Pacific Bell Telephone Co. v. City of Hawthorne

• Decision Date: 01 June 2001
• Docket Number: No. CV-01-01862 CBM.,CV-01-01862 CBM.
• Citation: 188 F.Supp.2d 1169
• Court: U.S. District Court — Central District of California
• Parties: PACIFIC BELL TELEPHONE COMPANY, Plaintiff, v. CITY OF HAWTHORNE; The City Council of the City of Hawthorne, and Does 1 through 10, Defendants.

188 F.Supp.2d 1169

PACIFIC BELL TELEPHONE COMPANY, Plaintiff, v. CITY OF HAWTHORNE; The City Council of the City of Hawthorne, and Does 1 through 10, Defendants.

No. CV-01-01862 CBM.

United States District Court, C.D. California, Western Division.

June 1, 2001.

Gleam Olivia Davis, Sandy L. Sakamoto, Pacific Telesis Group Legal Dept., Los Angeles, CA, for Plaintiff.

William M. Marticorena, Jeffrey Thomas Melching, Rutan & Tucker, Costa Mesa, CA, for Defendants. ORDER Denying Defendants' Motion to Dismiss and Granting Plaintiff's Request for Judicial Notice

MARSHALL, District Judge.

The matters before the Court, the Honorable Consuelo B. Marshall, United States District Judge presiding, are (1) Plaintiff's Request for Judicial Notice and (2) Defendants' Motion to Dismiss pursuant to Fed.R.Civ.P. 12(b)(6). The parties appeared before the Court on May 21, 2001. Upon consideration of the arguments presented, the Court grants Plaintiff's Request for Judicial Notice and denies Defendants' Motion to Dismiss.

JURISDICTION

This action is before the court pursuant to 47 U.S.C. § 253 and 28 U.S.C. § 1331. The Court has supplemental jurisdiction over Plaintiff's state law claims pursuant to 28 U.S.C. § 1367.

BACKGROUND AND PROCEDURAL HISTORY

Plaintiff Pacific Bell Telephone Company filed a Complaint against the City of Hawthorne and the City Council of the City of Hawthorne on February 27, 2001. The Complaint seeks declaratory and injunctive relief under § 253 of the Telecommunications Act of 1996; federal preemption; California Public Utilities Code § 7901; California Government Code §§ 50030, 66001; and the California Constitution. Plaintiff further seeks a peremptory writ of mandate, pursuant to California Code of Civil Procedure § 1085. Plaintiff contends that this Court has jurisdiction over this action pursuant to the Telecommunications Act of 1996 and the Supremacy Clause of the U.S. Constitution.

The gravamen of Plaintiff's Complaint is that the City of Hawthorne adopted ordinances that impose burdensome regulations and fees on telecommunications service providers. The City adopted Ordinance No. 1686 (the "Ordinance") and Resolution 6612 (the "Fee Resolution") on June 26, 2000 and July 24, 2000, respectively. The preamble to the Ordinance states that the Ordinance was enacted "to adopt reasonable regulations relating to the control and management of its public streets and rights-of-way." The Ordinance requires telecommunications service providers, inter alia, to list all telecommunications agreements, to include a "government approval provision" in all future telecommunications agreements, to maintain certain books and records, to permit auditing and inspection of such books by the City and to provide copies of any filings with the Federal Communications Commission. The Fee Resolution imposes various permit, application, inspection, registration, license and franchise fees on telecommunications service providers who utilize the City's streets, rights-of way and other public property.

The City Informed Plaintiff in January 2001 that Plaintiff is required to comply with the Fee Resolution and Ordinance. Complaint ¶ 4. Plaintiff was instructed to complete a questionnaire, which allegedly is "extensive, burdensome and overreaching." Complaint ¶ 4.

Plaintiff's federal claims seek a determination that the City's Ordinance and Fee Resolution violates and are preempted by § 253. Defendants filed a Motion to Dismiss the Complaint pursuant to Fed. R.Civ.P. 12(b)(6) on April 2, 2001. Plaintiff filed an Opposition and a Request for Judicial Notice on May 7, 2001. Defendants' Reply was filed on May 14, 2001.

DISCUSSION

I. Plaintiff's Request for Judicial Notice

Plaintiff requests the Court to take judicial notice of the Opposition to Defendants' Motion to Dismiss filed on March 30, 2001 by Qwest Communications in Qwest Communications Corp. v. City of Berkeley, Case No. C01-0663 SI (N.D.Cal.). A court may take judicial notice of a fact that is not subject to reasonable dispute. FED.R.EVID. 201. Courts generally take judicial notice of court filings or pleadings. See, e.g., Mullis v. United States Bankr.Court, 828 F.2d 1385, 1388 n. 9 (9th Cir.1987).

Based on the foregoing, the Court grants Plaintiff's Request for Judicial Notice.

II. Defendants' Rule 12(b)(6) Motion to Dismiss

The Complaint states that this Court has federal question jurisdiction over this action pursuant to the Supremacy Clause of the U.S. Constitution (hereinafter "Supremacy Clause") and the Telecommunications Act of 1996 (hereinafter "Telecom Act"). Defendants argue that Plaintiff's claims should be dismissed because § 253 of the Telecom Act does not provide for a private right of action. Defendants further argue that Plaintiff's challenge of the Fee Resolution is precluded by principles of federal-state comity and Tax Injunction Act.

A. Private Right of Action Under Section 253

Plaintiff's first cause of action seeks declaratory and injunctive relief under 47 U.S.C § 253(a) and (c).

Congress enacted the Telecom Act to partially deregulate the telecommunications industry. Section 253 expressly preempts any state law which prohibits or has the effect of prohibiting telecommunication services. 47 U.S.C. § 253(a). Section 253 does not expressly authorize a private right of action fix telecommunication service providers.

Whether a statute impliedly provides for a private right of action is a matter of statutory construction. Transamerica Mortgage Advisors, Inc. v. Lewis, 444 U.S. 11, 15, 100 S.Ct. 242, 62 L.Ed.2d 146 (1979). Courts consider the following factors when determining whether an implied private right of action should be inferred:

First, is the plaintiff one of the class for whose especial benefit the statute was enacted — that is, does the state create a federal right in favor of the plaintiff? Second, is there any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one? Third, is it consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff? And finally, is the cause of action one traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law?

Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975) (citations omitted). These factors are not entitled to equal weight. See Touche Ross & Co. v. Redington, 442 U.S. 560, 579, 99 S.Ct. 2479, 61 L.Ed.2d 82 (1979). "The central inquiry remains whether Congress intended to create, either expressly or by implications, a private cause of action." Id.

The language of § 253 and the legislative history of the Telecom Act support a finding that Congress intended to create a private right of action for telecommunications service providers under section 253(c), but not under sections 253(a) or (b). The Telecom Act partially deregulates the telecommunications industry "to accelerate ... private sector deployment of advanced telecommunications and information technologies and services to all Americans by opening all telecommunications markets to competition." H.R.CONF.REP. No. 104-458, at 1 (1996). The Telecom Act requires the interconnection of competitors' poles, ducts and rights-of-way to facilitate widespread customer access to telecommunications services. See 47 U.S.C. § 251. As part of this universal service effort, the Act limits states' ability to regulate providers of telecommunications services. See 47 U.S.C. § 253; see also City of Auburn v. Qwest Corp., 247 F.3d 966, 980-81 (9th Cir.2001) ("Municipalities ... have a very limited and prescribed role in the regulation of telecommunications.").

Section 253 provides, in relevant part:

(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.

(b) State regulatory authority. Nothing in this section shall affect the ability of a state to impose, on a competitively neutral basis and consistent with section 254 of this section, requirements necessary to preserve and advance service, protect the public safety and welfare, ensure the continued quality of telecommunications services, and safeguard the rights of consumers.

(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 the 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. (d) Preemption. If, after notice and an opportunity for public comment, 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.

47 U.S.C. § 253(a)-(d). Section 253(d) instructs the Federal Communications Commission ("FCC") to preempt any state or local legal requirement that violates either subsection (a) or (b). No express authority is given to the FCC to preempt state laws that violate subsection (c). Congress' failure to grant such authority to the FCC implies that Congress intended § 253(c) to be enforced by those entities most directly affected by unreasonable rates — namely, telecommunications service providers.

The legislative history of § 253 further indicates that Congress intended to provide a private right of action under subsection (c), but not subsections (a) and (b). The Senate debate regarding the scope of...