SUPREME COURT WILL HEAR TELRIC APPEAL
U.S. Supreme Court agreed Mon. to hear appeal of decision by 8th U.S. Appeals Court, St. Louis, that vacated FCC’s Total Element Long-Run Incremental Cost (TELRIC) pricing standard for competitive interconnection (CD July 19 p1). Court said it would hear case (Verizon Communications v. FCC) in 2001-2002 session that begins in Oct., meaning decision probably won’t be handed down until about year from now. Appeals were filed by Verizon, WorldCom, FCC, AT&T, General Communications. FCC Gen. Counsel Christopher Wright said agency was pleased court had granted its petition in this case as well as another involving rates that utilities can charge for pole attachments (see below). In both cases, “Congress decided that utilities owning bottleneck facilities must lease them to competitors at reasonable rates,” Wright said.
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This is 2nd time high court has heard appeal of 8th Circuit decisions on FCC’s interconnection rules. Supreme Court in 1999 overturned 8th Circuit ruling on jurisdictional issues raised by those interconnection rules. St. Louis court then returned to case to review legality of actual rules FCC used to determine cost of interconnection and in July vacated TELRIC standard.
Court set one hour for hearing and limited it to 3 questions: (1) Whether appeals court erred in holding that Telecom Act “forecloses the cost methodology adopted by the FCC, which is based on the efficient replacement cost of existing technology” for determining what new entrants must pay incumbent telcos for interconnection. (2) Whether 8th Circuit erred in holding that neither Takings Clause nor Telecom Act required incumbent’s “historical costs” to be taken into account in setting rates it could charge for access to network elements. (3) Whether Telecom Act prohibited regulators from requiring that incumbents “combine certain previously uncombined network elements” when new entrant requests combination and offers to pay for extra work to put it together.
High court declined to hear another telecom case involving rights of telecom companies to go to federal court to challenge state regulatory decisions. Case involved disputed interconnection decisions by regulators in Ill. and Wis. At issue is role of state regulators as arbitrators when negotiations between ILECs and new entrants fall through. Companies have authority under Telecom Act to appeal those arbitration decisions to federal courts but regulators in several states have questioned whether state decisions can be adjudicated in federal courts under U.S. Constitution’s 11th Amendment. Request for Supreme Court action in 3rd case involving Utah is still pending, NARUC official said. -- Edie Herman
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U.S. Supreme Court agreed to review lower court ruling that FCC lacked jurisdiction to regulate pole attachment fees paid by cable operators when providing Internet access. In announcement Mon., Supreme Court said it would consider appeal of Gulf Power decision by 11th U.S. Appeals Court, Atlanta, in its next term, which begins in Oct. Cable industry and FCC favor overturning Appeals Court decision, which concluded that Telecom Act permitted regulation only for strictly cable and telecom services, not for cable-delivered Internet access. But group of 11 utilities opposed appeal, arguing that cable operators didn’t deserve special treatment. NCTA Pres. Robert Sachs hailed Supreme Court’s move as “good news for the cable industry.” He predicted high court would find that 11th Circuit ruling “was contrary to the plain meaning of the pole attachment statute.