Citations
- 385 F. Supp. 2d 797
Full opinion text
ORDER ON MOTION BY INTERVE-NOR AND DEFENDANT FOR SUMMARY JUDGMENT
GRITZNER, District Judge.
This matter is before the Court on the Motion for Summary Judgment filed by Intervenor (Clerk’s No. 51) and joined by Defendant (Clerk’s No. 53). Attorney for Plaintiff is Thomas G. Fisher; attorney for Defendant is David J. Lynch; attorneys for Intervenor are Sheila K. Tipton, Dennis W. Johnson, Amy M. Omvig, and Roy E. Hoffinger. A hearing on the motion was held March 1, 2005, and the Court considers the motion fully submitted and ready for ruling.
PROCEDURAL HISTORY
Plaintiff, Rural Iowa Independent Telephone Association (“RUTA”), commenced this action against Defendant, the Iowa Utilities Board (“the IUB” or “the Board”), in this Court on July 19, 2002. Qwest Corporation (“Qwest”) moved to intervene on October 1, 2002, and its motion was granted on October 25, 2002.
This Court granted a motion to dismiss in an order filed December 3, 2002, solely on the Hobbs Act argument asserted by Qwest. The Eighth Circuit reversed and remanded the District Court’s order, stating that “RIITA challenges the IUB’s interpretation of [an FCC] order, ... [and] district courts have jurisdiction to determine whether a state administrative agency correctly interprets federal law .... ” Rural Iowa Indep. Tel. Ass’n v. Iowa Utils. Bd., 362 F.3d 1027, 1030 (8th Cir.2004) (citing Verizon Maryland Inc. v. Public Serv. Comm’n of Maryland, 535 U.S. 635, 643-44, 122 S.Ct. 1753, 152 L.Ed.2d 871 (2002), and Pac. Bell v. Pac-West Telecomm., Inc., 325 F.3d 1114, 1125 (9th Cir.2003)). The parties resolved remaining issues in the remanded motion to dismiss. On November 4, 2004, Qwest filed a motion for summary judgment, which was subsequently joined by the IUB. RIITA has resisted the motion.
BACKGROUND FACTS
A. Preliminary Statement
This case concerns interearrier compensation for telephone calls (“traffic”) placed by customers of third-party commercial mobile radio service (“CMRS”) providers (i.e., “wireless carriers”) to end-user customers served by third-party Incumbent Local Exchange Carriers (“ILECs”) located in the same calling area. The calls at issue are (1) placed (i.e., “originated”) by end-user customers of third-party wireless carriers, (2) delivered by the wireless carriers to Qwest, (3) transported approximately six blocks by Qwest and delivered to Iowa Network Services (“INS”), (4) transported by INS to the ILECs serving the called parties, and (5) routed and delivered (i.e., “terminated”) by the ILECs to the premises of the called parties (i.e., the ILECs’ end-user customers). RIITA is an ILEC involved in terminating the calls to its subscribers. Qwest and INS are involved in the transport of these calls because the originating third-party wireless carriers and the terminating ILECs have elected to “interconnect” their networks “indirectly” to permit calls between their end-user customers.
B. Plaintiffs Challenge
In its Complaint before this Court, RU-TA alleges the IUB issued a series of orders in docket number SPU-00-7 that misinterpret and misapply various provisions of the Telecommunications Act, in particular section 251, and the result is to deprive rural ILECs such as RUTA of their property without just compensation. Pursuant to 47 U.S.C. § 252(e)(6), RUTA is challenging the Board’s determinations that (a) wireless calls that are placed and received by subscribers of different carriers located in the same major trading area (“MTA”) are classified as “local” and are not subject to long distance access charges, notwithstanding the fact that the originating and terminating carriers are interconnected indirectly through one or more additional carriers; (b) the termination of such calls is subject to the “reciprocal compensation” provisions of 47 U.S.C. § 251(b), as implemented through negotiated or arbitrated interconnection agreements between the originating and terminating carriers pursuant to 47 U.S.C. § 252; and (c) Qwest, which provides an indirect interconnection and transiting service between the CMRS provider and INS, is not responsible for payment to the ILECs of access charges or other compensation for their termination of calls placed by subscribers of the CMRS providers.
C. Telecommunications in Iowa
RUTA is an association of small rural independent telephone companies. RUTA was a party to the IUB action and represents approximately 130 rural Iowa companies, all of which receive the type of traffic at issue here. The IUB, the only remaining Defendant, is the board charged with governing telecommunications in Iowa, so far as it is granted the authority to do so. Qwest, formerly known as U.S. West, is the Intervenor in this case. Qwest is the former Regional Bell Operating Company in the state of Iowa.
Due to the largely rural nature of Iowa, telecommunications service in much of the state has historically been provided by small independently-owned companies located in and serving small designated geographic areas. These phone companies provide local telephone services, called “telephone exchange service”, within a defined geographic area known as the local exchange. Providing such services made these local phone companies “local exchange carrier[s]” (“LECs”). Many, if not all, of these Iowa LECs were independently owned. Qwest, which provides local telephone services to customers throughout a fourteen-state area, is also an LEC, though not independently owned. Though differing greatly in size, Qwest and the independent LECs provide basically identical services.
Typically, LECs own the wires, computer switches, and other facilities necessary to provide telecommunications service to their subscribing customers. Access services or exchange services were available for purchase to competing carriers, thereby allowing purchasers to send or receive calls from a subscriber over the facilities owned and maintained by another LEC. The major benefit of purchasing access was that a company could reach specific phone customers by purchasing access to the LEC circuits without having to build facilities throughout an area served by another LEC.
In 1987, most of the independent LECs then in existence in Iowa joined together to form Iowa Network Services (“INS”). The major benefit of this formation was that calls placed to or from a customer served by one of the companies in INS could now utilize INS’ network to reach whichever independent LEC the customer subscribed to through INS’ one centralized network. As was customary, INS charged access fees to use its network, fees set forth in tariffs on file with the Federal Communications Commission (“FCC”), which governed INS’ interstate services, and tariffs on file with the IUB, which governed INS’ intrastate services.
As long as telephone calls were placed from traditional land-based wire connected phones, the system of ordering access to the INS network detailed above worked well. Technology had an impact on the development and popularity of wireless cellular phones, however, and as the popularity of wireless phones grew, so too did ambiguities surrounding the access services and charges associated with accessing the INS network.
Traditionally, when a call begins at a third-party wireless caller’s phone, the call is connected by radio signal to the wireless service provider. The call then travels over the wireless carrier’s network until it interconnects with Qwest’s network/faeilities. Qwest then transports the call on its network to a point of interconnection with INS, with INS carrying the call over its network to a point of interconnection with the independent LEC network serving the person being called. In short, as relevant to the present action, Qwest delivers to the INS network wireless phone calls originated by customers of third-party CMRS carriers who are calling subscribers of independent local exchange carriers such as RUTA, and whose calls originate and terminate in the same MTA. Until 1999, Qwest paid the tariffed rates for taking the wireless-originated calls from non-Qwest customers and delivering them to the independent LECs via the INS network pursuant to either the INS intrastate tariffs filed with the IUB or INS interstate tariffs on file with the FCC.
D. The Telecommunications Act and FCC Implementing Decisions
Congress enacted the Telecommunications Act (“the Act” or “the 1996 Act”) in February 1996, greatly amending the Communications Act of 1934. Prior to the Act, when a new company entered a geographic area, it routinely had to compete with an established LEC for customers in that particular service area. The Act was intended to enhance competition in the market for 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). To break down barriers to competition in the local phone market, the Act requires all carriers to “interconnect, directly or indirectly” with other carriers. 47 U.S.C. § 251(a)(1).
The Act also established interconnection agreements, requiring ILECs to agree, upon request, to provide interconnection to a competing carrier pursuant to the interconnection agreement approved by a state public utility commission rather than pursuant to a tariff. See 47 U.S.C. §§ 251(c)(1) and 252. The Act further imposes a duty on all LECs “to establish reciprocal compensation arrangements for the transport and termination of telecommunications.” See 47 U.S.C. § 251(b)(5). “ ‘[Reciprocal compensation’ means that when a customer of one [LEC] calls a customer of a different [LEC] who is within the same local calling area, the first carrier pays the second carrier for completing, or ‘terminating,’ the call.” Pac. Bell, 325 F.3d at 1119-20.
Thus, the Act’s goal of fostering competition is furthered by allowing carriers to compete with ILECs by utilizing the ILECs’ telecommunications networks, rather than forcing the competing carriers to build their own networks before serving a given area. The originating and terminating parties are then compensated according to the roles they play in the transport and termination of the traffic as provided in the interconnection agreement between the parties.
The 1996 Act also establishes a system of negotiation and arbitration in order to facilitate voluntary agreements between the competing carriers to implement its substantive requirements. Under the 1996 Act, “all local exchange carriers are required to establish reciprocal compensation arrangements in their interconnection agreements.” Id. at 1119 (quotations and citations omitted). Negotiation is triggered by a carrier making a bona fide request (“BFR”) to enter into an interconnection agreement for the exchange of local traffic. 47 U.S.C. § 252(a)(1).
Once negotiations begin, both the ILEC and the other carrier “have a duty to negotiate in good faith the terms and conditions of an agreement that accomplishes the Act’s goals.” Iowa Utils. Bd. v. FCC, 120 F.3d 753, 792 (8th Cir.1997) (citing 47 U.S.C. §§ 252(c)(1), 252(a)(1)). If the parties fail to reach an agreement through voluntary negotiations, either party may petition the relevant state public utility commission to arbitrate and resolve any open issue. 47 U.S.C. § 252(b). The final agreement, whether negotiated or arbitrated, must be approved by the state commission. Id. (citing 47 U.S.C. §§ 252(b), 252(e)(1)).
Due to the complexity of the Telecommunications Act, the FCC created an order directing the implementation of the Act. See Local Competition Order, at ¶¶ 1035-1045. In that order, the FCC addressed the applicability of the 1996 Act to particular types of calls, including calls originated by end-user customers of CMRS providers, of the Act’s provisions regarding “transport” and “termination”, and the formation of interconnection agreements. Id. Relevant to this case, the Local Competition Order specifically addressed the billing of calls that a wireless carrier delivers to an LEC for termination, where the call both originates and terminates in a geographic area, i.e., the MTA. See id.
In early 1999, Qwest stopped paying access charges to INS for the intraMTA wireless traffic of third parties that Qwest delivered to the independent LECs via the INS network based on the FCC determinations made in the Local Competition Order. Qwest believes the FCC determined that traffic between an LEC and a CMRS provider that at the beginning of the call originates and terminates within the same Major Trading Area is local traffic and therefore not subject to access charges. See id. at ¶ 1036.
E. Decisions of the IUB
This case involves the manner in which telephone traffic is exchanged by small local rural telephone companies, also known as independent or rural ILECs and wireless telephone companies through the telephone network owned and operated by Qwest. In April 1999, Qwest advised INS and the terminating ILECs that, as a transiting carrier, it was not responsible for paying “access” charges or other compensation for their transport and termination of calls placed by customers of third-party CMRS providers. INS and the terminating ILECs disagreed with Qwest’s position.
Consequently, on May 19, 2000, Qwest filed a petition with the IUB for a declaratory order regarding the exchange of local traffic between cellular telephone companies and other local service providers using Qwest’s facilities. The Board docketed the petition as a formal contested case proceeding pursuant to Iowa Code §§ 17A.12 and 476.3, and identified the contested case as Docket No. SPU-00-7. The Board granted motions to intervene filed by RUTA, the Iowa Telephone Association (“ITA”), several Iowa independent ILECs, INS, and several CMRS providers.
All parties involved in the IUB action had a chance to file initial briefs and reply briefs, and the Board held a “technical workshop”. Hearings presided over by all three Board members lasted several days and concluded on April 19, 2001. On November 26, 2001, the IUB issued a Proposed Decision and Order (hereinafter “IUB Proposed Decision ”).
Briefly, the Board’s decision concerns telephone traffic between a cellular telephone customer and a customer of an independent telephone company. Prior to the decision of the Board, if the cellular customer placed a call to a customer of an independent telephone company, the cellular company delivered the call to Qwest. Qwest then transported the traffic to INS, a centralized equal access service provider. INS then carried the call to the independent telephone company for connection to the called customer. Qwest charged the wireless company a transit fee for carrying the traffic. INS charged an access service fee to Qwest for carrying the traffic. The independent telephone company then assessed access charges to Qwest for terminating the call.
In the proposed decision and order issued November 26, 2001, by the IUB, the Board’s presiding officer found that the cellular traffic at issue is local and that access charges do not apply to such traffic. This decision was made pursuant to the Board’s understanding of orders issued by the FCC. The IUB held cellular carriers are entitled to interconnect directly with the independent carriers on a bill-and-keep basis pursuant to Board and FCC rules. The decision further found Qwest is entitled to compensation for carrying the traffic but has no obligation to pay access or other terminating fees. If the cellular companies want to use INS facilities for an indirect connection to the independent companies, they may do so, but INS is entitled to compensation for providing those services. The Board found it could not determine the appropriate rate for INS’ services on the record before it. As a result, the Board directed the parties to negotiate an interconnection agreement regarding these matters pursuant to the Telecommunications Act. Board arbitration was available to resolve any issues the parties were unable to resolve by negotiation.
Some of the parties, including RUTA, appealed the proposed decision to the Board. The Board affirmed the proposed decision by order issued March 18, 2002 (hereinafter “IUB Order Affirming Proposed Decision”). One party, the Iowa Telecommunications Association (“ITA”), filed an application for rehearing, which the Board denied by order issued May 3, 2002 (hereinafter “IUB Order Denying Rehearing ”). RUTA then sought judicial review of the Board’s decision in the Iowa District Court for Polk County pursuant to Iowa Code § 17A.19 but never served the petition on the Board. RUTA voluntarily dismissed that action on June 21, 2002, and subsequently brought the present action in this Court.
Relevant to the present action, the Board made the following determinations in its rulings:
• under the FCC’s orders, intraMTA traffic is classified as “local” and not subject to long distance “access” charges {IUB Proposed Decision, at 13, 21; IUB Order Affirming Proposed Decision, at 2);
• with regard to the traffic at issue, Qwest is not acting as an “IXC” providing “long distance” service to end users with whom it has a billing relationship but is providing an indirect connection for local traffic {IUB Proposed Decision, at 13); accordingly, Qwest “has no obligation to pay access or other termination fees” {IUB Order Affirming Proposed Decision, at 2);
• when Qwest refused in 1999 to continue paying access charges for traffic originated by third-party CMRS providers, it put INS and the terminating ILECs “on notice that it no longer believed it was ordering” access services {IUB Proposed Decision, at 37-38);
• rates and other terms applicable to such arrangements, including proposals that transit and other traffic should be delivered over “separate” trunks, and “the means by which interMTA [i.e., long distance] calls should be distinguished [from] intraMTA [i.e., local] calls” are “good examples” of the kinds of issues that can best be addressed through the Act’s negotiation and arbitration process {IUB Proposed Decision, at 30; IUB Order Affirming Proposed Decision, at 20);
• the results of the negotiations (and arbitrations, if necessary) would relate back to April 1999 {IUB Proposed Decision, at 38);
• the independent LECs have not proven they are entitled to assert the “rural exemption,” pursuant to 47 U.S.C. § 251(f)(1), from their section 251(c) duties, and the Board will consider section 251(f) factors “if and when a rural exemption claim” is “made and disputed” during the negotiation/arbitration process {IUB Order Affirming Proposed Decision, at 14).
As delineated above, RUTA attacks many of the IUB’s determinations in the present action by contending they violate federal law as contained in the 1996 Act and the FCC decisions concerning that Act.
ANALYSIS
A. Procedural Issues
1. Review of Administrative Agency Proceedings and Scope of Review
“ ‘The focal point for judicial review [of an administrative agency decision] should be the administrative record already in existence, not some new record made initially.’ ” Florida Power & Light Co. v. Lorion, 470 U.S. 729, 743, 105 S.Ct. 1598, 84 L.Ed.2d 643 (1985) (quoting Camp v. Pitts, 411 U.S. 138, 142, 93 S.Ct. 1241, 36 L.Ed.2d 106 (1973)); see also Newton County Wildlife Assoc. v. Rogers, 141 F.3d 803, 807 (8th Cir.1998) (following the rule that review of administrative determinations is confined to the administrative record). Thus, unless Congress has provided otherwise, judicial review of the determinations of an administrative agency proceeding are confined to the agency’s record, and de novo proceedings may not be held. United States v. Carlo Bianchi & Co., 373 U.S. 709, 715, 83 S.Ct. 1409, 10 L.Ed.2d 652 (1963).
When there is, however, specific statutory authorization for an action in district court to enforce private rights, a trial de novo is appropriate, even in cases involving prior administrative agency determinations. Chandler v. Roudebush, 425 U.S. 840, 862-63, 96 S.Ct. 1949, 48 L.Ed.2d 416 (1976). This is because the authorization is based on a congressional determination that is not for the judiciary to disturb. Id. at 864, 96 S.Ct. 1949. In addition, a trial de novo may be warranted where the agency determination “is fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence.” Carlo Bianchi & Co., 373 U.S. at 714, 83 S.Ct. 1409. For such to be the case, “ ‘there must be a strong showing of bad faith or improper behavior’ before the reviewing court may permit discovery and evidentiary supplementation of the administrative record.” Newton County Wildlife Assoc., 141 F.3d at 807 (emphasis added) (quoting Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 420, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971)); see also Camp, 411 U.S. at 142, 93 S.Ct. 1241.
The rationale behind the fundamental principle of confining review of agency decisions to the administrative record is that the parties have had full opportunity to present their case to the administrative agency “so that the hearings ... provide substantial evidence to support the agency’s decision.” Carlo Bianchi & Co., 373 U.S. at 717, 83 S.Ct. 1409. If a party were allowed to relitigate de novo issues presented in the agency proceedings, the structure and purpose of agency hearings would be frustrated because parties may decide “to withhold evidence at the administrative level and then introduce it in a judicial proceeding.” Id. In addition, relit-igation in federal court of issues resolved in administrative agency proceedings wastes judicial resources and may result in needless duplication of hearings and evidence. Id. Moreover, relitigation exacts a heavy burden in both time and costs to the involved parties and the court. Id. In addition, federal courts are not well-equipped to wade into the intricacies of regulatory matters entrusted to administrative agencies, see Cronin v. United States Dep’t of Agric., 919 F.2d 439, 444 (7th Cir.1990), particularly with the Communications Act which “gives the state commissions latitude to exercise their expertise in telecommunications and needs of the local market.” Mich. Bell Tel. Co. v. MCIMetro Access Transmission Servs., Inc., 323 F.3d 348, 352 (6th Cir.2003).
Qwest urges the Court to limit this action to judicial review of the agency action undertaken by the IUB. As a section 252(e)(6) case, Qwest contends the Court should decide it “on the basis of the record before the [agency] and the briefs of the parties,” without a trial or discovery. U.S. West Communications, Inc. v. Thoms, 1999 WL 33456553 (S.D.Iowa 1999). While there was some initial resistance by RUTA on this issue, at the hearing RUTA withdrew its objections and acknowledged the Court’s review is limited to the administrative record. The Court agrees and will therefore limit its review to the record before the IUB. The Board has already held extensive hearings on this matter and is particularly experienced in the telecommunications arena.
2. Issues on Motion
Pursuant to Rule 56 of the Federal Rules of Civil Procedure, Qwest moves for dismissal of all challenges in Plaintiffs Complaint to the lawfulness under the Communications Act of 1934, as amended by the Telecommunications Act of 1996, of decisions by the Iowa Utilities Board in its Docket No. SPU-00-7 regarding the inter-carrier compensation for the termination of by ILECs of intraMTA calls placed by subscribers of third-party wireless carriers to the ILECs’ subscribers. Qwest does, however, limit its motion to intercarrier compensation for the termination of wireless traffic by RIITA’s members and does not seek summary judgment on any claim by RUTA regarding charges to end-users. Additionally, the issues currently raised by Qwest do not address outbound traffic, though the Board notes that its order does not distinguish or differentiate between inbound and outbound traffic in light of its interpretation of the definition of “local” traffic.
B. Payment of Access Charges or Other Compensation
RUTA argues that the IUB erred in concluding the FCC has ruled “intraMTA” calls are “local”, and that ILECs are required under the Act to enter into reciprocal compensation arrangements. RUTA contends in its Complaint that reciprocal compensation as set forth in negotiated or arbitrated interconnection agreements applies only where the originating CMRS provider and the terminating LEC are “directly” connected. Meanwhile, Qwest argues the IUB correctly held that a transit carrier is not responsible for payment to terminating carriers of access charges or other compensation for intraMTA calls placed by subscribers of third-party wireless carriers.
In its Local Competition Order, the FCC had to determine which telecommunications are subject to “reciprocal compensation” for “transport and termination” under section 251(b)(5). In so doing, the FCC distinguished between transport and termination of “local” calls and that for “long-distance” calls, the latter having been historically subject to access charges. Local Competition Order, at ¶ 1033. For purposes of regulation, a call is treated as “local” if it originated and terminates in the same local calling area; a call is treated as “long distance” if it terminates in a local calling area different than the one in which it originates. See Competitive Te- lecomms, Ass’n v. FCC, 117 F.3d 1068, 1072 n. 3 (8th Cir.1997) (“CompTel”).
The FCC concluded that “section 251(b)(5) reciprocal compensation,” and not “access charges,” would apply “to traffic that originates and terminates within a local calling area, as defined” in a subsequent paragraph. Local Competition Order, at ¶ 1034. In defining the local service area for calls to or from a CMRS network for purposes of applying sections 251 and 252, the FCC determined that the MTA serves as the most appropriate definition for local service area for CMRS traffic. Id. at ¶ 1036. “Accordingly, traffic to or from a CMRS network that originates and terminates within the same MTA is subject to transport and termination rates under section 251(b)(5), rather than interstate and intrastate access charges.” Id. In contrast, “traffic originating or terminating outside of the applicable local area would be subject to interstate and intrastate access charges” payable by the long distance carriers using the LECs’ networks to provide the “end to end” service that they “sell as [their] product to [their] customers.” Southwestern Bell, 153 F.3d at 542 n. 9.
Subsequent FCC decisions considered the rights and obligations of transiting carriers under the 1996 Act and the Local Competition Order. In discussing “types of local LEC-CMRS interconnection” in a notice of proposed rulemaking (“NPRM”) on intercarrier compensation, the FCC explained that “in rural settings, wireless carriers can elect to deliver CMRS-origi-nated calls to a large ILEC for routing to the rural LEC carrier.” Notice of Proposed Rulemaking, Developing a Unified Intercarrier Compensation Regime, 16 FCC Red. 9610, ¶ 91 (2001) (hereinafter “Interearner Compensation NPRM ”).
In a separate case, the FCC provided the following in determining the application of its transport and termination rules to transiting:
Currently, our rules in this area follow the cost causation principle of allocating the cost of delivering traffic to the carriers responsible for the traffic, and ultimately their customers. Thus, through reciprocal compensation payments, the cost of delivering LEC-originated traffic is borne by the persons responsible for those calls, the LEC’s customers. As we stated in the Local Competition Order, “[t]he local caller pays charges to the originating carrier, and the originating carrier must compensate the terminating carrier for completing the call.” ... In the case of third-party originated traffic, however, the only relationship between the LEC’s customers and the call is the fact that the call traverses the LEC’s network on its way to the terminating carrier. Where the LEC’s customers do not generate the traffic at issue, those customers should not bear the cost of delivering that traffic from a CLEC’s network to that of a CMRS carrier like Answer Indiana. Thus, the originating third party carrier’s customers pay for the cost of delivering their calls to the LEC, while the terminating CMRS carrier’s customers pay for the cost of transporting that traffic from the LEC’s network to their network.
Texcom Inc. v. Bell Atlantic Corp., 16 FCC Rcd. 21493, ¶ 6 (2001) (“Texcom Order ”); see also Texcom Inc. v. Bell Atlantic Corp., 17 FCC Rcd. 6275, ¶ 4 (2002) (“Texcom Reconsideration Order”). On reconsideration of this decision, the FCC reiterated that a transiting carrier “may charge a terminating carrier for the portion of facilities used to deliver transiting traffic to the terminating carrier.... and [the terminating carrier] may seek reimbursement of these costs from originating carriers through reciprocal compensation.” Texcom Reconsideration Order, at ¶ 4 (citing 47 U.S.C. § 251(b)(5), 47 C.F.R. § 51.702). The FCC also noted that “carriers are free to negotiate different arrangements for the costs associated with indirect interconnection.” Id. (citing 47 U.S.C. § 252(a)(1)).
The FCC’s Common Carrier Bureau (“the Bureau”) also considered “the appropriate compensation mechanism for calls that originate on the network of a third-party LEC and terminate to an AT & T customer” during an arbitration of interconnection agreements done by the Bureau in lieu of the Virginia commission. Verizon Virginia Arbitration Order, at ¶ 541. AT & T, the terminating carrier, proposed that Verizon, as the transiting carrier, treat all calls as Verizon’s own and compensate AT & T accordingly. Id. The Bureau rejected this proposal, finding that “when a third-party LEC places a call that terminates to [an AT & T customer], AT & T must bill the third-party LEC directly” when traffic originated by third-party carriers “transits the network of an incumbent or other carrier, such as Verizon.” Id. at ¶ 544 and n. 1807 (citing the Texcom decisions).
In another section 252(e)(5) arbitration, the Bureau held the transiting carrier was not responsible for paying compensation to the terminating carrier except as to calls for which the former failed to provide the latter call identification information passed by the originating carrier. See Petition of Cavalier Telephone LLC Pursuant to ¶ 252(e)(5) of the Communications Act for Preemption of the Jurisdiction of the Virginia State Commission Regarding Interconnection Disputes with Verizon, Virginia, Inc., and for Arbitration, 18 FCC Red. 25887 (FCC Wireline Competition Bureau 2003) (“Cavalier”). The Bureau did hold, however, that the transiting carrier was not required to alter its systems to develop information that was not transmitted to it by the originating carrier. Id. at ¶ 42.
Qwest contends that the IUB correctly-interpreted the Act and the FCC decisions applying the Act and counters that RII-TA’s proposed interpretation would result in massive increases in costs incurred by CMRS providers and the resulting increased cost to consumers. Specifically, Qwest contends that if RIITA’s argument were correct, CMRS providers would either need to build up their network infrastructure in order to interconnect directly with many terminating ILECs or interconnect indirectly with and pay to the terminating LEC’s non-cost based access charges averaging about 9.2 cents per minute (“cpm”). In contrast, Qwest asserts cost-based reciprocal compensation would average approximately 1 cpm. Qwest maintains that the resulting costs, many of which would be passed to consumers, is the very result the FCC sought to avoid in the Local Competition Order.
The FCC’s Local Competition Order provides that “traffic to and from a CMRS network that originates and terminates with the same MTA” is “local” traffic, and not long distance traffic subject to access charges. Qwest argues that this is so regardless of whether one or more intermediate or transiting carriers provide a portion of the transport of the call from the network of the CMRS provider to the network of the terminating LEC. Pursuant to this argument, under the FCC’s decision, the relevant facts are the geographic locations of the end-user customers placing and receiving the call, not the method of interconnection chosen by the originating and terminating carriers.
In its decision, the Board explained that this determination means Qwest is not acting as an IXC providing long distance service to end users when the calling and called parties are located in the same MTA and the caller is served by a third-party CMRS provider. IUB Proposed Decision, at 13. Instead, Qwest is “providing an indirect connection for local traffic.” Id. Based on this determination, the IUB held that Qwest “has no obligation to pay access or other termination fees.” Order Affirming Proposed Decision, at 2.
Qwest asserts that all federal courts to consider this issue have ruled, like the Board, that indirect connection through a transiting carrier does not convert intraMTA “local” calls into “long distance” calls for which the transiting or any other carrier must pay “access” charges to the terminating carrier. For example, in 3 Rivers Telephone Cooperative, Inc. v. U.S. West Communications, Inc., the court reasoned that the FCC’s Local Competition Order “makes no distinction between such traffic [i.e., traffic delivered over a direct connection] and traffic that flows between a CMRS provider and LEC in the same MTA that also happens to transit another carrier’s facilities prior to termination.” 3 Rivers Tel. Coop., Inc. v. U.S. West Communications, Inc., 2003 U.S. Dist. LEXIS 24871, at *67 (D.Mt.2003), accord. Union Tel. Co. v. Qwest Corp., slip op., No. 02-CV-209B, at 26. 34 (D.Wyo. May 11, 2004); see also Atlas Tel. Co. v. Corp. Comm’n of Okla., 309 F.Supp.2d 1299, 1310 (W.D.Okla.2004) (finding, consistent with the determination of the Oklahoma Commission decision being reviewed, that the FCC’s classification of “mobile intraMTA traffic” as “local” as opposed to “toll” (i.e., interexchange or long distance) traffic applies “without regard to whether those calls are delivered via an intermediate carrier”). Accordingly, the 3 Rivers court held that “Qwest is not liable to plaintiffs for terminating access charges on CMRS (wireless) traffic that both originates and terminates in the same MTA.” Id. at *68-69.
Qwest further asserts that the FCC’s own decisions foreclose any doubt that indirect interconnection does not convert in-traMTA calls into “long distance” calls or otherwise justify the imposition of a compensation obligation for such calls on a transiting carrier. As Qwest points out, in Paragraph 1039 of the Local Competition Order the FCC acknowledges the existence of indirect interconnection between originating and termination carriers through “facilities provided by alternative carriers,” but nowhere held such an arrangement converted a “local” call into a “long distance” call or allowed other carriers to impose a compensation obligation on the transiting carrier. See Local Competition Order, at ¶ 1039. Additionally, in its Intercarrier Compensation NPRM, the FCC confirmed that use of a transit carrier for intraMTA calls is a form of “local” connection. Intercarrier Compensation NPRM, at ¶ 91.
In addition, Qwest argues that the FCC held specifically that the “cost causation principles” underlying its intercarrier compensation rules “allocate” the cost of delivering traffic to the carriers responsible for the traffic and, ultimately, their customers. Texcom Order, at ¶ 6; Texcom Reconsideration Order, at ¶ 4 (citing 47 U.S.C. § 251(b)(5), and 47 C.F.R. § 51.702). Thus, where a transiting carrier is involved, the originating third-party carrier pays for the cost of delivering their calls to the transiting carrier, while the terminating carrier pays for the cost of transporting that traffic from the transiting carrier’s network to its network. Texcom Order, at ¶ 6; Texcom Reconsideration Order, at ¶ 4. The terminating carrier may then “seek reimbursement of these costs from originating carriers through reciprocal compensation.” Texcom Reconsideration Order, at ¶ 4 (citing 47 U.S.C. § 251(b)(5), and 47 C.F.R. § 51.702). Thus, transiting carriers bear no responsibility for compensating other carriers, for they lack relationships with either the calling or called parties.
Finally, Qwest contends that the FCC’s Common Carrier Bureau, acting on behalf of the FCC in place of a state commission, has stated that federal law does not require a transiting carrier over its objection to compensate another carrier for its transport and termination of calls originated by third-party carriers under the theory that the calls are the transiting carrier’s “own traffic,” see Verizon Virginia Arbitration Order, at ¶ 541; see also id. at ¶¶ 114, 119, and that there is no evidence in the Board’s record that Qwest refused to provide to terminating LECs information received by Qwest from the originating CMRS providers. See Cavalier, at ¶ 42. Based on these decisions, Qwest argues that it could not be clearer that transiting carriers have no compensation obligations with respect to the transport and termination of intraMTA wireless or other local calls originated by end-user customers of third-party carriers under the Act.
RIITA asserts Qwest is being melodramatic in stating every court or agency has rejected RIITA’s argument. To the contrary, RIITA argues that no court or agency other than the IUB has found that transiting carriers delivering traffic without the consent of the terminating party are not responsible for payment. RIITA urges the Court to disregard Qwest’s citations to any arbitration cases. RIITA contends the IUB decision inhibits bona fide requests and negotiations, thereby rendering Qwest’s reliance on arbitration cases meaningless.
RIITA asserts that Qwest focuses its argument on paragraph 1034 of the Local Competition Order, yet fails to discuss that the traffic at issue falls between the two examples used in that paragraph. RIITA points out the FCC also stated that “[a]ecess charges were developed to address a situation in which three carriers— typically, the originating LEC, the IXC, and the terminating LEC — collaborate to complete a long-distance call.... By contrast, reciprocal compensation for transport and termination of calls is intended for a situation in which two carriers collaborate to complete a local call.” Local Competition Order, at ¶ 1034. RIITA maintains the Local Competition Order does not answer the key question in this case: how should three carriers, an originating wireless carrier, a carrier transporting calls across exchange boundaries, and a terminating LEC, handle and compensate each other for telephone traffic? RIITA asserts that even the FCC is unsure how to handle this situation. See Intercarrier Compensation NPRM, at ¶ 91 n. 148 (“Increasingly, the large ILEC is unwilling to bill for the rural carrier, so rural LECs have begun to insist that the CMRS carrier deliver calls directly to the rural LEC’s switch.”).
RUTA contends the FCC decisions regarding transiting subsequent to the Local Competition Order cited by Qwest are in-apposite as they are all either paging cases or arbitration review cases. RUTA contends these cases do not contain holdings related to inbound traffic where the wireless carrier is originating traffic bound for a wireline carrier (the paging cases) or concern arbitration following failed negotiations which has not occurred here because the wireless carriers have not served BFRs (arbitration review cases).
RUTA also urges the Court to reject Qwest’s reliance on the 3 Rivers decision as being interlocutory and unpublished, though RUTA subsequently contends the decision supports RIITA’s claims. According to RUTA, the 3 Rivers court found rural wireline tariffs make Qwest “liable for paying Plaintiffs terminating carrier access charges for the provision of access service regardless of the identity of the originating carrier.” 3 Rivers Tel. Coop., Inc., 2003 U.S. Dist. LEXIS 24871. The 3 Rivers court then determined this argument was preempted by federal law. Id.
RUTA contends that federal preemption is a different argument than the one made by Qwest, and one that has been rejected by other courts. See Mich. Bell Tel. Co., 323 F.3d at 358-59 (“Though an approved interconnection agreement means the general duties of 251(b) and (c) no longer apply, the Act is silent with respect to preexisting state duties.”). Indeed, “in the absence of persuasive evidence of preemptive intent by the FCC,” judicial restraint weighs against preemption. Qwest v. Scott, 380 F.3d 367, 374 (8th Cir.2004). RUTA contends that nothing in the Act preempts state tariffs such that they can be overridden by the negotiation/arbitration procedures in the Act.
Finally, RUTA asserts that the Eighth Circuit has found Qwest does not have an obligation to deliver this traffic under these circumstances. Iowa Network Servs., Inc. v. Qwest Corp., 363 F.3d 683, 694 n. 3 (8th Cir.2004) (“We respectfully believe that the district court misstated the law in stating that as an ILEC, Qwest was obligated to carry the CMRS traffic if requested to do so.”). RUTA draws from this finding the conclusion that if Qwest chooses to deliver this traffic in the absence of an agreement between the originating and terminating carriers, then Qwest must pay for the termination of the traffic. In short, Qwest becomes the cost-causer by volunteering to deliver the traffic.
Qwest replies that, contrary to RIITA’s suggestion, there is no indication the terminating carriers in the 3 Rivers, Union, and Atlas cases had entered into interconnection agreements with the originating wireless carriers or otherwise consented to the use of a transit carrier by wireless carriers. Qwest further disputes RIITA’s suggestion that the cases relied upon by Qwest are limited to paging carriers or that these decisions may be applied solely in arbitrations.
Qwest next reiterates that the FCC decisions regarding transit traffic uniformly hold transiting carriers are not required to pay compensation to other carriers for handling intraMTA calls placed by customers of other carriers. See Intercarrier Compensation NPRM, at ¶ 91 n. 148; Texcom Order, 16 FCC Red. 21493; Texcom Reconsideration Order, 17 FCC Rcd. 6275; Verizon Virginia Arbitration Order, at ¶¶ 114, 119; Cavalier, 18 FCC Rcd. 25887. Finally, Qwest disputes RIITA’s characterization of Qwest as the cost-causer by asserting it did not collude with anyone to deny compensation to the terminating LECs. In any event, Qwest asserts FCC decisions establish the cost-causer is the carrier that serves the caller, not the carrier that delivers the call to the terminating carrier, regardless of whether the transit service is provided voluntarily or under legal compulsion. See Verizon Virginia Arbitration Order, at ¶ 117 (finding transit carrier has no duty to compensate or bill for terminating carriers even where transiting is provided voluntarily).
The IUB also responds to RIITA’s contention that the Board’s decision is denying RIITA’s members from receiving compensation for terminating traffic. According to the Board, it has consistently taken the position that the rural LECs should be paid for the services they render. The Board encouraged parties to negotiate their own resolution of this issue, but also provided that if negotiations were unsuccessful and the conditions warranted, “the Board will set a rate applicable to exchange of the traffic, in order to fairly compensate the carriers for use of their respective networks.” Order Deny ing Application for Rehearing, at 7. Thus, the Board argues any claim by RUTA that the Board is denying them compensation to which they are entitled is simply incorrect.
During the pendency of this action, the FCC filed two items that affect the Court’s determinations of these issues. First, the FCC released its Declaratory Ruling Report and Order, Developing a Unified Intercamer Compensation Regime, T-Mobile Petition for Declaratory Ruling Regarding Incumbent LEC Wireless Termination Tariffs, CC Docket No. 01-92, FCC 05-42 (FCC Feb. 24, 2005) (“T-Mobile Wireless Termination Order”). The T-Mobile petitioners had sought a declaratory ruling that “wireless termination tariffs are not a proper mechanism for establishing reciprocal compensation ar;angements for the transport and termination of traffic.” T-Mobile Wireless Termination Order, at ¶ l.
In the T-Mobile Wireless Termination Order, the FCC ruled that under existing FCC rules it was not unlawful “per se” for LECs terminating wireless-originated calls to collect charges from wireless carriers through the use of termination tariffs. T-Mobile Wireless Termination Order, at ¶ 9. The FCC found that nothing in its rules prevented the use of tariffs in a manner that did not conflict with an agreement negotiated or arbitrated pursuant to Section 252 of the Communications Act. Id. at ¶ 13. Qwest argues the T-Mobile Wireless Compensation Order confirms that the FCC’s pre-Act decisions intended that CMRS interconnection issues would be resolved in “negotiated agreements between the parties,” and further “expressed] an expectation that tariffs would be filed only after carriers have negotiated agreements.” Id. at ¶ 11. Indeed, the Order reaffirms and states clearly the FCC’s “clear preference for contractual arrangements for non-access” traffic. Id. at ¶ 14.
The T-Mobile Wireless Compensation Order also reaffirms the FCC definition that “traffic to or from a CMRS network that originates and terminates within the same Major Trading Area (MTA) is subject to reciprocal compensation obligations under section 251(b)(5), rather than interstate or intrastate access charges.” Id. at ¶ 3. Further, the Order restates the definition of “local” traffic “subject to reciprocal compensation as traffic ‘that, at the beginning of the call, originates or terminates within the same Major Trading Area.’ ” Id. (citing 47 C.F.R. § 51.701(b)(2)).
The T-Mobile Wireless Compensation Order then acknowledges that section 251(b)(5) and the FCC’s reciprocal compensation rules “do not explicitly address the type of arrangement necessary to trigger the payment of reciprocal compensation or the applicable compensation regime, if any, when carriers exchange traffic without making prior arrangements with each other.” Id. at ¶ 4 (citing 47 U.S.C. § 251(b)(5), and 47 C.F.R. § 51.703(a)). The FCC goes on to recognize disputes arising out of the exact circumstances present in this case, i.e., an indirect interconnection between CMRS providers and smaller LECs via a Bell Operating Company (“BOC”) tandem even if there is no interconnection agreement or other compensation arrangement between the parties. Id. at ¶ 5. The FCC acknowledges that this practice has led to “numerous disputes between LECs and CMRS providers as to the applicable in-tercarrier compensation regime.” Id. at ¶ 6. The T-Mobile Wireless Compensation Order then goes on to discuss the use of tariffs, finding such previously-filed tariffs valid and prohibiting their use on a going forward basis. Id. at ¶¶ 7-9.
On March 3, 2005, the FCC released its Further Notice of Proposed Rulemaking in the Matter of Developing a Unified Intercarrier Compensation Regime, CC Docket No. 01-92, FCC 05-33 (Mar. 3, 2005) (hereinafter “Further NPRM ”). In this notice of proposed rulemaking, the FCC discusses intermediary carriers and the reciprocal compensation rules. While this notice is merely a proposal to adopt a rule of prospective applicability rather than a binding order, the FCC’s discussion in the Further NPRM is still pertinent to the IUB decisions at issue here, and this gradually evolving area of telecommunications law.
In the Further NPRM, the FCC observes that it has not adopted rules governing the charges of intermediary, i.e., transiting carriers. The FCC states the following:
The reciprocal compensation provisions of the Act address the exchange of traffic between an originating carrier and a terminating carrier, but the Commission’s reciprocal compensation rules do not directly address the intercarrier compensation to be paid to the transit service provider.
Further NPRM, at ¶ 120. The FCC states further,
If rules regarding transit service are warranted, we seek comment on the scope of such regulation. Specifically, we seek comment on whether transit service obligations under the Act should extend solely to the incumbent LECs or to all transit service providers, including competitive LECs.
Further NPRM, at ¶ 130. And additionally,
[W]e seek further comment on the appropriate pricing methodology, including the possibility of requiring that transit service be offered at the same rates, terms, and conditions as the incumbent LEC offers for equivalent exchange access services (e.g., tandem switching and tandem switched transport) and how this option would be affected by our proposals to alter the current switched access regime.
Further NPRM, at ¶ 132.
The FCC also makes the following statement, demonstrating the unresolved legal backdrop at the genesis of the present conflict:
We also note that carriers have disagreed regarding the meaning of the existing intraMTA rule. Many rural LECs argue that intraMTA traffic between a rural LEC and a CMRS provider must be routed through an IXC and therefore is subject to access charges, rather than reciprocal compensation. CMRS providers, however, argue that all CMRS traffic that originates and terminates within a single MTA is subject to reciprocal compensation. In the event that we retain the rule and interpret its scope in the more limited fashion advocated by the rural LECs, should the rule be changed so that all intraM-TA traffic to or from a CMRS provider is subject to reciprocal compensation?
See Further NPRM, at ¶ 137(footnotes omitted).
Qwest points out that the Further NPRM states only that the FCC has “not adopted rules” governing the charges of transiting carriers, and “not resolved” other issues. Qwest asserts that what RUTA misses is that the Iowa Utilities Board has resolved these issues in Iowa, consistent with the Board’s role under the 1996 Act and the FCC’s pre-Act decisions. Qwest contends that the Board’s decisions are thus substantive law that must be applied to the merits of the parties’ dispute, unless RUTA is able to show the Board’s decision violates federal law.
Qwest reiterates that FCC decisions have consistently held that disputes within a state regarding the rates, terms, and conditions applicable to LEC-CMRS interconnection (including the transport and termination of intrastate wireless calls) are to be resolved by the state commission, except to the extent the state’s decisions conflict with FCC regulations. See Efficient Use of Spectrum, at ¶¶ 54-56 (holding intercarrier compensation arrangements for wireless traffic are to be established in interconnection agreements between the parties); Equal Access NPRM, at ¶ 108 (finding wireless interconnection arrangements are “largely a matter of state, not federal concern”); Section 332 Implementation Order, at ¶ 231 (holding the rates for the intrastate component of wireless interconnection agreements is entirely a matter of state concern).
Qwest further underscores its argument by pointing out that in the 1996 Act, Congress expressly authorized state commissions to prescribe regulations to fulfill the requirements of that section of the Act encompassing Sections 251 through 261, see 47 U.S.C. § 261(b), and the FCC has held LEC-CMRS interconnection issues are to be addressed under sections 251 and 252. Local Competition Order, at ¶¶ 1023, 1025. Thereafter, the FCC held that where it has not clearly resolved a section 251 issue, the state commission is authorized to resolve it subject to federal court review, Qwest Application, 17 FCC Rcd. 26303, ¶ 325, and the Eighth Circuit has confirmed federal law does not preempt state regulation absent an express declaration to that effect by the FCC. See Qwest v. Scott, 380 F.3d 367 (8th Cir.2004). Qwest argues that, a fortiori, where the FCC has expressly declined to preempt state regulation of intrastate communications, state commissions retain jurisdiction.
Qwest emphatically argues that, ultimately, RIITA’s failure to show the Board’s resolution of the parties’ dispute violates federal law is fatal to its Complaint. Qwest points out that the FCC prefers negotiated agreements, as recently reaffirmed in its T-Mobile Wireless Ter- ruination Order. See T-Mobile Wireless Termination Order, at ¶ 14. Qwest also argues that equally important is the acknowledgment in the Further NPRM that compensation for the termination of in-traMTA is a matter for the originating and terminating carriers, not the transiting carrier. Further NPRM, at ¶ 133. Indeed, in a prior NPRM, the FCC emphasized that its “[ejxisting access charge rules and the majority of existing reciprocal compensation agreements require the calling party’s carrier, whether LEC, IXC or CMRS, to compensate the called party’s carrier for terminating the call.” Intercar-rier Compensation NPRM, at ¶ 9.
These latest FCC decisions and proposed rulemaking demonstrate the transitional state of telecommunications law. Furthermore, it demonstrates that the copious disputes are very much a result of the current state of the law, where the FCC has not kept pace with the advancement in technology and the needs of those in the telecommunications industry. This indeterminate framework has, in large part, resulted in the confusion and contention between the parties to this action.
Under the blanket of this confusion and contention, the parties participated before the IUB in proceedings geared toward resolving the disputed issues. The Court notes this was the proper procedure. The Court further finds the Board did not violate federal law in rendering the decisions at issue here. In light of the FCC’s T-Mobile Wireless Compensation Order, RI-ITA conceded during oral argument that there is really no longer any dispute of what constitutes “local” traffic in these circumstances. The IUB’s definition of “local” traffic is consistent with that of the FCC, and application of that definition to the traffic at issue in this case is entirely appropriate. The Court notes the FCC’s discussion in the T-Mobile Wireless Compensation Order was merely a clarification of existing standards and not a change in the law. Thus, the IUB decision related to the type of traffic was in accordance with federal law.
As a result, the IUB’s subsequent determinations related to reciprocal compensation and the obligations of the parties were also in accordance with federal law. While several of these issues have not been expressly determined by the FCC, and some are even postured for interpretation as demonstrated in the Intercarrier Compensation NPRM and the Further NPRM, such determinations by the state commission are entirely appropriate in the absence of such express conclusions. Thus, the Court concludes the IUB was within its authority to find Qwest was not acting as an IXC with respect to the traffic at issue and was not obligated to pay access charges, and that the terminating LECs needed to seek compensation from the originating carriers under a reciprocal compensation arrangement. These determinations are consistent with the 1996 Act and the FCC’s implementing and explanatory decisions.
The IUB also did not offend federal law in strongly suggesting the parties (including the transiting carriers) negotiate reciprocal compensation arrangements, and if those negotiations failed, seek arbitration before the Board. As noted most recently in the T-Mobile Wireless Compensation Order, the FCC strongly encourages negotiation/arbitrations in accordance with its “strong preference for contractual arrangements.” T-Mobile Wireless Compensation Order, at ¶ 9. This preference springs directly from the purposes of the 1996 Act, and the Board’s decision effectively promotes the aims of that Act. Accordingly, the Court finds the decisions of the IUB do not violate federal law and therefore must be upheld. The Court further finds the actions undertaken by the Board entirely appropriate and consistent with the aims of the 1996 Act and the FCC’s implementing decisions.
C. Bona Fide Requests
With the conclusion that the Board correctly defined the traffic at issue and ordered negotiation/arbitration, RUTA contends that this process is unavailable to it absent a bona fide request which therefore violates federal law. Qwest, on the other hand, asserts RUTA is incorrect in complaining that the IUB erred by concluding ILECs must interconnect with CMRS providers in the absence of a bona fide request. In addition, Qwest urges the Court to reject RIITA’s Complaint to the extent RUTA challenges the Board’s decision to reject the proposed ITA tariff purporting to impose access charges on CMRS providers in the absence of an interconnection agreement or that CMRS providers had made no BFRs.
The Board held that “the CMRS carriers must make a bona fide request of each” terminating LEC to initiate negotiations. IUB Proposed, Decision, at 33. Qwest contends this express declaration renders RIITA’s assertion of Board error baffling and wrong. Qwest contends that even if, assuming arguendo, the sending of calls by the CMRS providers to the terminating LECs did not constitute a BFR, the record before the Board contains substantial evidence that CMRS providers had contacted terminating LECs to request negotiations. In any event, Qwest contends that no CMRS provider has denied it is obligated to compensate the ILECs for terminating calls placed by their subscribers to the ILECs’ subscribers.
Qwest next asserts that the Board expressly provided a remedy for the terminating ILECs that would apply to all of the calls at issue, including calls prior to negotiations for or the adoption of an interconnection agreement. Specifically, the IUB ruled that the results of the section 252 negotiation/arbitration process would apply retroactively, thereby assuring the ILECs would be compensated by the CMRS providers for terminating all the calls at issue. Qwest maintains this ruling is entirely consistent with FCC decisions subsequent to the Local Competition Order applying retroactive “true-ups” for transactions that occur in the absence of rates approved by the state commission under the 1996 Act. See. e.g., Application of SBC Corp. Pursuant to Section 271 of the Telecommunications Act of 1996 to Provide In-Region InterLATA Service in Texas, 15 FCC Red. 18354, at ¶ 236 (FCC 2000)(“FCC Texas 271 Order ”). Moreover, the FCC has specifically authorized the use of interim rates for transport and termination pending the formation and approval of an interconnection agreement. Local Competition Order, at ¶ 1067. Accordingly, Qwest contends that the absence of an interconnection agreement does not justify imposition of access charges pursuant to a tariff or otherwise.
Finally, Qwest argues that even if the application of tariffed access charges for intraMTA calls is permissible in the absence of an interconnection agreement of BFR by the CMRS provider, the Court should affirm the Board’s holding that the transit carrier is not responsible for payment to the terminating LEC of access charges or other compensation for calls placed by subscribers of third-party carriers. As detailed above, Qwest maintains this holding is entirely consistent with federal law. Further, none of the transiting cases decided by the FCC or the Bureau deem it appropriate to impose liability on a transiting carrier based upon the absence of an interconnection agreement between the originating and te