Nw. Pub. Commc'ns Council v. Qwest Corp.

279 Or.App. 626

379 P.3d 633

Northwest Public Communications Council, on behalf of PSPs A to Z; NPCC Members; and Central Telephone, Inc., et al., Petitioner,

v.Qwest Corporation; Oregon Public Utilities Commission; and Stephen Bloom, Susan Ackerman and John Savage, in their capacity as Commissioners. Respondents.

A150775

Court of Appeals of Oregon.

Argued and submitted January 20, 2015.

July 27, 2016

Richard D. Gaines, Pennsylvania, argued the cause for petitioner. On the briefs was Franklin G. Patrick.

Lawrence H. Reichman, Portland, argued the cause for respondent Qwest Corporation. With him on the brief was Perkins Coie LLP.

Karla H. Ferrall, Assistant Attorney General, argued the cause for respondents Oregon Public Utilities Commission, Stephen Bloom, Susan Ackerman, and John Savage. With her on the brief were Ellen F. Rosenblum, Attorney General, and Anna M. Joyce, Solicitor General.

Before Sercombe, Presiding Judge, and Hadlock, Chief Judge, and Tookey, Judge.

SERCOMBE, P.J.

Northwest Public Communications Council (NPCC), an association of businesses that provide payphone services to the public, filed a complaint with the Oregon Public Utilities Commission (PUC) in 2001.¹ In that complaint, NPCC asked the PUC to order Qwest Corporation, a Bell Operating Company and local exchange carrier, to pay refunds to NPCC's members relating to certain services Qwest had provided and for which, NPCC asserted, Qwest had charged excessive rates.² NPCC seeks judicial review of a final order of the PUC granting Qwest's motion for summary judgment and dismissing NPCC's complaint. In three assignments of error, NPCC raises a number of contentions. Included among those are assertions that the PUC erred in granting Qwest's motion for summary judgment and in denying NPCC's request to amend its complaint to add additional claims for refunds. We reject NPCC's contentions, many of them without published discussion, and affirm the PUC's order.

LEGAL BACKGROUND

“Once upon a time, the only way to call home from a roadside rest stop or neighborhood diner was to use a payphone.” Illinois Public Telecommunications Ass'n. v. F.C.C. , 752 F.3d 1018, 1020 (D.C. Cir. 2014).

“Since the mid–1980s, independent payphone providers have competed with Bell Operating Companies in the consumer payphone market. At first, Bell Operating Companies had a built-in advantage. In addition to operating some payphones, Bell Operating Companies owned the local phone lines that provide service to all payphones. An independent payphone provider was thus ‘both a competitor and a customer’ of the local Bell Operating Company. Davel Communications, Inc. v. Qwest Corp. , 460 F.3d 1075, 1081 (9th Cir. 2006). And that Bell Operating Company could exploit its control over the local phone lines by charging lower service rates to its own payphones or higher service rates to independent payphone providers.”

Id. (emphasis in original).

“In 1996 Congress amended the Federal Communications Act * * * of 1934 in part to improve competition in the telecommunications industry in the wake of the breakup of the former AT&T into Bell Operating Companies.” Northwest Public Commc'n Council v. Oregon Public Utility , 805 F.Supp.2d 1058, 1061 (D. Or. 2011). “To prevent unfair competition in the payphone market, Congress included a payphone provision” in the 1996 Act. Illinois Public Telecommunications Ass'n. , 752 F.3d at 1020 ; see 47 USC § 276. That provision, codified as 47 USC section 276(a), provides that a Bell Operating Company may not “subsidize its payphone service directly or indirectly” or “prefer or discriminate in favor of its payphone service.” To implement that directive, in subsection (b) of section 276, Congress directed the Federal Communications Commission (FCC) to “prescribe regulations” governing rates charged by Bell Operating Companies. Among other things, in section 276(b),

“Congress ordered the FCC to ‘establish a per call compensation plan to ensure that all payphone service providers are fairly compensated for each and every completed intrastate and interstate call using their payphone.’ 47 USC § 276(b)(1)(A). That provision responded to the development of long-distance access codes and 800 numbers that allowed callers to use payphones without depositing coins, thereby depriving payphone operators of revenue. The FCC issued a rule requiring the long-distance carriers who benefitted from such ‘dial-around’ calls to compensate payphone providers.”

Illinois Public Telecommunications Ass'n. , 752 F.3d at 1026.

Specifically, pursuant to Congress' directive, the FCC issued a series of orders intended to implement the requirements of the 1996 Act. See Northwest Public Communications Council v. PUC , 196 Or.App. 94, 100, 100 P.3d 776 (2004) (“The District of Columbia Circuit Court of Appeals treats the FCC's orders under section 276 as binding on every state, and so do we.”). The Ninth Circuit summarized those orders in Davel Communications, Inc. , 460 F.3d at 1081–83 :

“Pursuant to th[e] directive [in 47 USC section 276(b) ], the FCC adopted regulations requiring local exchange carriers such as Qwest to set payphone service rates and ‘unbundled features' rates, including rates for fraud protection, according to the FCC's ‘new services test’ (sometimes ‘NST’). The new services test requires that rates for those telecommunications services to which it applies be based on the actual cost of providing the service, plus a reasonable amount of the service provider's overhead costs. The FCC's regulations required local exchange carriers to develop rates for the use of public access lines by intrastate payphone service providers that were compliant with the new services test. The rates were to be submitted to the utility commissions in the states in the local exchange carriers' territory, which would review and ‘file’ (i.e. , approve) the rates. See In re Implementation of the Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act of 1996 , Report and Order, FCC 96–388, 11 FCCR 20,541 (Sept. 20, 1996) ; In re Implementation of the Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act of 1996 , Order on Reconsideration, FCC 96–439, 11 FCCR 21,233 (Nov. 8, 1996) ¶ 163 (“Order on Recons.”) (collectively ‘Payphone Orders'). Also pursuant to the regulations, local exchange carriers were required to filed their ‘unbundled features' with both the state commissions and the FCC for approval. Order on Recons. ¶ 163. The FCC required the local exchange carriers to file the new tariffs for both kinds of rates by January 15, 1997, with an effective date no later than April 15, 1997. Id.

“In addition, the Payphone Orders required interexchange carriers, mainly long distance telephone service providers, to pay ‘dial-around compensation’ to payphone service providers, including Qwest, for calls carried on the carrier's lines which originated from one of the provider's pay telephones. If, however, the payphone service provider was also an incumbent local exchange carrier, as was Qwest, the Payphone Orders required full compliance with the new tariff filing requirements, including the filing of cost-based public access line rates and fraud protections rates, before the local exchange carrier could begin collecting dial-around compensation.

“On April 10, 1997, a coalition of regional Bell operating companies (‘the Coalition’), which included Qwest, sent a letter to the FCC requesting a limited waiver of certain provisions of the Payphone Orders. The Coalition wanted this waiver so that the constituent companies could begin collecting dial-around compensation before they were in full compliance with the new regulations. Specifically, they requested an extension of time to file intrastate payphone service rates compliant with the new services test. These rates were due to become effective on April 15, 1997, but the Coalition wanted that deadline extended forty-five days from April 4, 1997. (The FCC had earlier granted a similar extension with respect to interstate rates.) The Coalition proposed that, if the FCC granted the waiver and allowed the Coalition companies to file rates that complied with the new services test by the extended deadline, those companies would reimburse or provide a credit back to April 15, 1997, to customers purchasing the services if the new rates were lower than the previous non-compliant rates.

“On April 15, 1997, the FCC issued an order granting a limited waiver of the new services test rate-filing requirement. In re Implementation of the Pay Telephone Reclassification and Compensation Provisions of the Telecommunications Act of 1996 , Order, DA 97–805, 12 F.C.C.R. 21,370 (Apr. 15, 1997) (‘Waiver Order ’). Specifically, the Waiver Order granted an extension until May 19, 1997, for filing intrastate payphone service rates compliant with the new services test, while at the same time permitting incumbent local exchange carriers to begin collecting dial-around compensation as of April 15, 1997. Id. ¶ 2. The Waiver Order stated that the existing rates would continue in effect from April 15, 1997, until the new, compliant rates became effective (‘the waiver period’). The NST–compliant rates were to be filed with state utility commissions, which were required to act on the filed rates ‘within a reasonable time.’ Id. ¶ 19 n. 60 ; see also id. ¶¶ 2, 18–19, 25. If a local exchange carrier relied on the waiver, it was required to reimburse its customers ‘from April 15, 1997 in situations where the newly [filed] rates, when effective, are lower than the existing [filed] rates.’ Id. ¶¶ 2, 20, 25. The order emphasized that the waiver was ‘limited’ and ‘of brief duration.’ Id. ¶¶ 21, 23.”

(Third and fourth brackets in original; footnote omitted.)

FACTS AND PROCEDURAL HISTORY

The background facts and procedural history of this case are as follows. NPCC is a regional trade organization that represents companies providing...