U.S. West Communications v. Hix

Citation183 F.Supp.2d 1249
Decision Date23 June 2000
Docket NumberNo. 97-D-152.,97-D-152.
PartiesU S WEST COMMUNICATIONS, INC., a Colorado corporation, Plaintiff, v. Robert J. HIX, et al., Defendants.
CourtUnited States District Courts. 10th Circuit. United States District Court of Colorado

Russell Paul Rowe, Davis, Graham & Stubbs LLP, Denver, CO, William M. Ojile, Jr., Colleen M. Rea, Evergreen, CO, Bobbee J. Musgrave, B. Lawrence Theis, Perkins Coie LLP, Steven Harold Denman, Richard L. Corbetta, Melissa A. O'Leary, Denman & Corbetta PC, Michael Craig Thompson, Quest Communications International, Inc., Denver, CO, Theodore C. Hirt, U.S. Department of Justice Civil Division, Washington, DC, Martha Hirschfield, Linda Ann Surbaugh, United States Attorney's Office, Denver, CO, for Plaintiff.

David Alexander Beckett, Attorney General's Office, Denver, CO, Anthony Marquez, Attorney General's Office, Denver, CO, Robert M. Pomeroy, Jr., Marcy Geoffrey Glenn, Holland & Hart, LLP, United States District Court, Denver, CO, Michael D. Warden, Sidley, Austin, Brown & Wood, Washington, DC, Joseph W. Halpern, Holland & Hart, LLP, Greenwood Village, CO, Paul Michael Gordon, Wendell Hume Goddard, Gordon & Goddard LLP, Oakland, CA, David R. DeMuro, Vaughan & DeMuro, Denver, CO, Deborah S. Waldbaum, AT & T Corporation, Pleasanton, CA, Anne Baudino Holton, Attorney General's Office, Denver, CO, Craig D. Joyce, Walters & Joyce, P.C., Denver, CO, Albert H. Kramer, David Blair Killalea, Dickstein, Shapiro, Morin & Oshinsky, Washington, DC, Charles B. Hecht, Hamil/Hecht, LLC, Denver, CO, Darryl M. Bradford, Kristina M. Entner, John Russell Harrington, Jenner & Block, Chicago, IL, Mark Brian Ehrlich, Mark Brian Ehrlich, Washington, DC, Letty S.D. Frieson, Ireland, Stapleton, Pryor & Pascoe, P.C., United States District Court, Denver, CO, for Defendants.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

DANIEL, District Judge.

THIS MATTER arises under Sections 251 and 252 of the Telecommunications Act of 1996, 47 U.S.C. §§ 251 and 252 ("the Telco Act" or "the Act"). A hearing was held on September 22, 1998, in connection with issues concerning the merits of this case. The Court, being fully advised in the premises, hereby issues its Findings of Fact and Conclusions of Law in regard to certain of the issues argued at the hearing.

I. ISSUES WITHDRAWN BY U S WEST COMMUNICATIONS, INC. ("USWC")

The Court first addresses USWC's Notice of Withdrawal of Moot Claims filed April 5, 2000. In this pleading, USWC seeks to withdraw a number of issues as moot given certain changes in the law since the hearing held in September, 1998. The Court DENIES USWC's request to withdraw the challenge in the First Claim for Relief in 97-D-152, 97-D-1667, and 97-D-2096 that USWC not separate network elements that are currently combined in its network, because the Court spent time analyzing this issue before the filing of the Notice and has ruled on the merits of same in a separate Order issued previously. Moreover, the Court DENIES USWC's request to withdraw that portion of the Twelfth Claim for Relief in 97-D-2096 that addresses the unbundling of dark fiber for the same reason.

However, the Notice also seeks to withdraw a number of other claims which the Court finds should be allowed. Accordingly, the Court GRANTS USWC's request to withdraw the following claims, and these claims are DISMISSED to the extent set forth below:

A. Second Claim for Relief in Civil Action Numbers 97-D-152, 97-D-1667 and 97-D-2096 regarding the "most favored nations" provision of the agreement to the extent that USWC argued that the competitive local exchange carriers ("CLECs") should not be allowed to "pick and choose" provisions in other CLECs' interconnection agreements. The Supreme Court in AT & T Corp. v. Iowa Utils., Bd., 525 U.S. 366, 119 S.Ct. 721, 142 L.Ed.2d 835 (1999) upheld the FCC's "pick and choose" rule. USWC maintains the right to challenge the agreements to the extent they permit CLECs to opt into tariff provisions.

B. Third Claim for Relief in 97-D-152, 97-D-1667, and 97-D-2096 regarding restrictions on resale of services, to the extent that it challenges provisions requiring USWC to resell services already subject to wholesale discounts. However, USWC maintains the right to challenge the agreements to the extent they require USWC to resell services that are not "telecommunications services" such as enhanced services and inside wiring.

C. Seventh Claim for Relief in 97-D-152, Fifth Claim for Relief in 97-D-1667, and Sixth Claim for Relief in 97-D-2096 to the extent that they challenge the agreements' requirement to sell unregulated and deregulated services. However, USWC maintains the right to challenge the agreements to the extent that they require USWC to resell services that are not "telecommunications services."

D. Sixth Claim for Relief in 97-D-152 and Fifth Claim for Relief in 97-D-2096 to the extent that they challenge provisions of the agreements that require USWC to permit collocation at its "premises." However, USWC maintains the right to challenge the agreements to the extent that they allow the CLECs to determine whether their equipment may be collocated on USWC's premises, subject to the Court reviewing any waiver arguments on this issue. USWC also maintains the right to challenge those provisions of the agreements that permit those CLECs to collocate remote switching units ("RSU's") or other equipment that is not "necessary" for interconnection or access to unbundled elements, again subject to any waiver arguments by the CLECs.

E. Tenth Claim for Relief in 97-D-152 relating to "bill and keep" mechanism for recovery of transport and termination costs, and this claim is DISMISSED IN ITS ENTIRETY.

F. Eleventh Claim for Relief in 97-D-152 and Seventh Claim for Relief in 97-D-1667 relating to the division of access charges, and these claims are DISMISSED IN THEIR ENTIRETY.

G. Twelfth Claim for Relief in 97-D-152, Eighth Claim for Relief in 97-D-1667 and Fourteenth Claim for Relief in 97-D-2096 relating to denial of due process, and these claims are DISMISSED IN THEIR ENTIRETY.

H. Twelfth Claim for Relief in 97-D-2096 to the extent that it relates to unbundling of vertical switching features. However, USWC retains the right to challenge that unbundling of vertical switching features is only required where USWC must provide switching services.

II. USWC's CHALLENGE TO RESTRICTIONS ON RESALE OF SERVICES (TELECOMMUNICATIONS SERVICES)
A. Findings of Fact

1. USWC challenges provisions of the AT & T, MCI, TCG, Sprint and MFS interconnection agreements that require it to resell retail services that are not "telecommunications services."1

2. Specifically, USWC challenges Attachment 2, § 1.2 in its interconnection agreements with AT & T and MCI, which requires USWC to make available for resale:

all retail Telecommunications Services USWC currently provides, or may offer hereafter, including, but not limited to, non-tariffed services, deregulated services which are offered at retail which qualify as Telecommunications Services, grandfathered service contract services, packaged services, residential services, business services, services offered on an individual case basis, discounted services, ancillary services, and promotional offerings where offered for a period of greater than ninety days. This description of services is neither all inclusive nor exclusive. Specific services offered for resale shall also include, Centrex, Optional Calling Plans, Voice Mail, Inside Wire Maintenance, and Custom Calling Services.

Joint Appendix ("J.A.") Volume ("Vol.") 13, Tab 128, at Record ("R.") 26188; id. Tab 126, at R. 25041.

3. USWC challenges § 31.2.5.5 of the Sprint agreement which requires that USWC "offer all deregulated services to Sprint at a discount for resale." J.A. Vol. 11, Tab 112, at R. 1644.

4. As to MFS, although USWC does not assert what provision of the agreement is implicated, the Court notes that Section XXX provides that "USWC Basic Exchange Telecommunications Service ... will be available for resale from USWC ....". J.A. Vol. 12, Tab 120, at R. 05859.

B. Conclusions of Law

1. Section 251 requires USWC "to offer for resale at wholesale rates any telecommunications service that [USWC] provides at retail to subscribers who are not telecommunications carriers ...." 47 U.S.C. § 251(c)(4) (emphasis added).

2. The Court finds that enhanced services are not "telecommunications services" subject to regulation under Title II of the 1934 Communications Act. See Amendment of § 64.702 of the Commission's Rules (Second Computer Inquiry), 0080 WL 233301, 77 F.C.C.2d 384, 428 (1980), modified on recon., 84 F.C.C.2d 50 39 P.U.R.4th 319 (1980), further modified on recon., 1981 WL 158727, 88 F.C.C.2d 512 (1981), aff'd sub nom., Computer & Communications Indus. Ass'n v. FCC, 693 F.2d 198 (D.C.Cir.1982); Memorandum Opinion and Order, Petition for Emergency Relief & Declaratory Ruling Filed by Bell South Corp., 7 FCC Rcd 1619 (1992), aff'd sub nom., Georgia Pub. Serv. Comm'n v. FCC, 5 F.3d 1499 (11th Cir. 1993); see also 47 C.F.R. § 64.702(a).

3. This distinction is preserved in the Telco Act: it defines "information services" separately from "telecommunications services," 47 U.S.C. §§ 153(20) and (43), and the FCC has expressly stated that all services previously considered to be "enhanced services" are "information services" under the Act. E.g., First Report and Order and Further Notice of Proposed Rulemaking, IMPLEMENTATION OF THE TELECOMMUNICATIONS ACT OF 1996: TELEMESSAGING, ELECTRONIC PUBLISHING, AND ALARM MONITORING SERVICES, 1997 WL 49613, 12 FCC Red 5361 (1997). The Local Competition Order also indicates that enhanced services are not "telecommunications services." First Report and Order, Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, CC Docket Nos. 96-98 et al., 11 FCC Red 15499 ¶ 581 n. 1416 (1996) ("Local Competition Order").

4. The FCC has reiterated this conclusion in its orders...

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