Destek v. Verizon, et a l . CV-99-494-B 7/31/01 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
The Destek Group, Inc., d/b/a The Destek Networking Group
v. Civil No. 99-494-B Opinion No. 2001 DNH 140 Verizon New England, Inc., d/b/a Verizon New Hampshire, et a l .
MEMORANDUM AND ORDER
The Destek Group, Inc. seeks judicial review, pursuant to
the Telecommunications Act of 1996, of a decision of the New
Hampshire Public Utilities Commission approving a contract in
which Verizon New England, Inc. agreed to provide asychronous
transfer mode cell relay service to the University of New
Hampshire. See 47 U.S.C. § 252(e) (6). Destek also seeks damages
and injunctive relief against Verizon, the Commission, and the
three individual Commissioners pursuant to 42 U.S.C. § 1983. I
have before me the parties' cross-motions for summary judgment. I. BACKGROUND
On March 1 6 , 1999, Verizon1 entered into a contract (the
"ATM Contract") to provide asychronous transfer mode ("ATM")2
cell relay service to the University for sixty months at a rate
of $655.75 per interface per month, provided that the University
purchase at least 30 interfaces. The ATM Contract states that
these terms shall not apply until Verizon receives all "necessary
regulatory and other governmental approvals."
On June 4, 1999, Verizon submitted the ATM Contract to the
New Hampshire Public Utilities Commission (the "Utilities
Commission" or the "Commission") for approval, in accordance with
N.H. Rev. Stat. Ann. § 378 :18 .3 Section 378:18 provides as
1 Prior to August 1, 2000, Verizon was known as New England Telephone and Telegraph Company and did business as Bell Atlantic-New Hampshire. For ease of reference, I refer to it as Verizon throughout this Memorandum and Order.
2 ATM is a "high-speed cell-switching network technology for [local and wide-area networks] that handles data and realtime voice and video. It combines the high efficiency of packet switching used in data networks, with the guaranteed bandwidth of circuit switching used in voice networks." Alan Freedman, The Computer Glossary 20 (8th ed. 1998) .
3 Verizon also filed a motion for a protective order, seeking confidential treatment for certain cost data pertaining to the ATM Contract. The Utilities Commission granted Verizon's motion on October 4, 1999.
- 2 - follows:
Nothing herein shall prevent a public utility from making a contract for service at rates other than those fixed by its schedules of general application, if special circumstances exist which render such departure from the general schedules just and consistent with the public interest and, except as provided in RSA 378:18-b, the [CJommission shall by order allow such contract to take effect.
Section 378:18-b, in turn, provides that:
Any special contracts for telephone utilities providing telephone services shall be filed with the [CJommission and shall become effective 30 days after filing, provided the rates are set not less than: (I) The incremental cost of the relevant service; or (II) Where the telephone utility's competitors must purchase access from the telephone utility to offer a competing service, the price of the lowest cost form of access that competitors could purchase to compete for customers with comparable volumes of usage, plus the incremental cost of related overhead.
In its transmittal letter to the Utilities Commission,
Verizon stated that the ATM Contract:
is clearly in the public interest. This contract will provide the opportunity for all K-12 schools, the University System of New Hampshire and libraries throughout the state to obtain access to multi-site distance learning facilities as well as high speed internet access. This network will provide the opportunity for students to access advanced placement courses
- 3 - and other educational resources that are not offered at facilities in their region. This network will also provide increased professional development opportunities for teachers and administrators.
In addition, Verizon claimed that failure to approve the ATM
Contract "will likely result in higher prices to affected
customers, fewer service alternatives and lost contribution to
the joint and common costs borne by the general body of
ratepayers."
On June 25, 1999, Destek, a commercial provider of
telecommunications services, sent a letter to the Utilities
Commission objecting to the ATM Contract and requesting that the
Commission conduct hearings on the matter and allow Destek to
intervene in the proceeding. Destek argued that the ATM Contract
should not be approved because special contracts authorized by
N.H. Rev. Stat. Ann. § 378:18, such as the ATM Contract, "are
discriminatory and minimize or eliminate the ability for other
companies, like Destek, to compete."
On June 30, 1999, Tom Lyle and Paul Keller, members of the
Utilities Commission's Economics Department, sent a memorandum to
the Commissioners, and to the heads of the Commission's other
departments, recommending that the Commission deny, without
- 4 - prejudice, Verizon's request for approval of the ATM Contract.
In their memorandum, Lyle and Keller stated that the "cost
support data filed with the petition is devoid of any verifiable
documentation in support of its reported cost to provide ATM
services and the cost support data does not provide ANY detail
about the method [Verizon] used to allocate non-direct, joint and
common costs" to the University. Because of this lack of
information, Lyle and Keller were "not certain whether or not the
benefits of the special contract to [the University] outweigh the
costs to non-special contract customers."
A few days later, on July 2, 1999, Kate Bailey of the
Utilities Commission's Engineering Department sent a memorandum
to the Commissioners recommending that they approve the ATM
Contract. Bailey began her memorandum by noting that the ATM
Contract "provides schools the opportunity to have Tl access to
the Internet and video conferencing between schools on the
network for a flat price (which is easier to budget than a price
with usage or distance sensitive charges)." Because of this
potential public benefit, Bailey "performed an independent cost
analysis" to determine whether the ATM Contract satisfied the
requirements of N.H. Rev. Stat. Ann. § 378:18-b.
- 5 - Bailey based her analysis on "assumptions about where the
initial 30 customers would be located." Ultimately, she
concluded that the ATM Contract's price of $655 per connection
was not discriminatory, and therefore not in violation of N.H.
Rev. Stat. Ann. § 378:18-b, because it exceeded the actual
expected cost per connection, which would be either $613.35 or
$627.86, depending upon the equipment used.
Based on this analysis, Bailey concluded that "Destek's
objection has no merit [because it] could put a similar network
together . . . for a cost similar to that calculated." Moreover,
she noted that Verizon had publicly offered to make ATM services
available at the same price to anyone who would purchase at least
thirty interfaces.
On July 7, 1999, the Utilities Commission issued an Order
approving the ATM Contract on the condition that Verizon: (1)
file a tariff "making ATM services available throughout [New
Hampshire] upon the same terms and conditions and at the same
prices as in" the ATM Contract; and (2) resubmit the ATM Contract
to the Commission "disclosing the number of ATM circuits and the
average number of miles to serve customer locations from a
serving wire center."
- 6 - In its Order, the Commission noted that Verizon had not
provided many details regarding the actual cost to it of
providing ATM services to the University, thereby making it
difficult for the Commission to determine whether the ATM
Contract satisfied the requirements of N.H. Rev. Stat. Ann. §
378:18-b. The Commission went on to say, however, that "because
of the importance of the proposed service to the modernization of
the state's educational system, [the Commission's] Staff drew on
information in the filing and in related dockets to develop
estimates of the appropriate cost floors for RSA 378:18-b
analysis. This estimate shows the proposed rate exceeds, by a
narrow margin, the cost of providing ATM service."
The Commission noted that "[u]nder ordinary circumstances,"
it would not rely on its staff's "uncertain estimates," but would
instead "suspend the filing and open an investigation" in order
to determine whether the contract at issue satisfied the
statutory requirements. In this case, however, the Commission
stated that "special circumstances" existed which made an
investigation unnecessary. Specifically, the Commission observed
that the delay accompanying an investigation "could unnecessarily
deny school children the benefits of ATM services during the
- 7 - upcoming school year." Moreover, because: (1) Verizon was
willing to offer ATM services to other customers on the same
terms as provided in the ATM Contract; and (2) the Engineering
Department's estimates showed that the proposed terms satisfied
the requirements of N.H. Rev. Stat. Ann. § 378:18-b, the
Commission found that allowing the University to take advantage
of the terms of the ATM Contract was not "unduly discriminatory
and meets the requirements of the statutes."
Destek, the New Hampshire Office of the Consumer Advocate,
and Vitts Networks, Inc. each filed a motion asking the Utilities
Commission to reconsider its Order. Destek argued, among other
things, that the Commission's approval of the ATM Contract
violated: (1) §§ 251(b) and 253(a) of the Telecommunications Act
of 1996, 47 U.S.C. §§ 251(b) and 253(a); and (2) the Fourteenth
Amendment's Due Process Clause. The Utilities Commission held
two hearings on these motions, and issued an Order on November
22, 1999 denying them in their entirety.
Destek initiated this litigation on October 18, 1999 and
filed an amended complaint on April 28, 2000. It asserts three
claims. In Count I, Destek seeks judicial review of the
Utilities Commission's decision approving the ATM Contract based on § 252 of the Telecommunications Act, 47 U.S.C. § 252. Destek
claims that the ATM Contract is in violation of the Act because
its terms are discriminatory and contrary to the public interest.
In Counts II and III, Destek brings claims against Verizon, the
Utilities Commission, and the members of the Commission, Douglas
L. Patch, Nancy Brockway, and Susan S. Geiger, pursuant to 42
U.S.C. § 1983. It alleges in these counts that the defendants:
(1) violated Destek's rights under the Telecommunications Act
when it approved the ATM Contract; and (2) violated Destek's
right to due process when it conditionally approved the ATM
Contract without granting Destek's request for a hearing. Destek
seeks monetary damages, injunctive relief, declaratory relief,
and attorneys' fees. The parties have filed cross-motions for
summary judgment.
II. STANDARD OF REVIEW
Summary judgment is appropriate if the record, viewed in the
light most favorable to the non-moving party, shows that no
material facts remain in genuine dispute and that the moving
party is entitled to judgment as a matter of law. See Fed. R.
Civ. P. 56(c); Ayala-Gerena v. Bristol Myers-Squibb Co., 95 F.3d
- 9 - 86, 94-95 (1st Cir. 1996). A material fact is one "that might
affect the outcome of the suit under the governing law."
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986) . A
genuine factual issue exists if "the evidence is such that a
reasonable jury could return a verdict for the nonmoving party."
Id.
The party moving for summary judgment "bears the initial
responsibility of informing the district court of the basis for
its motion, and identifying those portions of [the record] . . .
which it believes demonstrate the absence of a genuine issue of
material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986). Once the moving party has properly supported its motion,
the burden shifts to the nonmoving party to "produce evidence on
which a reasonable finder of fact, under the appropriate proof
burden, could base a verdict for it; if that party cannot produce
such evidence, the motion must be granted." Ayala-Gerena, 95
F.3d at 94 (citing Celotex, 477 U.S. at 323; Anderson, 477 U.S.
at 249).
"Cross motions for summary judgment neither alter [this
standard of review], nor warrant the grant of summary judgment
per s e ." Wiahtman v. Springfield Terminal Railway Co., 100 F.3d
- 10 - 228, 230 (1st Cir. 1996). "Cross motions simply require [the
court] to determine whether either of the parties deserves
judgment as a matter of law on facts that are not disputed." Id.
I apply this standard in reviewing the parties' cross
motions for summary judgment.4
Ill. DISCUSSION
4 Verizon has claimed throughout this litigation that the case should be decided exclusively on the administrative record produced by the Utilities Commission. Accordingly, on December 7, 2000, it filed both a motion to stay discovery, (Doc. No. 34), and a motion for summary judgment, (Doc. No. 35). Destek filed its opposition to the motion to stay on December 26, 2000. (Doc. No. 41). On December 28, 2000, I granted Verizon's request for a stay but informed Destek that it "may oppose summary judgment by contending that it is entitled to conduct discovery before the motion for summary judgment can be decided." Margin Order, (Doc. No. 36). Although Destek continues to complain that it has not yet been accorded discovery, it filed its own summary judgment motion and elected to address the merits of Verizon's summary judgment motion rather than basing its objection on Fed. R. Civ. P. 56(f). The First Circuit has recognized that "a party ordinarily may not attempt to meet a summary judgment challenge head-on but fall back on Rule 56(f) if its first effort is unsuccessful." C .B . Trucking, Inc. v. Waste M q m t ., Inc., 137 F.3d 41, 44 (1st Cir. 1998). Moreover, Destek makes only a generalized claim that the case would benefit from additional discovery. This is not sufficient to support a request for relief under Rule 56(f). See i d . at 44-45. Accordingly, I address the merits of the cross motions for summary judgment rather than deferring a ruling until Destek has had an opportunity for discovery.
- 11 - To better understand Destek's claims, I begin by discussing
the relevant sections of the Telecommunications Act.
A. The Telecommunications Act
The purpose of the Telecommunications Act is to increase
competition in the market for local telephone services. See
Puerto Rico Tel. Co. v. Telecomms. Regulatory Bd. of Puerto Rico,
189 F.3d 1, 7 (1st Cir. 1999); see also AT&T Corp. v. Iowa
Utilities B d ., 525 U.S. 366, 371-73 (1999). To achieve this
goal, the statute imposes certain obligations on those companies
that control the existing telecommunications network in a local
area. Puerto Rico Tel. Co., 189 F.3d at 8; see 47 U.S.C. §§ 251,
252 (2001). Those companies, such as Verizon, are known as
"incumbent local exchange carriers" ("ILECs"). See 47 U.S.C. §§
2 5 2 (j), 251(h) (defining "ILECs"); Verizon's Answer to P I .'s
Amended Cplt., (Doc. No. 19), 5 9 (admitting that Verizon is an
ILEC); see also 47 U.S.C. § 153(26) (defining "local exchange
carrier").
Under § 251 of the Telecommunications Act, if a
telecommunications carrier5 seeks to enter a local market and
5 "The term 'telecommunications carrier' means any provider of telecommunications services, except that such term does not
- 12 - compete with an ILEC, it may request permission from the ILEC to
interconnect with its facilities and equipment. See 47 U.S.C. §
251; 47 C.F.R. § 51.5 (2000) ("Interconnection is the linking of
two networks for the mutual exchange of traffic."). When a
telecommunications carrier makes such a request, the ILEC must
negotiate with it in good faith. 47 U.S.C. §§ 251 ( c ) (1),
2 5 2 (a)(1).
If the requesting telecommunications carrier and the ILEC
agree on the terms under which the requestor will interconnect
with the ILEC, the parties must submit their interconnection
agreement to the relevant state regulatory commission for
review.6 47 U.S.C. § 252(e)(1); see also id. § 153(41). The
include aggregators of telecommunications services (as defined in [47 U.S.C. § 226])." 47 U.S.C. § 153 (44); see id. § 22 6 (a) (2) (defining an aggregator to mean "any person that, in the ordinary course of its operations, makes telephones available to the public or to transient users of its premises, for interstate telephone calls using a provider of operator services."). The statute defines "telecommunications service" to mean "the offering of telecommunications for a fee directly to the public, or to such classes of users as to be effectively available directly to the public, regardless of the facilities used." Id. § 153 (46) .
6 Although I describe only those obligations and procedures that are applicable to voluntarily negotiated agreements, I note that the Act imposes different obligations and procedures on parties who reach an interconnection agreement through
- 13 - state regulatory commission must either approve or reject the
interconnection agreement. I d . § 252(e) (1) . If the state
regulatory commission fails to act on the agreement within ninety
days after submission by the parties, the Act provides that the
agreement "shall be deemed approved." I d . § 252(e) (4) . Section
252(e)(2) provides that a state regulatory commission may only
reject a voluntarily negotiated interconnection agreement if it
finds that: (1) "the agreement (or portion thereof) discriminates
against a telecommunications carrier not a party to the
agreement;" or (2) "the implementation of such agreement or
portion is not consistent with the public interest, convenience,
and necessity." 47 U.S.C. § 252 (e) (2) .
Section 252(e) (6) provides that in any case where a state
regulatory commission "makes a determination under this section
[§ 252], any party aggrieved by such determination may bring an
action in an appropriate Federal district court to determine
whether the agreement or statement meets the requirements of
arbitration. See 47 U.S.C. §§ 252 (b)- (e) . Significantly, a voluntarily negotiated agreement is not subject to the pricing standards set forth in 47 U.S.C. § 252(d) or the other obligations set forth in 47 U.S.C. § 2 5 1 (b)- (c). See i d . § 252 (a)(1).
- 14 - section 251 of this title and this section [§ 2 5 2 ] 4 7 U.S.C. §
252(e)(6). The only "determination" under § 252 that a state
regulatory commission can make with regard to a voluntarily
negotiated interconnection agreement is a decision, under §
252(e)(1), to approve or reject the agreement based on the
criteria set forth in § 252 (e) (2) . See 47 U.S.C. § 252; see also
Bell Atlantic Maryland, Inc. v. MCI WorldCom, Inc., 240 F.3d 279,
303 (4th Cir.), cert, granted in part sub nom., Verizon Maryland
Inc. v. Public Serv. Comm'n of Maryland, 121 S.Ct. 2548 (2001)
("The only ''determination' that can be made by the State
commission under § 252 on a negotiated agreement is a
determination to approve or reject it." (emphasis in original)).
With this background in mind, I first turn to defendants'
summary judgment motions.
B. Defendants' Summary Judgment Motions
1. Count I: Destek's Claim for Judicial Review __________ under 47 U.S.C. 5 252(e)(6)
Destek claims in Count I of its amended complaint that it is
entitled to federal court review of the ATM Contract pursuant to
§ 252(e)(6) of the Telecommunications Act because the contract is
an interconnection agreement subject to the requirements of the
- 15 - Act. Section 252(e)(6) provides that an aggrieved party may seek
judicial review in "any case in which a State commission makes a
determination under this s e c t i o n 47 U.S.C. § 252(e)(6)
(emphasis added). Thus, I must ascertain whether the Utilities
Commission made a determination under § 252 of the Telecommuni
cations Act when it approved the ATM Contract before I can assert
jurisdiction to review the Commission's decision pursuant to §
2 52 (e) (6) . See Puerto Rico Tel. Co., 189 F.3d at 13-14.
When Verizon submitted the ATM Contract to the Utilities
Commission for review, it's expressed purpose was to comply with
the requirements of N.H. Rev. Stat. Ann. § 378:18-b rather than
the Telecommunications Act. See Letter from Verizon to Utilities
Commission of 6/4/1999 (the "Verizon Transmittal Letter") , A p p .7
, Tab 25. Verizon's initial submission contained no reference to
the Telecommunications Act, presumably because it believed that
the ATM Contract was not an interconnection agreement, and,
therefore, was not subject to the Act. See i d . Similarly,
Destek's initial objection and request to intervene did not refer
to the Telecommunications Act. See Letter from Susnock to
7 "A p p ." refers to the appendix to Verizon's motion for summary judgment, (Doc. No. 35).
- 16 - Utilities Commission of 06/25/1999, A p p ., Tab 13. It is not
surprising, therefore, that the Utilities Commission's Order
conditionally approving the ATM Contract did not discuss the
Telecommunications Act, and instead focused on whether the ATM
Contract complied with N.H. Rev. Stat. Ann. § 378:18-b. See
Order No. 23,255 of the Utilities Commission, dated July 7, 1999,
A p p ., Tab 27.
In its motion for reconsideration, Destek argued that all
special contracts contemplated by N.H. Rev. Stat. Ann. § 378:18,
including the ATM Contract, violate §§ 251(b) and 253(a) of the
Telecommunications Act because they give ILEC's an unfair
competitive advantage in the local market for telecommunications
services. See Destek's Mem. of Law in Support of Motion for
Reconsideration, A p p ., Tab 17 at 5-9. Destek did not argue,
however, that the ATM Contract is an interconnection agreement
that the Utilities Commission must either approve or reject in
accordance with the standards set forth in § 252(e) (2) of the
Act. See i d . Because Destek did not assert a claim based on §
252, the Commission neither cited nor discussed § 252 in its
subsequent Order. Instead, it denied Destek's motion, holding
that neither § 2 5 1 (b) nor § 253 (a) prohibited the Commission from
- 17 - approving special contracts in accordance with N.H. Rev. Stat.
Ann. § 378:18. See Order N o . 23,34 8 of the Utilities Commission
(the "Order Denying Reconsideration") , dated Nov. 2 2 , 1999, A p p .,
Tab 28 at 22-23.
The record in this case demonstrates that the Commission
neither approved nor rejected the ATM Contract pursuant to § 252
and did not even decide whether the agreement was regulated by §
252. Accordingly, it did not make any "determination" under §
252 for me to review. See 47 U.S.C. § 2 5 2 (e) (6) . Therefore, I
grant defendants' motions for summary judgment with regard to
this claim.
2. Counts II and III:Destek's § 1983 claims
Destek also asserts claims for damages and injunctive relief
based on 42 U.S.C. § 1983. In Count II of its amended complaint,
Destek alleges that all of the defendants violated Destek's
rights under the Telecommunications Act while acting under color
of state law.8 In Count III, Destek alleges that the Utilities
8 Because the parties have not briefed the issue, I will assume without deciding that § 1983 can be used to remedy violations of the Telecommunications Act in appropriate cases. See AT&T Wireless PCS, Inc. v. City of Atlanta, 210 F.3d 1322, 1327, 1327 n.7 (11th Cir. 2000) (subsequent procedural history omitted) (concluding that the Telecommunications Act can be
- 18 - Commission and the three individual Commissioners violated
Destek's right to due process under the Fourteenth Amendment. I
first address Desktek's § 1983 claims against Verizon.
a. Destek's § 1983 claims against Verizon
Destek's § 1983 claims against Verizon are plainly without
merit. As the First Circuit has recognized "[s]ection 1983 . . .
does not provide relief against most private individuals . . .
the alleged deprivation must be 'fairly attributable to the
state.'" Gonzalez-Morales v. Hernandez-Arencibia, 221 F.3d 45,
49 (1st Cir. 2000) (quoting Lugar v. Edmondson Oil Co . , 457 U.S.
922, 935 (1982)). Because Destek has not demonstrated that
Verizon engaged in any conduct that is fairly attributable to the
state, Verizon is entitled to summary judgment with respect to
Destek's § 1983 claims.
b. Destek's claims for damages against the __________ Commission and the Commissioners in their __________ official capacities
The Commission moves for summary judgment on the grounds
that it is immune from suit under Section 1983 because it is a
enforced by using § 1983 but recognizing that district courts are split on the issue) .
- 19 - state agency. Similarly, the Commissioners assert that they are
entitled to summary judgment with regard to the claims against
them for damages in their official capacities. As discussed
below, I agree.
Section 1983 provides for a cause of action against every
"person" who, while acting under color of law, deprives another
person of her federal rights. 42 U.S.C. § 1983. The Supreme
Court has held "that a State is not a person within the meaning
of § 1983." Will v. Mich. Dept, of State Police, 491 U.S. 58, 64
(1989). Accordingly, a state agency, such as the Utilities
Commission, may not be sued under Section 1 983 .9 I d . at 64-71;
Wang v. N.H. Bd. of Registration in Medicine, 55 F.3d 698, 700
(1st Cir. 1995). Therefore, I grant the Utilities Commission's
motion for summary judgment.
9 Destek argues that the Utilities Commission waived its Eleventh Amendment immunity by agreeing to participate in the regulatory framework established by the Telecommunications Act. This argument is beside the point, however, because Destek chose to sue under § 1983, not under the Telecommunications Act. Even if the Commission has waived its Eleventh Amendment immunity, the fact remains that it is not a person for purposes of a § 1983 claim. See, e.g., McLaughlin v. Bd. of Trustees of State Colleges of Colorado, 215 F.3d 1168, 1172 (10th Cir. 2000) (holding that a § 1983 claim against a state agency was barred, even though the state had waived its Eleventh Amendment immunity, because a state is not a person for purposes of § 1983) .
- 20 - Destek's claims for damages against the Commissioners in
their official capacities also are without merit. "[A] suit
against a state official in his or her official capacity is not a
suit against the official but rather is a suit against the
official's office. As such, it is no different from a suit
against the State itself." Will, 491 U.S. at 71 (internal
citations omitted). Accordingly, a state official acting in her
official capacity is not a "person" for purposes of Section 1983
and, therefore, may not be sued for damages under that statute.
I d .; Wang, 55 F.3d at 700; see also Hafer v. Melo, 502 U.S. 21,
27 (1991) (discussing the distinction between official-capacity
and personal-capacity suits). Therefore, I grant the
Commissioners' motion for summary judgment with regard to the
claims for damages against them in their official capacities.
c. Destek's claims for damages against the __________ Commissioners in their individual __________ capacities
The Commissioners argue that Destek's claims for damages
against them in their individual capacities are barred by the
doctrine of "quasi-judicial" immunity. I agree.
- 21 - State officials, who "irrespective of their title, perform
functions essentially similar to those of judges or prosecutors,
in a setting similar to that of a court" are absolutely immune
from suit based on those "quasi-judicial" functions. Bettencourt
v. Bd. of Registration in Medicine, 904 F.2d 772, 782 (1st Cir.
1990); see Scott v. Central Maine Power Co., 70 9 F. Supp. 117 6,
1181-85 (D. Me. 1989). In order to determine whether the
Commissioners "perform functions similar to those of judges," and
are therefore entitled to absolute immunity, I must answer three
questions. Bettencourt, 904 F.2d at 783. First, does a
Commissioner "perform a traditional 'adjudicatory' function, in
that he decides facts, applies law, and otherwise resolves
disputes on the merits (free from direct political influence)?"
Id. Second, does a Commissioner, like a judge, "decide cases
sufficiently controversial that, in the absence of absolute
immunity, he would be subject to numerous damages actions?" Id.
Third, does a Commissioner "adjudicate disputes against a
backdrop of multiple safeguards designed to protect a
[participant's] constitutional rights?" Id. Because I answer
these questions in the affirmative, I grant the Commissioners'
motion for summary judgment with regard to Destek's claims for
- 22 - damages against them in their individual capacities.
First, the Commissioners perform traditional adjudicatory
functions when acting in their official capacities. See
Bettencourt, 904 F.2d at 783. Whether they are reviewing
contracts for compliance with the requirements of N.H. Rev. Stat.
Ann. § 378:18-b, or reviewing interconnection agreements for
compliance with the appropriate provisions of the
Telecommunications Act, the Commissioners review the factual
record before them, decide facts, apply the relevant law, and
resolve disputes based upon the appropriate statutory factors.
See id.
Second, the cases that come before the Commission are
"sufficiently controversial." The decision to approve or reject
a special contract or an interconnection agreement "is likely to
stimulate a litigious reaction from the disappointed [party],
making the need for absolute immunity apparent." Id.
Lastly, "enough safeguards exist to 'enhance the reliability
of information and the impartiality of the [Commission's]
decisionmaking process'" with regard to both special contracts
and interconnection agreements. I d . (quoting Butz v.
- 23 - Economou, 438 U.S. 478, 512 (1978)). The Commissioners make
decisions in accordance with a process established by New
Hampshire statutory law and regulations. See, e.g., N.H. Rev.
Stat. Ann. §§ 363:1-35 (setting forth the Commission's purpose,
procedures, and ethical rules, e.g., prohibitions on ex parte
contacts and conflicts of interest); N.H. Code Admin. R. PUC
201.01-205.10 (describing the Commission's procedures with regard
to: (1) the submission of pleadings and evidence; (2) discovery;
and (3) hearings). Among the protections afforded by that
process include the right of a party to be represented by legal
counsel. N.H. Code Admin. R. PUC 201.03. Moreover, the
Commission must issue a written order explaining its decision.
N.H. Rev. Stat. Ann. § 363:17-b.
For the foregoing reasons, I conclude that the Commissioners
are entitled to absolute immunity with regard to Destek's claims
against them in their individual capacities.
d. Destek's claims for prospective injunctive __________ relief against the Commissioners
Destek seeks prospective injunctive relief pursuant to §
1983 to compel the Commissioners to comply with the
Telecommunications Act. "[A] state official in his or her
- 24 - official capacity, when sued for injunctive relief [is] a person
under § 1983 because ''official capacity actions for prospective
relief are not treated as actions against the State.'" Wil l , 491
U.S. at 71 n.10 (citations omitted). Accordingly, I deny the
Commissioners' motion for summary judgment with respect to
Destek's § 1983 claims for prospective injunctive relief,
e. Conclusion
In summary, Verizon and the Utilities Commission are
entitled to summary judgment with respect to all of Destek's
claims against them. The Commissioners are entitled to summary
judgment with respect to Count I and all of Counts II and III,
except for Destek's claims for prospective injunctive relief
under those two counts. Because Destek has asserted viable
claims for prospective injunctive relief against the
Commissioners in their official capacities, I turn to Destek's
C. Destek's Summary Judgment Motion
Destek moves for summary judgment only with regard to Count
II of its amended complaint. It asserts in this count that the
Commissioners violated the Telecommunications Act by: (1) failing
- 25 - to treat the ATM Contract as an interconnection agreement that
the Commission must approve or reject pursuant to § 252 ( e ) (1) of
the Act; and (2) failing to make a complete copy of the ATM
Contract available for public inspection as is required by §
252(h) of the Act. Destek also argues that the Commissioners'
use of N.H. Rev. Stat Ann. § 378:18 to avoid its obligations
under §§ 252(e) (1) and 252(h) violates § 253(a) of the Act which
provides that " [n]o State or local statute or regulation, or
other State or local legal requirement, may prohibit or have the
effect of prohibiting the ability of any entity to provide any
interstate or intrastate telecommunications service." 47 U.S.C.
§ 253(a). I decline Destek's request for summary judgment as to
these claims because facts material to the question of whether
the ATM Contract is an interconnection agreement subject to §§
252(e) and 252(h) remain in genuine dispute.
1. Backcrround
An interconnection agreement is (1) an agreement between an
(2) ILEC and a (3) telecommunications carrier regarding (4) the
provision of interconnection services. See 47 U.S.C. §§
2 5 2 (a)(1), (e)(1). In this case, the parties' primary
disagreement is whether the University is, in fact, a
- 26 - telecommunications carrier.
As noted above, a "telecommunications carrier" is "any
provider of telecommunications services" other than an aggregator
of such services. 47 U.S.C. § 153 (44). The Act defines
"telecommunications service" to mean "the offering of
telecommunications for a fee directly to the public, or to such
classes of users as to be effectively available directly to the
public, regardless of the facilities used." I d . § 153(46); see
i d . § 153(43) (defining "telecommunications").
The Federal Communications Commission ("FCC"), relying on
the legislative history of the Telecommunications Act, has
interpreted the statutory term "telecommunications service" to
mean telecommunications provided on a common carrier basis. See,
e.g.. In re Federal-State Joint Bd. on Universal Serv., FCC 99-
268, 1999 WL 809480, at 5 13 (released Oct. 8, 1999); In re AT&T
Submarine Svs., Inc., FCC 98-263, 1998 WL 709391, at ^ 6
(released Oct. 9, 1998); In re Cable & Wireless, PLC, FCC 97-204,
1997 WL 339269, at 5 13 (released June 20, 1997). The Court of
Appeals for the District of Columbia Circuit has accepted this
interpretation. Virgin Islands Tel. Corp. v. FCC. 198 F.3d 921,
926-27 (D.C. Cir. 1999) (concluding that the FCC's interpretation
- 27 - of the term "telecommunications service" constituted a
"permissible construction" of the Telecommunications A c t ) .
Because I find the opinion of the District of Columbia Circuit to
be persuasive, I also accept the FCC's determination that the
term telecommunications service means telecommunications provided
on a common carrier basis. See i d . Accordingly, in order to
determine whether the University is a telecommunications carrier,
I must ascertain whether it provides telecommunications services
on a common carrier basis.
The Telecommunications Act defines a "common carrier" as
"any person engaged as a common carrier for hire." 47 U.S.C. §
153(10); see 47 C.F.R. § 21.2 (2000) (defining the term
"communication common carrier" to mean "[a]ny person engaged in
rendering communication service for hire to the public").
Because of the circular nature of this definition, the federal
courts have developed, and the FCC has accepted as controlling, a
two-part test for determining whether an entity is a common
carrier. See Nat'l Ass'n of Regulatory Utility Comm'rs. v. FCC.
533 F .2d 601, 608-10 (D.C. Cir. 1976) ("NARUC II") ; Nat'l Ass'n
of Regulatory Utility Comm'rs. v. FCC. 525 F.2d 630, 640-42 (D.C.
Cir. 1976) ("NARUC I"); In re Cable & Wireless. PLC. FCC 97-204,
- 28 - 1997 WL 339269, at 13-17 (applying the test set forth in NARUC
X ) ; see also FCC v. Midwest Video Corp., 440 U.S. 689, 701, 701
n.10 (1979) (acknowledging the "circularity" of the statutory
definition and citing NARUC I with approval).
Under this rubric, I first ask whether the University
"undertakes to carry for all people indifferently." NARUC I, 525
F.2d at 641 (internal quotation marks and citations omitted). I
must consider whether the University is under any "legal
compulsion . . . to serve indifferently those who seek to avail
themselves of [its] particular services." I d . at 642. I must
also consider whether there are "reasons implicit in the nature
of [the University's] operations to expect" it to hold itself out
indifferently to the public. I d . at 642. That is to say, I must
ask whether it is the University's practice to "serve all
indiscriminately." Id. "[A] carrier will not be a common
carrier where its practice is to make individualized decisions,
in particular cases, whether and on what terms to deal." I d .10
10 Because I conclude that Destek offers insufficient evidence to demonstrate that the University intends to "serve all indiscriminately," I need not analyze whether the University satisfies the second requirement for common carrier status: that all customers who utilize the University's ATM services may "transmit intelligence of their own design and choosing." NARUC
- 29 - 2. Analysis
Destek does not contend that the University is legally
compelled to offer ATM services indifferently to the public. See
NARUC I, 525 F.2d at 642. Thus, my analysis turns on whether
there are "reasons implicit in the nature of [the University's]
operations to expect" the University to offer ATM services
indifferently to the public.11 Id.
Destek offers two pieces of evidence to support its argument
that the University is a telecommunications carrier: (1) the ATM
Contract itself; and (2) the affidavit of Destek's President,
Brian Susnock.
a. The ATM Contract
Destek argues that "the plain words of the [ATM Contract]
establish that [the University is] a telecommunications carrier."
Destek's Mem. of Law in Opposition to Verizon's Mot. for Summ.
J., etc. ("Destek's Mem. of Law"), (Doc. No. 39), at 19. I
disagree.
11, 533 F.2d at 609 (internal quotation marks and citations omitted); see also Midwest Video Corp., 440 U.S. at 701.
11 I assume for purposes of discussion that ATM technology is a form of "telecommunications," as defined by the Telecommunications Act. See 47 U.S.C. § 153(43).
- 30 - While the ATM Contract does not prohibit the University from
reselling ATM services to others for a fee, it does not state
that the University intends to do so. Moreover, the mere fact
that the University has the ability to offer ATM services to the
public does not necessarily mean that it will offer those
services indiscriminately.12 See NARUC I , 525 F.2d at 641-42.
Indeed, in their submissions to the Utilities Commission,
Verizon and the University suggested that it was the University's
intent to offer ATM services only to its various campuses and to
other public educational institutions, such as libraries and
schools. See Verizon Transmittal Letter. Under those
circumstances, the University would not be a common carrier. See
NARUC I, 525 F.2d at 641-42; In re Federal-State Joint Bd. on
12 In this regard, I note that the Utilities Commission, in denying the various motions for reconsideration, observed that the ATM Contract is
between a local exchange carrier (LEG) and a customer; what that customer does with the service provided is a concern of the [Utilities Commission] only if [the University] chooses to resell the services. Here, [the University] is simply providing a service to its remote "campuses" which happen to be located in various schools, libraries and other locations.
Order Denying Reconsideration at 14.
- 31 - Universal Serv., FCC 99-268, 1999 WL 809480, at 1 13 (holding
that a state network providing telecommunications services to
state agencies and other public entities did not hold itself out
indifferently to all potential users). The ATM Contract thus
does not establish Destek's claim that the University is a
telecommunications carrier because it offers telecommunications
b. The Susnock Affidavit
The only other evidence that Destek offers to support its
argument that the University is a telecommunications carrier is
the affidavit of Brian Susnock, Destek's President. His
affidavit states as follows:
Since the approval of the [ATM Contract], [the University] has marketed its ATM networking services to Destek's customers, and generally to businesses, schools and nonprofit entities throughout New Hampshire and Southern Maine.
Aff. of Brian Susnock, Exh. F to Destek's Mem. of Law, at SI 4;
see also Letter from Susnock to Utilities Commission of
09/29/1999, A p p ., Tab 20 ("Based on information we have just
received, it is obvious that [Verizon] and [the University] plan
to sell ATM Services to commercial and corporate interests in New
- 32 - Hampshire.").
Even if the statements contained in this affidavit are true,
they are not sufficient to support a conclusion that the
University offers ATM services on a common carrier basis, i.e.,
indifferently to the public. See NARUC I , 525 F.2d at 641-42.
Indeed, the affidavit suggests that the University may be
attempting to reach individual deals with specific potential
customers. Under those circumstances, it would not be a common
carrier. See Southwestern Bell Tel. Co. v. FCC, 19 F.3d 1475,
1481 (D.C. Cir. 1994) ("If the carrier chooses its clients on an
individual basis and determines in each case whether and on what
terms to serve . . . the entity is a private carrier" (internal
quotation marks and citations omitted)); NARUC I, 525 F.2d at 641
("a carrier will not be a common carrier where its practice is to
make individualized decisions, in particular cases, whether and
on what terms to deal").
Because Destek offers insufficient evidence to demonstrate
that the University intends to offer ATM services on a common
carrier basis, I cannot conclude that the University is a
telecommunications carrier and that the ATM Contract is an
interconnection agreement subject to the Telecommunications Act.
- 33 - As facts material to these issues remain in genuine dispute, I
deny Destek's motion for summary judgment. See Fed. R. Civ. P.
56(c); Ayala-Gerena, 95 F.3d at 94-95.
IV. CONCLUSION
_____ For the reasons discussed herein, I grant Verizon's motion
for summary judgment, (Doc. No. 35), in its entirety and grant
the Commission and the Commissioners' motion for summary
judgment, (Doc. No. 42), in part. I deny Destek's motion for
summary judgment, (Doc. No. 38).
SO ORDERED.
Paul Barbadoro Chief Judge July 31, 2001
cc: Eugene F. Sullivan III, Esq. Sean A. Lev, Esq. Thomas J. Donovan, Esq. Victor D. DelVecchio, Esq.
- 34 -