Telecommunications Regulatory Board v. CTIA-The Wireless Ass'n

752 F.3d 60, 60 Communications Reg. (P&F) 326, 2014 WL 1856766, 2014 U.S. App. LEXIS 8780
CourtCourt of Appeals for the First Circuit
DecidedMay 9, 2014
Docket12-2427
StatusPublished
Cited by19 cases

This text of 752 F.3d 60 (Telecommunications Regulatory Board v. CTIA-The Wireless Ass'n) 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
Telecommunications Regulatory Board v. CTIA-The Wireless Ass'n, 752 F.3d 60, 60 Communications Reg. (P&F) 326, 2014 WL 1856766, 2014 U.S. App. LEXIS 8780 (1st Cir. 2014).

Opinion

TORRUELLA, Circuit Judge.

At issue in this case is a law passed by the government of Puerto Rico to obtain information about the owners of prepaid cell phones. The Puerto Rican government passed the Act of Dec. 27, 2011, No. 280, 2011 P.R. Laws 2963 (codified at P.R. Laws Ann. tit. 27, §§ 531-539 (Supp.2013)) (the “Registry Act”), in order to combat the use of anonymous prepaid cell phones for criminal purposes in Puerto Rico. The Registry Act functions by requiring telephone companies and other sellers of prepaid phones to provide information about the purchasers of such phones to the government of Puerto Rico. The government then compiles a registry with the names, numbers, and addresses of all those who purchase prepaid cell phones in Puerto Rico.

The question before us is whether the Registry Act conflicts with and is preempted by the federal Stored Communications Act, 18 U.S.C. §§ 2701-2712 (the “SCA”), which restricts the ability of wireless communications providers to release customer information to governmental entities. After careful consideration, we affirm the district court’s finding that the Registry Act is preempted by the SCA and that its enforcement should be enjoined.

I. Background

A. The Registry Act

On December 27, 2011, Puerto Rico Governor Luis Fortufio signed into law the Registry Act. According to the Act’s explanatory statement, while many individu *62 als legitimately purchase prepaid phones to avoid signing burdensome contracts or paying for unnecessary service, the criminal use of such phones has become widespread in Puerto Rico. See Registry Act, pmbl. 1 The Registry Act was thus created to address the “problem ... that the owners of these mobile units, because they are pre-paid, are not registered by the various companies, making it impossible for the authorities to track down their owners” in the event the phone is used to commit a criminal offense like extortion. Id.

To combat this problem, the Registry Act instructs the Telecommunications Regulatory Board of Puerto Rico (the “Board”), a government agency tasked with regulating telecommunications services in Puerto Rico, to create and maintain a registry of prepaid cell phone numbers. Id. §§ 3-5. To ensure that the Board is provided with the information it needs to create a registry, the Act requires that:

Every telephone company, natural or legal person, or business entity that sells a pre-paid mobile telephone unit shall require photo identification at the time of purchase and shall register with the Board the name and physical and postal address of the owner of the unit and an alternative telephone number, the number of the unit, its make, model, and serial number.

Id. § 5. This information must be provided to the Board within thirty days of purchase, and the penalty for failing to do so is a fine of up to $25,000 for each violation. Id. § 8.

B. Procedural history

Plaintiff-Appellee CTIA — The Wireless Association (“CTIA”) is a non-profit corporation that represents the interests of the wireless communications industry. CTIA’s members include Sprint, AT & T, T-Mobile, and others who sell prepaid cell phones in Puerto Rico. On February 15, 2012, CTIA sued the Board, three of the Board’s members in their official capacities, and Governor Fortuño in his official capacity (collectively, the “Appellants”). CTIA sought declaratory and injunctive relief, arguing that the Registry Act was preempted by the SCA because the SCA prohibits CTIA’s members from turning over to the government — without a subpoena — the same information that the Registry Act requires them to provide.

Appellants moved to dismiss the complaint, and the district court denied the motion to dismiss on August 2, 2012, adopting the magistrate judge’s recommendation and finding that the two laws clearly conflict. The district court determined that the plain language of the SCA prohibits the disclosure of cell-phone customer information in the manner that the Registry Act requires. The district court then referred back to the magistrate judge the question whether the court should permanently enjoin the enforcement of the Registry Act. On October 18, 2012, the district court adopted the magistrate judge’s findings and recommendations and granted CTIA’s motion for a permanent injunction. This timely appeal followed.

II. Discussion

On appeal, Appellants argue that the Registry Act constitutes a valid exercise of *63 Puerto Rico’s police powers that does not conflict with the SCA. Pointing to the structure and purpose of the SCA, Appellants contend that the SCA protects only-customer information related to specific communications. It does not, they argue, protect the information required by the Registry Act, like a customer’s name and address captured at the time of purchase and untethered to any particular communications or transactional record. Thus, Appellants conclude that the SCA and Registry Act do not conflict, the Registry Act is not preempted, and the judgment of the district court should be reversed. 2

We review the district court’s finding that the Registry Act is preempted by the SCA de novo. See Weaver’s Cove Energy, LLC v. R.I. Coastal Res. Mgmt. Council, 589 F.3d 458, 472 (1st Cir.2009); SPGGC, LLC v. Ayotte, 488 F.3d 525, 530 (1st Cir.2007).

Under the Supremacy Clause of the Constitution, “the Laws of the United States ... shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the ... Laws of any State to the Contrary notwithstanding.” U.S. Const. art. VI, cl. 2. “By virtue of this commandment, state law that conflicts with federal law is a nullity.” Mass. Ass’n of Health Maint. Orgs. v. Ruthardt, 194 F.3d 176, 178 (1st Cir.1999). Nullification of state law is no small matter, and thus we “start with the assumption that the historic police powers of the States are not to be superseded by ... Federal Act unless that is the clear and manifest purpose of Congress.” Grant’s Dairy-Maine, LLC v. Comm’r of Me. Dep’t of Agric., Food & Rural Res., 232 F.3d 8, 14-15 (1st Cir.2000) (internal quotation marks and citation omitted). 3

While there are a number of ways in which Congress could preempt state law, see SPGGC,

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752 F.3d 60, 60 Communications Reg. (P&F) 326, 2014 WL 1856766, 2014 U.S. App. LEXIS 8780, Counsel Stack Legal Research, https://law.counselstack.com/opinion/telecommunications-regulatory-board-v-ctia-the-wireless-assn-ca1-2014.