FCC TO DRAFT NEW UNE RULES; NARUC AND AT&T FILE FOR STAY
With the FCC’s UNE rules set to be vacated June 16 unless there’s action on last-min. stay requests, the FCC plans to start working immediately to draft new rules, FCC Chmn. Powell told reporters after the agency’s meeting Thurs. He told reporters he was “quite optimistic that the project will be completed “expeditiously,” perhaps by year-end. An AT&T spokeswoman said she hoped the FCC and the Administration “are mindful that, under the law, it is their duty to protect the interests of American consumers and businesses, not the interests of entrenched monopolies.”
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The Administration said last week it wouldn’t challenge a decision by the U.S. Appeals Court, D.C., that vacated the rules (CD June 10 p1) and the FCC said it wouldn’t file an appeal either. Although that could mean no rules will be in place on the June 16 effective date for the D.C. Circuit’s decision, carriers are expected to continue operating for a while under their existing interconnection agreements. However, battles already are shaping up in the states over how to apply the “change of law” provisions in those agreements and whether states can issue “standstill orders” while they review contract language. The FCC is expected to issue interim rules soon to cover areas where there are disputes about change of law provisions and where such provisions don’t exist, but permanent rules are required by the Telecom Act.
Acting NTIA Dir. Michael Gallagher said the Administration will urge the FCC to develop interim UNE rules quickly if the Supreme Court doesn’t grant a stay or accept an appeal. “During the time that these interim rules are in place, the Administration will encourage the FCC to develop final national ground rules that appropriately continue competition and are sustainable in the courts,” Gallagher said. He said the Administration also will continue to urge all parties to negotiate commercial agreements.
Meanwhile, NARUC and a group of CLECs led by AT&T asked the U.S. Supreme Court Thurs. to stay the D.C. Circuit’s decision because they plan to file appeals by the June 30 deadline. AT&T, joined by more than a dozen other competitors and associations, asked Chief Justice William Rehnquist to stay the D.C. Circuit’s mandate by June 15 or, if that’s not possible, to provide a temporary stay for a few days, sometimes known as a “housekeeping stay,” said a CLEC attorney.
The competitors said a stay is needed “to preserve the status quo and avoid the irreparable harm that would result to state utility commissions and to CLECs if the court of appeals’ mandate were to take effect during the brief period required for this court to review and resolve the petitions for certiorari.” The CLECs said the case “raises questions of national importance that four members of this court are likely to decide to review” and there’s a good chance the court will reverse the D.C. Circuit. They said they're also concerned because “if the mandate issues, the incumbents have stated that they will not voluntarily preserve the status quo as they did following [earlier] decisions, but that following no more than 30-90 day periods they will unilaterally cease providing access to switching and transport elements at cost- based rates and will shift competitive carriers to different and much costlier arrangements.” As a result, “the issuance of the D.C. Circuit’s mandate will require each of the nation’s state utility commissions to initiate emergency proceedings to determine the unbundling arrangements that will apply if the existing rules are vacated.”
NARUC told Rehnquist a stay was needed because the high court is likely to reverse the D.C. Circuit. NARUC said the appeals court decision conflicted with decisions on similar topics by the Supreme Court and other appeals courts. For example, it “squarely conflicts” with Supreme Court decisions in AT&T v. Iowa Utilities Board and Verizon v. FCC “which made clear that policy decisions about unbundling should be left to state and federal agencies and not decided by the courts,” NARUC said. “A stay is necessary to prevent the substantial irreparable harm that will be caused by extensive and unnecessary State administrative proceedings that will result if the lower court’s mandate issues,” it said. The D.C. Circuit vacated the agency’s UNE rule because the FCC had delegated unbundling determinations to state PUCs without authorization from Congress, NARUC told the high court. This decision was made “even given the cooperative federalism approach of the statute [and] the clear reservations of state authority to impose unbundling,” it said.
House Commerce Committee ranking Democrat Dingell (Mich.) said he hoped Solicitor Gen. Theodore Olson’s decision would “end the series of bizarre FCC interpretations” of the 1996 Telecom Act. Dingell said FCC interpretations “thwarted” the intent of the Telecom Act. “The time for legalistic bickering and squabbling has passed,” he said. “All companies in the telecommunications industry should now compete vigorously, offer the new services and products that consumers want, and build the broadband infrastructure that can reinvigorate job creation.” Rep. Boucher (D-Va.) also praised the decision, saying it “establishes much-needed certainty for the telecommunications sector, which has been discouraged from investment and innovation because of the burden of the UNE-P rules.”
Though the FCC and the Administration have chosen not to appeal, the challenge by competitors isn’t as much of a long shot as some might think, CLEC attorney Andrew Lippman said. The high court has heard this issue 3 times before; its positions have sometimes differed from those of the D.C. Circuit and some justices seem to have “keen interest” in the phone competition issue, he said. “It’s like a murder mystery, you have to read to the last page,” he said.