20040503_819.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
CO MMISSI 0 NER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
FROM:DON HOWELL
DATE:APRIL 27, 2004
RE:PAGEDATA'S "FORMAL" COMPLAINT AGAINST QWEST
CORPORATION, CASE NO. QWE-03-
On October 31 , 2003, Joseph McNeal dba PageData filed a "formal" complaint
against Qwest. PageData alleged that Qwest is not in compliance with the reciprocal
compensation provisions of their Interconnection Agreement. On November 26, 2003, Qwest
submitted a "limited" response to PageData s complaint. Qwest urged the Commission to refrain
from opening a complaint docket and suggested that PageData s complaint should be dismissed.
Qwest did not address the merits of PageData s complaint. On December 12, 2003, PageData
filed a Reply to Qwest's limited response.
On January 2004 PageData filed a Request for Summary Judgment. Since then
attempts to resolve the complaint have been unfruitful. No party has asked for oral argument.
BACKGROUND
In Order No.28499 issued September 1 2000 the Commission approved an
Interconnection Agreement between Qwest and Arch Paging. In January 2003, the Qwest-Arch
Interconnection Agreement was amended and subsequently approved by the Commission
Order No. 29178. Among other things, the amendment to the "Arch" Agreement added terms
and conditions for interconnection at a single point-of-presence (SPOP). In February 2003, the
Commission approved PageData s adoption of the Arch Agreement (as amended).
No. 29198 at 3.
Order
1 The Staff assigned a case number so that pleadings could be grouped for tracking purposes.
DECISION MEMORANDUM
PAGEDATA'S COMPLAINT
In its complaint, PageData alleged first that Qwest has misbilled PageData under the
adopted Arch Interconnection Agreement, and second that Qwest has refused to correct the
billing. PageData requested that the Commission direct Qwest to correct the billing on Account
BAN208R51-0454-454. In addition, PageData seeks an Order from this Commission to require
Qwest to remit cash payments to PageData for reciprocal compensation or, at a minimum, to
issue credits for the reciprocal compensation to specific accounts designated by PageData.
Pursuant to the terms and conditions of their Interconnection Agreement, PageData has
invoiced" Qwest for reciprocal compensation for the period of January - May 15, 2003.
Under the adopted Arch Agreement, PageData asserted it is "in a unique position
(because) Qwest owes PageData more money per month than PageData owes Qwest" as a result
of the reciprocal compensation mechanism. Complaint at 2. PageData maintained Qwest has
refused to issue cash payments for reciprocal compensation "because of prior disputed
accounts.!d. at 3. PageData alleged that Qwest's failure to make reciprocal compensation
payments or provide credits violates Section 12.3. of the parties' Interconnection Agreement.
Section 12.3. allows either party to dispute any portion of the monthly billing and both parties
agree to expedite investigation of any dispute. This section also provides that either party may
withhold "up to four months worth of disputed charges not to exceed $100 000 in the aggregate.
Id.
PageData argued that Qwest should not be allowed to violate the terms of the
approved Interconnection Agreement by mixing current interconnection disputes with "past
disputes that are before authoritative bodies that have jurisdiction to settle those disputes....
Complaint at 7.PageData believes that the terms of its Interconnection Agreement should
control regardless of past disputes with Qwest.
PageData filed its formal complaint pursuant to the federal Telecommunications Act
of 1996, Section 13.14. (Dispute Resolution) of its Interconnection Agreement, and the
Commission s procedural Rule 54? Section 13.14. of the Interconnection Agreement addresses
disputes. This section provides in pertinent part
2 As the Commission is aware PageData and Qwest are opposing parties in Idaho Supreme Court Appeal No. 29175
involving billing disputes arising before the parties entered into their flISt interconnection agreement.
3 Rule 54 sets out the required contents of formal complaints. IDAP A 31.01.01.054.
DECISION MEMORANDUM
If any claim, controversy or dispute between the Parties, their agents
employees, officers, directors, or affiliated agents ("Dispute cannot be
settled through negotiation, it shall be resolved by arbitration under the then
current rules of the American Arbitration Association ("AAA"
).
The
arbitration shall be conducted by a single neutral arbitrator familiar with the
telecommunications industry and engaged in the practice of law. ... The
prevailing Party, as determined by the arbitrator, shall be entitled to an award
of reasonable attorney s fees and costs. The arbitration shall occur at a
mutually agreed upon location. .. Nothing in this Section shall be construed to
waive or limit either Party's right to seek relief from the rIdaho) Commission
or the FCC as provided by state or federal law.
Adopted Qwest-Arch Interconnection Agreement dated June 2000 13.14. (emphasis added).
In summary, PageData asked the Commission to order Qwest to: (1) correct the
billing under the Interconnection Agreement; (2) comply with the terms of the Interconnection
Agreement without regards to prior disputes between the parties; (3) pay PageData for reciprocal
compensation in the form of a check or credits to specific accounts designated by PageData; and
(4) provide other measures of relief. Id. at 8.
QWEST'S RESPONSE
In its "limited" response to PageData s filing, Qwest asserted that the Commission
should decline to open a complaint proceeding and "should dismiss PageData s Filing." Qwest
Response at 2. Qwest specifically stated that its limited response does not constitute an
Answer" under the Commission s procedural Rule 57, IDAPA 31.01.01.057. Qwest maintained
that the parties' Interconnection Agreement sets out detailed procedures for resolving disputes
but PageData has entirely ignored that contractual obligation.Id. at 2. Because the substance
of PageData s complaint is a contract dispute under their Interconnection Agreement, Qwest
urged the Commission to decline jurisdiction and instead direct the parties to utilize the dispute
resolution provisions of their Interconnection Agreement.
Commenting briefly on the stayed Supreme Court appeal (Docket No. 29175), Qwest
noted that PageData has not sought a stay of the Commission s final Order No. 29140. Even
after applying the Commission-determined refund credit in the case on appeal, Qwest claims that
PageData currently owes Qwest approximately $300 000 for wholesale/interconnection services.
Qwest Response at 4. Qwest stated PageData has not paid for "any interconnection or other
wholesale services since at least October 1998, including services provided under PageData
DECISION MEMORANDUM
Interconnection Agreement." !d. (emphasis original). Thus, Qwest inferred that it is entitled to
recover past-billed amounts accruing before the existing interconnection agreement.
Qwest further asserted that the procedures for addressing PageData s complaint is
covered by the parties' Interconnection Agreement. Both Qwest and PageData rely on the
dispute resolution Section 13.14. (set out above) of their Agreement. Given that the subject
matter of PageData s complaint arises under their adopted and approved Interconnection
Agreement, Qwest believes that PageData is contractually bound to follow the dispute resolution
procedures called out in the Agreement. In other words, the parties' dispute should be submitted
to a qualified arbitrator as provided for in Section 13 .14.
Qwest next insisted there is no federal or state law clearly granting the Commission
jurisdiction over disputes arising from an Interconnection Agreement. The Company maintained
that generally the construction and enforcement of contract rights in Idaho is a matter that lies in
the jurisdiction of the courts and not this Commission. Bunker Hill Company v. Washington
Water Power Company, 101 Idaho 493 , 616 P.2d 272 (1980). Thus, Qwest questions whether
the Commission is the proper forum to address PageData s contract complaint.
Finally, Qwest asserted that Idaho law strongly favors the enforcement of contractual
arbitration clauses. As mentioned above, Section 13.14. provides that umesolved disputes
between the parties shall be resolved by arbitration.Qwest noted arbitration is a favored
remedy for disputes. International Assoc. of Firefighters, Local No. 672 v. City of Boise 136
Idaho 162, 30 P.3d 940 (2001). For these reasons, Qwest urged the Commission to dismiss the
complaint and not initiate a complaint proceeding.
PAGEDATA'S REPLY
In its Reply, PageData argued the Commission should reject Qwest's assertion that
the Commission has no jurisdiction over this complaint. The Pager insisted the Commission has
jurisdiction to resolve disputes concerning interconnection agreements. More specifically,
PageData stated that Idaho Code 9962-614 and 62-615(1) provides the Commission with the
requisite statutory authority to investigate and resolve this dispute. PageData relied on the
Commission s Order No. 29219 in the ITA/Iluminet v. Qwest case (No. QWE-02-11) for
4 Section 13.14. of the Interconnection Agreement also notes that the dispute resolution section "shall not be
construed to waive or limit either Parties' right to seek relief from the (Idaho) Commission or the FCC as provided
by state or federal law.
DECISION MEMORANDUM
support. In that case, the Commission noted that Idaho Code 9 62-615(1) gives the Commission
full power and authority to implement the federal telecommunications act of 1996." PageData
Reply at 326 quoting Order No. 29219 at n.1. In addition, the Pager maintained that Idaho Code
9 62-6145 provides broad authority to the Commission so that it may "resolve disputes between
incumbent telephone companies, like Qwest, and other telephone service providers.Id.
quoting Order No. 29219 at 4. Consequently, PageData believes that the Commission has
jurisdiction to entertain PageData s complaint.
PageData also asserted that the Commission "is responsible for enforcing the pricing
schedules and reciprocal compensation terms on interconnection agreements that (the
Commission) approved (Idaho Code 962-614)." PageData Reply at 9. PageData also believes
the Commission "is compelled by Idaho statute to investigate all commercially filed formal
complaints and enforce all provisions of interconnection agreements that are filed within the
state of Idaho.... Id.
PageData next argued "that Qwest has no authority under the interconnection
agreement or the 1996 Tel Act to unilaterally withhold reciprocal compensation payments from
PageData..,or apply PageData s..,reciprocal compensation to (accounts) actively disputed..Id.
at 16.
PageData acknowledged that Section 13.14. of the Interconnection Agreement
provides for three methods of dispute resolution. "Qwest has the ability to take PageData to
arbitration; file a complaint at the (Idaho) Commission where the services are being provided; or
file a complaint at the FCC in order that Qwest may request an order to demand payment or
disconnect services.Id. at 16. Instead of pursuing one of these three methods of dispute
resolution, Qwest took unilateral action by withholding reciprocal compensation. Consequently,
PageData stated that Qwest's conduct leaves the decision on which dispute resolution alternative
to utilize "to PageData alone.Id. at 1. PageData having filed this complaint, Qwest should
now be prohibited from dictating a different course of dispute resolution. Id. at 19.
Idaho Code 9 62-614(1) states
If a telephone corporation providing basic local exchange service which has exercised the election
provided in section 62-604(2)(a), Idaho Code, and any other telephone corporation subject to title
, Idaho Code, or any mutual, nonprofit or cooperative telephone corporation, are unable to agree
on any matter relating to telecommunication issues between such companies, then either telephone
corporation may apply to the commission for determination of the matter.
DECISION MEMORANDUM
Finally, PageData alleged Qwest is charging for facility PageData has "requested in
writing.. .to be shut off. Qwest continues to invoice for these facilities, at inflated rates, along
with interest and late charges.PageData Reply at 18.The Pager insists that a
telecommunications carrier should not have to seek arbitration or file a complaint with this
Commission or the FCC "in order for Qwest to disconnect facilities requested in writing by the
carrier.Id.
THE REQUEST FOR SUMMARY JUDGMENT
On January 29, 2004, PageData filed a "Request for Summary Judgment." In its
Request, PageData stated that Qwest is correcting the disputed invoices in this matter but is "still
not agreeing to remit payment for reciprocal compensation due PageData." PageData Summary
Judgment at 2. PageData also insisted that its entitlement to reciprocal compensation under its
interconnection agreement is further bolstered by a recent Court of Appeals decision from the
c. Circuit. In Mountain Communications v. Federal Communications Commission 355 F.
644 (D.C. Cir. 2004), the Circuit Court found that the FCC had acted arbitrarily when it allowed
Qwest to charge a paging company (Mountain Communications) for "wide area calling.6 A
review of the Mountain case will be helpful.
1. Wide Area Calling. Mountain Communications established a single point-of-
presence (SPOP) in one of three local calling areas in Colorado and then requested Qwest to
transport calls from Qwest customers in the three calling areas to Mountain s spar. Id. at 645.7
Qwest provided the facilities but charged Mountain for calls to the SPOP made by Qwest
customers. Qwest insisted that calls from the two local calling areas to the local calling area
where the spar was located should be considered as toll calls. As the Court explained
Qwest claimed in response to Mountain s complaint before the FCC that it
was entitled to charge Mountain for the tolls it was unable to charge its own
customers. According to Qwest, Mountain could avoid the toll charges by
establishing a (point-of-presence) in each of the three local calling areas-
doubtless at an increased cost. Then, if a paging call were placed from a local
number to another local number, no toll would be charged to anyone. If, on
the other hand, a paging call were made from one local calling area to
another, Qwest would transport the call to Mountain s (SPOP)-without
crossing a local calling area boundary-at which time Mountain would
6 Wide area calling is an issue in the Supreme Court appeal.
7 Section 251(c)(2)(B) requires LECs such as Qwest to provide interconnection facilities with other carriers "at any
technically feasible point within the (ILEC's) network."
DECISION MEMORANDUM
assume responsibility for delivering the call across the local calling areas
presumably at Mountain s expense.
Id. at 645-46 (emphasis original). The FCC characterized Mountain s network configuration as
a "wide area calling arrangement" and "therefore Qwest was entitled to charge Mountain for that
service Id. at 646.
However, the Circuit Court noted that the FCC's finding "comes into direct conflict
with (the FCC's) own regulation.Id. at 648. The FCC's regulation (found that 47 c.F.
9 51.703(b)) states that LECs "may not assess charges on any other telecommunications carrier
for telecommunications traffic that originate on the LEC's network." Consequently, this
regulation prohibits Qwest from charging Mountain for calls that Qwest customers made to
Mountain s spar.
Returning to PageData s complaint, the Pager insisted that the Mountain decision
supports its claim for reciprocal compensation. PageData now has its SPOP in Boise and Qwest
provides T -1 facilities for traffic from Qwest's eastern Idaho local calling area to the SPOP.
PageData Request at 9; Order No. 29064 at 23. Because Qwest presumably offsets its reciprocal
compensation owed to PageData with charges for PageData s wide area calling, PageData
believed its request for reciprocal compensation is even stronger. PageData may be entitled to
more reciprocal compensation because Qwest cannot offset wide area calling against the amount
it otherwise owes PageData for reciprocal compensation.
2. Transit Traffic.PageData also relied upon the Mountain case to support its
argument that Qwest may not offset its reciprocal compensation with transit traffic charges. 8
PageData Request at 6-8. Here again, the Court in Mountain questioned why the FCC allowed
Qwest to charge Mountain for the cost of transit traffic. Mountain Communications 355 F.3d at
649. Mountain argued that Qwest should not have charged it for transit traffic. The FCC allowed
Qwest to charge Mountain for transit traffic and indicated that Mountain could seek
reimbursement from the originating carrier. !d. However Mountain never received information
from Qwest about which carrier initiated the transit call.
8 "Transit Traffic" is calling traffic that originates from a carrier other than the interconnecting LEC but nonetheless
is carried over the LEC network to the paging carrier s network. Order No. 29140 at 23. In other words, transit
traffic in this instance would be non-Qwest originated traffic that Qwest transports to PageData.
DECISION MEMORANDUM
The Court did not decide this issue. The Court noted that "at oral argument, Qwest's
counsel obviated any need for us to decide this issue by indicating that Qwest would provide
Mountain with the information necessary so that Mountain could charge the originating carrier
for reimbursement. Under those circumstances, Mountain dropped that part of its Petition. Id.
In summary, PageData asserted that it does not owe Qwest any money, rather
Qwest owes PageData money." PageData Request at 12. PageData insisted that its accounts
should be zeroed out; it should receive a refund of all cash paid to Qwest for interconnection
activity; and Qwest should remit reciprocal compensation through January 2003 directly to
PageData.Id. at 13. Finally, PageData asserted that the reciprocal compensation that Qwest
owes it from January 2003 forward should be applied to Accounts 208 R510454 454 and 208-
375-8896-012B on a going-forward basis, with any remainder to be remitted to PageData by
check. !d.
COMMISSION DECISION
1. Does the Commission wish to process this complaint as a formal proceeding?
, what process (the Commission itself, hearing examiner, etc.) does the Commission wish to
utilize?
2. Or, does the Commission wish to dismiss the formal complaint?
reasons? Does the Commission wish to defer to an arbitrator or the FCC?
For what
3. Does the Commission wish to pursue another course of action?
Don Howell
Vld/M:QWETO325 - dh
9 PageData s Request for Summary Judgment also raises several other issues not directly related to its formal
complaint. These other topics included Qwest's failure to file interconnection agreements , federal rules preempted
rate tariffs, and PageData s request for an SPOP in August 1998 was ignored by Qwest.
DECISION MEMORANDUM