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NEW CINGULAR WIRELESS PCS, LLC - DC.
New Cingular Wireless PCS, LLC v. Finley
Headline
Fourth Circuit Interprets Telecommunications Act on Issues Previously
Undecided by the FCC
Alert Type No Alert
Area of Law Telecommunications
Issue(s) Presented
1. Whether ordering only one point of interconnection between rural
telecommunications carriers and national carriers and not requiring
the rural carriers to pay for the transit charges is consistent with
the Telecommunications Act. 2. Whether a state's utilities commission
had authority to modify the federal pricing standards for reciprocal
compensation agreements.
Brief Summary
Small rural telecommunications companies in North Carolina sought to
interconnect their networks with those of the national providers AT&T
and Verizon. The parties failed to reach an agreement. The rural
carriers then petitioned the North Carolina Utilities Commission(NCUC)
for arbitration. The NCUC entered an arbitration order and theparties
reached an agreement. The national providers sought review of the
arbitration and the agreement infederal court. The District Court
granted summary judgment for the rural providers and affirmed the
agreement.
The United States Court of Appealsfor the Fourth Circuit affirmed.
The court held that an agreement with only one point of
interconnection complies with federal law. The court then rejected
the national carriers' objection to having the burden of paying
transit charges. Any disputed transit costs are recoverable under a
reciprocal compensation agreement. And, in the event that the
reciprocal compensation is not sufficient, the national providers
could petition theNCUC for asymmetrical compensation rates. The court
then held that the NCUC had the authority to modify the pricing
standards for reciprocal compensation agreements.
Significance, if Any
Extended Summary (if applicable)
Small rural telecommunications carriers in North Carolina formally
requested to become "interconnected" with the networks of national
carriers AT&T and Verizon. The Telecommunications Act of 1996 (the
Act) requires incumbent telecommunications carriers to assist new
competitors entering the market. One such requirement on the
incumbent carriers is to allow companies like the rural carriers to
interconnect with their networks. The two sides in this case were
unable to reach anagreement to interconnect their networks. The rural
carriers then petitioned the NCUC for arbitration.
The NCUC ordered an Interconnection Agreement betweenthe two parties.
The agreement provided for one point of interconnection and modified
the pricing standards for the carriers' reciprocal compensation rates.
Under the agreement, the rural carriers are technically and
financially responsible for transporting their originating traffic to
the point of interconnection and for paying reciprocal compensation to
the national providers for completing the call beyond the point of
interconnection. The rural providersare not responsible, however, for
transit charges when the national providers use a third party's
network to complete the call.
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