Martha Self v. BellSouth Mobility, Inc.

700 F.3d 453, 56 Communications Reg. (P&F) 1534, 2012 U.S. App. LEXIS 22386, 2012 WL 5308066
CourtCourt of Appeals for the Eleventh Circuit
DecidedOctober 30, 2012
Docket11-13998
StatusPublished
Cited by11 cases

This text of 700 F.3d 453 (Martha Self v. BellSouth Mobility, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Martha Self v. BellSouth Mobility, Inc., 700 F.3d 453, 56 Communications Reg. (P&F) 1534, 2012 U.S. App. LEXIS 22386, 2012 WL 5308066 (11th Cir. 2012).

Opinion

CARNES, Circuit Judge:

Spurred on by Congress, the Federal Communications Commission issued an order requiring telecommunications carriers to make payments into a Universal Service Fund for subsidizing services for certain categories of consumers. The carriers’ mandatory payments into the fund were calculated based on their interstate and intrastate revenues. The FCC allowed the carriers to recover the amount of their payments by charging their customers a monthly fee.

After the order went into effect and the carriers made payments into the fund and collected fees from their customers, a federal appeals court held that the FCC had *455 exceeded its authority by including intrastate revenues in the calculation of the payments the carriers were required to make. The court did not decide what should be done about the money the carriers had already paid into the fund or about the fees the customers had already paid to the carriers. The FCC, however, issued orders determining that the court decision would not be applied retroactively and that there would be no refunds of the payments that the carriers had made. The question remains what should happen to the intrastate portion of the fees that the customers paid to reimburse the carriers for the payments they made to the fund. Are the customers entitled to a refund of any portion of the fees they paid the carriers even though the FCC has denied the carriers a refund of any portion of the payments the carriers made to the fund?

That is the motivating issue in this case, but it is not the specific question presented by this appeal. Instead, the question we have is whether the district court has subject matter jurisdiction to decide that issue. In answering that question, we are reminded of Justice Holmes’ view about the comparative difficulty of deciding cases. He said that “when you walk up to the lion and lay hold the hide comes off and the same old donkey of a question of law is underneath.” 1 In our experience that view is not always accurate, but it is here. The best way for us to get the hide off the lion in this case is to summarize the applicable law, including the relevant FCC orders, before setting out the procedural history and facts. Be forewarned that there is a lot of hide.

I.

Congress passed the Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56, to ensure that all Americans have access to a baseline level of affordable telecommunications services. To help achieve that goal, the Act directs the FCC to create “specific, predictable and sufficient Federal and State mechanisms to preserve and advance universal service.” 47 U.S.C. § 254(b)(5). The Act also lists several “[universal service principles” that the FCC must follow when creating those federal and state mechanisms. Id. § 254(b). One principle is that telecommunications services should be available to consumers “in all regions of the Nation, including low-income consumers and those in rural, insular, and high cost areas.” Id. § 254(b)(3). Another principle is that “schools and classrooms, health care providers, and libraries should have access to advanced telecommunications services,” Id. § 254(b)(6).

The Act does not allocate any funds to finance the FCC’s creation and administration of the “universal service support mechanisms.” Id. § 254(a)(1); see also id. § 254(d). Instead, it provides that all interstate telecommunications carriers “shall contribute, on an equitable and nondiscriminatory basis, to the ... mechanisms established by the [FCC] to preserve and advance universal service.” Id. § 254(d). In other words, carriers must fund any universal service support mechanisms that the FCC creates under its § 254(b) authority.

The FCC implemented the Act’s universal service requirements by issuing a “Universal Service Order” in May 1997. In re Fed.-State Joint Bd. on Universal Serv., 12 FCC Red. 8776, 1997 WL 236383 (1997) [hereinafter “Universal Service Order”], *456 aff'd in part and rev’d in part by Tex. Office of Pub. Util. Counsel v. FCC, 183 F.3d 393 (5th Cir.1999). That order created “universal service support mechanisms” for four different categories of need: high-cost areas, low-income consumers, rural healthcare providers, and schools and libraries. Id. at 8787, 8792-97. All four categories of support were financed through a Universal Service Fund (“USF”), which was in turn funded by mandatory contributions from interstate telecommunications carriers. Id. at 8797; see also id. at 8780-81. The contributions used to finance the high-cost and the low-income support mechanisms were based solely on the carriers’ interstate revenues. Id. at 9201; see also id. at 9198. The contributions used to support schools, libraries, and rural healthcare providers, however, were based in part on the carriers’ intrastate revenues. Id. at 9203-05; cf. id. at 9192 (“[T]he Commission has jurisdiction to assess contributions for the universal service support mechanisms from intrastate as well as interstate revenues .... ”).

The Universal Service Order authorized carriers to recover their mandatory USF contributions from certain customers. Id. at 9198-99. Specifically, the order stated that “carriers will be permitted, but not required, to pass through their contributions to their interstate access and interexchange customers.” Id. at 9199 (emphasis added). It seems odd to describe the carriers as “passing] through their contributions” by requiring customers to pay them, but such is FCC-speak. The Universal Service Order did not specify how the carriers should pass through their USF contributions if they chose to do so (which, of course, they did). The order did provide that any passing through had to be done “in an equitable and nondiscriminatory fashion.” Id. at 9209; see also id. at 9199. Carriers started making their mandatory USF contributions and passing them through to customers on January 1, 1998. Id. at 8813.

In later orders, the FCC appointed the Universal Service Administrative Company to administer all universal service program activities. See, e.g., In re Changes to the Bd. of Directors of the Nat’l Exch. Carrier Ass’n Inc., 12 FCC Red. 18400, 18407, 18415, 1997 WL 408266 (1997); see also 47 C.F.R. § 54.701(a). That company is responsible for, among other things, “billing [carriers], collecting contributions to the universal service support mechanisms, and disbursing universal service support funds.” 47 C.F.R. § 54.702(b).

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Bluebook (online)
700 F.3d 453, 56 Communications Reg. (P&F) 1534, 2012 U.S. App. LEXIS 22386, 2012 WL 5308066, Counsel Stack Legal Research, https://law.counselstack.com/opinion/martha-self-v-bellsouth-mobility-inc-ca11-2012.