Court Considers Stay of FCC Number Portability Ruling

Much of 2 related oral arguments before the U.S. Appeals Court, D.C., centered on whether the FCC met the requirements of the Regulatory Flexibility Act (RFA) in issuing the order. The RFA requires agencies to determine the effect of rulemakings on small businesses. The court scheduled 2 cases back-to-back, and the same arguments ran through them. One case against the FCC was brought by USTA, with NTCA and OPASTCO as intervenors, and the other was brought by a group of rural LECs led by the Central Tex. Telephone Co-op.

Lawyers for the FCC argued that the agency’s action was a simple clarification of existing rules and so didn’t require an RFA analysis. Lawyers for USTA and rural LECs counted by saying the agency’s action was a rulemaking, so the FCC needed to do an RFA study to determine the action’s effect on small businesses such as rural telephone companies. The FCC’s order provided CTIA with the requested clarification -- that LECs must port numbers to wireless carriers where the requesting wireless carrier’s coverage area overlaps the geographic location of the LEC rate center to which the number is assigned, even if the wireless carrier’s point of interconnection isn’t in the rate center. FCC attorneys said that language was a clarification because the porting obligations were called for in an earlier order. The LEC attorneys said the agency should have issued a Notice of Proposed Rulemaking (NPRM) because this was a formal requirement to provide intermodal portability.

All 3 judges gave signaled they were considering a stay, although the action didn’t look certain. Judge Merrick Garland asked lawyers in both cases to comment on the impact on customers and the industry of a stay of the order until the FCC acted on the RFA analysis. This stay would apply only to rural carriers and only for future action, leaving ported numbers alone, he said. FCC attorney Richard Welch said that would be better than vacating the order entirely but it might be confusing to customers. Garland responded that telephone companies would just have to tell customers that the FCC made a mistake and they will have to wait awhile to have their numbers ported. Gregory Whiteaker, attorney for the Central Tex. group, said such action would be “helpful” but wouldn’t go far enough. Aaron Panner, attorney for USTA, said he favor vacating future application of the rule entirely. “I don’t think anyone is saying you could pull back” numbers already ported, he said.

Judges on the panel -- which included David Sentelle and Raymond Randolph -- asked many questions apparently aimed at helping make up their minds about whether to stay to order. For example, they asked LEC attorneys what their clients would have added to the FCC’s deliberations if the agency had used an NPRM instead of a clarification format. Judge Randolph, sometimes joined by the others, asked for technical explanations of how call porting works. Welch said the issue was simple: Wireline carriers “attempted to graft limits onto our rules,” so the FCC was required to “interpret” its original order. The agency never considered this action a rulemaking and thus, since it didn’t think it was “exercising legislative authority,” it didn’t need to meet requirements such as the RFA and the Administrative Procedures Act.

NTCA and OPASTCO released a joint statement saying they were pleased with the judges’ “interest” in the RFA concerns raised by the 2 organizations. They said the FCC “failed to consider the overly burdensome implications of its intermodal LNP decision on small, rural telecom providers” as the RFA required. The associations said LNP rules require wireline carriers to update their systems to allow customers to port their telephone numbers to a wireless carrier. “Since the rules were first implemented, as many as 37 state public utility commissions have granted waivers on intermodal LNP to small and rural wireline carriers” because of concerns about raised by the small companies, they said.