U.S. Cellular Corp v. Fed Communic Commission

• Decision Date: 29 June 2001
• Docket Number: 00-1536,00-1538,Nos. 00-1072,s. 00-1072
• Citation: 254 F.3d 78
• Parties: (D.C. Cir. 2001) United States Cellular Corporation, Petitioner v. Federal Communications Commission and United States of America, Respondents Association of Public-Safety Communications Officials-International, Inc., et al., Intervenors , and 01-1047
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 78

254 F.3d 78 (D.C. Cir. 2001)

United States Cellular Corporation, Petitioner v. Federal Communications Commission and United States of America, Respondents

Association of Public-Safety Communications Officials-International, Inc., et al., Intervenors

Nos. 00-1072, 00-1536, 00-1538, and 01-1047

United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 15, 2001

Decided June 29, 2001

On Petitions for Review of Orders of the Federal Communications Commission

Thomas P. Van Wazer argued the cause for petitioners. With him on the briefs were James P. Young, Donald J. Evans and Sylvia Lesse. Stephen G. Kraskin entered an appearance.

Roberta L. Cook, Counsel, Federal Communications Commission, argued the cause for respondents. With her on the brief were Christopher J. Wright, General Counsel, John E. Ingle, Deputy Associate General Counsel, Catherine G. O'Sullivan and Andrea Limmer, Attorneys, U.S. Department of Justice. Daniel M. Armstrong, Associate General Counsel, Federal Communications Commission, entered an appearance.

Robert M. Gurss and Tamara Y. Brown were on the brief for intervenor Association of Public-Safety Communications Officials-International, Inc.

Before: Henderson, Tatel and Garland, Circuit Judges.

Opinion for the Court filed by Circuit Judge Tatel.

Tatel, Circuit Judge:

In an effort to speed implementation of enhanced 911 services for wireless phones, the Federal Communications Commission removed a provision condition- ing wireless carriers' obligation to purchase and install the necessary technology on guaranteed state or local government funding. The carriers challenge this decision, arguing that, among other things, it contravenes the cost causation principle adopted by this court in Competitive Telecommunications Association v. FCC, 87 F.3d 522, 529 (D.C. Cir. 1996) ("Comptel"), is arbitrary and capricious, 5 U.S.C. § 706(2)(A), violates the Regulatory Flexibility Act, 5 U.S.C. §§ 601-612, and amounts to an unconstitutional taking. Finding petitioners' arguments either without merit or not properly before us, we deny the petition for review in its entirety.

I

Over the last thirty years, 911 service has "spread across the nation and become synonymous with emergency assistance." In re Revision of the Comm'n's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Sys., 11 FCC Rcd 18676 p 3 (1996) ("First Report & Order"). At its most basic, 911 service involves routing calls to state or local governmental entities responsible for coordinating emergency response, known as Public Safety Answering Points ("PSAPs"), which dispatch emergency assistance to callers. Most PSAPs now provide E911--enhanced 911--services for calls placed from traditional landline phones, using Automatic Numbering Identification ("ANI") to determine a caller's phone number and Automatic Location Identification ("ALI") to pinpoint a caller's location. For landline calls, ALI information is typically determined by looking up the caller's phone number in an address/telephone number database.

Although wireless callers place a large number of 911 calls, implementing E911 services for wireless phones has proven more difficult. In June 1994, a group of public safety organizations (including the Association of Public-Safety Communications Officials ("APCO"), intervenor here) issued an Emergency Access Position Paper highlighting the need to make E911 services available to wireless callers to "facilitate rapid and effective contact with emergency services, when and where needed." Shortly thereafter, the Commission issued a notice of rulemaking to "ensure that, over time, [wireless callers would] have the same level of access to 911 emergency services as [landline] callers," and proposed requiring wireless carriers to make both ANI and ALI information available to PSAPs. In re Revision of the Comm'n's Rules to Ensure Compatibility With Enhanced 911 Emergency Calling Sys., 9 FCC Rcd 6170 pp 37, 50-52 (1994).

After the comment period ended, APCO and two other public safety bodies, together with the Cellular Telecommunications Industry Association ("CTIA"), a trade association of wireless industry participants, filed with the Commission a Consensus Agreement addressing wireless E911 implementation. Among other things, the Agreement proposed a cost recovery mechanism to fund carrier and PSAP investment in E911 technology, asking the Commission to condition the obligation to make these investments on a guarantee of state or local government funding. The Commission also sought public comment on this Consensus Agreement.

After receiving comments on its proposal and the Consensus Agreement, the Commission adopted its First Report & Order, which established a two-phase plan for wireless E911 implementation. Phase I, to have been completed in eighteen months, required wireless carriers to enable PSAPs to determine a caller's ANI and the location of the base station or cell site receiving the 911 call. First Report & Order, 11 FCC Rcd 18676 at p 10. Wireless carriers had five years to complete Phase II, which required them to enable PSAPs to identify a caller's ALI within a specified range. Id. Wireless carriers can implement Phase II in at least two ways. One is network-based, determining a caller's location by triangulating signals from several different cell sites or base stations. In re Revision of the Comm'n's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Sys., 14 FCC Rcd 17388 p 23 (1999) ("Third Report & Order"). The other is handset-based; it incorporates locating functionality (such as Global Positioning System technology) into the telephone itself. Id. at p 18.

Under the Commission's Order, carriers' Phase I and Phase II obligations would not be triggered until two conditions were met: (1) the carrier had to receive a request for these services from a PSAP capable of receiving and utilizing the data; and, responding to the Consensus Agreement's cost recovery provision, (2) "a mechanism for the recovery of costs relating to the provision of such services" had to be in place. First Report & Order, 11 FCC Rcd 18676 at p 11. The Commission prescribed no particular cost recovery mechanism, however, because "[n]o party dispute[d] the fundamental notion that carriers must be able to recover their costs of providing E911 services" and because "an inflexible Federal prescription would deny carriers and government officials the freedom to develop innovative cost recovery solutions." Id. at WW 89-90.

The Commission also responded to comments by rural wireless carriers that "providing ALI in rural areas may not be technologically and economically feasible," id. at p 84, and that carrier cost recovery mechanisms might not fully reimburse these higher implementation costs. According to the rural carriers, a network-based method of providing ALI would be difficult because, given the configuration of many rural providers' towers as a "string of pearls" along a highway, triangulation would require a large number of additional towers and equipment. Petitioners' Opening Br. at 17; cf. Third Report & Order, 14 FCC Rcd 17388 at p 23. They also claimed they had no alternative, because the handset-based solution was not yet technologically available. The Commission concluded that these problems "need not delay adoption of the general rule" because "[i]n cases where the cost recovery mechanism for E911 service uniquely disadvantages a particular carrier, we will ... consider waiver requests." First Report & Order, 11 FCC Rcd 18676 at p 84.

Reconsidering the First Report & Order, the Commission reaffirmed its decision not to prescribe a particular cost recovery mechanism. In re Revision of the Comm'n's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Sys., 12 FCC Rcd 22665 WW 143-146 (1997). CTIA filed for a second reconsideration, asking the Commission to clarify that state and local governments could not satisfy the carrier cost recovery requirement by asking carriers to recover their own costs directly through charges to wireless customers, and to mandate that the cost recovery mechanisms states and localities adopt be "competitively neutral." In response, and after receiving a Joint Status Report filed by the Consensus Agreement parties (joined by the Wireless Consumers Alliance, Inc.) revealing that Phase I implementation was proceeding more slowly than planned, the Commission issued a Public Notice seeking information on whether the carrier cost recovery requirement was responsible for the delay, and if so, how to address this problem. Public Notice, Comm'n Seeks to Facilitate Wireless E911 Implementation and Requests a Report, 14 FCC Rcd 11138, 11138 (1999). Petitioners United States Cellular Association ("US Cellular") and the Rural Cellular Association ("RCA") submitted comments.

In the resulting Second Reconsideration Order, the Commission found that the "prerequisite that there be a carrier cost recovery mechanism has not expedited the delivery of E911 service and, if anything, has become and will continue to be an impediment of E911 service." In re Revision of the Comm'n's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Sys., 14 FCC Rcd 20850 p 42 (1999) ("Second Recons. Order"). Although twenty-seven states had enacted some sort of Phase I cost recovery legislation, id. at p 34, these services were "scarce, and, in most parts of the country, nonexistent," id. at p 33. Twenty-three states had no Phase I cost recovery mechanism in place, and even in the states that had enacted legislation, the Commission found that disputes about the adequacy and administration of cost recovery interfered with Phase I implementation. Id. at p 36. The Commission further agreed with APCO that, because few state and local governments had enacted Phase II legislation, and because the costs of doing so would likely exceed Phase I costs, carrier cost...