20051109final order no 29905.pdf

Office of the Secretary
Service Date
November 9, 2005
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE JOINT PETITION
OF ROBERT RYDER DBA RADIO PAGING
SERVICE AND JOSEPH B. McNEAL DBA
PAGEDATAFORARBITRATIONOF AN
INTERCONNECTION AGREEMENT DISPUTE.
CASE NO. QWE- T -04-
ORDER NO. 29905
On November 26 2004, Radio Paging Service and PageData (collectively referred to
as "the Pagers ) filed a Petition for Arbitration against Qwest Corporation. In their Petition, the
Pagers requested that the Commission arbitrate the disputed issue of whether they are entitled to
a refund for "transit traffic" charges paid to Qwest under their respective Interconnection
Agreements.Transit traffic consists of calls that originate from a carrier other than the
interconnecting local exchange carrier (in this case Qwest) but nonetheless are carried over
Qwest's network to the paging carrier s network. Order No. 29140 at 23 citing TSR Order
70 (emphasis added); Robert Ryder v. Idaho PUC Idaho -' 120 P.3d 736 (2005). On
November 30, 2004, the Commission issued a Summons to Qwest directing it to file an Answer
to the Pagers' Petition.
In December 2004, the Commission granted Qwest's Motion requesting an extension
of time in which to file its Answer. Order No. 29672 allowed Qwest to file its Answer no later
than January 4 2005. The parties subsequently consented to another extension for Qwest to file
its Answer of an unspecified duration. On June 9, 2005, the Commission issued Order No.
29798 directing Qwest to file an Answer no later than June 23, 2005. Qwest filed a timely
Answer. For reasons set out in greater detail below, the Commission declines to resolve this
Interconnection Agreement dispute.
THE PETITION FOR ARBITRATION
The two Interconnection Agreements subject to this dispute were both submitted to
the Commission as voluntarily negotiated Agreements. Case Nos. USW-99-5 and 99-13.
Radio Paging s initial Interconnection Agreement with U S WEST Communications (Qwest's
TSR Wireless v. US WEST Communications, Memorandum Opinion and Order 15 FCC Rcd 11 166 (2000), aff'd
sub nom. Qwest Corporation v. FCC 252 F.3d 462 (D.C. Cir. 2001).
ORDER NO. 29905
predecessor)2 was approved by the Commission on May 13, 1999. See Order No. 28032.
PageData s initial Interconnection Agreement with Qwest was approved by the Commission on
September 10 1999.See Order No. 28139.
In their Petition, the Pagers allege that they entered into their respective
Interconnection Agreements "under duress or business compulsion.Petition at 2, ~ 3. The
Pagers contend that when they entered into their Agreements in 1999 federal
telecommunications laws and Federal Communications Commission (FCC) regulations provided
that certain facilities were to be furnished to them without charge. They insisted that Qwest
refused to supply the necessary facilities unless the Pagers entered into their Agreements.
Although Radio Paging s Interconnection Agreement recognized the parties' disagreement over
transit traffic, Section 2.1.2 of their Agreement states that the Pager will be charged for transit
traffic. Agmt. at 1-
The Pagers also contend that they are not time barred by the terms of their expired
Agreements from seeking arbitration. They rely on a related Idaho federal court action where the
Pagers brought suit against Qwest. In the federal suit, the Pagers maintained that Qwest agreed
to dismissal of the federal action, without prejudice "and stipulated to entry of a dismissal order
wherein the parties waived limitations defenses." Petition at 3, ~ 5. Thus, the Pagers insist that
they are "entitled to arbitration of the issue of . . transit traffic charges under their
interconnection agreements.Id. at ~ 6.
THE INTERCONNECTION AGREEMENTS
In compliance with the federal Telecommunications Act of 1996, voluntarily
negotiated interconnection agreements are submitted to the state regulatory commissions for
approval. 47 US.C. ~ 252(a), (e). Both Agreements purported to be voluntarily negotiated and
were filed as "Joint Applications" submitted by both the Pagers and Qwest. Case Nos. USW-
99-5 and 99-13. Several provisions of the two Interconnection Agreements are pertinent to this
dispute. Section 1.2 of both Agreements state that each Agreement is based
2 Unless otherwise necessary, all references will be to Qwest.
3 Both Pagers are currently operating under new Interconnection Agreements. PageOata s adoption of the Arch-
Qwest Interconnection Agreement was approved by the Commission in Order No. 29198 issued February 28, 2003.
Radio Paging s new Interconnection Agreement was approved in Order No. 29407 issued January 5,2004.
ORDER NO. 29905
in large part, on the existing state of the law, rules, regulations and
interpretations thereof, as of the date hereof (the "Existing Rules ). To the
extent that certain of the Existing Rules are changed and modified, and it
reasonably appears that the Parties would have negotiated and agreed to
different term( s) . . than as contained herein had such change or
modification been in existence before execution hereof, then this Agreement
shall be amended to reflect such different term(s), condition(s), or
covenant(s). Where the Parties failed to agree upon such an amendment. it
shall be resolved in accordance with the Dispute Resolution provision of this
Agreement.
Interconnection Agreements, g 1.2 (emphasis added).
Both Interconnection Agreements also contain nearly identical dispute resolution
provisions. The dispute resolution or arbitration clause is contained in Sections 8.15 and 17.
of Radio Paging and PageData s Agreements, respectively. The only difference between the two
provisions is the time limitation for seeking arbitration in the second paragraph. Radio Paging
arbitration provision provides
If any claim, controversy or dispute between the Parties
, . . . ("
Dispute
cannot be settled through negotiation it shall be resolved by arbitration
conducted by a single arbitrator engaged in the practice of law, under the then
current rules ofthe American Arbitration Association ("AAA"). The Federal
Arbitration Act, 9 U.C. Secs. 1-, not state law, shall govern the
arbitrability of all Disputes. The arbitrator shall not have authority to award
punitive damages. All expedited procedures prescribed by the AAA rules
shall apply. The arbitrator s award shall be final and binding and may be
entered in any court having jurisdiction thereof. The prevailing Party, as
determined by the arbitrator shall be entitled to an award of reasonable
attorneys' fees and costs.The arbitration shall occur in Denver, Colorado.
Nothing in this Section shall be construed to waive or limit either Parties
right to seek relief from the (Idaho) Commission or the Federal
Communications Commission as provided by state or federal law.
No dispute, regardless of the form of action, arising out of this Agreement
may be brought by either Party more than three (3) years after the cause of
action accrues.
Radio Paging Agreement, ~ 8.15 (emphasis added). PageData s Agreement limits filing for
arbitration to no more than two years after the cause of action occurs. ~ 17.16. The Agreements
were signed by Mr. Ryder and Mr. McNeal, respectively.
ORDER NO. 29905
QWEST'S ANSWER AND MOTION TO DISMISS
On June 23, 2005 , Qwest filed its Answer and Motion to Dismiss the Petition. Qwest
urges the Commission to dismiss the dispute on the merits. In the alternative, if the Commission
is not inclined to reach the merits of the dispute, then the Commission should dismiss the
Petition consistent with the Commission s Order Nos. 29687 and 29726 in Case No. QWE-03-
25 (the "03-25 case 4 In the 03-25 case the Commission declined to exert jurisdiction over an
interconnection dispute because of the very same arbitration clause set out above.
Turning to the merits, Qwest raises a number of contract arguments and affirmative
defenses why the Commission should dismiss the Petition on the merits. Qwest argues the
Petition for Arbitration is "six years too late." Qwest Answer at 3. The Pagers "could have
properly invoked the Commission s (Section 252(b) Arbitration) jurisdiction in 1999, but they
chose otherwise, seeking the Commission s approval of the very negotiated agreements they now
ask the Commission to undo.Id. Qwest insists that the Pagers should not be allowed to seek
retroactive amendment of their "now-terminated" Interconnection Agreements.Id.The
arbitration provision of both Agreements prohibits the parties from seeking arbitration two or
three years after the alleged cause of action occurs. Qwest also notes that the Pagers voluntarily
entered into their respective Interconnection Agreements and these Agreements require them to
compensate Qwest for the transit traffic delivered to them.Id. at 7.
In the alternative, Qwest asserts the "Commission should decline to exercise its
jurisdiction and should hold that PageData follow the contract's dispute resolution process.
Qwest Answer at 9. Qwest contends that the FCC has recognized that a state commission has no
responsibility to arbitrate an interconnection dispute if the underlying interconnection agreement
contains a dispute resolution provision. Qwest relies on the Star Power Order where the FCC
acknowledged that parties to an interconnection agreement
may be bound by dispute resolution clauses in their interconnection
agreement to seek relief in a particular fashion and, therefore, the state
commission would have no responsibility under Section 252 to interpret and
enforce an existing agreement.
In the Matter of Star Power Communications, Petition for Preemption of Jurisdiction of the
Virginia State Corporation Commission Pursuant to 252(e)(5) of the Telecommunications Act of
4 PageData has appealed ITom the Commission s two Orders in the 03-25 case. Supreme Court Docket No. 31844.
ORDER NO. 29905
1996 Memorandum Opinion and Order 15 FCC Rcd 11 277 n.14 (June 14, 2000); 2000 WL
767701 (FCC).
Qwest urges the Commission to decline jurisdiction and allow this matter to proceed
to arbitration. Qwest observed that the Commission declined jurisdiction in the 03-25 case, and
the same result is warranted here.
DISCUSSION AND FINDINGS
After reviewing the pleadings in this case, we decline to exercise jurisdiction over
this Petition for Arbitration. This case is similar to PageData s complaint against Qwest in the
03-25 case. In that case, PageData brought a complaint against Qwest under its Interconnection
Agreement - the same Interconnection Agreement that is the subject of this case. As noted
above, both Interconnection Agreements in this proceeding contain an arbitration provision for
the resolution of disputes between the parties. The arbitration provision provides that any
dispute between the parties "shall be resolved by arbitration" and the arbitrator s decision "shall
be final and binding.(Emphasis added.Consistent with our Orders in the 03-25 case, we
believe that the parties must resolve their dispute through arbitration. Order No. 29687 at 6;
Order No. 29726 at 4-6. Thus, we again decline to exercise jurisdiction over this transit traffic
dispute.
In the 03-25 case, PageData argued that the arbitration clause was unconscionable.
In the present case, the Pagers assert that they were compelled to enter into their respective
Interconnection Agreements "under duress or business compulsion.Petition at 2. They also
maintain that the federal court dismissal does not limit their right to seek redress under the
Interconnection Agreements.
In its Answer, Qwest counters that the Pagers entered into their Interconnection
Agreements through "voluntary negotiations without resort to mediation or arbitration." Answer
at 2.Our records show that both Mr. Ryder and Mr. McNeal executed their respective
Interconnection Agreements. Each Joint Application requesting the Commission s approval of
the two Interconnection Agreements was purportedly submitted by both the Pagers and Qwest.
Qwest further asserts that the Pagers could have availed themselves of mandatory arbitration by
invoking the Commission s jurisdiction under Section 252(b) of the Telecommunications Act.
Finally, Qwest raises the issue of whether the Commission should resolve this dispute where the
ORDER NO. 29905
Interconnection Agreements have been superceded or where the cause of action has accrued
more than two or three years before the petition was filed.
The parties have raised a broad array of contract issues including but not limited to
duress, business necessity, waiver, various forms of estoppel, the effect of the federal court
stipulation, parol-evidence, set offs, contract construction, and enforcement. We believe that
resolution of the contract issues presented in this case lie beyond the jurisdiction of the
Commission. As we noted in the 03-25 case, our Supreme Court has held that "the construction
and enforcement of contracts is generally 'a matter which lies in the jurisdiction of the courts and
not the public utilities commission.'" Order No. 29726 at quoting Lemhi Telephone Company
V. Mountain States Tel. Tel. Company, 98 Idaho 692, 696, 571 P.2d 753 , 757 (1977); Afton
Energy v. Idaho Power Company, 111 Idaho 925, 729 P.2d 400 (1986). Consequently, we
decline to resolve this dispute given the presence of the arbitration clause and because resolution
would require us to construe and determine complex contract issues. Our determination here is
consistent with our Orders in the 03-25 case.
As noted above, Order Nos. 29687 and 29726 are the subject of PageData s appeal in
Docket No. 31844. The Court's decision in the appeal may be controlling in this case.
Procedural Rule 324 allows the Commission to stay any Order on its own motion. IDAPA
31.01.01.324. Given the similarity of this case and the 03-25 case on appeal, the Commission
finds there is good cause to stay the effective date of this final Order until the Supreme Court
renders a decision, or until the case is dismissed.
ORDER
IT IS HEREBY ORDERED that the Commission declines to accept jurisdiction to
arbitrate Radio Paging and PageData s dispute with Qwest regarding transit traffic under their
respective Interconnection Agreements. Consequently, we dismiss the Pagers' Petition without
prejudice.
IT IS FURTHER ORDERED that this final Order be STAYED pending the Supreme
Court's decision in Docket No. 31844. This final Order shall become effective after the Court
issues a final decision and remittitur in the appeal, or when the appeal is dismissed.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) may petition for reconsideration within twenty-one (21) days after this
final Order becomes effective as described in the preceding ordering paragraph. Within seven
ORDER NO. 29905
(7) days after any person has petitioned for reconsideration, any other person may cross-petition
for reconsideration. See Idaho Code g 61-626.
, DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
gi*
day of November 2005.
, PRESIDENT
ARSHA H. SMITH, COMMISSIONER
ATTEST:
~AJ'Je D. JewellCo ISSlOn Secretary
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ORDER NO. 29905