20070216Response to Qwest Supplemental Authority.pdf

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ATTORNEYS AT LAW
Molly 0' Leary
Tel: [phone] Fax: [phone]
molly&J richardson a ndoleary. com
O. Box 7218 Boise, ID 83707 - 515 N. 27th St. Boise, ID 83702
16 February 2007
Ms. Jean Jewell
Commission Secretary
Idaho Public Utilities Commission
POBox 83720
Boise ID 83720-0074
Hand Delivered
RE: Case No. QWE-06-
Dear Ms. Jewell:
Enclosed please find an original and seven (7) copies of the AT&T'
RESPONSE TO QWEST'S SUPPLEMETNAL AUTHORITY in the above
referenced case.
I have also enclosed an extra copy to be service-dated and returned to
us for our files.
Sincerely,
encl.
Molly O'Leary (ISB No. 4996)
RICHARDSON & O'LEARY PLLC
515 North 27th Street
O. Box 7218
Boise, Idaho 83707
Telephone: [phone]
Fax: [phone]
Mail: mollY(fYxichardsonandoleary.com
Theodore A. Livingston
Dennis G. Friedman
MAYER, BROWN, ROWE & MAW LLP
71 South Wacker Drive
Chicago, IL 60606-4637
Telephone: [phone]
Fax: [phone]
Mail: dfriedman~mayerbrown.com
Dan Foley
General Attorney & Assistant General Counsel
AT&T WEST
P. O. Box 11010; 645 E. Plumb Lane, B132
Reno, Nevada 89520
Telephone: [phone]
Fax: [phone]
Mail: df6929~att.com
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Attorneys for Complainant AT&T Communications of the Mountain States, Inc.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
AT&T COMMUNICATIONS OF THE MOUNTAIN )
STATES, INC.
Complainant
vs.
QWEST CORPORATION
Respondent.
Case No. QWE-06-
AT&T'S RESPONSE TO QWEST'S
SUPPLEMENTAL AUTHORITY
Complainant AT&T Communications of the Mountain States, Inc. ("AT&T"
respectfully submits this response to Qwest Corporation s Supplemental Authority in Support
of Motion to Dismiss. Contrary to Qwest's assertion , the Utah decision Qwest submits does
not support its motion to dismiss.
As the Commission knows, AT&T has sued Qwest for breach of the parties
interconnection agreement, and Qwest has moved to dismiss by arguing that this claim must
be treated as federal in nature and thus subject to a two-year limitations period under 47
US.C. 415 , making it time-barred. Qwest now submits a decision by the Utah federal
district court that denied AT&T's motion for remand to state court in AT&T Communications
of the Mountain States, Inc. v, Qwest Corporation Case No. 2:06CYO0783 DS (D. Utah
Feb. 13 2007) ("Utah Remand Order ), another case in which an AT&T affiliate has sued
Qwest for breach of an interconnection agreement. Qwest contends that the Utah decision is
directly relevant to Qwest's pending Motion to Dismiss" and "confirms. . . that federal law
governs AT&T's claims here." Qwest Supp. Auth. at l-2. Qwest is incorrect for three main
reasons.
Qwest's argument in this case is that AT&T's breach of contract claim is a
claim for violation of federal law and thus governed by a federal statute of limitations. The
Utah court, however, did not have to reach that issue in order to decide whether it had
jurisdiction over AT&T's breach of contract claims , and thus did not do so. Federal question
jurisdiction can exist if the complaint "establishes either that (1) federal law creates a cause
of action or that (2) the plaintiff s right to relief necessarily depends on resolution of a
substantial question of federal law." Utah Remand Order at 4, quoting Nicodemus v. Union
Pacific Corp.440 F.3d 1227, 1232 (loth Cir. 2006). The Utah decision relied on the latter
AT&T RESPONSE TO QWEST
SUPPLEMENTAL AUTHORITY - 2
ground, finding that the "resolution" of AT&T's breach of contract claim "depends on the
application and interpretation of federal law" and that "AT&T's right to relief necessarily
depends on resolution of substantial questions of federal law." Utah Remand Order at 1 O.
Although AT&T disagrees with that conclusion it does not matter here, for a determination
that jurisdiction exists due to a substantial question of federal law is not a finding that the
cause of action itself is federal. Rather, the question of what law ultimately governs the
disposition of AT&T's contract cause of action on the merits is entirely separate.
The Ninth Circuit and several others have already answered the question of what law
ultimately governs claims for breach of an interconnection agreement. In Pacific Bell v. Pac-
West Telecomm, Inc.325 F.3d 1114 (9th Cir. 2003), the Ninth Circuit stated that "'the
(interconnection J agreements themselves and state law principles govern the questions of
interpretation of the contracts and enforcement of their provisions.'" 325 F.3d at 1128
quoting Southwestern Bell v. Public Uti/so Comm '208 F.3d 475 485 (5th Cir. 2000).
AT&T has explained in its prior briefs, the Fifth through Tenth Circuits are in accord on this
point, with only the Fourth Circuit (over a strong and persuasive dissent) reaching a different
result. Moreover, state law principles govern such contract disputes despite the fact that, as
the Utah court found, federal law may play some role in analyzing the contract dispute. As
the Eighth Circuit concluded in Connect Communications Corp, v, Southwestern Bell
Telephone 467 F.3d 703 (8th Cir. 2006), which involved a claim for breach of an
interconnection agreement just like AT&T's claim here
, "
(a)lthough federal law may playa
1 For example, where, as here, one is dealing with contract provisions that track and incorporate federal
requirements, in detennining what the contract means and what rights it creates, one must of course determine
what those federal requirements are. But the basic cause of action still could be (and the overwhelming weight
of authority holds that AT&T's contract action here is) created by state law,
AT &T RESPONSE TO QWEST
SUPPLEMENTAL AUTHORITY - 3
large role in this dispute, the ultimate issue in this case - interpretation of the Interconnection
Agreement - is a state law issue.Id. at 708.
Even if the Utah court actually had found that AT&T's breach of contract
claim in Utah was a federal claim, as opposed to merely involving a substantial federal
question, it would have to be rejected under Ninth Circuit law. As just noted Pacific Bell
found that a claim for breach of an interconnection agreement is governed by state law, as
did a recent decision by the Washington Utilities and Transportation Commission (which
AT&T has already submitted and discussed in prior briefs, including its response to the
Commission s notice of oral argument (at 6-9 and Att. 1 thereto)). The only reason these
state law contract issues have been before the federal appellate courts at all was that the
district courts had "supplemental jurisdiction" over the contract claim under 28 U.C. 9
1367. Connect Communications 467 F.3d at 708; Southwestern Bell Tel. v, Brooks Fiber
Communications of Oklahoma, Inc.235 F.3d 493 494 (loth Cir. 2000). Indeed, the Utah
court seemed to recognize this point, thus reinforcing that it based its jurisdictional
determination on a finding of a federal issue rather than a federal claim, by noting that
although it would "( e )xercise( e) original jurisdiction to determine issues of federal law " it
needed "supplemental jurisdiction pursuant to 28 U.C. 9 1367(a)" in order to "proceed with
state law determinations ' such as "questions of interpretation of the contract and
enforcement of its provisions." Utah Remand Order at 9 n. 4.
Finally, the Utah court also seems to have made the same error as the
Wyoming district court by failing to follow the binding Tenth Circuit law. See AT&T's
Response to Commission s Notice of Oral Argument, at 10-12. As in Wyoming, the Utah
court was bound by the Tenth Circuit's holding in Brooks Fiber that disputes over
AT &T RESPONSE TO QWEST
SUPPLEMENTAL AUTHORITY - 4
interconnection agreements are governed by state law. Like the Wyoming court, however
the Utah court instead elected to follow an outlier decision by the Fourth Circuit, the only
circuit to have found that federal law governs claims for breach of interconnection
agreements. Utah Remand Order at 9-, citing Verizon Maryland, Inc. v. Global NAPs
Inc.377 F.3d 355 (4th Cir. 2004). As AT&T explained in its response to the Commission
notice of oral argument (at 10-12), the fact patterns in Verizon Maryland and Brooks Fiber
are indistinguishable; both cases involved claims for breach of interconnection agreement
terms that tracked or incorporated federal law. The only difference is that the Tenth Circuit
(like the Fifth through Ninth) held that such claims nevertheless are normal contract claims
governed by state law, whereas the Fourth Circuit applied federal law. Because the cases are
identical except for the legal conclusions drawn by the two circuits, the Utah court erred in
failing to follow Brooks Fiber.
In sum, the Utah decision does not in any way support Qwest's motion to dismiss.
DATED this 16th day of February, 2007.
RICHARDSON & O'LEARY, P.LLC.
By:
AT&T RESPONSE TO QWEST
SUPPLEMENTAL AUTHORITY - 5
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 16th day of February, 2007 a true and correct copy
of the within and foregoing AT&T'S RESPONSE TO QWEST'S SUPPLEMENTAL
AUTHORITY was filed with the Idaho Public Utilities Commission and parties as indicated
below:
Ms. Jean Jewell
Commission Secretary
Idaho Public Utilities Commission
POBox 83720
Boise ID 83720-0074
2L Hand Delivery
- U.S. Mail, postage pre-paid
Facsimile
Electronic Mail
Mary S. Hobson
999 Main, Suite 1103
Boise, ID 83702
E-mail: mary.hobson~qwest.com
- Hand Delivery
S. Mail, postage pre-paid
Facsimile
2L Electronic Mail
Douglas R.M. Nazarian
Hogan & Hartson
III South Calvert St
Baltimore MD 21202
E-mail: drmnazarian~hhlaw.com
- Hand Delivery
2LU.S. Mail, postage pre-paid
Facsimile
Electronic Mail
AT&T RESPONSE TO QWEST
SUPPLEMENTAL AUTHORITY - 6