Teliax, Inc. v. AT&T Corp.

220 F. Supp. 3d 1094, 2016 U.S. Dist. LEXIS 188220, 2016 WL 6777830
CourtDistrict Court, D. Colorado
DecidedNovember 1, 2016
DocketCivil Action No 15-cv-01472-RBJ
StatusPublished

This text of 220 F. Supp. 3d 1094 (Teliax, Inc. v. AT&T Corp.) is published on Counsel Stack Legal Research, covering District Court, D. Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Teliax, Inc. v. AT&T Corp., 220 F. Supp. 3d 1094, 2016 U.S. Dist. LEXIS 188220, 2016 WL 6777830 (D. Colo. 2016).

Opinion

ORDER

R. Brooke Jackson, United States District Judge

This matter is before the Court on plaintiffs motion for a summary judgment dismissing defendant’s counterclaim. ECF No. 59. For the reasons below, the Court GRANTS that motion.

I. FACTS

Plaintiff Teliax, Inc. is a company that routs toll-free 1-800 or “8YY” calls in Colorado. Defendant AT & T Corp. services many of those 8YY customers. Teliax alleges that AT & T has failed to fully pay [1096]*1096its bills for Teliax’s routing services.1 See ECF No. 44 (Second Amended Complaint). AT & T counters that Teliax charges a rate applicable to “end office” services that Teliax does not in fact provide. Accordingly, AT & T has asserted a counterclaim to recoup or “claw back” an unspecified amount for these allegedly unduly-charged services. See ECF No. 55 (Answer to Second Amended Complaint and First Amended Counterclaim); see In the Matter of Connect Am. Fund, 30 F.C.C. Rcd. 1587, *8 n.83 (2015) (hereinafter “CAF Order”) (describing the kind of counterclaim AT & T asserts here). Arguing that it was entitled to those charges, Teliax now seeks summary judgment on AT & T’s counterclaim. ECF No. 59.

Teliax and AT & T’s 8YY Call Service Arrangement

Teliax is a competitive local exchange company (“CLEC”) operating in Denver that provides both retail and wholesale 8YY services.2 Id. at 44. (Ex. 5, Dep. of David Aldworth, at 8:6-20, 12:11-13); id. at 25 (Ex. 2, Aldworth Decl. at ¶7). That Teliax offers retail 8YY services means that it receives 8YY calls directly from individual end user customers to whom it provides telephone numbers.3 ECF No. 44 at ¶16. Its wholesale 8YY service, however, operates a bit differently. Teliax has several wholesale 8YY service contracts with Local Exchange Carriers (“LECs”)4 and Interconnected Voice over Internet Protocol (“VoIP”) service providers. Pursuant to those contracts, the carriers and providers deliver to Teliax’s network the 8YY traffic that originates on their telecommunications systems.5 See ECF No. 59 at 25-26 (Ex. 2, Aldworth Decl. at ¶¶5-6).

These voice calls commonly originate in Internet Protocol (“IP”) format, which means calls that are initially sent over the internet. ECF No. 1-2 at 13 (Teliax Tariff). But they occasionally originate in older, time division multiplexing (“TDM”) format, which is “[a] method of transmitting and receiving voice signals over the Public Switched Telephone Network.” Id. at 17. Teliax nevertheless receives all of these voice calls from these wholesale providers over the internet no matter in what form the calls originated. See ECF No. 59 at 26 (Ex. 2, Aldworth Decl. at ¶9). This is known as “Over-the-Top” or “OTT” VoIP traffic. See In the Matter of Verizon Commc’ns Inc. & Mci, Inc., 20 F.C.C. Rcd. 18433, 18479 (2005).

[1097]*1097Upon receipt of these calls, Teliax performs a database query (“DBQ”) to determine to which carrier the caller intended the call ultimately to go. Id. at 26 (Ex. 2, Aldworth Decl. at ¶6). Teliax then delivers these 8YY calls to the proper interex-change carrier (“IXC”) (e.g. AT & T in Colorado if the 8YY number the end user customer dialed is assigned to a Colorado AT & T customer). See id. However, Teliax does not deliver these calls directly to the carrier. Id. Instead, Teliax delivers these calls to an intermediary “tandem” switch operated by a third party carrier. Id. That third party carrier, which has direct access to carriers’ networks, in turn delivers the 8YY call to its final destination: the call recipient’s carrier (e.g. AT & T).6 See id.

Billing Structure

As laid out above, once an 8YY call is made, that call generally moves in a linear fashion from the end user (i.e. the human being making the call) to the proper carrier of the call’s intended recipient, save for a few stops in between. The money involved in this operation, however, changes hands quite a bit differently. The tandem provider ultimately delivering the 8YY call to its final destination bills AT & T directly for delivering this 8YY call. ECF No. 62-2 at 61 (Aldworth Dep.). That tandem provider then, in turn, pays Teliax a portion of that money it receives from AT & T. Id. at 59-61. The tandem provider also pays Tel-iax an additional sum so that Teliax continues to send that tandem provider the 8YY traffic Teliax receives. Id.

Teliax also pays its wholesale providers a set rate determined by the parties’ contracts. ECF No. 62-1 at 3, 5 (Wholesale Provider Contract); ECF No. 62-2 at 61-62. Under most of their contracts, the wholesale providers and Teliax agree not to bill another company, such as AT & T, on behalf of the other party. See, e.g. ECF No. 62-3 at 2-3. To avoid confusion, they also agree that Teliax will be the company that bills for Tandem and DBQ services, but not necessarily end user switching services. See id. Finally, and most importantly for this dispute, Teliax also bills AT & T. ECF No. 62-2 at 61. With respect to its wholesale 8YY traffic, Teliax allegedly billed AT & T three separate charges: (1) an “end office switching” charge; (2) a “local switching common trunk port” charge; and (3) an “8YY database query” charge. See ECF No. 44 at ¶20.

For the interstate 8YY services Teliax provided to AT & T, Teliax billed AT & T certain rates for its services under Teliax’s interstate tariff,- known as Teliax Tariff F.C.C. No. 1 (“Tariff’).7 See ECF No. 1-2. Teliax must file this Tariff with the Federal Communications Commission (“FCC”). See Qwest Corp. v. AT & T Corp., 371 F.Supp.2d 1250, 1250-51 (D. Colo. 2005) (explaining that “Section 203 of the Federal Communications Act of 1934, 47 U.S.C. § 203, requires all common carriers of in[1098]*1098terstate and foreign telecommunications to file a schedule of their charges, as well as the classifications, practices and regulations affecting such charges, with the [FCC] ” and that “[t]his schedule is known as a tariff’). It did so in this case on September 18, 2012. See ECF No. 59 at 22 (Ex. 1, Roesel Decl. at ¶4).

Before the Tariff became effective, however, the parties whom Teliax would bill under the Tariff (e.g. AT & T) had a fifteen-day window to object to the terms and rates set out in that document. See 47 U.S.C. § 203. The FCC itself could also reject, suspend, or investigate the Tariff. See 47 C.F.R. §§ 61.69, 61.191. In this case, however, no party objected, and the FCC also took no action. ECF No. 59 at 22 (Ex. 1, Roesel Deck at ¶5). The Tariff therefore became “effective” as of September 28, 2012. ECF No. 1-2. It was also “deemed lawful,” meaning that there would now be a presumption that the rates contained therein are lawfully charged. See 47 U.S.C.

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Cite This Page — Counsel Stack

Bluebook (online)
220 F. Supp. 3d 1094, 2016 U.S. Dist. LEXIS 188220, 2016 WL 6777830, Counsel Stack Legal Research, https://law.counselstack.com/opinion/teliax-inc-v-att-corp-cod-2016.