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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
Nova Cellular West, Inc., )
)
Petitioner, )
)
v. ) File No. EB-00-MD-0221
)
AirTouch Cellular, )
)
Respondent. )
)
MEMORANDUM OPINON AND ORDER
Adopted: July 18, 2002 Released: July 25, 2002
By the Commission:
I. INTRODUCTION
1. In this Memorandum Opinion and Order, we deny a
Petition for Declaratory Ruling filed by Nova Cellular West, Inc.
(``Nova'').2 The Petition alleges that, by failing to provide
electronic billing tape to Nova in connection with numerous
cellular telephone service rate plans, AirTouch Cellular
(``AirTouch'') unreasonably restricted Nova's ability to resell
the service, in violation of section 20.12 of the Commission's
rules3 and sections 201(a), 201(b), and 202(a) of the
Communications Act of 1934, as amended (``Act'').4 The Petition
further contends that AirTouch unreasonably discriminated against
Nova by failing to change rate plans for Nova in the same timely
manner that AirTouch did for other customers, in violation of
section 202(a) of the Act. We deny Nova's claims regarding the
provision of electronic billing tape for resale purposes, because
a settlement and release agreement previously executed by Nova
and AirTouch waives these claims and limits Nova's remedy to
seeking enforcement of the settlement agreement itself under
California law. We also deny Nova's claims about changing rate
plans, because Nova failed to demonstrate that AirTouch treated
Nova differently in this regard than any other similarly-situated
AirTouch customer.
II. BACKGROUND
II.A. The Parties
2. Nova is a corporation with its principal place of
business in Encinitas, California.5 Under the name ``San Diego
Wireless,'' Nova provides cellular and other commercial mobile
radio service (``CMRS'') in the San Diego, California area as a
reseller of the services of facilities-based CMRS providers.6
Nova was a reseller of AirTouch services in the San Diego area
from 1986 until May 1999.7
3. AirTouch is a corporation with its headquarters in San
Francisco, California.8 AirTouch provides cellular service in
the San Diego, California Standard Metropolitan Statistical Area
(``SMSA'')9 as a common carrier, pursuant to a license issued by
the Commission.10
4. AirTouch offers cellular service pursuant to wholesale
rate plans (designed for resellers) and retail rate plans
(designed for AirTouch's own retail customers).11 Unlike its
retail rate plans, AirTouch's wholesale rate plans generally are
equipped to provide resellers with electronic billing tapes that
sets forth the usage of the phones assigned to the plans.12
According to the Petition, such tapes enable larger resellers,
like Nova, to bill their numerous customers in a timely and
efficient manner.13
II.B. California Public Utilities Commission Proceeding
5. In 1996, Nova sought to purchase from AirTouch access
and airtime pursuant to certain promotional retail rate plans
that Nova believed offered more favorable rates than the
wholesale rate plans then available.14 AirTouch informed Nova
that Nova could purchase under any retail plan for resale, but
that electronic billing tapes to facilitate Nova's billing of its
customers were not available in connection with retail plans.15
6. Dissatisfied with AirTouch's response, Nova filed a
complaint against AirTouch with the California Public Utilities
Commission (``CPUC'') on December 13, 1996.16 The 1996 CPUC
Complaint alleged that AirTouch unlawfully refused Nova's request
to purchase access and airtime under AirTouch's ``Easy 21 Plan''
(and, later, a modified version of that plan) ``by characterizing
it as a retail plan under which Nova would not receive a magnetic
tape containing call records along with a summary hard copy
bill.''17 The 1996 CPUC Complaint sought an injunction
preventing ``AirTouch from continuing to bill and collect from
Nova for charges under a rate plan other than the Easy 21 Plan,
as modified, or such other favorable plan that [Nova] and
[AirTouch] agree upon.''18
7. The parties resolved the litigation before the CPUC
(``CPUC Proceeding'') by entering into a Compromise Agreement and
General Release dated April 30, 1997 (``Settlement and
Release''), which provides in relevant part:
In consideration of the mutual covenants
contained herein and upon satisfaction of the
conditions set forth at Paragraph 4 below, the
parties agree as follows:
1.Nova and AirTouch hereby release and
forever discharge each other ... separately
and collectively from any and all claims,
liens, demands, causes of action,
obligations, damages and liabilities, known
or unknown, that each party has had in the
past, or now has, or may have in the future
against each other, arising out of the
matters involved in the formal complaint
proceeding commonly known as Nova Cellular
West v. AirTouch Cellular, Public Utilities
Commission of the State of California ....
* * *
4. As a condition to and on the condition
of Nova's actions as required in Paragraph
5 below [Nova's agreement to dismiss the
suit with prejudice], AirTouch ... (b)
hereby agrees to make retail pricing plans
which are offered by AirTouch in San Diego
available to Nova in a wholesale billing
tape format whenever AirTouch's currently
existing billing system is capable of
doing so.
*
* *
14. This [Settlement and Release] shall be
construed and enforced pursuant to the
domestic laws of the State of
California.19
8. Nova construes the Settlement and Release as an
agreement by AirTouch that it ``would eventually be able to
provide [Nova] with the appropriate bills in electronic
format.''20 Nova further maintains that, despite the passage of
years, AirTouch failed to fulfill this commitment and continued
to profess an inability to provide electronic billing tapes in
connection with retail rate plans.21
9. Nova compared the retail rates for the plans it sought
versus the wholesale rates for the plans it was receiving, and
concluded that AirTouch had ``overcharged'' it by $221,000.22
Accordingly, Nova deducted $221,000 from the amount AirTouch
billed.23 In response, AirTouch demanded full payment, and, on
May 11, 1999, terminated service to Nova for non-payment.24
II.C. United States District Court Proceeding
10. On May 25, 1999, Nova sued AirTouch in the United
States District Court for the Northern District of California.25
The District Court Complaint alleges that AirTouch unlawfully
denied Nova access to certain rate plans that AirTouch had made
available to other customers: plans, promotions, and special
offers that were not available to Nova ``because an electronic
billing format for these offerings has not been developed for
resellers.''26 The District Court Complaint asserts violations
of sections 201(a), 201(b), and 202(a) of the Act, as well as the
Resale Rule.27
11. Like the 1996 CPUC Complaint, the District Court
Complaint stems from Nova's inability to obtain from AirTouch
electronic billing tapes for desired rate plans, and challenges
the validity of AirTouch's assertion that it lacks the capability
to provide such tapes.28 Specifically, the District Court
Complaint avers that, ``[a]s early as May 1997'' (just after the
parties entered the Settlement and Release), AirTouch offered its
retail customers various plans, discounts, and promotions, but
that AirTouch effectively denied Nova access to these plans,
discounts, and promotions by failing to provide an electronic
billing format.29 According to Nova, detailed electronic billing
would provide:
the call detail necessary for NOVA to bill
its own customers. AIRTOUCH'S unwillingness
to provide an electronic bill for any service
offering thus insulates any such service
offering from resale, thereby discriminating
against NOVA and similarly-situated resale
customers.30
12. AirTouch moved to dismiss the complaint in its entirety
or, alternatively, to refer to the Commission the claims arising
under the Communications Act.31 On October 8, 1999, the district
court dismissed the Communications Act claims, without prejudice,
pursuant to the doctrine of primary jurisdiction, and stayed the
remaining state law claims.32 The court further ordered Nova to
``submit its First, Second, Third and Fourth Causes of Action to
the FCC.''33
II.D. The Instant Proceeding
13. Based on the district court's ruling, Nova submitted
its Communications Act claims to this Commission in a Petition
for Declaratory Ruling, alleging violations of sections 201(a),
201(b), and 202(a) of the Act, and the Resale Rule.34 In
particular, the Petition asserts that AirTouch violated the Act
by: (1) denying Nova favorable rate plans that were offered to
other AirTouch customers; (2) denying Nova electronic billing
made available to other customers and not offering Nova
electronic billing that required little or no modification to
AirTouch's existing billing system; (3) refusing to provide Nova
manual credits, as an alternative to electronic billing; and (4)
unreasonably discriminating against Nova in responding to
requests for rate plan changes.35 Like the District Court
Complaint, the Petition challenges as invalid AirTouch's
justification for not offering Nova favorable rate plans that
were available to AirTouch's other customers - i.e., that
AirTouch's ``electronic billing system is incapable of providing
a billing format that would allow a customer to resell the
service.''36
III. DISCUSSION
III.A. The Settlement and Release Bars Nova's Claims
Relating to Electronic Billing.
14. AirTouch asserts as one of its threshold defenses that
the Settlement and Release, which resolved the CPUC Proceeding,
constitutes a waiver of Nova's claims in the pending Petition.37
To a significant extent, we agree. Specifically, as discussed
below, we find that the Settlement and Release applies and bars
the claims in the Petition that hinge on the electronic billing
tape dispute that is the subject of the Settlement and Release.
Nova's sole remedy regarding these claims, as stipulated in the
Settlement and Release itself, is to seek enforcement of that
agreement under California law.
15. The Petition is a continuation of the long-running
dispute between Nova and AirTouch regarding the provision of
electronic billing tapes for resale purposes. The 1996 CPUC
Complaint challenged AirTouch's unwillingness to provide Nova
with electronic billing tape in connection with AirTouch retail
plans.38 In order to resolve the CPUC Proceeding, the parties,
both represented by counsel, entered into the Settlement and
Release. The Settlement and Release obligated AirTouch to
provide in the future electronic billing tapes for any rate plan
- retail or otherwise - whenever it was ``capable'' of doing
so.39 Based explicitly on that promise going forward, Nova
released all claims, existing and in the future, ``arising out of
the matters involved'' in the CPUC Proceeding - i.e., the
electronic billing tape dispute.40 In other words, the release
(Paragraph 1) expressly is conditioned upon AirTouch's compliance
with its agreement to provide billing tape in connection with any
future rate plan when it was ``capable of doing so'' (Paragraph
4).41
16. In our view, the broad release language contained in
Paragraph 1 of the Settlement and Release, coupled with the
future obligation regarding AirTouch's provision of electronic
billing tapes contained in Paragraph 4 of the Settlement and
Release, means that Nova has released any future claims regarding
AirTouch's obligation to provide electronic billing tapes, except
a claim seeking enforcement under California law of the
provisioning obligation contained in the Settlement and Release
itself. Although releases typically do not cover claims based on
post-release conduct, the unique combination of Paragraphs 1 and
4 leads us to conclude that that is precisely what the parties
intended here. Reading these Paragraphs in tandem, Nova obtained
a promise from AirTouch regarding the provision of electronic
billing tapes for future retail rate plans in exchange for Nova
relinquishing its right to seek redress regarding such provision
by means other than enforcement of the Settlement and Release.
In other words, Nova expressly and deliberately waived its right
to assert that AirTouch's conduct regarding the provisioning of
electronic billing tapes violates the Act.
17. Nova disagrees that the release (contained in Paragraph
1 of the Settlement and Release) applies to all claims under the
Act arising from AirTouch's going-forward obligation (contained
in Paragraph 4 of the Settlement and Release) to provide
electronic billing tape.42 In particular, Nova suggests that the
release relates solely to claims concerning the Easy 21 Plan that
was specified in the CPUC Complaint, while the billing tape
condition pertains to all present and future retail plans.43
18. We do not read the release so narrowly. Its language
is not limited to the Easy 21 Plan, or to rate plans enumerated
in the CPUC Complaint. Rather, the release, by its terms,
applies to all claims ``arising out of the matters involved in''
the CPUC Complaint.44 In the CPUC Proceeding, Nova sought to
enjoin AirTouch from billing Nova under a ``rate plan other than
the Easy 21 Plan ... or such other favorable plan that the
complainant and defendant agree upon.''45 The matters arising
out of the CPUC Proceeding thus transcend the Easy 21 Plan.
Paragraph 4 of the Settlement and Release, which expressly
applies to future AirTouch rate plans, without limitation,
further illustrates the breadth of the relief sought by Nova in
the CPUC Proceeding.46
19. Nova's strained construction of the Settlement and
Release thus ignores the inclusive wording of the release and the
scope of the CPUC Complaint. Moreover, Nova's interpretation
overlooks the fact that the release specifically was conditioned
on AirTouch's agreement with respect to all future rate plans.47
Consequently, we think that the Settlement and Release, fairly
read as a whole, releases all claims in the Petition pending
before us that relate to the electronic billing tape dispute.48
Nova's sole remedy for a breach of AirTouch's obligation in
Paragraph 4 to provide electronic billing tape is to seek
enforcement of that Paragraph pursuant to California law.49
Therefore, we must determine whether Nova's claims under the Act
in this proceeding hinge on the scope of AirTouch's obligation
under the Settlement and Release to provide electronic billing
tapes. Such claims, to the extent they exist, must be dismissed
as waived.
20. The gist of Nova's Petition pertains to precisely the
same dispute about AirTouch's provision (or lack thereof) of
electronic billing tapes that Nova asserted was at issue in the
CPUC Proceeding. In particular, Nova's Petition acknowledges
that, in order to establish the violations of the Act alleged,
Nova must demonstrate ``AirTouch's capability to provide an
electronic billing format.''50 In fact, in the district court
case, Nova unequivocally stated that all of its Communications
Act claims hinge on the billing tape dispute:
This lawsuit arises from the incredulity of
AirTouch's claim that their ``currently
existing billing system'' was incapable of
providing Nova with retail rates in an
electronic format .... [Nova] alleges that
AirTouch's continuing claim that they lacked
the capability to bill plaintiff accordingly
was without merit.
* * *
[T]his is a straightforward dispute over
AirTouch's refusal to provide [Nova] with a
billing tape.51
Indeed, Nova admits that the Settlement and Release covers the
conduct at issue here. Specifically, in support of its claim
that AirTouch acted unreasonably, Nova affirmatively contends
that AirTouch's conduct breaches the Settlement and Release
because, according to Nova, AirTouch is capable of providing
electronic billing tape to Nova by one method or another.52
Therefore, with only a couple of exceptions addressed below,53
Nova's purported claims under the Act here fall within the scope
of the Settlement and Release, and hence must be dismissed as
waived.
21. A closer examination of the particulars of Nova's
claims buttresses this conclusion, because each of these claims
hinges on AirTouch's conduct regarding the provision of
electronic billing tapes. As set forth above, the Petition
specifies four ways in which AirTouch allegedly violated the Act.
First, the Petition alleges that AirTouch denied Nova 20 retail
(and five wholesale) rate plans that were offered to other
customers.54 Nova alleges that it could not take advantage of
those retail plans ``because AirTouch did not offer or make
available to Nova any form of electronic billing with those
plans.''55 Therefore, to the extent that Nova bases its claim on
these retail plans, the claim is barred by the Settlement and
Release. We note that the five wholesale plans cited by Nova,
however, do not appear to relate to the electronic billing issue.
Consequently, Nova has not relinquished its rights to have us
decide claims under the Act regarding those plans, and we address
them below.56
22. Second, the Petition alleges that AirTouch failed to
afford Nova a form of electronic billing with its rate plans,
thereby denying Nova the ability to resell cellular services on
the same terms and conditions provided to other AirTouch
customers.57 This claim explicitly rests upon the electronic
billing dispute and, accordingly, the Settlement and Release bars
the claim.
23. Third, the Petition alleges that, if AirTouch proves
that it could not provide electronic billing to Nova, then
AirTouch failed manually to adjust its monthly bills to Nova and
calculate appropriate credits so that Nova would receive the same
rates as AirTouch's other customers.58 In other words, Nova
contends that AirTouch could have compensated for its failure to
provide electronic billing by manually adjusting Nova's bills
each month.59 We view this alternative argument as part and
parcel of the underlying dispute regarding electronic billing
covered by the Settlement and Release, in which AirTouch
committed to supply electronic billing tape to Nova whenever
AirTouch was capable of doing so. Nova's contention that
AirTouch has breached this commitment - by failing to provide
manual credits or otherwise - falls within the scope of the
Settlement and Release.60
24. Fourth, the Petition claims that AirTouch failed to
change rate plans offered to Nova in the same timely manner that
AirTouch changed rate plans for other customers.61 This claim
does not concern AirTouch's conduct regarding the provision of
electronic billing tapes. Thus, the Settlement and Release does
not appear to bar this claim. Accordingly, we will analyze it on
the merits below.62
25. In sum, because the parties have entered into the
Settlement and Release agreement, we do not need to determine if
the actions of AirTouch with regards to the electronic billing
tape in the instant proceeding are in violation of the Act. If
Nova wishes to pursue those claims, it must do so through
enforcement of the Settlement and Release under California law.
Accordingly, we deny Nova's Petition with respect to those
claims. Consequently, only two of Nova's claims remain - whether
AirTouch unlawfully denied Nova access to five wholesale rate
plans that AirTouch offered to other customers, and whether
AirTouch unreasonably discriminated against Nova by not timely
responding to Nova's rate plan change requests.
III.B. Nova Failed to Submit Adequate Proof of Its
Remaining Claims.
1. Access to Wholesale Plans
26. According to the Petition, AirTouch denied Nova access
to rate plans that AirTouch offered to other customers, in
violation of sections 201(a), 201(b), and 202(a) of the Act, as
well as the Resale Rule.63 Specifically, the Wheatland
Declaration identifies five wholesale plans in AirTouch's
discovery responses that ``AirTouch never made available to Nova
and that Nova did not even know existed until AirTouch'' served
its discovery responses.64 Mr. Wheatland notes that these five
plans would have been more favorable to Nova than the wholesale
plans that AirTouch actually offered to Nova during the dispute
period.65
27. The AirTouch discovery response referenced in the
Wheatland Declaration is Table 3, which lists AirTouch rate plans
and the dates they were available.66 In the cover letter
accompanying Table 3, counsel for AirTouch indicated that
AirTouch compiled the information contained in the table by
searching numerous databases, and that plans could have been
listed that never were actually made available to any customer.67
AirTouch later corrected Table 3, stating that the five wholesale
plans in question were ``never actually `rolled out' commercially
and made available to any customer.''68 In response, Nova
submitted no contrary evidence. Consequently, Nova has not
established that AirTouch ever made available to any of its
customers the five wholesale plans identified by Mr. Wheatland.
Therefore, Nova has failed to submit sufficient proof of its
claim that it was denied access to those plans.
2. Rate Plan Changes
28. The Petition alleges that AirTouch unreasonably
discriminated against Nova, in violation of section 202(a), by
failing ``to change rate plans for [Nova] in the same timely ...
manner that it changed rate plans for its other customers.''69
In resolving discrimination claims under section 202(a), the
Commission employs a three-step inquiry: (1) whether the
services at issue are ``like''; (2) if so, whether there are
differences in the terms and conditions pursuant to which the
services are provided; and (3) if there are such differences,
whether they are reasonable.70 When a complainant establishes
the first two components, the burden of persuasion shifts to the
defendant carrier to justify the discrimination as reasonable.71
As discussed below, we find that Nova has failed to demonstrate
that there were differences in the terms and conditions under
which AirTouch provided like communication service; we further
find that, in any event, any discrimination was reasonable.
29. Nova bases its allegation of discriminatory treatment
primarily on the fact that, as a general rule, AirTouch changes
cellular rate plans more quickly for retail customers than for
resellers. Specifically, Nova contends that (1) AirTouch changes
rate plans for a retail customer within one business day, while
AirTouch takes 20 business days or more to change rate plans for
a reseller, and (2) AirTouch requires less change documentation
from retail customers than resellers.72
30. In support of this claim, Nova again relies on the
Wheatland Declaration, which states that, as an AirTouch retail
customer, Mr. Wheatland is able to effectuate a rate plan change
by telephone in one day.73 In addition, Nova relies on
AirTouch's interrogatory response indicating that retail
customers typically request such a change by telephone, and that
``[t]he rate plan change becomes effective as agreed upon with
the customer but no sooner than the next business day.''74
According to that interrogatory response, AirTouch
representatives provide retail customers the option of changing
rate plans at the end of the current billing cycle (which
AirTouch prefers).75
31. With regard to resellers, AirTouch's discovery
responses reveal that AirTouch requires some documentation to
effectuate a plan change. Prior to November 1998, resellers had
to submit rate plan change requests to AirTouch either on a
prepared form or by letter listing each mobile phone number for
which the change was requested.76 This process purportedly took
longer for reseller rate plan changes than for retail rate plan
changes, because AirTouch needed to alter the service record of
each individual customer served by the reseller.77 After
November 1998, AirTouch still required resellers to submit the
rate plan change requests via faxed forms; however, AirTouch's
computer system then was able to process the changes in batches,
rather than individually.78 Nevertheless, the change request
form states that ``AirTouch will make reasonable efforts to
process the rate plan changes requested within twenty days''
after AirTouch accepts the request in writing.79
32. This record falls short of establishing a violation of
section 202(a). Beyond Mr. Wheatland's anecdotal recollection
that, as a retail customer, he could change rate plans in a
single day, there is no evidence of how quickly AirTouch actually
effectuates retail rate plan changes. Rather, the record only
indicates that AirTouch and the customer agree on the effective
date of any retail plan change, and that AirTouch preferred to
make such changes effective as of the end of a billing cycle.80
Thus, the record does not permit us to conclude that AirTouch
does, in fact, treat resellers differently than retail customers
regarding change requests. Moreover, AirTouch's practice, based
on this record, appears to be reasonable. Nova does not dispute
that making rate plan changes for a reseller that has numerous
individual mobile phone subscribers could be more time consuming
than making such a change for a single retail customer. Nor is
there any basis for disputing that requiring resellers to submit
a written request on a standardized form is reasonable.
33. Nova alleges further examples of ``damaging,
unreasonably discriminatory treatment.''81 First, Nova asserts
that it requested a credit for AirTouch's 11-day delay in
changing a wholesale rate plan as requested in May 1997, and that
AirTouch did not approve the credit for almost nine months.82
Nova provides no information about the timing of a comparable
credit for a similarly-situated retail customer. Thus, Nova has
failed to establish a prima facie case of discrimination under
section 202(a).
34. Second, Nova argues that, in November 1998, AirTouch
discontinued two of its wholesale rate plans with only one day
notice, and that AirTouch forced Nova to choose new wholesale
rate plans that were less favorable, ``without according Nova the
benefits of the AirTouch policy that allowed customers to receive
plans beyond the stated expiration date.''83 Correspondence
attached to the Wheatland Declaration confirms that Nova was
unhappy with the one-day notice, but it also confirms that
AirTouch sent all resellers, including Nova, the same
notification at the same time.84 Again, therefore, Nova has not
established a violation of section 202(a), based on this
record.85
35. Finally, Nova complains that in February 1999, it
requested a wholesale rate plan change and that, despite
ultimately submitting the requisite standard form on March 24,
1999, AirTouch never complied with the request.86 Nova makes no
suggestion that AirTouch did not require other similarly-situated
customers to submit such wholesale rate plan change requests in
writing. Moreover, as indicated above, Nova has not demonstrated
that AirTouch's process for changing wholesale rate plans is
unreasonable. Furthermore, Nova overlooks the fact that, after
demanding payment, AirTouch terminated service to Nova on May 1,
1999. We cannot conclude that AirTouch acted unreasonably in not
changing Nova's wholesale rate plan when Nova apparently had not
paid for service. Yet again, therefore, Nova has not established
a violation of section 202(a), based on this record.
IV. CONCLUSION
36. In sum, we conclude that Nova's claims relating to
AirTouch's failure to provide electronic billing tape are the
subject of the Settlement and Release. Thus, Nova cannot assert
those claims in this proceeding, and we deny this aspect of its
Petition. Nova's proper recourse is to seek enforcement of the
Settlement and Release under California law, as provided in that
agreement. In addition, because Nova failed to submit sufficient
evidence, we also deny its remaining claims relating to (1)
denial of access to five wholesale plans, and (2) discrimination
in the time it takes AirTouch to respond to rate plan change
requests.87
V. ORDERING CLAUSES
37. ACCORDINGLY, IT IS ORDERED, pursuant to sections 1,
4(i), 4(j), 201, and 202(a) of the Communications Act of 1934, as
amended, 47 U.S.C. §§ 151, 154(i), 154(j), 201, and 202(a), and
section 20.12 of the Commission's rules, 47 C.F.R. § 20.12, that
the Petition filed by Nova against AirTouch IS DENIED in its
entirety.
38. IT IS FURTHER ORDERED, pursuant to sections 1, 4(i),
and 4(j) of the Communications Act of 1934, as amended, 47 U.S.C.
§§ 151, 154(i), and 154(j), that the Motion to Dismiss, filed on
April 3, 2000; the Application for Review, filed on September 11,
2000; the Motion to Strike or Exclude AirTouch Cellular Proposed
Exhibits from the Evidentiary Record, filed on May 4, 2001; and
the Further Motion to Strike or Exclude AirTouch Cellular
Proposed Reply Exhibits from the Evidentiary Record, filed on May
23, 2001, ARE DISMISSED as moot.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
_________________________
1 The file number previously assigned to this matter was
ENF-00-002. When citing to the parties' pleadings, this Order
refers to the prior file number.
2 Petition for Declaratory Ruling, File No. ENF-00-002
(filed Feb. 21, 2000) (``Petition'').
3 47 C.F.R § 20.12, effective September 23, 1996, 61 Fed.
Reg. 38388 (July 24, 1996), modified, effective January 10, 2000,
64 Fed. Reg. 61022 (Nov. 9, 1999) (``Resale Rule'').
4 47 U.S.C. §§ 201(a), 201(b), and 202(a).
5 Petition, Exhibit 1 (First Amended Complaint for
Damages and Injunctive Relief, Nova Cellular West, Inc. v.
AirTouch Cellular, Inc., No. C 99-2142 [CAL], United States
District Court, Northern District of California (filed May 25,
1999)) (``District Court Complaint'') at 2, ¶ 4.
6 Id.; Joint Stipulation of Stipulated Facts and Disputes
Remaining, File No. ENF-00-002 (filed Apr. 14, 2000) (``Joint
Stipulation'') at 2, ¶¶ 2-3.
7 Petition, Exhibit 8 (Wheatland District Court
Declaration) at 2, ¶ 4.
8 Petition, Exhibit 1 (District Court Complaint) at 2, ¶
5.
9 The Commission uses SMSAs, which the Office of
Management and Budget defines based on population statistics, to
allocate cellular radio licenses.
10 Response to Petition for Declaratory Ruling, File No. ENF-
00-002 (filed Apr. 3, 2000) (``Response to Petition'') at 5-6, ¶
13; Petition, Exhibit 1 (District Court Complaint) at 2, ¶ 5. At
the time Nova filed the Petition, the licensee of record for the
San Diego B-block cellular license was Vodafone AirTouch
Licensees, LLC. As of April 3, 2000, the license was transferred
to Cellco Partnership, a subsidiary of Verizon Wireless. See
Reply of AirTouch Cellular, File No. ENF-00-002 (filed Apr. 18,
2000) (``Reply'') at 1 n.1.
11 See Nova Cellular West, Inc. d/b/a [sic] Consolidated Reply
to AirTouch Cellular's Response to Petition for Declaratory
Ruling & Motion to Dismiss, File No. ENF-00-002 (filed Apr. 11,
2000) (``Nova Consolidated Reply'') at 2; Response to Petition,
Exhibit 7 (Declaration of Monica Chang) (``Chang Declaration'')
at 1, ¶¶ 2-3.
12 Response to Petition, Exhibit 7 (Chang Declaration) at
1, ¶¶ 2-3; Petition, Exhibit 8 (Declaration of Paul Wheatland in
Opposition to Defendant's Motion to Refer to the FCC, dated
August 6, 1999) (``Wheatland District Court Declaration'') at 2-
3, ¶ 6.
13 Petition, Exhibit 1 (District Court Complaint) at 5-6,
¶ 19.
14 Id. at 2, ¶¶ 4-5.
15 Id.
16 Nova Consolidated Reply, Exhibit 16 (Amended Complaint &
Request for Immediate Cease & Desist Order, Nova Cellular West,
Inc. d/b/a San Diego Cellular v. AirTouch Cellular of San Diego,
C 96-12-027, Before the Public Utilities Commission of the State
of California (filed Apr. 10, 1997) (``1996 CPUC Complaint'')).
17 Id. at 2.
18 Id. at 3-4 (emphasis added).
19 Petition, Exhibit 11 (Settlement and Release) at 1-2, 5, ¶¶
1, 4, 14 (emphasis added); see Joint Stipulation at 3, ¶ 11.
20 Petition, Exhibit 8 (Wheatland District Court Declaration)
at 2, ¶ 5.
21 Id. at 2-3, ¶¶ 6-7.
22 Petition, Exhibit 1 (District Court Complaint) at 4-6, ¶¶
15-20.
23 Id. at 6-7, ¶¶ 20-23; see Joint Stipulation at 3, ¶ 7.
24 Petition, Exhibit 1 (District Court Complaint) at 6-7, ¶¶
23-25; see Joint Stipulation at 3, ¶ 8.
25 Id.; see Joint Stipulation at 4, ¶ 13.
26 Id. at 5-6, ¶ 19.
27 Petition, Exhibit 1 (District Court Complaint) at 7-10, ¶¶
27-46. In addition, the District Court Complaint asserts six
state law claims, including intentional interference with
prospective economic opportunity, intentional misrepresentation,
unfair business practices, intentional interference with
contractual relations, conversion, and trespass, as well as a
cause of action seeking injunctive relief. Id. at 10-17, ¶¶ 47-
87.
28 Petition, Exhibit 8 (Wheatland District Court Declaration)
at 1-3, ¶¶ 2, 5-7.
29 Petition, Exhibit 1 (District Court Complaint) at 4-6, ¶¶
15-19.
30 Id. at 5-6, ¶ 19.
31 Nova Consolidated Reply, Exhibit 13 (Defendant AirTouch
Cellular's Notice of Motion to Dismiss the First Amended
Complaint, Nova Cellular West, Inc. dba San Diego Wireless v.
AirTouch Cellular, Inc., No. C 99-2142 [CAL], United States
District Court, Northern District of California (filed June 29,
1999)) at 1-2.
32 Petition, Exhibit 2 (Order Granting in Part and Denying in
Part AirTouch Cellular's Motion to Dismiss the First Amended
Complaint, Nova Cellular West, Inc. dba San Diego Wireless v.
AirTouch Cellular, Inc., No. C 99-2142 [CAL], United States
District Court, Northern District of California (dated Oct. 8,
1999)) at 2.
33 Id.
34 Id. at 1, 6-10.
35 Id. at 2. See also Nova Consolidated Reply at 1-3; Opening
Brief of Nova Cellular West, Inc. d/b/a San Diego Wireless
Communications, File No. ENF-00-002 (filed Apr. 13, 2001) (``Nova
Opening Brief'') (Summary) at 1; Reply Brief of Nova Cellular
West, Inc. d/b/a San Diego Wireless Communications, File No. ENF-
00-002 (filed May 4, 2001) (``Nova Reply Brief'') at i, 1-8.
36 Petition at 5-6. See Nova Opening Brief at 5-6; Nova
Consolidated Reply at 16-17; Nova Reply Brief at 8. AirTouch
filed a Motion to Dismiss, and later an Application for Review,
asserting that the manner in which Commission staff structured
this proceeding deprived AirTouch of a fair opportunity to
respond to Nova's allegations. Motion to Dismiss, File No. ENF-
00-02 (filed Apr. 3, 2000) (``Motion to Dismiss''); Application
for Review, File No. ENF-00-002 (filed Sept. 11, 2000)
(``Application for Review''). AirTouch's assertions are
meritless. The Commission has broad discretion in managing its
proceedings. See 47 U.S.C. §§ 154(i) and 154(j); see also Global
Crossing Telecommunications, Inc. v. FCC, 259 F.3d 740, 748 (D.C.
Cir. 2001) (the Commission ```enjoys wide discretion in
fashioning its own procedures,''' and is authorized by section
208 ``to investigate a complaint `in such a manner and by such
means as it shall deem proper''') (quoting City of Angels Broad.,
Inc. v. FCC, 745 F.2d 656, 664 (D.C. Cir. 1984); 47 U.S.C. §
208). In doing so here, Commission staff afforded AirTouch ample
opportunity to respond to Nova's allegations. In particular,
Commission staff permitted AirTouch to conduct significant
discovery and file several briefs responding to Nova's claims.
See, e.g., Reply of Airtouch Cellular, File No. ENF-00-002 (filed
Apr. 18, 2000) (``Reply''); Initial Brief of AirTouch Cellular,
File No. ENF-00-002 (filed Apr. 13, 2001) (``AirTouch Initial
Brief''); Reply Brief of AirTouch Cellular, File No. ENF-00-002
(filed May 4, 2001) (``AirTouch Reply Brief''). Indeed, the
record in this proceeding is quite voluminous - the parties took
four depositions and submitted a total of more than 100 exhibits.
Further, contrary to AirTouch's assertion, Commission staff
expressly ruled that Nova bears the burden of proof. Letter from
Roderick A. Mette, Attorney, Market Disputes Resolution Division,
Enforcement Bureau, to Peter A. Casciato, counsel for Nova, and
Kenneth D. Patrich, counsel for AirTouch, File No. ENF-00-02
(dated Apr. 21, 2000). In any event, because we are denying the
Petition, we dismiss as moot both the Motion to Dismiss and the
Application for Review.
37 Response to Petition at 30, ¶¶ 72-73; AirTouch Initial Brief
at ii, 22-23.
38 Nova Consolidated Reply, Exhibit 16 (CPUC Complaint) at 2.
39 Petition, Exhibit 11 (Settlement and Release) at 2, ¶ 4.
The Resale Rule requires CMRS carriers to provide electronic
billing only if it can be made available ``without significant
alterations'' to the carrier's system. See Interconnection and
Resale Obligations Pertaining to Commercial Mobile Radio
Services, Memorandum Opinion and Order on Reconsideration, FCC
99-250, 17 Comm. Reg. (Pike & Fisher) 518, ¶ 54 (rel. Sept. 27,
1999) (``CMRS Resale Reconsideration Order''). Nova construes
the affirmative obligation contained in Paragraph 4 of the
Settlement and Release as holding AirTouch to a stricter
standard, contending that AirTouch must provide electronic
billing tapes whenever it is capable of doing so, regardless of
the scope of alterations necessary. See Nova Consolidated Reply
at 16-17.
40 Petition, Exhibit 11 (Settlement and Release) at 1, ¶ 1.
41 Id. at 1 (``[U]pon satisfaction of the conditions set forth
at Paragraph 4 below, the parties agree as follows ....'').
42 Nova Consolidated Reply at 16-17.
43 See Nova Consolidated Reply at 17; Nova Reply Brief at 8.
44 Petition, Exhibit 11 (Settlement and Release) at 1, ¶ 1.
45 Nova Consolidated Reply, Exhibit 16 (CPUC Complaint) at 3-4
(emphasis added).
46 Petition, Exhibit 11 (Settlement and Release) at 2, ¶ 4; see
also Petition, Exhibit 8 (Wheatland District Court Declaration)
at 2, ¶ 5.
47 Nova further suggests that the Commission somehow can avoid
deciding the waiver issue, because its claim that AirTouch
breached the Settlement and Release is covered by the state
causes of action for intentional misrepresentation and unfair
business practices, which the federal district court stayed.
Nova Consolidated Reply at 17-18. Regardless of the substance of
any state law claim, however, the Settlement and Release between
Nova and AirTouch released all claims under the Act relating to
the billing dispute and thus bars such claims here.
48 See, e.g., In re: Crystal Properties, Ltd., 268 F.3d 743,
748 (9th Cir. 2001) (quoting Kennewick Irrigation Dist. v. United
States, 880 F.2d 1018, 1032 (9th Cir. 1989)) (under California
law, a ``written contract must be read as a whole and every part
interpreted with reference to the whole.'').
49 Petition, Exhibit 11 (Settlement and Release) at 5, ¶ 4.
50 Petition at 5-6 (emphasis added). This is consistent with
the District Court Complaint, which alleges that AirTouch refused
to provide various rate plans and promotions to Nova ``because an
electronic billing format for these offerings has not been
developed for resellers.'' Petition, Exhibit 1 (District Court
Complaint) at 5-6, ¶ 19. According to Nova, ``[t]he detailed
electronic bill NOVA receives from AIRTOUCH provides the call
detail necessary for NOVA to bill its own customers. AIRTOUCH'S
unwillingness to provide an electronic bill for any service
offering thus insulates any such service offering from resale,
thereby discriminating against NOVA and similarly-situated resale
customers.'' Id.
51 Response to Petition, Exhibit 6 (Plaintiff's Opposition to
Defendant's Motion to Dismiss the First Amended Complaint) at 1.
52 Petition at 5; Nova Opening Brief at 15-16.
53 See Section III(B), infra.
54 Petition at 2-6, 8; see Nova Consolidated Reply at 3, 14-18;
Nova Opening Brief at 1-2 (Summary), 2-5; Nova Reply Brief at 6-
7; Further Evidentiary Submission of Nova Cellular West, Inc. dba
San Diego Wireless, File No. ENF-00-002 (filed Dec. 5, 2000)
(``Nova Further Submission''), Exhibit 22 (Declaration of Paul
Wheatland) (``Wheatland Declaration'') at 1, ¶ 2.
55 Id. at 4, ¶ 8.
56 See Section III (B), infra.
57 Petition at 2-6, 8-9; see Nova Opening Brief at 1-4
(Summary), 5-14; Nova Reply Brief at 2-3.
58 Petition at 2, 9-10; see Nova Opening Brief at 1, 4
(Summary), 14-15; Nova Reply Brief at 2-3.
59 Nova Opening Brief at 15.
60 Petition, Exhibit 11 (Settlement and Release) at 5, ¶ 14.
61 Petition at 2.
62 See Section III (B), infra.
63 Petition at 2, 6-8. See Nova Consolidated Reply at 1-3, 13-
21; Nova Opening Brief at 2-5, 22-25.
64 Nova Further Submission, Exhibit 22 (Wheatland Declaration)
at 1, ¶ 3. See Nova Opening Brief at 2-3; Nova Reply Brief at 6-
7.
65 Nova Further Submission, Exhibit 22 (Wheatland Declaration)
at 1, ¶ 3.
66 Nova Further Submission, Exhibit 23.
67 Id., Letter dated November 9, 2000 to Peter Casciato,
counsel for Nova, from Timothy J. Cooney, counsel for AirTouch,
at 1 n.1.
68 AirTouch Exhibits, Vol. II, File No. ENF-00-02 (filed Apr.
4, 2001), Exhibit 65 (Letter dated January 3, 2001 from Timothy
J. Cooney, counsel for AirTouch, to Peter Casciato, counsel for
Nova) at 1-2.
69 Petition at 2. See id. at 10; Nova Opening Brief at 16-18.
Nova suggests that the alleged discriminatory treatment also
violates section 201. Id. Because the conduct at issue is
discrimination, we view these claims to be the same. Therefore,
we analyze the claim under section 202(a), which, as discussed
below, entails a burden-shifting analysis that is more favorable
to the Complainant.
70 See, e.g., MCI Telecommunications Corp. v. FCC, 917 F.2d 30,
39 (D.C. Cir. 1990).
71 See id. See also National Communication Ass'n, Inc. v. AT&T
Corp., 238 F.3d 124, 129-30 (2d Cir. 2001).
72 Nova Opening Brief at 16-17.
73 Nova Further Submission, Exhibit 22 (Wheatland Declaration)
at 9-10, ¶ 15.
74 Nova Further Submission, Exhibit 18 (Response to
Interrogatory No. 9) at 11-12.
75 Id.
76 Id., Exhibit 18 (Response to Interrogatory No. 10) at 12.
77 Id.
78 Id.
79 Id. at 12-13.
80 Id., Exhibit 18 (Response to Interrogatory No. 9) at 11-12.
81 Nova Opening Brief at 17.
82 Nova Further Submission, Exhibit 22 (Wheatland Declaration)
at 8, ¶ 12 and Attachment G; Nova Opening Brief at 17.
83 Nova Opening Brief at 17; Nova Further Submission, Exhibit
22 (Wheatland Declaration) at 8-9, ¶ 13.
84 Nova Further Submission, Exhibit 22 (Wheatland Declaration),
Attachment H.
85 Nova further alleges that, in November 1998, it sought the
equipment discounts and expanded local coverage available in
AirTouch retail plans. Nova Opening Brief at 18; Nova Further
Submission, Exhibit 22 (Wheatland Declaration) at 9, ¶ 14. This
dispute, too, involves AirTouch's failure to provide electronic
billing tapes to resellers in connection with retail plans and
thus is barred by the Settlement and Release, for all of the
reasons explained in Section III (A), supra.
86 Nova Opening Brief at 18; Nova Further Submission, Exhibit
22 (Wheatland Declaration) at 9-10, ¶ 15 and Attachment I.
87 Two Nova motions to strike AirTouch exhibits remain pending.
Motion to Strike or Exclude AirTouch Cellular Proposed Exhibits
from the Evidentiary Record, File No. ENF-00-002 (filed May 4,
2001); Further Motion to Strike or Exclude AirTouch Cellular
Proposed Reply Brief Exhibits from the Evidentiary Record, File
No. ENF-00-002 (filed May 23, 2001). Because both motions
pertain to exhibits on which this Order does not rely, we dismiss
both motions as moot. In addition, on December 5, 2000, Nova
filed a motion for the public release of AirTouch Table 3, which
lists AirTouch rate plans and the dates they were available
during the dispute period. Motion of Nova Cellular West, Inc.
for Public Release of AirTouch Table 3, File No. ENF-00-002
(filed Dec. 5, 2000). Given the disposition of this Petition, we
also dismiss this motion as moot.