Sprint Commc'ns Co. v. Crow Creek Sioux Tribal Court, 4:10–CV–04110–KES.

• Decision Date: 07 August 2015
• Docket Number: No. 4:10–CV–04110–KES.,4:10–CV–04110–KES.
• Parties: SPRINT COMMUNICATIONS COMPANY L.P., Plaintiff, v. CROW CREEK SIOUX TRIBAL COURT, Native American Telecom, LLC., and B.J. Jones, in his official capacity as special judge of Tribal Court, Defendants.
• Court: U.S. District Court — District of South Dakota

121 F.Supp.3d 905

SPRINT COMMUNICATIONS COMPANY L.P., Plaintiff,

v.CROW CREEK SIOUX TRIBAL COURT, Native American Telecom, LLC., and B.J. Jones, in his official capacity as special judge of Tribal Court, Defendants.

No. 4:10–CV–04110–KES.

United States District Court, D. South Dakota, Southern Division.

Signed Aug. 7, 2015.

Philip R. Schenkenberg, Scott G. Knudson, Briggs and Morgan, P.A., Minneapolis, MN, Tommy Drake Tobin, Winner, SD, for Plaintiff.

Scott R. Swier, Swier Law Office, Prof., LLC, Avon, SD, Stephen Wald, Partridge Snow & Hahn LLP, Boston, MA, for Defendants.

KAREN E. SCHREIER, District Judge.

Pending are cross-motions for summary judgment. Plaintiff, Sprint Communications Company, L.P., seeks summary judgment on Counts I and IV of defendant Native American Telecom, LLC's (NAT) amended counterclaim. NAT seeks summary judgment on all of Sprint's claims, as well as summary judgment on Counts I and IV of its amended counterclaim. For the following reasons, the court grants in part and denies in part Sprint's motion and grants in part and denies in part NAT's motion.

BACKGROUND

The pertinent, undisputed facts are as follows:¹

Sprint provides nationwide long-distance telephone services and is known under the telecommunications regulatory framework as an interexchange carrier (IXC). Sprint delivers long-distance calls to a local exchange carrier (LEC) for termination to end-users. Under the FCC's current regulatory framework, Sprint pays the LEC a terminating access charge based on the LEC's interstate access tariff, which is filed with the FCC.

In October 2008, the Crow Creek Sioux Tribal authority authorized NAT to provide telecommunications service on the Crow Creek Reservation subject to the tribe's laws. Pursuant to the 2008 approval order, NAT began to operate as an LEC. NAT filed its first interstate tariff with the FCC, which became effective on September 15, 2009. NAT's second interstate tariff became effective on November 30, 2010, and canceled and replaced NAT's tariff number one. NAT revised its tariff number two, which revision became effective on June 26, 2011. NAT's third interstate tariff was filed with the FCC in August 2011, and became effective on August 23, 2011.

NAT also operates a free conference calling system (used for conference calling, chat-lines, and similar services) in connection with Free Conferencing Corporation (Free Conferencing). A party using NAT's services does not pay NAT for the conference call, but rather is assessed charges by the party's telecommunications provider. NAT then bills the telecommunications provider an access fee as defined in its interstate tariff. NAT's access charges, which were billed to Sprint for conference calls, are at issue here.

After paying two of NAT's bills for charges connected to conference calls, Sprint ceased paying NAT's terminating access tariffs because Sprint believed that NAT was involved in a traffic-pumping scheme, otherwise known as access stimulation, to generate traffic from free conference calls and chat services. On August 16, 2010, Sprint filed suit against NAT alleging a breach of the Federal Communications Act (FCA) and a state-law unjust enrichment claim. Docket 1.

On March 8, 2011, NAT amended its answer and asserted counterclaims against Sprint alleging a breach of contract and a collection action pursuant to its tariffs, a breach of implied contract resulting from a violation of its tariffs, and a quantum meruit/unjust enrichment claim. NAT also sought declaratory relief. Docket 99.

On November 29, 2011, the FCC released its Connect America Fund final rule, which addresses access stimulation and traffic pumping. See Connect America Fund; A National Broadband Plan for Our Future; Establishing Just and Reasonable Rates for Local Exchange Carriers; High–Cost Universal Service Support, 76 Fed.Reg. 73830 (Nov. 29, 2011). The FCC also created a transitional framework for VoIP intercarrier compensation. Id. at ¶ 19. On December 27, 2011, this court issued an order directing the parties to discuss what effect, if any, the FCC's Connect America Fund final rule had on the issues presented in this case. Docket 128. Then, on February 22, 2012, this court issued an order discussing the final rule and determined that it did not apply retroactively. Docket 141 at 9–11 ("Thus, the final rule is inapplicable to the time period before the final rule became effective."). As part of the same order, this court granted Sprint's then-pending motion to stay this proceeding and referred three issues to the FCC for resolution. Id. at 25. This court also directed the parties to issue periodic updates describing the status of the FCC proceeding. This court received these updates over the next two years, which showed that the status of the FCC referral remained unchanged since November 2012. Compare Docket 154 with Docket 163. Because of the limited progress on the FCC referral, a telephonic status conference was held on July 23, 2014. See Docket 164.

The parties stated that they had been engaged in litigation before the South Dakota Public Utilities Commission (SDPUC). Docket 169 at 5. In that litigation, NAT was granted a certificate of authority by the SDPUC to provide certain telecommunications services in South Dakota. Based on the results of the SDPUC litigation and the lack of action by the FCC during the period of the stay, the parties discussed whether some of the disputes in this case remained viable. Id. at 8–10. The court proposed entering an order that would lift the stay, withdraw the issues that had been referred to the FCC, and establish deadlines for the parties to amend the complaint, counterclaims, and to file any motions to dismiss. Id. at 12. The court also stated that it would rule on any motions to dismiss based on a statute of limitations defense and that a new referral of issues to the FCC could then be discussed. Id. With the parties in agreement, a formal order was issued that same day. See Docket 168.

Sprint did not amend its complaint. NAT amended its counterclaim on September 9, 2014, and added a number of allegations that arose during the period of the stay and FCC referral. Docket 172. A number of procedural motions have since been filed by the parties. Relevant to the present discussion are the parties' cross-motions for summary judgment. Docket 211, Docket 223.

LEGAL STANDARD

Summary judgment on all or part of a claim is appropriate when the movant "shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a) ; see also In re Craig, 144 F.3d 593, 595 (8th Cir.1998). The moving party can meet its burden by presenting evidence that there is no dispute of material fact or that the nonmoving party has not presented evidence to support an element of its case on which it bears the ultimate burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 322–23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party has met this burden, "[t]he nonmoving party may not ‘rest on mere allegations or denials, but must demonstrate on the record the existence of specific facts which create a genuine issue for trial.’ " Mosley v. City of Northwoods, Mo., 415 F.3d 908, 910 (8th Cir.2005) (quoting Krenik v. Cnty. of Le Sueur, 47 F.3d 953, 957 (8th Cir.1995) ). "Further, ‘the mere existence of some alleged factual dispute between the parties is not sufficient by itself to deny summary judgment.... Instead, the dispute must be outcome determinative under prevailing law.’ " Id. (quoting Get Away Club, Inc. v. Coleman, 969 F.2d 664, 666 (8th Cir.1992) ). The facts, and inferences drawn from those facts, are "viewed in the light most favorable to the party opposing the motion" for summary judgment. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (quoting United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962) ).

DISCUSSION

I. Sprint's Motion for Partial Summary Judgment

Sprint seeks summary judgment on Counts I and IV of NAT's amended counterclaim. Count I of NAT's amended counterclaim seeks to enforce each of NAT's interstate tariffs and to recover the amounts NAT billed to Sprint pursuant to those tariffs. Docket 172 at 17. Count IV seeks declaratory relief regarding Sprint's obligations pursuant to NAT's tariffs. Id. at 18–19. Alternatively, Sprint argues that NAT's cross-motion for summary judgment on Counts I and IV of its amended counterclaim should be denied.

A. Whether Sprint Can Move for Summary Judgment?

NAT asserts that Sprint cannot move for partial summary judgment because Sprint has not amended its complaint to include the grounds upon which Sprint's motion is founded.² Sprint is seeking partial summary judgment as a defendant on Counts I and IV of NAT's amended counterclaim. In its answer to NAT's counterclaim, Sprint denied that NAT's tariffs were enforceable and pleaded several affirmative defenses on point. Sprint's answer was sufficient to raise the grounds it now pursues, and Sprint was not required to first amend its complaint before seeking partial summary judgment on Counts I and IV of NAT's amended counterclaim.

B. Whether NAT Was Authorized to Provide Telecommunications Services on the Crow Creek Reservation Prior to June 12, 2014?

It is undisputed that the Crow Creek Sioux Tribal Utility Authority granted NAT a certificate of authority to provide telecommunications services on the Crow Creek Reservation in October 2008. Docket 212 at ¶ 2; Docket 220 at ¶ 2. That certificate purported to allow NAT to operate as a CLEC on the Reservation. Docket 14–4 at 1 n. 1. It is also undisputed that NAT filed an application with the SDPUC in October 2011 to provide intrastate access services in South Dakota that originate or terminate off the Reservation. Docket 212 at ¶ 11; Docket 240 at ¶ 11. Further, it is undisputed that the SDPUC did not grant NAT a certificate of...