Global Crossing Telecommunications, Inc. v. Federal Communications Commission

259 F.3d 740, 347 U.S. App. D.C. 271, 2001 U.S. App. LEXIS 18774
CourtCourt of Appeals for the D.C. Circuit
DecidedAugust 21, 2001
Docket00-1204
StatusPublished
Cited by26 cases

This text of 259 F.3d 740 (Global Crossing Telecommunications, Inc. v. Federal Communications Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Global Crossing Telecommunications, Inc. v. Federal Communications Commission, 259 F.3d 740, 347 U.S. App. D.C. 271, 2001 U.S. App. LEXIS 18774 (D.C. Cir. 2001).

Opinion

Opinion for the Court filed by Circuit Judge GARLAND.

GARLAND, Circuit Judge:

Global Crossing Telecommunications, Inc. petitions for review of an order of the Federal Communications Commission (FCC), requiring Global Crossing to pay Verizon Telephone Companies compensation for payphone calls originating from Verizon payphones and routed over Global Crossing’s network. 1 Finding the FCC’s decision consistent with the statutory scheme and neither arbitrary nor capricious, we deny the petition for review.

I

In § 276 of the Telecommunications Act of 1996, 2 Congress directed the FCC to:

*742 prescribe regulations that—
(A) establish a per call compensation plan to ensure that all payphone service providers are fairly compensated for each and every completed intrastate and interstate call using their payphone ...; [and]
(B) discontinue ... all intrastate and interstate payphone subsidies from basic exchange and exchange access revenues, in favor of a compensation plan as specified in subparagraph (A).

47 U.S.C. § 276(b)(1)(A), (B). 3 Pursuant to Congress’ direction, the FCC issued orders in 1996 that implemented the provisions of § 276, including paragraphs (A) and (B). See Report and Order, Implementation of the Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act of 1996, 11 FCC Red 20,541, 1996 WL 547458 (1996); Order on Reconsideration, 11 FCC Red 21,233, 1996 WL 658824 (1996), affd in part and remanded in part sub nom. Illinois Pub. Telecomm. Ass’n v. F.C.C., 117 F.3d 555 (D.C.Cir.1997) (collectively, Payphone Orders).

With respect to paragraph (A), the FCC required interexchange carriers (IXCs) that carry calls originating from payphones to compensate the payphone service provider (PSP). 4 See 47 C.F.R. § 64.1300(a) (“[E]very carrier to whom a completed call from a payphone is routed shall compensate the payphone service provider for the call at a rate agreed upon by the parties by contract.”); Report and Order, Payphone Orders, 11 FCC Red at 20,566, ¶ 48; id. at 20,584, ¶ 83. Previously, PSPs had received no revenue for originating certain calls (such as subscriber 800 and other toll-free number calls) and were prohibited from blocking callers from making some of those calls (such as access code calls). See Bell Atlantic-Delaware v. Frontier Communications Servs. Inc., 14 FCC Red 16,050, 16,053-54, ¶ 5 (Com. Car. Bur.1999) (hereinafter “Bureau Order”). The Commission concluded that PSPs must be compensated for all such calls, and determined that IXCs, as the primary beneficiaries of those calls, should be responsible for providing that compensation. See id. at 16,054, -¶ 5; Report and Order, Payphone Orders, 11 FCC Red at 20,584, ¶ 83.

To implement paragraph (B), the FCC ruled that in order to receive compensation for completed calls originating from its payphones, a PSP that is also a local exchange carrier (LEC PSP), see supra note 4, “must be able to certify” that it has complied with several requirements, including the institution of “effective intrastate tariffs reflecting the removal of charges that recover the costs of payphones and any intrastate [payphone] subsidies.” Order on Reconsideration, Payphone Orders, 11 FCC Red at 21,293, ¶ 131. The FCC delegated to its Common Carrier Bureau the authority to make “any necessary determination as to whether a LEC has complied with all requirements” for compensation. Id. at 21,294, ¶ 132.

Verizon is a LEC PSP that offers local exchange and payphone services in the northeast and mid-Atlantic states. Global Crossing is an IXC that provides both interstate and intrastate telephone toll ser *743 vice. Since October 1997, when the per call compensation requirement became effective, Verizon has delivered calls from its payphones to Global Crossing.

In June 1997, in order to obtain compensation for calls originating from Verizon’s payphones and carried by Global Crossing, Verizon presented Global Crossing with signed letters attesting that it had complied with all of the conditions for receiving compensation, including the elimination of intrastate subsidies. Global Crossing replied that it would not pay compensation until Verizon provided additional information, specified by Global Crossing, establishing that Verizon had in fact satisfied the compensation eligibility prerequisites — particularly the removal of those subsidies. In June 1998, representatives of Verizon and Global Crossing met with staff of the Common Carrier Bureau, who advised that under the FCC’s rules and orders, “IXCs must compensate a LEC payphone service provider upon receipt of the LEC’s certification of eligibility without further inquiry or requirements.” Bureau Order, 14 FCC Red at 16,058, ¶ 10. Nonetheless, Global Crossing continued to refuse to pay, and, on July 15, 1998, Verizon filed a formal complaint with the FCC pursuant to 47 U.S.C. § 208. 5 The complaint alleged that Global Crossing had violated 47 U.S.C. § 276, as well as 47 C.F.R. § 64.1300, by failing to compensate Verizon for more than 11,200,000 calls. Complaint ¶¶ 33-35.

In September 1999, the Common Carrier Bureau held that Verizon had adequately certified its compliance with the prerequisites for receiving compensation and ordered Global Crossing to pay Verizon for applicable past and future calls. Bureau Order, 14 FCC Red at 16,052, ¶ 3. The Bureau determined that “[t]he term ‘certification’ ... does not mandate that a LEC payphone service provider prove to the IXC payor that it has satisfied each compensation eligibility prerequisite,” but rather requires that a LEC “attest[] authoritatively to an IXC payor that such LEC payphone service provider has satisfied each prerequisite.” Id. (emphasis added). The Bureau found that interpretation to be consistent with prior Commission orders, and permissible under the language of § 276. Id. at 16,063-65, ¶¶ 18-19, 22. And it held that if Global Crossing (or any other IXC) wished to question “the veracity of a LEC’s certification,” it was obliged to do so by filing its own complaint with the Commission, rather than by simply refusing to make payment. Id.

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Bluebook (online)
259 F.3d 740, 347 U.S. App. D.C. 271, 2001 U.S. App. LEXIS 18774, Counsel Stack Legal Research, https://law.counselstack.com/opinion/global-crossing-telecommunications-inc-v-federal-communications-cadc-2001.