Global Naps, Inc. v. Verizon New England, Inc.

396 F.3d 16, 34 Communications Reg. (P&F) 1390, 2005 U.S. App. LEXIS 969, 2005 WL 100772
CourtCourt of Appeals for the First Circuit
DecidedJanuary 19, 2005
Docket04-1711
StatusPublished
Cited by30 cases

This text of 396 F.3d 16 (Global Naps, Inc. v. Verizon New England, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the First Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Global Naps, Inc. v. Verizon New England, Inc., 396 F.3d 16, 34 Communications Reg. (P&F) 1390, 2005 U.S. App. LEXIS 969, 2005 WL 100772 (1st Cir. 2005).

Opinion

*18 LYNCH, Circuit Judge.

This appeal represents one part of a larger dispute between Global NAPs, a competitive local exchange carrier (CLEC), and Verizon New England, Inc., an incumbent local exchange carrier (ILEC), in their attempt to reach an interconnection agreement under the Telecommunications Act of 1996(TCA), Pub.L. No. 104-104, 110 Stat. 56 (codified as amended in scattered sections of 47 U.S.C.). The TCA sets up detailed procedures for the creation of interconnection agreements in order to serve the TCA’s goal of fostering competition in local telephone markets. Those procedures allow competing carriers to gain access to the incumbent carrier’s telecommunications network and facilities and govern the terms and fees of that access.

. Global NAPs appeals from the district court’s judgment affirming a February 19, 2003 order of the Massachusetts Department of Telecommunications and Energy (DTE), the state commission given the power to arbitrate disputes over interconnection agreements under the TCA. 47 U.S.C. § 252(b). The February 19, 2003 administrative order followed an earlier December 12, 2002 DTE order deciding the arbitration between Verizon and Global NAPs. That arbitration had been initiated by Global NAPs after a period of negotiation with Verizon failed to produce an agreement on all issues.

The challenged February 19 order allowed a remedial motion by Verizon to force Global NAPs to sign an interconnection agreement consistent with the terms of the' DTE’s earlier December 12 arbitration order. Verizon brought this motion because Global. NAPs had balked at the December 12 arbitration order, said it was not bound by the result of the arbitration, and that it was instead exercising what it thought was its unconditional right under § 252(i) of the Act to adopt the terms of an interconnection agreement Verizon had with Sprint, which preexisted Global NAPs’ arbitration request.

The merits of the underlying December arbitration order from the DTE are not before us. The merits issue before us is whether in its February order the DTE acted in violation of § 252(i) of the TCA in precluding Global NAPs from nullifying and avoiding the effect of the arbitration— which binds Global NAPs and Verizon to an agreement — by instead opting into the terms of an older agreement Verizon had signed with Sprint. If Global NAPs were free to so opt in, that would moot the challenge to the underlying December arbitration order. We find that the DTE’s February 19 order was not in violation of the TCA and affirm the district court.

I.

Before the passage of the TCA, local telephone service was provided mainly by state-regulated monopolies, such as Verizon. These monopolies, the ILECs, owned all networks and facilities (including telephone lines, poles, trunks, etc.) attendant to the provision of local telephone service. See AT & T Corp. v. Iowa Utils. Bd., 525 U.S. 366, 371, 119 S.Ct. 721, 142 L.Ed.2d 835 (1999). A purpose of the TCA was to end the local telephone monopolies and create a national telecommunications policy that strongly favored competition in local telephone markets. See P.R. Tel. Co. v. Telecomm. Regulatory Bd. of P.R., 189 F.3d 1, 7 (1st Cir.1999).

Section 251 of the TCA imposes obligations on both competing carriers and incumbent carriers. Section 251(a)(1) imposes a duty on all carriers “to interconnect directly or indirectly with the facilities and equipment of other telecommunications carriers.” 47 U.S.C. § 251(a)(1). *19 The TCA imposes on an incumbent carrier more stringent duties, including “the duty to permit other carriers to interconnect with its facilities, to provide other carriers with access to elements of its local network on an ‘unbundled’ basis, to sell to other carriers at wholesale prices the services that it provides to its customers, and to negotiate interconnection agreements in good faith.” P.R. Tel. Co., 189 F.3d at 8; see 47 U.S.C. § 251(c).

Section 252 provides the procedures for the creation of interconnection agreements. 1 Interconnection agreements govern the terms and conditions by which CLECs may gain access to the ILECs’ local telephone network and facilities, thus allowing the CLECs to provide competing local telephone service. Incumbents and competitors may negotiate freely an interconnection agreement, and both parties have a duty to negotiate in good faith. 47 U.S.C. § 251(c)(1). If the parties reach an agreement through negotiation, that agreement need not satisfy the substantive requirements of §§ 251(b) and (c). Id. § 252(a)(1). If after a period of negotiation the parties are not able to come to an agreement on some issues, either party may petition a state commission to decide those open issues in arbitration. Id. § 252(b)(1). The commission then has the authority to decide the open issues between the parties, and to impose conditions on the parties for the implementation of the terms of arbitration into an agreement. Id. § 252(b)(4)(C). In deciding those issues, the commission must “ensure that such resolution and conditions meet the requirements of section 251 of this title, including the regulations prescribed by the [Federal Communications Commission] pursuant to section 251.” Id. § 252(c)(1). Further, either party’s refusal to negotiate or to cooperate with the state commission acting as arbitrator constitutes a breach of its duty to negotiate in good faith. Id. § 252(b)(5).

In addition, the TCA requires ILECs to allow any requesting CLEC to adopt the terms and conditions of any interconnection agreement it has with any other CLEC, provided that agreement has been approved by the requisite state telecommunications commission. Id. § 252(i).

Once a negotiated or arbitrated agreement is completed, it must be submitted to the state commission for approval. Id. § 252(e)(1). The commission may reject any negotiated agreement if it discriminates against a third party carrier or if its implementation is “not consistent with the public interest, convenience, and necessity.” Id. § 252(e)(2)(A). The commission may reject an arbitrated agreement if it fails to meet the substantive requirements of § 251, including the FCC’s implementing regulations, or the pricing standards set forth in § 252(d). Id. § 252(e)(2)(B). That commission decision is subject to federal judicial review:

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Bluebook (online)
396 F.3d 16, 34 Communications Reg. (P&F) 1390, 2005 U.S. App. LEXIS 969, 2005 WL 100772, Counsel Stack Legal Research, https://law.counselstack.com/opinion/global-naps-inc-v-verizon-new-england-inc-ca1-2005.