Western Radio Serv. Co. v. Qwest Corp.
| Citation | 734 F.Supp.2d 1139 |
| Decision Date | 16 August 2010 |
| Docket Number | Civ. No. 05-159-AA |
| Parties | WESTERN RADIO SERVICES CO., an Oregon corporation, Plaintiff, v. QWEST CORPORATION, a Colorado Corporation; The Public Utility Commission of Oregon; Lee Beyer, Chairman; Ray Baum, Commissioner; and John Savage, Commissioner, in their official capacities as Commissioners of the Public Utility Commission of Oregon, Defendants. |
| Court | U.S. District Court — District of Oregon |
Marianne Dugan, Attorney at Law, Eugene, OR, for Plaintiff.
Gregory B. Monson, Stoel Rives LLP, Salt Lake City, UT, Alex M. Duarte, Qwest Corporate Counsel, Portland, OR, for defendant Qwest Corporation.
John Kroger, Attorney General, Michael T. Weirich, Assistant Attorney General, Department of Justice, Salem, OR, for defendants Public Utility Commission, Lee Beyer, Ray Baum and John Savage.
Before this court is the Opening Brief on Issue Remaining for Trial ("Opening Brief") of plaintiff Western Radio Services ("Western"). Western asks this court to address the First Cause of Action in its Complaint, the only issue remaining for this court to decide on remand. Western alleges that certain provisions in the interconnection agreement between Western and Qwest Corporation ("Qwest") and its approval by defendants Oregon Public Utility Commission, Lee Beyer, Ray Baum, and John Savage (collectively the "PUC") violate the Telecommunications Act of 1996, Pub. Law. No. 104-104, 110 Stat. 56 (1996), codified at 47 U.S.C. §§ 151-615 (the "Act") and the implementing regulations of the Federal Communications Commission ("FCC"). This court finds in favor of Qwest and the PUC and against Western.
Providing telephone services requires physically wiring each customer to a network of other customers who also have telephone lines. US W. Commc'ns, Inc. v. Jennings, 304 F.3d 950, 954 (9th Cir.2002). Traditionally, these networks have been owned and operated by a single local utility telephone company, referred tounder the Act as the incumbent local exchange carrier ("ILEC"). Id. For the purpose of encouraging competition in the local telephone service market, the Act was established to, among other things, require ILECs to interconnect their networks with newer local exchange carriers, referred to as "requesting" carriers. See 47 U.S.C. § 251(c)(2); see also N. Cnty. Commc'n Corp. v. McLeodUSA Telecomm. Serv., Inc., No. CV-09-2063-PHX-GMS, 2010 WL 1779445, at *1 (D.Ariz.2010).
Title 47 U.S.C. § 251(d)(1) directs the FCC to promulgate regulations implementing the Act's local competition provisions. "Unless and until an FCC regulation is stayed or overturned by a court of competent jurisdiction, the FCC regulations have the force of law and are binding upon state [public utility commissions] and federal district courts." AT & T Commc'ns of Cal. v. Pac. Bell, No. C 97-0080 SI, 1998 WL 246652, at *2 (N.D.Cal.1998) (citing Anderson Bros. Ford v. Valencia, 452 U.S. 205, 219-20, 101 S.Ct. 2266, 68 L.Ed.2d 783 (1981)). The FCC implements the statute's local competition provisions through a series of regulations and orders. See AT & T Corp. v. FCC, 220 F.3d 607, 612-13 (D.C.Cir.2000).
Title 47 C.F.R. § 51.5 defines interconnection as "the linking of two networks for the mutual exchange of traffic." Interconnection provides a way for a requesting carrier's customers to reach an ILEC's customers and vice versa. See Pac. Bell Tel. Co. v. Cal. Pub. Util. Comm'n, 597 F.3d 958, 965-66 (9th Cir.2010). If a carrier requests interconnection, the requesting carrier and the ILEC to whom the request is made have a duty to "establish reciprocal compensation arrangements" for interconnection. 47 U.S.C. § 251(b)(5). In creating an interconnection agreement, both the ILEC and the requesting carrier have a "duty to negotiate in good faith ... the particular terms and conditions" of such agreements. 47 U.S.C. § 251(c)(1).
The Act sets out a procedural framework for negotiations: A requesting carrier must first make a request for interconnection to an ILEC, which "may negotiate and enter into a binding agreement with the requesting ... carrier ... without regard" to the substantive standards of 47 U.S.C. § 251. 47 U.S.C. § 252(a)(1). The parties to the negotiation may, if they wish, ask a state public utilities commission "to mediate any differences arising in the course of the negotiation." 47 U.S.C. § 252(a)(2). If the parties cannot reach agreement through voluntary negotiations or mediation, either may "petition a State commission to arbitrate any open issues." 47 U.S.C. § 252(b)(1). In resolving the open issues through compulsory arbitration, a state commission must ensure that its resolution "meet[s] the requirements of section 251" and may "impos[e] appropriate conditions" to ensure the requirements of 47 U.S.C. § 251 are met. 47 U.S.C. § 252(b)(4)(C).
Once an interconnection agreement has been adopted either by negotiation or after compulsory arbitration, it must "be submitted for approval" to the state commission, which must either "approve or reject the agreement." 47 U.S.C. § 252(e)(1). Finally, the Act provides for judicial review of state commission actions. 47 U.S.C. § 252(e)(6).
Western is a licensed Commercial Mobile Radio Service ("CMRS") provider incorporated under the laws of Oregon with its principle place of business in Bend, Oregon. It offers wireless telephone services in Oregon. It does not, however, have a certificate of authority to provide wireline services in Oregon as a "competitivetelecommunications service provider," commonly referred to as a "CLEC." By contrast, Qwest is an ILEC that has a certificate of authority to provide wireline services in Oregon.
Western alleges that negotiations under the Act between Qwest's predecessor, U.S. WEST Communications, Inc., and Western began in August 1996. Negotiations resolved some, but not all, of the issues between the parties and in March 2004, Western filed a petition with the PUC for arbitration pursuant to 47 U.S.C. § 252(b). In its petition, Western identified five issues remaining for arbitration. In its response, Qwest identified ten additional issues for arbitration.
The arbitrator issued his decision on September 20, 2004. In his decision, the arbitrator ordered that Qwest's proposed language be adopted as to all but one issue. Regarding that one issue, the arbitrator prescribed the exact language to be utilized in the interconnection agreement.
The arbitrator also ordered, among other things, that "[w]ithin 30 days of the date of the final order in this proceeding, Qwest and Western shall submit an interconnection agreement consistent with the terms of this decision." Decl. of Richard Oberdorfer in Supp. of Pl.'s Opening Br., Ex. 1, at 14, July 17, 2009. Western subsequently filed exceptions to the arbitrator's order.
Despite Western's exceptions, the PUC in Order No. 04-600 adopted the arbitrator's decision in its entirety. This triggered a statutory requirement for Western, as petitioner, to prepare a compliant interconnection agreement and serve it on Qwest within fourteen days of the order.1 Western did not do so. In addition, Western was required to submit a compliant interconnection agreement to the PUC within thirty days, however, Western again failed to do so.
On November 10, 2004, Qwest submitted an interconnection agreement to Western for review. In response, Richard Oberdorfer, Western's owner, informed Qwest he would be out of town and would not review the document until he returned. Despite this, on November 18, 2004, Qwest timely filed the proposed agreement with the PUC. Western did not sign the agreement.
On November 29 and December 1, 2004, Western reviewed Qwest's proposed interconnection agreement, and found some areas where it allegedly did not comply with the PUC's order. Instead of informing the PUC of its concerns, Western filed an action on February 3, 2005 with the United States District Court for the District of Oregon. Western alleged that the district court had jurisdiction over its suit pursuant to 47 U.S.C. § 252(e)(6), 42 U.S.C. § 207, and 28 U.S.C. §§ 1331 and 1343(a).
In its Complaint, Western alleged the following causes of action: (1) the PUC's violation of delegated authority, 47 U.S.C. §§ 251, 252; (2) Qwest's failure to negotiate the interconnection agreement in good faith, 47 U.S.C. §§ 251(c), 252(A); (3) violation of 42 U.S.C § 1983, civil rights/due process against the PUC; and (4) violation of 42 U.S.C. § 1983 civil rights/equal protection against the PUC.
The defendants moved to dismiss the complaint for lack of subject-matter jurisdiction and failure to state a claim. See Fed.R.Civ.P. 12(b)(1), (6). Additionally, the defendants argued the court lacked jurisdiction because the PUC had neither approved nor rejected an interconnectionagreement. Moreover, all defendants argued that the court lacked jurisdiction to consider the "good faith" cause of action because it had not been decided by the PUC. The PUC also contended that Western's 42 U.S.C § 1983 causes of action were barred by the Eleventh Amendment and by absolute and qualified immunity.
This court, in an opinion and order filed on July 25, 2005, dismissed the entire action for lack of jurisdiction. Western responded by filing an appeal to the Ninth Circuit Court of Appeals ("Ninth Circuit").
After this court issued its opinion and order, Qwest sought the PUC's approval of the interconnection agreement submitted on November 18, 2004. On October 10, 2005, the PUC approved the interconnection agreement in Order No. 05-1075, Docket ARB 537.2 On October 14, 2005, four days after the approval of the interconnection agreement, Western petitioned the PUC for arbitration, Docket ARB 706. In its petition, Western identified several issues for arbitration, including an allegation that Qwest failed to negotiate in good faith. On January 3, 2006, however, the PUC...
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