Wisconsin Bell v. Public Serv. Com'n of Wisconsin

• Decision Date: 12 July 1999
• Docket Number: No. 98-C-11-C.,No. 97-C-566-C.,No. 98-C-366-C.,No. 98-C-153-C.,97-C-566-C.,98-C-11-C.,98-C-153-C.,98-C-366-C.
• Citation: 57 F.Supp.2d 710
• Parties: WISCONSIN BELL, INC. d/b/a Ameritech Wisconsin, Plaintiff, v. PUBLIC SERVICE COMMISSION OF WISCONSIN, and Cheryl L. Parrino, Daniel J. Eastman, and Joseph P. Mettner, Defendants. Wisconsin Bell, Inc. d/b/a Ameritech Wisconsin, Plaintiff, v. Public Service Commission of Wisconsin, and Cheryl L. Parrino, Daniel J. Eastman, and Joseph P. Mettner, in their official capacities as members of the Commission, and MCI Telecommunications Corp. and MCI Metro Access Transmission Services, Inc., Defendants, and United States of America, Intervenor. MCI Telecommunications Corp., and MCI Metro Access Transmission Services, Inc., Plaintiffs, v. Wisconsin Bell, Inc. d/b/a Ameritech Wisconsin, Public Service Commission of Wisconsin, and Cheryl L. Parrino, Daniel J. Eastman, and Joseph P. Mettner, in their official capacities as members of the Commission, Defendants, and United States of America, Intervenor. Wisconsin Bell, Inc. d/b/a Ameritech Wisconsin, Plaintiff, v. TCG Milwaukee, Inc., Public Service Commission of Wisconsin, Cheryl L. Parrino and Joseph P. Mettner, Commissioners of the Public Service Commission of Wisconsin, and Time Warner Communications of Milwaukee, L.P., Defendants.
• Court: U.S. District Court — Western District of Wisconsin

Page 710

57 F.Supp.2d 710

WISCONSIN BELL, INC. d/b/a Ameritech Wisconsin, Plaintiff, v. PUBLIC SERVICE COMMISSION OF WISCONSIN, and Cheryl L. Parrino, Daniel J. Eastman, and Joseph P. Mettner, Defendants.

Wisconsin Bell, Inc. d/b/a Ameritech Wisconsin, Plaintiff, v. Public Service Commission of Wisconsin, and Cheryl L. Parrino, Daniel J. Eastman, and Joseph P. Mettner, in their official capacities as members of the Commission, and MCI Telecommunications Corp. and MCI Metro Access Transmission Services, Inc., Defendants,

and

United States of America, Intervenor.

MCI Telecommunications Corp., and MCI Metro Access Transmission Services, Inc., Plaintiffs, v. Wisconsin Bell, Inc. d/b/a Ameritech Wisconsin, Public Service Commission of Wisconsin, and Cheryl L. Parrino, Daniel J. Eastman, and Joseph P. Mettner, in their official capacities as members of the Commission, Defendants, and United States of America, Intervenor.

Wisconsin Bell, Inc. d/b/a Ameritech Wisconsin, Plaintiff, v. TCG Milwaukee, Inc., Public Service Commission of Wisconsin, Cheryl L. Parrino and Joseph P. Mettner, Commissioners of the Public Service Commission of Wisconsin, and Time Warner Communications of Milwaukee, L.P., Defendants.

No. 97-C-566-C.

No. 98-C-11-C.

No. 98-C-153-C.

No. 98-C-366-C.

United States District Court, W.D. Wisconsin.

July 12, 1999.

Wayne O. Hanewicz, Foley & Lardner, Madison WI, Bradley D. Jackson, Foley & Lardner, Madison WI, for Wisconsin Bell, Inc., plaintiff.

Niles Berman, Wheeler, Van Sickle & Anderson, S.C., Madison WI, for MCI Telecommunications Corp, MCIMetro Access Transmission Ser.

Mary M. Stevens, Public Service Commission, Madison WI, Anthony A. Tomaselli, Quarles & Brady, Madison WI, Michael J. Varda, Staff Attorney, Public Service Commission, Madison WI, Michael J. Varda, Staff Attorney, Public Service Commission, Madison WI, for Public Service Commission of WI, Cheryl L. Parrino, Daniel J. Eastman, Joseph P. Mettner.

Linda M. Clifford, Lafollette & Sinykin, Madison WI, Michael L. Shor, Swidler & Berlin, Washington DC, for U.S. Xchange, L.L.C. (amicus).

Andrea M. Sharrin, U.S. Dept. of Justice, Federal Programs Branch, Washington DC, for Federal Communications (Prop In).

John R. Dawson, Foley & Lardner, Milwaukee WI, for Wisconsin Bell, Inc., Ameritech Wisconsin, defendant.

Kathleen M. Mulligan, Sidley and Austin, Chicago IL, for TCG Milwaukee, Inc.

Peter Gardon, Reinhart, Boerner, et al., Madison WI, for Time Warner Communications.

OPINION AND ORDER

CRABB, District Judge.

The Telecommunications Act of 1996 introduced local telephony to a brave new world of competition. At the same time, it brought the Federal Communications Commission, all the state utility commissions and the federal courts into a new universe of "cooperative federalism." See Philip J. Weiser, Chevron, Cooperative Federalism, and Telecommunications Reform, 52 Vand.L.Rev. 1, 53-54 (1999). The Supreme Court has remarked that the act's interplay of state and federal authority is "surpassing strange" and that the Congressional "scheme" is decidedly novel, as are "the attendant legal questions, such as whether federal courts must defer to state agency interpretations." AT & T Corp. v. Iowa Utilities Board, 525 U.S. 366, ___ n. 6, 733 n. 10, 119 S.Ct. 721, 730 n. 6, 733 n. 10, 142 L.Ed.2d 835 (1999). The cases before the court bear out these comments.

All four of the cases before the court are brought under the 1996 act. Two have been consolidated pursuant to Fed. R.Civ.P. 41. All involve challenges to rulings of the Public Service Commission of Wisconsin dealing with the "interconnection" of local telephone carriers in Wisconsin. In all the lawsuits, the commission and its members are defendants.¹ The local carriers are also parties, although they are aligned in various ways; some are plaintiffs (challenging a ruling), some are defendants (supporting a ruling) and one as both (supporting a ruling in one case, challenging rulings in others).

With legislation such as the 1996 act, which breaks so much substantive and procedural ground, it is no surprise that other courts and administrative agencies have issued rulings bearing on these lawsuits during the roughly eighteen months since these cases were filed. What is unsettling, particularly in light of the time and resources the parties and the court have devoted to the cases, is that a ruling by the Supreme Court made in the last three weeks has deprived this court of jurisdiction to entertain the cases.

In College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board, ___ U.S. ___, 119 S.Ct. 2219, ___ L.Ed.2d ___ (1999), the Supreme Court repudiated the doctrine of constructive waiver on which the Court of Appeals for the Seventh Circuit had rested its conclusion that a state commission was not entitled to Eleventh Amendment immunity from suits brought pursuant to the act. See MCI Telecommunications Corp. v. Illinois Commerce Comm., 168 F.3d 315 (7th Cir.1999), amended, 1999 WL 447547 (June 23, 1999). The holding in College Savings Bank requires defendants' dismissal from all the suits on the ground of immunity. This decision establishing defendants' immunity from suit is especially significant in light of the opinion of the Court of Appeals for the Seventh Circuit in Illinois Bell Telephone Co. v. Worldcom Technologies, Inc., 179 F.3d 566 (7th Cir. 1999). If, after the decision in MCI, there had been any question about the need to include state commissions in any kind of federal court action brought under the act, it was answered in Illinois Bell. The court confirmed that the presence of a state commission is essential to federal jurisdiction under the Telecommunications Act. In the face of College Savings Bank, MCI and Illinois Bell, I have no option but to dismiss all four lawsuits.

OPINION

A. Eleventh Amendment

The possibility that the Eleventh Amendment might bring an end to this litigation is not exactly a surprise. On November 27, 1998, over the carriers' united objections, I held that defendants were entitled to Eleventh Amendment immunity. See Wisconsin Bell, Inc. v. Public Service Comm. of Wisconsin, 27 F.Supp.2d 1149 (W.D.Wis.1998). In arguing that Wisconsin was not immune to suit under the act, the carriers did not argue that Congress had abrogated the state's immunity or that the state had made an express waiver of its immunity. They relied solely on the concept of constructive waiver. In their view, defendants had chosen to regulate interconnection activities in Wisconsin and by doing so, had consented implicitly to being sued in federal court under the act's provision directing the federal courts to undertake the "review of state commission actions" for compliance with federal law. See 47 U.S.C. § 252(e)(6). In support of their assertion that defendants had a true choice not to engage in such cooperative federalism, the local carriers emphasized that Congress had directed the Federal Communications Commission to act whenever a state commission chose not to. See § 252(e)(4) (FCC to act if state commission fails to act).

Although I noted that it was arguable whether the doctrine of constructive waiver was still good law, see Wisconsin Bell, 27 F.Supp.2d at 1158, I found the doctrine inapplicable in the circumstances of the Telecommunications Act. I agreed with defendants that their participation could not be viewed as a true waiver of Eleventh Amendment immunity given the nature of the legislation, which envisioned the state commissions' continuing to serve as regulators of local telephone carriers, and the long history of such local regulations, extending back at least to the passage of the Communications Act of 1934. Moreover, a careful reading of the act revealed that the FCC backup role was not complete. Under § 252(e)(4) and 47 C.F.R. § 51.801, if a state commission takes no action with respect to a voluntary agreement reached between carriers, the FCC does not review the agreement on behalf of the state commission. It is deemed approved automatically. See Wisconsin Bell, 27 F.Supp.2d at 1155-59.

I rejected the local carriers' contention that Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908), yielded an alternative basis for jurisdiction. Ex parte Young established the rule (often referred to as a legal fiction) that injunctive relief is available to restrain state officials from violating the Constitution even when the state itself is immune from suit under the Eleventh Amendment. Although Young itself concerned an alleged constitutional violation, the rule extends to violations of federal statutory law. See Idaho v. Coeur d'Alene Tribe of Idaho, 521 U.S. 261, 281, 117 S.Ct. 2028, 138 L.Ed.2d 438 (1997) ("An allegation of an on-going violation of federal law where the requested relief is prospective is ordinarily sufficient to invoke the Young fiction.") (Emphasis added.) See also Marie O. v. Edgar, 131 F.3d 610 (7th Cir.1997) (Ex parte Young action can be brought to vindicate violations of federal statute). The theory of the local carriers was that defendants were violating federal law because they had interpreted and applied the 1996 act improperly. (The United States, as intervenor, and the FCC, as amicus, joined the carriers in arguing that the commission and its members were not entitled to Eleventh Amendment immunity and alternatively, could be sued under Ex parte Young.)

At first glance, one must acknowledge the conceptual difference between a state official performing state functions in a way that violates federal law and a state official who is performing federally authorized functions but is alleged to have performed those functions improperly. One must acknowledge as well that some of the suits against state commissions brought under the act are directed at correcting the past decisions or other actions of the commission rather than at preventing future enforcement and that the actions at issue (interpretation...