers and voice over Internet protocol (“VoIP”) providers. Intrado seeks to compete with AT & T's incumbent 9–1–1 service. Intrado offers a novel “Intelligent Emergency Network” (“IEN”) 9–1–1 service that utilizes an “Internet protocol” technology based network as an alternative to the traditional, ILEC-maintained, wireline-based 9–1–1 systems. Intrado's customers will not be 9–1–1 callers themselves, but rather those who answer 9–1–1 calls, referred to as Public Safety Answering Points (“PSAPs”), and other public safety entities, including municipal police and fire departments. By providing this more specialized, limited 9–1–1 service, Intrado intends to increase efficiency and effectiveness in responding to emergency calls.

AT & T is a monopoly provider of 9–1–1 services in Ohio. In order to provide its 9–1–1 service to Ohio customers, therefore, Intrado's network must be interconnected with AT & T's network. Interconnection is defined as “the actual physical linking of two networks for the mutual exchange of traffic.” 47 C.F.R. § 51.5. The Act provides protections against ILEC monopoly of markets and requires ILECs to enter into interconnection agreements with competitors. The typical interconnection agreement enables a so-called competing local exchange carrier (“CLEC”) to offer local exchange and exchange access services and sets forth the terms and conditions by which the new competitor can use an ILEC's network and purchase the ILEC's telecommunication services for a negotiated fair price. See47 U.S.C. § 251(a)(1) & (c). Competing carriers can compel an ILEC, such as AT & T, to negotiate an interconnection agreement when certain conditions are met. State utility commissions review, arbitrate, and grant final approval to interconnection agreements. See47 U.S.C. § 252(e).

The Act establishes a procedure which first allows voluntary negotiations between the incumbent carrier and the new competitor. In the event the parties fail to negotiate all the terms of the interconnection agreement, the Act authorizes state public utility commissions to adjudicate or arbitrate disputed issues. In that case, either the new entrant or the incumbent carrier may file a petition for arbitration under 47 U.S.C. § 252(b)(1). Here, because Intrado and AT & T were unable to negotiate certain interconnection terms on their own, Intrado petitioned to PUCO for arbitration under the Act. AT & T opposed Intrado's petition, arguing that Intrado's service did not meet the requirements under state and federal law to compel interconnection through an arbitration proceeding before PUCO. PUCO ordered interconnection between AT & T and Intrado, and prescribed specific terms which AT & T now contests as contrary to the Act. Defendants insist that AT & T's challenges are baseless and merely constitute attempts to delay, if not deny, competition for emergency 9–1–1 service in its monopoly area.


Intrado filed its initial application for certification as a CLEC with PUCO on November 19, 2007.2 AT & T and other interested parties were granted interventions by PUCO to challenge Intrado's certification. Prior to PUCO's ruling on Intrado's certification application, Intrado filed a second petition with PUCO on December 21, 2007, seeking arbitration in its interconnection with AT & T under Section 251 of the Act.3 On February 5, 2008, PUCO issued an order certifying Intrado as a “competitive emergency services telecommunications carrier” (or “CESTC,” as opposed to a traditional CLEC) with the right to request interconnection with AT & T under PUCO's rules and the Act.4See In re Intrado Commc'ns, Inc., No. 07–1199–TPACE, 2008 WL 312963 (Ohio P.U.C. February 5, 2008) (“Certification Order”). AT & T and the other interveners applied for rehearing of Intrado's certification.5

In its April 2, 2008, entry on rehearing, PUCO fundamentally affirmed its prior certification of Intrado's service as a “telecommunications carrier” under both state law and federal law. See In re Intrado Commc'ns, Inc., No. 07–1199–TP–ACE, 2008 WL 1294837 at *9, 2008 PUC LEXIS 201 at *31 (Ohio P.U.C. April 2, 2008) (“Certification Rehearing”). PUCO clarified, however, that its ruling did not apply to any other emergency telephone services, id. at *8, 2008 PUC LEXIS 201 at *27, nor did PUCO decide any specifics regarding Intrado's still pending request for arbitration, id. at *8, 2008 PUC LEXIS 201 at *28. None of the intervening parties, including AT & T, appealed PUCO's final decision in the Certification Rehearing to the Supreme Court of Ohio, as provided as a matter of right under Ohio law. SeeO.R.C. § 4903.13.

On March 4, 2009, PUCO issued an arbitration award on Intrado's petition for arbitration, ordering AT & T to provide interconnection to Intrado for all services offered by Intrado, subject to certain requirements. See In re Intrado Communications, Inc., No. 07–1280–TP–ARB, 2009 WL 585861, 2009 PUC LEXIS 897 (Ohio P.U.C. March 4, 2009) (“Arbitration Award”). AT & T applied for rehearing, arguing, inter alia, that PUCO could not compel AT & T to provide interconnection to Intrado, because Intrado's service does not meet the definition of a “telephone exchange service” under the Act. On June 17, 2009, PUCO issued its entry on the application for rehearing, denying AT & T's challenges in material part. See In re Intrado Communications, Inc., No. 07–1280–TP–ARB, 2009 WL 1759657, 2009 PUC LEXIS 420 (Ohio P.U.C. June 17, 2009) (“Arbitration Rehearing”). On October 15, 2009, AT & T brought suit in this Court to challenge PUCO's arbitration determinations pursuant to the Act's provision for federal judicial review of state commission determinations in connection with arbitrations or negotiations of interconnections agreements. See47 U.S.C. § 252(e)(6).6

This Court initially reserved ruling on the merits of AT & T's claims in this action because similar, if not identical, issues to those raised by AT & T here were until very recently before the Federal Communications Commission (“FCC”) for determination in a pending arbitration proceeding involving Defendant Intrado. See In re Petition of Intrado Communications of Virginia, Inc., et al., FCC Rcd. 17867 (2008). Given the FCC's primary jurisdiction and “special competence” in applying and interpreting the Act, this Court decided that it was prudent to await the ruling in that case which may have decided this one. See United States v. Any & All Radio Station Transmission Equip., 204 F.3d 658, 665 (6th Cir.2000) (discussing the doctrine of primary jurisdiction in a case involving the FCC). The parties in that action recently resolved their arbitration disputes, however, thereby making it unnecessary for the FCC to decide the issues regarding of interconnection of Intrado's emergency 9–1–1 service. See In re Petition of Intrado Communications of Virginia, Inc., WC Docket No. 08–33 (July 18, 2011), at 2 (“The Bureau makes no determination regarding whether Intrado is or was...

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