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Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
In the Matter of )
)
AT&T Corporation, )
)
Complainant, )
)
v. ) File No. E-97-04
)
Beehive Telephone Company, Inc. )
and Beehive Telephone, Inc. Nevada, )
)
Defendants. )
)
- and - )
)
Beehive Telephone Company, Inc. )
and Beehive Telephone, Inc. Nevada, )
)
Complainants, )
)
v. ) File No. E-97-14
)
AT&T Corp., )
)
Defendants. )
MEMORANDUM OPINION AND ORDER
Adopted: June 14, 2002 Released: June 20, 2002
By the Commission:
I. INTRODUCTION
1. In this Memorandum Opinion and Order (``Order''), we resolve
two complaint proceedings that we have consolidated for
administrative convenience.1 First, we grant in part and
dismiss and deny in part a formal complaint that AT&T
Corporation (``AT&T'') filed against Beehive Telephone
Company, Inc. and Beehive Telephone, Inc. Nevada
(collectively, ``Beehive'') pursuant to section 208 of the
Communications Act of 1934, as amended (``Act'' or
``Communications Act'').2 Second, we dismiss and deny in its
entirety a formal complaint that Beehive filed against AT&T
pursuant to section 208 of the Act.3
2. In its complaint, AT&T alleges that Beehive exceeded its
authorized rate of return and engaged in various unlawful
billing practices, in violation of sections 201(b)4 and
203(c)5 of the Act.6 In addition, AT&T alleges that an access
revenue-sharing arrangement between Beehive and an information
service provider to which Beehive terminated traffic breached
Beehive's common carrier duties, in violation of section
201(b) of the Act,7 and constituted unreasonable
discrimination, in violation of section 202(a) of the Act.8
We grant AT&T's claims that Beehive violated section 203(c) of
the Act by failing to comply with various billing requirements
of Beehive's effective tariff. We also grant AT&T's claims
that Beehive violated section 203(c) of the Act by failing to
comply with its tariff's requirements regarding billing access
charges based upon call attempts, but only as to liability and
not as to damages. We further grant AT&T's claims that
Beehive exceeded its authorized rate of return, but only as to
liability and not as to damages. Finally, on the basis of the
facts and arguments presented in this record, we deny AT&T's
claims regarding the access revenue-sharing arrangement
between Beehive and the information service provider, because
AT&T has failed to meet its burden of demonstrating that this
arrangement violated either section 201(b) or section 202(a)
of the Act.9
3. In its complaint, Beehive alleges conditionally that, if
(and only if) the Commission grants AT&T's claims that
Beehive's access revenue-sharing arrangement was unlawful,
then the Commission must also grant Beehive's claims that
certain of AT&T's billing arrangements with customers violated
sections 201(b), 203, and 228 (the Telephone Disclosure and
Dispute Resolution Act (``TDDRA'')) of the Act for precisely
the same reasons.10 Beehive also alleges that AT&T violated
sections 1.1711 and 1.729(b)12 of the Commission's rules by
failing to disclose certain information in the AT&T Complaint
proceeding.13 Because we deny AT&T's claims that Beehive's
access revenue-sharing arrangement was unlawful, the condition
precedent pled by Beehive has not been satisfied, and thus we
dismiss Beehive's claims under sections 201(b), 203, and 228
of the Act. In addition, we deny Beehive's claims under
sections 1.17 and 1.729(b) of the Commission's rules, because
Beehive has failed to meet its burden of demonstrating that
AT&T deliberately failed to disclose material information in
the AT&T Complaint proceeding.
II. BACKGROUND
4. At all relevant times, Beehive was an incumbent local
exchange carrier (``LEC'') located in rural Utah and Nevada
that served approximately 700 access lines.14 Beehive
provided local exchange service to end user customers, and
exchange access services to AT&T and other interexchange
carriers (``IXCs'').15
5. Prior to March 31, 1994, Beehive charged IXCs access rates
at the levels contained in the interstate access tariff filed
by the National Exchange Carrier Association (``NECA'') on
behalf of its member companies.16 The NECA tariff specified a
rate of approximately $.07 per terminating access minute.17
On March 31, 1994, pursuant to section 61.39 of the
Commission's rules,18 Beehive withdrew from the NECA tariff
and filed its own interstate access tariff (``Tariff'')
specifying a terminating interstate access rate of $.47 per
minute.19 That Tariff became effective on July 1, 1994.20
Although it contained its own access rates, Beehive's Tariff
explicitly incorporated the non-rate regulations, terms, and
conditions for access services set forth in NECA's Tariff
F.C.C. No. 5.21 As of July 1, 1995, Beehive reduced its
interstate access rate to $0.14 per terminating minute.22
6. In October, 1994, Beehive entered into an access revenue-
sharing arrangement with Joy Enterprises, Inc. (``Joy''), an
information service provider to which Beehive terminated
traffic.23 Initially, the compensation arrangement required
Beehive to pay Joy $.04 per access minute for each long
distance call terminated to Joy; eventually, in October, 1995,
the compensation was adjusted to a flat-rate of $84,000 per
month.24 Subsequently, in January, 1997, the amount was
reduced to $42,000 per month.25 III. DISCUSSION
A. Beehive Violated Section 203(c) of the Act By Imposing
Access Charges on AT&T For Unsuccessful Call Attempts.
7. AT&T alleges ¾ and Beehive admits ¾ that Beehive charged
AT&T for terminating unsuccessful long-distance call attempts,
i.e., calls that did not terminate to the end user, due to
either a ``no answer'' or ``busy signal'' at the called
number.26 AT&T maintains that this practice contradicted the
terms of Beehive's Tariff, in violation of section 203(c).27
For the following reasons, we agree.
8. As the parties acknowledge, Beehive ``was absolutely bound
by section 203(c) . . . to provide access services in exact
accordance with its tariff.''28 The parties also agree that
section 2.6 of NECA Tariff F.C.C. No. 5 governed whether
Beehive could properly impose access charges for terminating
unsuccessful call attempts.29 This Tariff section provided,
in pertinent part:
For the purpose of calculating chargeable usage,
the term `Access Minutes' denotes customer usage
of exchange facilities in the provision of
interstate or foreign service. . . . On the
terminating end of an interstate or foreign call,
usage is measured from the time the call is
received by the end user in the terminating
exchange. Timing of usage at both originating and
terminating ends of an interstate or foreign call
shall terminate when the calling or called party
disconnects, whichever event is recognized first
in the originating and terminating exchanges, as
applicable.30
9. We interpret this Tariff provision to mean that usage for
which Beehive may impose access charges on AT&T does not begin
to accrue until a called party ``receives'' a call. Under
this provision, a called party does not ``receive'' a call
that goes uncompleted (generally due to a no answer or busy
signal at the called number); rather, a called party
``receives'' a call only when that party actually answers it.
Our interpretation of the tariff term ``receive'' comports
with the common understanding of the word. For example, the
dictionary definition of ``receive'' is, in pertinent part:
``1. take or accept (something offered or given) into one's
hands or possession. . . . 3. accept delivery of (something
sent).31 A called party does not ``take'', ``accept'', or
``accept delivery of'' a call until he/she answers it. Thus,
under the pertinent tariff provision, an uncompleted call
generates no usage for which Beehive may impose access charges
on AT&T.
10. To try to counter this reading, Beehive only points out
that, under the Tariff, the timing of usage ``terminate[s]
when the calling or called party disconnects. . . .''32 Based
on this observation, Beehive argues that it can, in fact,
charge for uncompleted calls, because a calling party can
``disconnect'' a call even when the called party never picks
up.33 This reading of the Tariff fatally ignores the fact
that the standard for determining when usage terminates does
not even apply unless and until the standard for determining
when usage begins has been met. As explained above, an
uncompleted call does not meet that latter standard.
Consequently, Beehive's practice of imposing access charges on
AT&T for terminating uncompleted calls violated Beehive's
Tariff and, thus, section 203(c) of the Act.
11. AT&T's Complaint requests an order requiring Beehive ``to
refund AT&T all amounts which [Beehive] has unlawfully charged
[AT&T] in connection with'' uncompleted calls.34 However,
AT&T has neither submitted evidence regarding the appropriate
amount of such a refund, nor sought bifurcation of this
proceeding to make a complete damages showing in a subsequent
action.35 Perhaps this is because the parties have agreed to
an arbitration mechanism to resolve billing disputes, or
because AT&T can assert these unlawful charges as a claim or
an offset in the Utah Court Action.36 In any event, based on
this record, we find that AT&T has established that Beehive's
conduct regarding uncompleted calls violated section 203(c) of
the Act but has not proven damages.37
12. Accordingly, we grant Count Nine of AT&T's Complaint as to
liability, but deny Count Nine as to damages.38 We express no
opinion, however, as to whether AT&T may pursue a damages
claim in the Utah Court Action or in the parties'
arbitration.39
B. Beehive Violated Section 203(c) of the Act By Failing to
Comply With Certain Other Billing Requirements of Its
Tariff.
13. AT&T argues that Beehive violated section 203(c) of the Act
by ``consistently and intentionally''40 submitting bills to
AT&T for access services that were ``seriously inaccurate,''41
confusing, and non-compliant with the billing requirements of
Beehive's own Tariff.42 According to AT&T, the most egregious
problems were ``inconsistent and overlapping time periods
contained in each bill and the intentionally deceptive manner
in which Beehive identifies the days on which terminating
usage accrued.''43 Specifically, AT&T maintains that
Beehive's bill dates varied, Beehive's billing periods ranged
from three days to thirty-eight days, Beehive's bills often
included charges for usage incurred outside the billing
period, and Beehive billed some days twice or not at all.44
Moreover, AT&T asserts that Beehive identified some of the
dates on its bills through the use of the Julian calendar,
instead of the modern calendar, which is known as the
Gregorian calendar.45 According to AT&T, the Julian calendar
is approximately 13 days ahead of the Gregorian calendar, and
has not been observed since the 16th century.46 As evidence
of all these practices, AT&T submits three bills it received
from Beehive and an AT&T staff analysis of alleged
discrepancies in 173 Beehive bills (``AT&T Chart'').47
14. As explained above, section 203(c) of the Act requires that
a carrier adhere to the terms of its published tariff.48 As
also explained above, Beehive's Tariff incorporated by
reference the non-rate terms and conditions set forth in NECA
Tariff F.C.C. No. 5.49 That Tariff clearly specified that the
minimum billing period would be one month; that Beehive would
establish a uniform bill date each month that would not change
except upon sixty days' notice to AT&T; and that Beehive would
not double-bill for the same usage.50 Beehive admits that it
failed to comply with the first two of these requirements.51
Beehive explains that it could not adhere to a standard
billing cycle of at least one month because (i) it depended on
data from US West, which data often arrived out of sequence
and overdue, and (ii) its billing systems experienced
problems.52 Even if factually correct, these explanations do
not excuse Beehive from the obligation to comply with its
Tariff. Moreover, AT&T has submitted substantial evidence of
numerous and prolonged billing errors, which Beehive does not
refute.53 Thus, AT&T has met its burden of proving that
Beehive violated section 203 of the Act by committing numerous
billing errors and by failing to adhere to a standard billing
cycle of at least one month.54
15. We further find, however, that the record fails to support a
finding that Beehive committed anything more than a de minimus
violation of either section 203(c) or 201(b) by rendering
access bills based upon the Julian calendar. The evidence
submitted by AT&T is underwhelming. There is no allegation
(much less proof) that any of the three bills submitted by
AT&T into the record fails to properly identify the billing
period based upon the Gregorian calendar.55 Moreover, the
AT&T Chart that purports to summarize errors discovered on 173
bills indicates that almost all of those bills expressed dates
based upon both the Julian and Gregorian calendars.56
Finally, although Beehive admits that it submitted five
invoices to AT&T between February and May 1995 that referred
only to Julian calendar dates, Beehive denies that this
practice continued thereafter,57 and there is no evidence in
the record to the contrary. Thus, assuming, arguendo, that
billing based solely on the Julian calendar would violate
sections 201(b) and 203(c), we conclude that any such
violations here were too trivial to warrant any adverse
Commission finding.58
16. In sum, we conclude that AT&T has met its burden of proving
that Beehive violated section 203 with respect to all of the
billing practices alleged, except the use of the Julian
calendar. Therefore, we largely grant and partially deny
Counts Six and Seven of AT&T's Complaint accordingly.59 We
note that AT&T neither requested nor sought to prove damages
arising from the billing practices alleged in Counts Six and
Seven.
C. Beehive's Access Rates Violated Section 201(b) by Generating
Earnings Above the Prescribed Rate of Return in 1994, 1995,
and 1996.
17. AT&T alleges that Beehive's $.47 per minute and $.14 per
minute rates for terminating interstate access services
violated section 201(b) of the Act, because they caused
Beehive to exceed its prescribed rate of return of 11.25% in
1994, 1995, and 1996.60 AT&T did very little to seek or
submit in this proceeding's record evidence to substantiate
its allegations of overearnings.61 AT&T did eventually
request, however, that we take official notice of Beehive's
acknowledgment in another Commission proceeding that Beehive's
interstate access charges exceeded the prescribed rate of
return in 1994, 1995, and 1996.62 For the reasons explained
below, we accede to AT&T's request and, as a result, conclude
that AT&T has met its burden of showing that Beehive exceeded
the prescribed rate of return in 1994, 1995, and 1996.
18. On August 5, 1997, pursuant to section 204(a) of the Act,63
the Common Carrier Bureau's Competitive Pricing Division
suspended the interstate access tariff that Beehive had
belatedly filed on July 22, 1997 for the 1997-1999 period
(``Transmittal No. 6'').64 In doing so, the Suspension Order
stated that Transmittal No. 6 raised ``significant questions
of lawfulness'' about, inter alia, whether it contained rates
violative of section 201(b) of the Act.65 On December 2,
1997, the Common Carrier Bureau designated for investigation
various issues regarding Transmittal No. 6 and directed
Beehive to provide to the Commission detailed information
concerning its costs and revenues during 1994, 1995, and
1996.66
19. On December 15, 1997, in response to the Designation Order,
Beehive submitted to the Commission its ``Direct Case''
containing cost and revenue information for 1994, 1995, and
1996.67 This information indicated that, for interstate
services, Beehive had earned a 15.18% rate of return in 1994,
a 62.60% rate of return in 1995, and a 67.95% rate of return
in 1996, all well above the prescribed rate of return of
11.25%.68 Two weeks later, on December 29, 1997, Beehive
filed another pleading in that proceeding acknowledging the
accuracy of those excessive rates of return.69
20. The Commission has broad discretion in its adjudicatory
proceedings to take official notice of factual issues
``related directly to the agency's expertise or relate[d] to
certain aspects of the parties' situation of which the
commission has a good deal of prior knowledge.''70 The
historic rate-of-return information submitted by Beehive in
the Commission's investigation of Beehive's Transmittal No. 6
falls well within such discretion.71 Consequently, we agree
with AT&T that we should take official notice of Beehive's
acknowledgement in the Commission's proceeding investigating
Beehive's Transmittal No. 6 that Beehive exceeded its
prescribed interstate access rate of return in 1994, 1995, and
1996.
21. Beehive proffers several reasons why we should refrain from
considering AT&T's overearnings claims or taking official
notice of Beehive's prior statements that Beehive exceeded its
prescribed interstate access rate of return in 1994, 1995, and
1996.72 All of those reasons lack merit.
22. First, Beehive argues that the two-year statute of
limitations in section 415(c) of the Act73 bars AT&T's claim
regarding Beehive's $.47 rate, because AT&T knew or should
have known of the grounds for the claim when the rate took
effect on July 1, 1994, more than two years before AT&T filed
its complaint on October 29, 1996.74 Beehive argues that
section 415 also bars AT&T's claim regarding Beehive's $.14
rate, because AT&T knew or should have known of the grounds
for the claim when the rate took effect on July 1, 1995, more
than two years before AT&T submitted supporting evidence on
July 2, 1997.75 It is well established, however, that the
statute of limitations on a claim alleging overearnings does
not even begin to run until the defendant carrier files with
the Commission final information indicating that it did, in
fact, overearn during a particular period.76 The record
contains no evidence that Beehive filed such information with
the Commission more than two years before AT&T filed the
instant complaint.77 Thus, Beehive's statute of limitations
defense fails.78
23. Second, Beehive maintains that we should not take official
notice of information submitted in the Commission's
investigation of Transmittal No. 6, because such submissions
occurred after a statutory deadline for resolving AT&T's
claims in this proceeding had lapsed.79 Even assuming,
arguendo, the validity of Beehive's premise, Beehive's
conclusion does not follow. It is well established that the
expiration of a statutory deadline for the Commission to act
does not divest the Commission of authority to continue moving
toward resolution of a proceeding.80 Accordingly, we have
authority to take official notice of information submitted in
the Commission's investigation of Transmittal No. 6, whether
or not such submissions occurred after a statutory deadline
for resolving AT&T's claims in this proceeding had lapsed.81
Thus, Beehive's statutory deadline defense fails.
24. Third, Beehive contends that section 207 of the Act bars
AT&T's claims regarding the lawfulness of Beehive's rates,
because AT&T previously alleged the unlawfulness of Beehive's
rates as a defense in the Utah Court Action.82 Section 207
provides, in pertinent part, that ``[a]ny person claiming to
be damaged by any common carrier . . . may either make
complaint to the Commission . . . or may bring suit for the
recovery of the damages for which such common carrier may be
liable . . . in any district court of the United States . . .;
but such person shall not have the right to pursue both such
remedies.''83 Beehive overlooks the key facts, however, that
AT&T raised this defense in the context of a motion to dismiss
or stay the matter on primary jurisdiction grounds,84 and that
ultimately the federal court essentially granted AT&T's
motion.85 It is well established that section 207 does not
apply in the context of a primary jurisdiction referral.86
Thus, Beehive's section 207 defense fails.87
25. Fourth, Beehive asserts that we should not look to the
Commission's investigation of Transmittal No. 6 for any
purpose here, because the procedural rules governing the
investigation were ad hoc and different from formal complaint
procedures; the investigation included ex parte presentations;
the investigation proceeded on an unlawfully abbreviated
schedule; the investigation concerned Beehive's 1997
interstate switching rates, not its 1994-1996 overall access
rates; and the investigation record contained no data
concerning Beehive's costs and demand in 1993.88 All of these
assertions miss the point.89 None of these assertions changes
the fact that, during the course of the Commission's
investigation of Transmittal No. 6, Beehive itself submitted
information to the Commission clearly indicating that Beehive
exceeded its prescribed interstate access rate of return in
1994, 1995, and 1996; and Beehive has shown nothing in the
investigation proceeding or in this proceeding that undermines
the validity of Beehive's submissions. Thus, Beehive's
defense based on the nature and content of the Commission's
investigation of Transmittal No. 6 fails.
26. Finally, Beehive argues that AT&T cannot challenge the
lawfulness of Beehive's interstate access rates in 1995-1996,
because AT&T refused during that time to first pay all of the
charges based on those rates.90 Beehive's argument fatally
ignores the fact that its own Tariff contemplates that a
customer may withhold payment of disputed charges pending
resolution of the dispute.91 Under the filed rate doctrine,
therefore, Beehive's argument fails.92
27. In sum, Beehive presents no valid argument why we should
refrain from considering AT&T's overearnings claims and taking
official notice of information submitted by Beehive during the
Commission's investigation of Transmittal No. 6.
Consequently, we take official notice of the fact that,
according to Beehive's own records, Beehive earned interstate
access revenues above its prescribed rate of return in 1994,
1995, and 1996. Moreover, nothing in the record refutes this
evidence. Thus, AT&T has met its burden of demonstrating that
Beehive's access rates during those years were unjust and
unreasonable, in violation of section 201(b) of the Act.93
28. AT&T has not met its burden, however, of demonstrating the
extent to which it was damaged by Beehive's unlawful rates.
Although the record contains some pertinent information, the
record does not contain everything needed to make a precise
damage calculation. Moreover, nowhere in the record does AT&T
explain exactly how much it believes we should award due to
these violations or precisely how it would calculate such an
amount based on record evidence. Thus, we grant AT&T's
overearnings claims in Counts Four and Five of the Complaint
as to liability, but deny those claims as to damages. Again,
however, we express no opinion as to whether AT&T may pursue a
damages claim in the Utah Court Action or in the parties'
arbitration.94
D. AT&T Has Not Demonstrated on This Record that the Access
Revenue-Sharing Arrangement Between Beehive and Joy Violated
Section 201(b) or 202(a) of the Act.
29. AT&T alleges in its Complaint that the access revenue-
sharing arrangement between Beehive and Joy breached Beehive's
common carrier duties, in violation of section 201(b) of the
Act, and constituted unreasonable discrimination, in violation
of section 202(a) of the Act.95 AT&T's allegations and
arguments are identical to those raised and denied in AT&T v.
Jefferson96 and AT&T v. Frontier.97 Thus, for the reasons
explained in those orders, we conclude that AT&T has failed on
this record to meet its burden of demonstrating that Beehive
violated either section 201(b) or section 202(a) of the Act.98
Therefore, we deny Counts One, Two, and Three of AT&T's
Complaint.99
E. Beehive's Complaint Lacks Merit.
30. In its Complaint, Beehive alleges that, if (and only if) the
Commission were to find in this consolidated proceeding that
its access revenue-sharing arrangement with Joy was unlawful,
then the Commission must also find that AT&T's use of so-
called Terminating Switched Access Arrangements (``TSAAs'')
with AT&T's end user customers is unlawful.100 Elsewhere in
this Order, we find that, based on the record in this
proceeding, AT&T has failed to meet its burden of proving that
Beehive's access revenue-sharing arrangement with Joy was
unlawful.101 Therefore, the condition precedent pled by
Beehive has not been satisfied, and Beehive's claims must
fail.102 Accordingly, we dismiss the First and Second Causes
of Action of Beehive's Complaint.103
31. Beehive further alleges that, if (and only if) the
Commission were to find in a different pending proceeding that
a similar access revenue-sharing arrangement between another
carrier (Total Telecommunications Services, Inc.) and an
information provider was an unlawful attempt to evade the
requirements TDDRA, then the Commission must also find that
AT&T's use of TSAAs constituted an unlawful evasion of TDDRA,
as well.104 In Total Telecommunications Services, Inc., and
Atlas Telephone Company, Inc. v. AT&T Corp., we rejected this
TDDRA claim as moot,105 and AT&T did not raise a TDDRA claim
in its Complaint here. Therefore, again, the condition
precedent pled by Beehive has not been satisfied, so Beehive's
claim must fail. Accordingly, we dismiss the Fifth Cause of
Action of Beehive's Complaint. 106
32. Finally, Beehive alleges that AT&T concealed material facts
in this complaint proceeding, in violation of sections 1.17
and 1.729(b) of the Commission's rules.107 These facts dealt
with the existence and details of certain of AT&T's TSAAs.
Based on our review of the entire record in this proceeding,
we conclude that Beehive has failed to meet its burden of
proving that AT&T willfully withheld material information.
Accordingly, we deny the Third and Fourth Causes of Action of
Beehive's Complaint.108
IV. ORDERING CLAUSES
33. ACCORDINGLY, IT IS ORDERED, pursuant to sections 1, 4(i),
4(j), 201(b), 202(a), 203(c), and 208 of the Communications
Act of 1934, as amended, 47 U.S.C. §§ 151, 154(i), 154(j),
201(b), 202(a), 203(c), and 208, that the above-captioned
complaint filed by AT&T IS GRANTED IN PART AND DISMISSED OR
DENIED IN PART to the extent described herein.
34. IT IS FURTHER ORDERED, pursuant to sections 1, 4(i), 4(j),
201(b), 202(a), 203(c), and 208 of the Communications Act of
1934, as amended, 47 U.S.C. §§ 151, 154(i), 154(j), 201(b),
202(a), 203(c), and 208, that the above-captioned complaint
filed by Beehive IS DISMISSED AND DENIED IN ITS ENTIRETY WITH
PREJUDICE.
35. IT IS FURTHER ORDERED, pursuant to sections 1, 4(i), 4(j),
201(b), 202(a), 203(c), and 208 of the Communications Act of
1934, as amended, 47 U.S.C. §§ 151, 154(i), 154(j), 201(b),
202(a), 203(c), and 208, that AT&T's May 20, 1997 Motion to
Dismiss, Beehive's July 16, 1997 Motion to Strike, and
Beehive's March 16, 1998 Petition for Reconsideration are
DISMISSED as moot.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
_________________________
1 AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone Inc. Nevada, and Beehive Telephone Co., Inc. and
Beehive Telephone Inc. Nevada v. AT&T Corp., Letter from Russell
D. Lukas, Counsel for Beehive Telephone Co., to Thomas D. Wyatt,
Associate Chief, Enforcement Division, Common Carrier Bureau,
FCC, File Nos. E-97-04, E-97-14 (dated Jan. 21, 1998) (confirming
that the parties agreed to the consolidation of these complaint
proceedings during a conference call held with Commission staff
on January 9, 1998).
2 47 U.S.C. § 208. See AT&T Corp. v. Beehive Telephone
Co., Inc. and Beehive Telephone Inc. Nevada, Verified Complaint,
File No. E-97-04 (filed October 29, 1996) (``AT&T Complaint'').
3 AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone, Inc. Nevada, Cross Complaint, File E-97-14 (filed
March 25, 1997) (``Beehive Complaint'').
4 47 U.S.C. § 201(b). Section 201(b) of the Act
provides, in pertinent part, that ``[a]ll charges [and] practices
. . . in connection with such communication service shall be just
and reasonable, and any such charge [or] practice . . . that is
unjust or unreasonable is hereby declared to be unlawful.'' 47
U.S.C. § 201(b).
5 47 U.S.C. § 203(c). Section 203(c) of the Act states
that a carrier must provide communications services in strict
accordance with the terms and conditions contained in its tariff.
47 U.S.C. § 203(c).
6 AT&T Complaint at 9-12, ¶¶ 28-47.
7 AT&T Complaint at 6-8, ¶¶ 16-23.
8 47 U.S.C. § 202(a). See AT&T Complaint at 8, ¶¶ 24-27.
Section 202(a) of the Act makes it unlawful ``for any common
carrier to make any unjust or unreasonable discrimination in
charges, practices, . . . facilities, or services for or in
connection with like communication service . . . or to make or
give any undue or unreasonable preference or advantage to any
particular person.'' 47 U.S.C. § 202(a).
9 See generally Hi-Tech Furnace Systems, Inc. v. FCC, 224
F.3d 781, 787 (D.C. Cir. 2000) (affirming that the complainant in
a proceeding conducted under section 208 of the Act bears the
burden of proof). We also dismiss as moot AT&T's billing claims
under section 201(b) of the Act, because they are based on the
same facts, and seek the same relief, as the claims under section
203(c) that we grant.
10 Beehive Complaint at 9-10, 12-13, ¶¶ 34-40, 54-61.
11 47 C.F.R. § 1.17. Section 1.17 of the Commission's
rules forbids a carrier from making ``any misrepresentation or
willful material omission bearing on any matter within the
jurisdiction of the Commission.'' 47 C.F.R. § 1.17.
12 47 C.F.R. § 1.729(b) (1996). At the relevant time,
section 1.729(b) of the Commission's rules required
interrogatories to be answered ``fully in writing under oath or
affirmation.'' Id. That obligation now appears in section
1.729(e) of our rules. 47 C.F.R. § 1.729(e) (2001).
13 Beehive Complaint at 10-12, ¶¶ 41-53.
14 AT&T Complaint at 2-3, ¶¶ 2-3, 5; AT&T Corp. v. Beehive
Telephone Co., Inc. and Beehive Telephone Inc. Nevada, Answer,
File No. E-97-04 (filed December 18, 1996) at 1-2, ¶¶ 2-3, 5
(``Beehive Answer''); AT&T Corp. v. Beehive Telephone Co., Inc.
and Beehive Telephone Inc. Nevada, Brief for Defendants, File No.
E-97-04 (filed June 5, 1997) at 3 (``Beehive Initial Brief'');
Beehive Complaint at 1, ¶¶ 1-2.
15 AT&T Complaint at 2-3, ¶¶ 2-3, 5; Beehive Answer at 1-
2, ¶¶ 2-3, 5; AT&T Corp. v. Beehive Telephone Co., Inc. and
Beehive Telephone Inc. Nevada, Initial Brief of AT&T Corp., File
No. E-97-04 (filed June 5, 1997) at 1 (``AT&T Initial Brief'').
16 AT&T Complaint at 3, ¶ 6; Beehive Answer at 2, ¶ 6;
AT&T Initial Brief at 1.
17 AT&T Complaint at 3, ¶ 6; Beehive Answer at 2, ¶ 6;
AT&T Initial Brief at 1-2.
18 47 C.F.R. § 61.39 (permitting certain small local
exchange carriers to base their tariffed access rates upon
historic costs and revenues).
19 AT&T Complaint at 3, ¶¶ 6-7; Beehive Answer at 2, ¶¶ 6-
7; AT&T Initial Brief at 1-2; Beehive Initial Brief at 3.
20 AT&T Complaint at 3, ¶ 7; Beehive Answer at 2, ¶ 7;
AT&T Initial Brief at 2.
21 AT&T Complaint at 11, ¶ 44; Beehive Answer at 7-8, ¶
44; Beehive Initial Brief at 23-24; AT&T Initial Brief at 22.
Beehive's current Tariff is available on the Commission web site
at http://svartifoss2.fcc.gov/cgi-
bin/ws.exe/prod/ccb/etfs/webpublic/search.hts.
22 AT&T Complaint at 4, ¶ 11; Beehive Answer at 3, ¶ 11;
AT&T Initial Brief at 4. At about that same time, AT&T began to
refuse to pay some or all of Beehive's interstate terminating
access charges. Beehive Answer at 3-4, ¶ 12; Beehive Initial
Brief at 6. Five months later, on December 5, 1995, Beehive
filed suit against AT&T in federal district court in Utah seeking
to recover access charges allegedly withheld unlawfully by AT&T
(the ``Utah Court Action''). Beehive Answer at 3-4, ¶ 12;
Beehive Initial Brief at 6. On January 5, 1996, pursuant to
Fed.R.Civ.P. 12(b), AT&T filed, in lieu of an answer, a motion to
dismiss or stay the complaint on primary jurisdiction grounds.
See AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone Inc. Nevada, Reply Brief of AT&T Corp., File No. E-97-
04 (filed July 2, 1997) (``AT&T Reply Brief'') at Exhibits C, D.
On April 29, 1997, the federal district court stayed the Utah
Court Action pending a ruling by the Commission in this
proceeding. AT&T Corp. v. Beehive Telephone Co., Inc. and
Beehive Telephone Inc. Nevada, Letter from Peter H. Jacoby,
Counsel for AT&T Corp., to Greg Lipscomb, Attorney, Formal
Complaints and Investigations Branch, Enforcement Division,
Common Carrier Bureau, FCC, File No. E-97-04 (dated May 6, 1997),
Attachment; AT&T Reply Brief at 14-15.
23 AT&T Complaint at 3-4, ¶ 9; Beehive Answer at 2-3, ¶ 9;
AT&T Initial Brief at 3.
24 Beehive Initial Brief at 4 n.4; AT&T Initial Brief at
Exhibit 4 (Defendant's Response to Complainant's First Set of
Interrogatories), Response to Interrogatory No. 1.
25 AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone Inc. Nevada, Reply Brief For Defendants, File No. E-97-
04 (filed July 2, 1997) at 6 (``Beehive Reply Brief'').
26 AT&T Complaint at 5, 11-12, ¶¶ 14, 43-47; Beehive
Answer at 4, ¶ 14; Beehive Initial Brief at 23-24. See AT&T
Initial Brief at 23-26; AT&T Reply Brief at 24-25.
27 AT&T Complaint at 11-12, ¶¶ 43-47; AT&T Initial Brief
at 23-26.
28 Beehive Initial Brief at 11. See, e.g., Public Service
Enterprises of Pennsylvania, Inc. v. AT&T Corp., Memorandum
Opinion and Order, 10 FCC Rcd 8390, 8402 (1995) (stating that
``[s]ection 203 is intended primarily to insure that carriers
file all rates and regulations in their tariffs and abide by them
upon all occasions.''), vacated and remanded on other grounds,
AT&T Corp. v. FCC, 86 F.3d 242 (1996). See also Philippine Long
Distance Telephone v. World Communications, Inc., Order and
Notice of Apparent Liability for Forfeitures, 8 FCC Rcd 755, 759
n.35 (1993), recon. granted on other grounds, Philippine Long
Distance Telephone v. World Communications, Inc., Order, 13 FCC
Rcd 21520 (1998).
29 See AT&T Complaint at 11, ¶ 44; Beehive Answer at 7-8,
¶ 44; Beehive Initial Brief at 23-24; AT&T Initial Brief at 22.
We note that AT&T failed to enter into the record section 2.6 of
NECA Tariff F.C.C. No. 5. This did not violate any existing
rule, however. At the time the complaint was filed in this
proceeding, section 1.720(h) of the Commission's rules merely
encouraged parties to provide copies of any relevant tariff
provisions. 47 C.F.R. § 1.720(h) (1996). This rule has since
been revised to require that parties provide copies of relevant
tariff provisions. 47 C.F.R. § 1.720(h) (2001).
30 NECA Tariff F.C.C. No. 5, Section 2.6, Definitions,
Access Minutes (emphasis added). Because neither party submitted
into the record the version of section 2.6 of NECA Tariff F.C.C.
No. 5 that was effective during the relevant period, we quote
from the currently effective version of NECA Tariff No. 5 (which
is available on the Commission web site at
http://svartifoss2.fcc.gov/cgi-
bin/ws.exe/prod/ccb/etfs/webpublic/search.hts), and assume that
the current version does not materially differ from the version
in effect at the relevant time.
31 The Oxford American Dictionary of Current English
(Oxford University Press 1999) at 665.
32 Beehive Initial Brief at 23, quoting NECA Tariff F.C.C.
No. 5, § 2.6 at 2-61 (emphasis added).
33 Beehive Initial Brief at 23-24.
34 AT&T Complaint at 13.
35 See 47 C.F.R. § 1.722 (1996).
36 Beehive Initial Brief at 22; AT&T Reply Brief at 23-24;
Beehive Reply Brief at 27.
37 Beehive alleges that the Filed Rate Doctrine bars
AT&T's claim of overcharges based on charges for uncompleted
calls. Beehive Answer at 8, ¶¶ 50-52. This defense is patently
meritless. To the extent that Beehive billed AT&T in violation
of its Tariff and the Act, the Filed Rate Doctrine provides no
shelter. See, e.g., AT&T Corp. v. Business Telecom, Inc.,
Memorandum Opinion and Order, 16 FCC Rcd 12312, 12317-18, ¶ 9
(2001).
38 In addition, we dismiss as moot Count Eight of AT&T's
Complaint because, although based on section 201(b) rather than
section 203(c), Count Eight is identical in all other material
respects to Count Nine.
39 This is because this proceeding stems from a primary
jurisdiction referral. See paragraph 24, infra.
40 AT&T Initial Brief at 19.
41 AT&T Initial Brief at 19.
42 AT&T Complaint at 5, 10-11, ¶¶ 13, 38-42.
43 AT&T Initial Brief at 19. See AT&T Complaint at 5, ¶
13.
44 AT&T Complaint at 5, ¶ 13; AT&T Initial Brief at 19-23;
AT&T Reply Brief at 22-23.
45 AT&T Complaint at 5, ¶ 13; AT&T Initial Brief at 20;
AT&T Reply Brief at 23. The Julian calendar was adopted by
Julius Caesar in 46 B.C.E. The Julian calendar closely resembles
the Gregorian calendar, as both derive from 365 days divided into
twelve months. By the thirteenth century, however, scholars
realized that the Julian calendar included a minor flaw, which
resulted in the calendar slowly becoming out of sync with the
solar year. The flaw was this: under the Julian calendar, a year
was 365.25 days long (i.e., an extra day was inserted every
fourth year, typically known as a ``leap year''). This
significantly differs from the ``real'' length of the solar year,
which is approximately 365.242199 days long. This error amounted
to slightly more than 11 minutes per year. As a result, as the
centuries passed, the Julian calendar became increasingly
inaccurate with respect to the seasons. By the 16th century, the
Julian calendar was running nearly two weeks late. To fix this
growing problem, astronomers proposed eliminating ten days from
the calendar and changing the rules regarding leap years. Pope
Gregory XIII adopted this proposal in 1582. Thus, under the
Gregorian calendar, ``leap year'' is skipped three times every
four hundred years. See ``Calendar,'' 15 ENCYCLOPEDIA BRITANNICA
432, 444-46 (15th ed., 1991); Peter Meyer, ``The Julian and
Gregorian Calendars,''
http://serendipity.magnet.ch/hermetic/cal_stud/cal_art.htm; L. E.
Doggett, ``Calendars,''
http://astro.nmsu.edu/~lhuber/leaphist.html.
46 AT&T Complaint at 5, ¶ 13; AT&T Initial Brief at 20.
AT&T is incorrect. Although Pope Gregory XIII issued a papal
decree establishing the Gregorian calendar in 1582, several
nations continued to use the Julian calendar for some time
thereafter. For example, Britain (and the British colonies, such
as America) continued to use the Julian calendar until 1752.
Other countries that continued to use the Julian calendar include
Sweden (switched in 1753), Japan (1873), Egypt (1875), the Soviet
Union (1918), and Turkey (1927), to name just a few. Alaska
retained the Julian calendar until 1867, when it was transferred
from Russia to the United States. See ``Calendar,'' 15
ENCYCLOPEDIA BRITANNICA 432, 444-46 (15th ed., 1991); Peter
Meyer, ``The Julian and Gregorian Calendars,''
http://serendipity.magnet.ch/hermetic/cal_stud/cal_art.htm.
47 AT&T Reply Brief at Exhibit I; AT&T Initial Brief at
Exhibit 3, Attachment A.
48 47 U.S.C. § 203(c). See n.28, supra.
49 See ¶ 8 and n.29, supra.
50 NECA Tariff F.C.C. No. 5, sections 2.4.1, 2.4.2
(appended to AT&T's Initial Brief at Exhibit 7). Although no
provision of the NECA tariff expressly prohibits double billing,
this duty is implied throughout section 2.4.1. For example,
section 2.4.1(B) states that Beehive ``shall bill on a current
basis all charges incurred by and credits due to the customer
under this tariff . . . .'' NECA Tariff F.C.C. No. 5, section
2.4.1(B).
51 See AT&T Initial Brief at Exhibit 4, Response to
Interrogatory No. 10. For example, three Beehive bills submitted
into the record by AT&T indicate billing periods of six, five,
and four days. See AT&T Reply Brief at Exhibit I.
52 Beehive Reply Brief at 26.
53 See AT&T Initial Brief at Exhibit 3, Attachment A.
54 Because of this holding, we dismiss as moot AT&T's
claim in Count Seven that Beehive violated section 201(b), based
on the same conduct.
55 See AT&T Reply Brief at Exhibit I.
56 See AT&T Initial Brief at Exhibit 3, Attachment A.
57 Beehive Answer at 4, ¶ 13.
58 In order to minimize uncertainty and confusion in
interstate access billing matters, we strongly encourage carriers
to use the standard, generally accepted calendar.
59 Beehive alleges that the Filed Rate Doctrine bars
AT&T's claims of unlawful billing practices. Beehive Answer at
8, ¶¶ 50-52. This defense is patently meritless. See supra,
n.37.
60 AT&T Complaint at 9-10, ¶¶ 28-37; AT&T Initial Brief at
26-29; AT&T Reply Brief at 20-22; AT&T Corp. v. Beehive Telephone
Co., Inc. and Beehive Telephone Inc. Nevada, Initial Brief of
AT&T Corp., File Nos. E-97-04, E-97-14 (filed Apr. 20, 1998) at
8-11, 24-15 (``AT&T Supplemental Brief''); AT&T Corp. v. Beehive
Telephone Co., Inc. and Beehive Telephone Inc. Nevada, Reply
Brief of AT&T Corp., File Nos. E-97-04, E-97-14 (filed May 4,
1998) at 7-13 (``AT&T Supplemental Reply Brief''). See
Represcribing the Authorized Rate of Return for Interstate
Services of Local Exchange Carriers, Order, 5 FCC Rcd 7507, 7509,
¶ 13 (1990) (prescribing a rate of return of 11.25% for certain
incumbent LECs, including Beehive).
61 See generally AT&T Reply Brief at 20-22 (acknowledging
that, based on the record evidence at that time, the Commission
could not be ``completely certain'' that Beehive had exceeded its
prescribed rate of return).
62 AT&T Supplemental Brief at 24-25; AT&T Supplemental
Reply Brief at 3-11.
63 47 U.S.C. § 204(a) (authorizing the Commission to
suspend a tariff and to determine whether new or revised charges
contained in the tariff are just and reasonable).
64 Beehive Telephone Co., Inc., Tariff F.C.C. No. 1,
Transmittal No. 6, Suspension Order, 12 FCC Rcd 11695 (Com. Car.
Bur., Com. Pric. Div. 1997) (``Suspension Order'').
65 Suspension Order, 12 FCC Rcd at 11697, ¶ 6.
66 Beehive Telephone Co., Inc., Tariff F.C.C. No. 1,
Transmittal No. 6, Order Designating Issues for Investigation, 12
FCC Rcd 20249 (Com. Car. Bur. 1997) (``Designation Order'').
67 Beehive Telephone Co., Inc., Tariff F.C.C. No. 1,
Transmittal No. 6, Direct Case, CC Docket No. 97-237 (filed Dec.
15, 1997) (``Direct Case'').
68 Direct Case at 4, 7, 11.
69 Beehive Telephone Co., Inc., Tariff F.C.C. No. 1,
Transmittal No. 6, Rebuttal to Opposition to Direct Case, CC
Docket No. 97-237 (filed Dec. 29, 1997) at 13 (``Rebuttal'').
The Commission ultimately determined that Beehive's switching
rates in Transmittal No. 6 were excessive, and thus prescribed
lower switching rates and ordered refunds. Beehive Telephone
Co., Inc., Tariff F.C.C. No. 1, Transmittal No. 6, Memorandum
Opinion and Order, 13 FCC Rcd 2736 (1998) (``Refund Order''),
modified on recon., Order on Reconsideration, 13 FCC Rcd 11795
(1998), aff'd, Beehive Telephone Co., Inc. v. FCC, 180 F.3d 314
(1999). In so ruling, the Commission determined that Beehive's
rate of return on switching alone was 12.2% in 1994, 111% in
1995, and 65% in 1996. Refund Order, 13 FCC Rcd at 2741, ¶ 13.
70 Aman & Mayton, Administrative Law § 8.4.8 at 232 (West
1993). See 5 U.S.C. § 556(e); 47 C.F.R. §§ 1.361, 1.727(b); Fed.
R. Evid. 201.
71 See, e.g., Bachow/Coastel, L.L.C. v. GTE Wireless of
the South, Inc., Order on Review, 16 FCC Rcd 4967, 4968-69, ¶ 5
(2001); In Re Applications of Chesapeake and Potomac Company of
Virginia, Memorandum Opinion and Order, 98 F.C.C. 2d 238, 239 n.4
(1984); Revision of the Processing Policies for Waivers of the
Telephone Company-Cable Television ``Cross Ownership Rules,''
Memorandum Opinion and Order, 82 F.C.C. 2d 254, 260-61 & n.6
(1980), recon. granted in part on other grounds, Revision of the
Processing Policies for Waivers of the Telephone Company-Cable
Television ``Cross Ownership Rules,'' Memorandum Opinion and
Order, 86 FCC 2d 983 (1981).
72 AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone Inc. Nevada, Supplemental Brief for Defendants in File
No. E-97-04 and Initial Brief for Complainants in File No. E-97-
14, File Nos. E-97-04, E-97-14 (filed Apr. 20, 1998) at 17-26
(``Beehive Supplemental Brief''); AT&T Corp. v. Beehive Telephone
Co., Inc. and Beehive Telephone Inc. Nevada, Reply Brief, File
Nos. E-97-04, E-97-14 (filed May 4, 1998) at 8-12, 27-28
(``Beehive Supplemental Reply Brief'').
73 47 U.S.C. § 415.
74 Beehive Supplemental Brief at 17-20; Beehive
Supplemental Reply Brief at 22.
75 Beehive Supplemental Brief at 20-23.
76 See, e.g., MCI Telecommunications Corp. v. FCC, 59 F.3d
1407, 1416-17 (D.C. Cir. 1995), cert. dismissed sub nom.
BellSouth Telecommunications, Inc. v. FCC, 517 U.S. 1129 (1996),
cert. denied sub nom. BellSouth Telecommunications, Inc. v. FCC,
517 U.S. 1240 (1996); General Communication, Inc. v. Alaska
Communications Systems Holdings, Inc., et al., Memorandum Opinion
and Order, 16 FCC Rcd 2834, 2860-61, ¶¶ 67-68 (2001), appeal
pending, ACS of Anchorage, Inc. v. Federal Communications
Commission, No. 01-1059 (D.C. Cir., filed Feb. 7, 2001).
77 See generally 47 C.F.R. § 65.600 (requiring local
exchange carriers not subject to price cap regulation to file
with the Commission an annual rate-of-return monitoring report).
78 For the same reasons, Beehive's laches defense also
fails. Answer at 9-12, ¶¶ 57-71.
79 Beehive Supplemental Brief at 20-23 (citing 47 U.S.C. §
208(b)(1)).
80 See, e.g., Contract Freighters, Inc. v. Dep't of
Transportation, 260 F.3d 858, 860 n.3 (8th Cir. 2001);
Southwestern Bell Telephone Co. v. FCC, 138 F.3d 746, 749-50 (8th
Cir. 1998); Gottleib v. Pena, 41 F.3d 730, 733-37 (D.C.
Cir.1994); 800 Data Base Access Tariffs and the 800 Service
Management System Tariff, Order on Reconsideration, 12 FCC Rcd
5188, 5193-94, ¶ 15 (1997).
81 Given this conclusion, we need not and do not decide
whether the submissions at issue here occurred after a statutory
deadline for resolving AT&T's claims in this proceeding had
lapsed.
82 47 U.S.C. § 207. See Beehive Initial Brief at 15-16.
83 47 U.S.C. § 207.
84 AT&T Reply Brief at Exhibits D, C.
85 AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone Inc. Nevada, Letter from Peter H. Jacoby, Counsel for
AT&T Corp., to Greg Lipscomb, Attorney, Formal Complaints and
Investigations Branch, Enforcement Division, Common Carrier
Bureau, FCC, File No. E-97-04 (dated May 6, 1997), Attachment.
See Beehive Initial Brief at 10; AT&T Reply Brief at 14-15.
86 See, e.g., Allnet Communication Service, Inc. v.
National Exchange Carrier Association, Inc., 965 F.2d 1118, 1122
(D.C. Cir. 1992).
87 It is true that AT&T filed its complaint here perhaps a
bit prematurely, a few months before the federal court granted
AT&T's primary jurisdiction motion. At this point, however, long
after the court has granted AT&T's motion, dismissing AT&T's
complaint on that basis would unduly exalt form over substance.
This is especially true, given that Beehive has alleged no
prejudice arising from AT&T's filing of the complaint in
anticipation of the court's order granting referral. Indeed,
section 207 might not even apply here, because AT&T raised the
issue of rate reasonableness in the context of a Rule 12(b)
motion, not in the context of an affirmative defense or
counterclaim. Nevertheless, we caution future complainants that
the mere filing of a primary jurisdiction motion in court does
not vitiate section 207 concerns.
88 Beehive Supplemental Brief at 23-26; Beehive
Supplemental Reply Brief at 11-12, 27-28.
89 We note that the D.C. Circuit affirmed the Commission's
order concluding the investigation of Transmittal No. 6, which
found that Beehive's interstate rate of return for local
switching in 1994-1996 was excessive, and which rejected the
``due process'' arguments raised here. Beehive Telephone
Company, Inc., Tariff F.C.C. No. 1, Transmittal No. 6, Memorandum
Opinion and Order, 13 FCC Rcd 2736 (1998), modified on recon.,
Order on Reconsideration, 13 FCC Rcd 11795 (1998), aff'd, Beehive
Telephone Co., Inc., 180 F.3d 314 (D.C. Cir. 1999).
90 Beehive Initial Brief at 16-17.
91 NECA Tariff F.C.C. No. 5, section 2.4.1(D). Given this
result, we need not decide whether Beehive's defense has any
other flaws.
92 See, e.g., AT&T v. Central Office Telephone, Inc., 524
U.S. 214 (1998). Beehive also seems to argue that the filed rate
doctrine precludes AT&T from challenging the reasonableness of
Beehive's tariffed access rates. Beehive Answer at 8, ¶¶ 50-52;
Beehive Initial Brief at 16-17. That argument is patently
meritless. It is well established that the Commission has the
authority to determine the reasonableness of a tariffed rate in
the context of a section 208 complaint proceeding. See, e.g.,
AT&T Corp. v. Business Telecom, Inc., Memorandum Opinion and
Order, 16 FCC Rcd 12312, 12317-20, ¶¶ 9-12 (2001).
93 We must assess the lawfulness of Beehive's rates and
earnings in 1994 in combination with Beehive's rates and earnings
in 1993. See 47 C.F.R. §§ 65.600(b), 65.702(b). See also Virgin
Islands Telephone Corp. v. FCC, 989 F.2d 1231 (D.C. Cir. 1993).
Here, we conclude that Beehive's rates in 1994 were unlawful
based, in part, on an assumption that Beehive did not materially
underearn in 1993. This assumption is reasonable, because
Beehive knew that AT&T was urging us to consider information
regarding Beehive's rates and earnings in 1994, yet offered no
evidence (such as monitoring reports) indicating that any
overearnings in 1994 had been offset by underearnings in 1993.
This assumption is especially appropriate because (i) Beehive
participated in the NECA tariff during 1993 and half of 1994, and
(ii) the record contains some evidence that Beehive actually
overearned in the 1993-94 period. See AT&T Reply Brief at
Exhibit H (a Beehive preliminary report indicating that its
interstate rate of return during 1993-94 would be 16.93%).
Beehive moves us to strike this (and other) evidence as untimely
filed, AT&T Corp. v. Beehive Telephone Co., Inc. and Beehive
Telephone Inc. Nevada, Letter from Russell D. Lukas, Counsel for
Beehive Telephone Co., to Greg Lipscomb, Attorney, Enforcement
Division, Common Carrier Bureau, FCC, File No. E-97-04 (dated
Jul. 16, 1997), but we deny that motion, because Beehive had
ample opportunity in its briefs filed in 1998 to respond to this
(and other) evidence, which AT&T filed in 1997.
94 See n.39, supra.
95 AT&T Complaint at 6-8, ¶¶ 16-27. See AT&T Initial
Brief at 5-19; AT&T Reply Brief at 9-12, 15-20.
96 AT&T Corp. v. Jefferson Telephone Co., Memorandum
Opinion and Order, 16 FCC Rcd 16130 (2001) (``AT&T v.
Jefferson'').
97 AT&T Corp. v. Frontier Communications of Mt. Pulaski,
Inc. et al., Memorandum Opinion and Order, 17 FCC Rcd 4041 (2002)
(``AT&T v. Frontier'').
98 See generally Hi-Tech Furnace Systems, Inc. v. FCC, 224
F.3d 781, 787 (D.C. Cir. 2000) (affirming that the complainant in
a proceeding conducted under section 208 of the Act bears the
burden of proof). We note that, although AT&T suggests that
Beehive's corporate relationship with Joy was somehow improper,
see, e.g., AT&T Initial Brief at 2, 5, AT&T asserts no claim on
this basis.
99 Moreover, we decline to reach two issues that AT&T
raised for the first time in its briefs, because the tardy
raising of these issues renders the record insufficient to permit
a reasoned decision. See, e.g., AT&T v. Jefferson, 16 FCC Rcd
at 16133 n.18; Consumer.Net v. AT&T Corp., Order, 15 FCC Rcd 281,
300, ¶ 40 n.93 (1999) (declining to consider an argument raised
for the first time in the briefs). Cf., Building Owners and
Managers Association International v. FCC, 254 F.3d 89, 100 n.14
(D.C. Cir. 2001) (declining to address an issue raised cursorily
in the brief). Specifically, in its briefs, AT&T maintains for
the first time that the revenue-sharing arrangement between
Beehive and Joy also violated section 201(b) by ``evading the
requirements'' of TDDRA. AT&T Initial Brief at 14-16; AT&T Reply
Brief at 9-12. In addition, in its briefs, AT&T argues for the
first time that Beehive's practice of billing AT&T for traffic
terminated to Joy violated the Commission's tariff regulations.
AT&T Initial Brief at 10-13; AT&T Reply Brief at 8-9.
100 Beehive Complaint at 2, 9-10, 12-13, ¶¶ 5, 34-40, 54-
61. See Beehive Supplemental Brief at 26-30; Beehive
Supplemental Reply Brief at 12-18; Beehive Telephone Co., Inc.
and Beehive Telephone Inc. Nevada v. AT&T Corp., Opposition to
Motion to Dismiss, File No. E-97-14 (filed June 4, 1997) at 4-5.
101 See section III.D, supra.
102 Beehive filed a petition for reconsideration of a staff
discovery ruling regarding information about AT&T's TSAAs.
Beehive Telephone Co., Inc. and Beehive Telephone Inc. Nevada v.
AT&T Corp., Petition For Reconsideration, File No. E-97-14 (filed
Mar. 26, 1998); AT&T Corp. v. Beehive Telephone Co., Inc. and
Beehive Telephone Inc. Nevada, and Beehive Telephone Co., Inc.
and Beehive Telephone Inc. Nevada v. AT&T Corp., Letter from
Deena M. Shetler, Attorney, Enforcement Division, Common Carrier
Bureau, FCC, to Peter H. Jacoby, Counsel for AT&T Corp., and
Russell D. Lukas, Counsel for Beehive Telephone Co., File Nos. E-
97-04, E-97-14 (dated Mar. 16, 1998); AT&T Corp. v. Beehive
Telephone Co., Inc. and Beehive Telephone Inc. Nevada, and
Beehive Telephone Co., Inc. and Beehive Telephone Inc. Nevada v.
AT&T Corp., Letter from Deena M. Shetler, Attorney, Enforcement
Division, Common Carrier Bureau, FCC, to Peter H. Jacoby, Counsel
for AT&T Corp., and Russell D. Lukas, Counsel for Beehive
Telephone Co., File Nos. E-97-04, E-97-14 (dated Mar. 24, 1998).
As this Order makes clear, such information was not germane to
our resolution of any of the claims by either party. Thus, we
dismiss Beehive's petition as moot.
103 Because we dismiss these claims on other grounds, we
need not reach the arguably antecedent question whether these
claims should be dismissed due to their conditional nature.
104 Beehive Complaint at 12-13, ¶¶ 54-61. See Beehive
Supplemental Brief at 26-30; Beehive Supplemental Reply Brief at
18-19.
105 Total Telecommunications Services, Inc., and Atlas
Telephone Company, Inc. v. AT&T Corp., Memorandum Opinion and
Order, 16 FCC Rcd 5726, 5744 ¶ 41 (2001), appeal pending, AT&T
Corp. v. FCC, Case Nos. 01-1188, 01-1201 (D.C. Cir., filed Apr.
20, 2001).
106 Again, because we dismiss this claim on other grounds,
we need not reach the arguably antecedent question whether this
claim should be dismissed due to its conditional nature.
107 Beehive Complaint at 2, 10-11, ¶¶ 5, 41-53. See
Beehive Supplemental Brief at 14-15, 30-32; Beehive Supplemental
Reply Brief at 6-8, 23-27.
108 Because we deny these claims on other grounds, we need
not reach the arguably antecedent question whether alleged
violations of sections 1.17 and 1.729(b) of our rules ¾ which
govern carriers' dealings with the Commission, not their
provision of telecommunication services ¾ state a claim under
section 208 of the Act. In addition, because we deny Beehive's
Complaint in its entirety, we also dismiss as moot AT&T's Motion
to Dismiss Beehive's Complaint. See AT&T Corp. v. Beehive
Telephone Co., Inc. and Beehive Telephone Inc. Nevada, Motion to
Dismiss, File No. E-97-14 (filed May 20, 1997).