The Ohio Bell Telephone Company v. Public Utilities Commission of Ohio, et al.

Filing 49

ORDER affirming the arbitration award of the Public Utilities Commission of Ohio in all disputed respects. Plaintiffs Counts One through Six areDISMISSED. This case is accordingly DISMISSED in its entirety. Signed by Judge Algenon L. Marbley on 1/6/2012. (cw)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION

THE OHIO BELL TELEPHONE
COMPANY,
Plaintiff,
v.
PUBLIC UTILITIES COMMISSION
OF OHIO, et al.,

Defendants.

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Case No. 2:09-CV-00918
JUDGE ALGENON L. MARBLEY
Magistrate Judge Mark R. Abel

OPINION AND ORDER
I. INTRODUCTION
This matter is before the Court for merits review of the claims brought by the Plaintiff
Ohio Bell Telephone Company, AT&T Ohio (“AT&T”). In its Initial Brief on the Merits,
AT&T challenges the final determinations of Defendant Public Utilities Commission of Ohio
(“PUCO”) on the arbitration petition brought by Defendant Intrado Communications, Inc.
(“Intrado”). AT&T alleges that the requirements in the “interconnection agreement” between
AT&T and Intrado are contrary to the Telecommunications Act of 1996, 47 U.S.C. §§ 151 et
seq. (“the Act”).
Count One of AT&T’s Complaint contends that the Defendant Commissioners of PUCO1
violated the Act by finding that Intrado’s service qualified as a telecommunications carrier
offering “telephone exchange service” under the Act. Counts Two and Three allege that PUCO
lacked authority to order AT&T to establish a “point of interconnection” (or “POI”) on Intrado’s
network as part of the interconnection agreement. Count Four seeks invalidation of certain terms
ordered by PUCO in the arbitration award that are necessarily related to the point of
1

Defendants Alan Schriber, Ronda Fergus, Valerie Lemmie, Paul Centolella, and Cheryl Roberto are sued in their
official capacities as employees and commissioners of Defendant PUCO.

interconnection being established on Intrado’s network. Finally, AT&T’s Counts Five and Six
challenge the lawfulness of PUCO’s orders requiring established frameworks for certain transfer
arrangements with third party customers, and the rates to be charged to Intrado for any services
or products AT&T provides that are not contained in the agreement.
For the reasons provided below, the Court finds that PUCO’s decisions in its Arbitration
Award were consistent with the Act, and were not arbitrary or capricious.
II. BACKGROUND
A. FACTUAL BACKGROUND
Plaintiff AT&T is a provider of local telephone services in the state of Ohio and meets
the definition of an “incumbent local exchange carrier” (or “ILEC”) under the Act. See 47
U.S.C. § 251(h); 47 C.F.R. § 51.5. ILECs are the telephone companies which held monopolies
in local telephone markets prior to the passing of the Act, which was enacted to encourage
competition in those markets by imposing several duties on the incumbent carriers. One part of
AT&T’s operations as an ILEC in Ohio is its 9-1-1 emergency telephone services. Defendant
Intrado is a 9-1-1 emergency service provider for end users of wireline and wireless carriers and
voice over Internet protocol (“VoIP”) providers. Intrado seeks to compete with AT&T’s
incumbent 9-1-1 service. Intrado offers a novel “Intelligent Emergency Network” (“IEN”) 9-1-1
service that utilizes an “Internet protocol” technology based network as an alternative to the
traditional, ILEC-maintained, wireline-based 9-1-1 systems. Intrado’s customers will not be 9-11 callers themselves, but rather those who answer 9-1-1 calls, referred to as Public Safety
Answering Points (“PSAPs”), and other public safety entities, including municipal police and
fire departments. By providing this more specialized, limited 9-1-1 service, Intrado intends to
increase efficiency and effectiveness in responding to emergency calls.
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AT&T is a monopoly provider of 9-1-1 services in Ohio. In order to provide its 9-1-1
service to Ohio customers, therefore, Intrado’s network must be interconnected with AT&T’s
network. Interconnection is defined as “the actual physical linking of two networks for the
mutual exchange of traffic.” 47 C.F.R. § 51.5. The Act provides protections against ILEC
monopoly of markets and requires ILECs to enter into interconnection agreements with
competitors. The typical interconnection agreement enables a so-called competing local
exchange carrier (“CLEC”) to offer local exchange and exchange access services and sets forth
the terms and conditions by which the new competitor can use an ILEC’s network and purchase
the ILEC’s telecommunication services for a negotiated fair price. See 47 U.S.C. § 251(a)(1) &
(c). Competing carriers can compel an ILEC, such as AT&T, to negotiate an interconnection
agreement when certain conditions are met. State utility commissions review, arbitrate, and
grant final approval to interconnection agreements. See 47 U.S.C. § 252(e).
The Act establishes a procedure which first allows voluntary negotiations between the
incumbent carrier and the new competitor. In the event the parties fail to negotiate all the terms
of the interconnection agreement, the Act authorizes state public utility commissions to
adjudicate or arbitrate disputed issues. In that case, either the new entrant or the incumbent
carrier may file a petition for arbitration under 47 U.S.C. § 252(b)(1). Here, because Intrado and
AT&T were unable to negotiate certain interconnection terms on their own, Intrado petitioned to
PUCO for arbitration under the Act. AT&T opposed Intrado’s petition, arguing that Intrado’s
service did not meet the requirements under state and federal law to compel interconnection
through an arbitration proceeding before PUCO. PUCO ordered interconnection between AT&T
and Intrado, and prescribed specific terms which AT&T now contests as contrary to the Act.

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Defendants insist that AT&T’s challenges are baseless and merely constitute attempts to delay, if
not deny, competition for emergency 9-1-1 service in its monopoly area.
B. PROCEDURAL BACKGROUND
Intrado filed its initial application for certification as a CLEC with PUCO on November
19, 2007.2 AT&T and other interested parties were granted interventions by PUCO to challenge
Intrado’s certification. Prior to PUCO’s ruling on Intrado’s certification application, Intrado
filed a second petition with PUCO on December 21, 2007, seeking arbitration in its
interconnection with AT&T under Section 251 of the Act.3 On February 5, 2008, PUCO issued
an order certifying Intrado as a “competitive emergency services telecommunications carrier” (or
“CESTC,” as opposed to a traditional CLEC) with the right to request interconnection with
AT&T under PUCO’s rules and the Act.4 See In re Intrado Commc’ns, Inc., No. 07-1199-TPACE, 2008 WL 312963 (Ohio P.U.C. February 5, 2008) (“Certification Order”). AT&T and the
other interveners applied for rehearing of Intrado’s certification.5
In its April 2, 2008, entry on rehearing, PUCO fundamentally affirmed its prior
certification of Intrado’s service as a “telecommunications carrier” under both state law and
federal law. See In re Intrado Commc’ns, Inc., No. 07-1199-TP-ACE, 2008 PUC LEXIS 201 at
*31 (Ohio P.U.C. April 2, 2008) (“Certification Rehearing”). PUCO clarified, however, that its
ruling did not apply to any other emergency telephone services, id. at *27, nor did PUCO decide
any specifics regarding Intrado’s still pending request for arbitration, id. at *28. None of the
intervening parties, including AT&T, appealed PUCO’s final decision in the Certification
2

Ohio P.U.C. Case No. 07-1199-TP-ACE.
Ohio P.U.C. Case No. 07-1280-TP-ARB.
4
On February 13, 2008, PUCO issued a supplemental finding and order (“Supplemental Order”) clarifying certain
terms and requirements for contracts between Intrado and individual Ohio counties. See In re Intrado
Communications, Inc., No. 07-1199-TP-ACE, 2008 WL 449803 (Ohio P.U.C. February 13, 2008).
5
On March 6, 2008, applications for rehearing of PUCO’s February 5, 2008, Certification Order were filed by
AT&T, Cincinnati Bell Telephone Company LLC (“Cincinnati Bell”), and the Ohio Telecom Association (“OTA”).
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Rehearing to the Supreme Court of Ohio, as provided as a matter of right under Ohio law. See
O.R.C. § 4903.13.
On March 4, 2009, PUCO issued an arbitration award on Intrado’s petition for
arbitration, ordering AT&T to provide interconnection to Intrado for all services offered by
Intrado, subject to certain requirements. See In re Intrado Communications, Inc., No. 07-1280TP-ARB, 2009 PUC LEXIS 897 (Ohio P.U.C. March 4, 2009) (“Arbitration Award”). AT&T
applied for rehearing, arguing, inter alia, that PUCO could not compel AT&T to provide
interconnection to Intrado, because Intrado’s service does not meet the definition of a “telephone
exchange service” under the Act. On June 17, 2009, PUCO issued its entry on the application
for rehearing, denying AT&T’s challenges in material part. See In re Intrado Communications,
Inc., No. 07-1280-TP-ARB, 2009 PUC LEXIS 420 (Ohio P.U.C. June 17, 2009) (“Arbitration
Rehearing”). On October 15, 2009, AT&T brought suit in this Court to challenge PUCO’s
arbitration determinations pursuant to the Act’s provision for federal judicial review of state
commission determinations in connection with arbitrations or negotiations of interconnections
agreements. See 47 U.S.C. § 252(e)(6).6
This Court initially reserved ruling on the merits of AT&T’s claims in this action because
similar, if not identical, issues to those raised by AT&T here were until very recently before the
Federal Communications Commission (“FCC”) for determination in a pending arbitration
proceeding involving Defendant Intrado. See In re Petition of Intrado Communications of
Virginia, Inc., et al, FCC Rcd. 17867 (2008). Given the FCC’s primary jurisdiction and “special

6

Section 252(e)(6) provides:
In any case in which a State commission makes a determination under this section [252], any
party aggrieved by such determination may bring an action in an appropriate Federal district court
to determine whether the agreement … meets the requirements of section 251 of this title and this
section [252].
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competence” in applying and interpreting the Act, this Court decided that it was prudent to await
the ruling in that case which may have decided this one. See United States v. Any & All Radio
Station Transmission Equip., 204 F.3d 658, 665 (6th Cir. 2000) (discussing the doctrine of
primary jurisdiction in a case involving the FCC). The parties in that action recently resolved
their arbitration disputes, however, thereby making it unnecessary for the FCC to decide the
issues regarding of interconnection of Intrado’s emergency 9-1-1 service. See In re Petition of
Intrado Communications of Virginia, Inc. WC Docket No. 08-33 (July 18, 2011), at 2 (“The
Bureau makes no determination regarding whether Intrado is or was entitled to interconnection
under section 251 (c) of the Act for the service at issue in the arbitration.”)
The issues have been fully briefed by the Parties, and the matter is now ripe for this
Court’s determination.
III. STANDARD OF REVIEW
The district court “reviews the decisions of the Commissioners of PUCO de novo as to
whether or not the arbitrated interconnection agreements are in compliance with the Act, while
all other issues, particularly factual determinations, are reviewed under an arbitrary and
capricious standard.” MCI Telecomms. Corp. v. Ohio Bell Tel. Co., 279 F. Supp. 2d 947, 953
(S.D. Ohio 2003).
In reviewing the state commission’s findings of fact made in the course of exercising its
enforcement authority, “[p]ursuant to arbitrary-and-capricious review, we must canvass the
record to determine whether there exists a ‘rational connection between the facts found and the
choice made.’” Alliance for Cmty. Media v. FCC, 529 F.3d 763, 786 (6th Cir. 2008) (quoting
Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)). This
standard “is the least demanding form of judicial review of administrative action. When it is
-6-

possible to offer a reasoned explanation, based on the evidence, for a particular outcome, that
outcome is not arbitrary or capricious.” Killian v. Healthsource Provident Adm’rs, Inc., 152
F.3d 514, 520 (6th Cir. 1998). Defendant PUCO’s factual decisions “should be upheld if it is the
result of a deliberate principled reasoning process, and if it is supported by substantial evidence.”
Id.
IV. LAW AND ANALYSIS
A. Preclusion of AT&T’s Claims
Count One of AT&T’s complaint alleges that PUCO violated the Act by finding in the
Arbitration Award and Arbitration Rehearing that Intrado’s IEN service qualifies as “telephone
exchange service” for purposes of compelling an interconnection agreement under Section
251(c)(2). Complaint, ¶ 2. Success on this first claim would make it unnecessary for the Court
to decide AT&T’s remaining challenges to PUCO’s determinations in the arbitration
proceedings, because to be eligible to compel arbitration of an interconnection agreement under
Section 251(c)(2), Intrado must provide either “telephone exchange service” or “exchange
access” as defined by federal law. Section 251(c) provides that among the obligations of ILECs
is the duty to provide for interconnection for a requesting telecommunications carrier (such as
Intrado) “for the transmission and routing of telephone exchange service and exchange access.”
47 U.S.C. § 251(c)(2)(A).
Defendants PUCO and Intrado argue compellingly that the issues regarding Intrado’s
status as a “telecommunications carrier” including its provision of “telephone exchange service”
were already decided in the prior certification case and, thus, AT&T should be precluded from
raising them again in this appeal from the arbitration proceedings. AT&T’s argument that
Intrado’s service does not meet the definition of “telephone exchange service,” Defendants
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assert, is an improper attempt to have this Court revisit the final decision of PUCO on that issue
in the Certification Rehearing, which AT&T declined to appeal to the Supreme Court of Ohio.
Defendants argue that res judicata and the equitable doctrines of waiver and estoppel foreclose
AT&T’s claim. Before reviewing the merits of AT&T’s claims, therefore, the Court examines
first whether any of these doctrines apply in this case.
1. Issue preclusion
Defendants argue that res judicata forecloses AT&T’s claim that Intrado’s service does
not qualify as “telephone exchange service” under federal law because PUCO decided that issue
in the earlier certification case, and that decision constituted a separate and final decision on the
merits. The equitable doctrine of res judicata encompasses two similar, but operationally
distinct, bars to re-litigating similar issues: claim preclusion, sometimes called “true” res
judicata, and issue preclusion, or “collateral estoppel.” See Migra v. Warren City Sch. Dist. Bd.
of Ed., 465 U.S. 75, 77, n.1 (1984) (internal citations omitted); Dubuc v. Green Oak Twp., 312
F.3d 736, fn. 4 (6th Cir. 2002). The parties here contest issue preclusion’s bar to AT&T’s reraising the issue of “telephone exchange service” more vigorously than that of claim preclusion,
and therefore the Court treats the applicability issue preclusion first.
Issue preclusion provides that “a fact or a point that was actually and directly at issue in a
previous action, and was passed upon and determined by a court of competent jurisdiction, may
not be drawn into question in a subsequent action between the same parties or their privies.”
Trafalgar Corp. v. Miami County Bd. Of Comm’rs., 519 F.3d 285, 287 (6th Cir. 2008) (citation
omitted). The Sixth Circuit has held that issue preclusion requires the party seeking the
preclusion to establish the following elements:
(1) the precise issue raised in the present case must have been raised and actually
litigated in the prior proceeding; (2) determination of the issue must have been
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necessary to the outcome of the prior proceeding; (3) the prior proceeding must
have resulted in a final judgment on the merits; and (4) the party against whom
estoppel is sought must have had a full and fair opportunity to litigate the issue in
the prior proceeding.
Kosinski v. C.I.R., 541 F.3d 671, 675 (6th Cir. 2008) (internal citation omitted); see also Spilman
v. Harley, 656 F.2d 224, 229 (6th Cir. 1981) (holding that the party asserting the estoppel has the
burden of proving that the requirements have been met).
AT&T argues as a preliminary matter that res judicata and issue preclusion apply only to
administrative proceedings that are adjudicatory, or “quasi-judicial,” in nature, and since the
certification case did not employ the trappings of an adjudicatory proceeding (expert testimony,
presenting evidence, and cross examination) issue preclusion cannot apply. AT&T Reply, at 2.
It is true that “where an administrative proceeding involves legislative or rulemaking functions”
as opposed to exercising its judicial function, “res judicata does not apply.” State Corp. Comm.
of Kansas v. Wichita Gas Co., 290 U.S. 561, 569 (1934). PUCO’s role in ruling on certification
applications, however, undoubtedly engages the adjudicative function of administrative action as
opposed to the legislative or rulemaking function. Unlike soliciting comments prior to a
rulemaking or a rate-setting, which are classic legislative actions, see id., the prior certification
case was an adversarial proceeding involving hearings and argument from parties on the disputed
issues of law and fact, in addition to procedural rights to rehearing and appellate review. See
United States v. Utah Construction & Mining Co., 384 U.S. 394, 422 (1966) (applying federal
principles of res judicata and collateral estoppel “when an administrative agency is acting in a
judicial capacity and resolves disputed issues of fact properly before it which the parties have
had an adequate opportunity to litigate”). Issue preclusion therefore applies to the
determinations of PUCO in the Certification Order and Certification Rehearing.

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To meet the first requirement for issue preclusion, the issue of whether Intrado’s service
constitutes “telephone exchange service” under the Act must have been “raised and actually
litigated” in the prior certification case. To be “actually litigated,” the issue must have been
addressed and decided on the merits by the trier of fact, rather than simply conceded or stipulated
to. See State ex rel. Davis v. Public Emples. Ret. Bd., 899 N.E.2d 975, 983 (2008). This Court
finds that here the issue was actually decided. PUCO expressly held, upon its extensive analysis
of Intrado’s 9-1-1 service offered for certification as a CLEC, that “Intrado is a
telecommunications carrier engaged in the provision of telephone exchange service pursuant to
Section 251.” Certification Order, at *3 (emphasis added). On rehearing of that precise issue,
among others, PUCO denied the intervening challenges to that determination, reiterating that its
determinations regarding “the business plan and operation of Intrado” remained intact.
Certification Rehearing, at *27.
Likewise, the parties (including AT&T) extensively litigated the issue of whether Intrado
would be engaged in “telephone exchange service” (or be involved in “exchange access”) for
purposes of interconnection under Section 251 in the certification case. Intrado asserted there
that “its services constitute telephone exchange service as defined in the 1996 Act inasmuch as it
provides the routing, transmission, and transport of traditional and nontraditional emergency call
traffic to the appropriate PSAP.” Certification Order, at *2. On rehearing, the adverse
intervening parties disputed this, arguing, inter alia, that “the company is not engaged in the
routing of telephone exchange service as defined by 47 U.S.C. 153(47) or involved in the
provisioning of exchange access.” Certification Rehearing, at *23. Intrado defended its position
on this issue again, id. at *25, and PUCO sided with Intrado, denying this basis for rehearing. Id.
at 31-32.
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AT&T’s argument that PUCO only determined the issues relating to Intrado’s
qualifications as a “basic local exchange service” under state law is simply wrong. As discussed
above, PUCO expressly determined (and then clarified on rehearing) that Intrado’s service
qualified as a novel telecommunications service offering telephone exchange service under both
state and federal law. See Certification Order at *2; Certification Rehearing at *31. This Court
finds, therefore, that the issue of whether Intrado’s service constituted “telephone exchange
service” under federal law was raised and “actually litigated” in the certification proceedings.
With regard to the second requirement for issue preclusion, that the issue “must have
been necessary to the outcome of the prior proceeding,” the Court finds it, too, is met in this
case. AT&T argues that even if the issue of Intrado providing “telephone exchange service”
was decided in the certification case, it was not necessary to the outcome of the Certification
Order, because certification as a CLEC turns entirely on state law determination of whether
Intrado’s service qualified as “basic local exchange service” under O.R.C. § 4927.01(A). Thus,
the federal law issue of whether Intrado offers “telephone exchange service” for the purpose of
compelling interconnection under Section 251(c)(2) was not “necessary” to determining whether
Intrado qualified as a CLEC. PUCO responds, however, and the Court agrees, that in fact the
federal law questions were necessary in PUCO’s determination to certify Intrado, not as a CLEC,
but under the novel category of “competitive emergency services telecommunications carrier”
entitled to all the rights of a telecommunications carrier under Section 251. In fact, PUCO made
this precise point on rehearing in the certification case:
While it appears that the intervenors advocate that the Commission’s analysis
should simply begin and end with the issue of whether Intrado is a CLEC, the
intervenors fail to recognize that simply because an applicant is not a CLEC does
not signify that it is also not a telephone company subject to the Commission’s
jurisdiction pursuant to Sections 4905.02, 4905.03(A)(2), and 4905.04, Revised
Code. Therefore, upon determining that Intrado is a telephone company that does
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not fit neatly into the existing carrier classifications, the Commission took the
next logical and necessary step of determining the appropriate classification for
the telephone company in order to determine the appropriate regulatory
framework to apply to Intrado.
Certification Rehearing at *12 (emphasis added).
PUCO decided the issue of whether Intrado qualified as offering “telephone exchange
service” as part of its necessary analysis of how to classify the novel 9-1-1 IEN service offered
by Intrado. See Certification Order at *3 (“Therefore, while Intrado is a telecommunications
carrier engaged in the provision of telephone exchange service pursuant to Section 251 of the
1996 Act, its telephone exchange activities are restricted in scope and, thus, do not extend to the
level of a CLEC.”). As PUCO had to classify Intrado to rule on the certification application, the
issue was “necessary to the outcome” of the certification case for the purpose of issue preclusion.
The third requirement for issue preclusion is “the prior proceeding must have resulted in
a final judgment on the merits.” Kosinski, 541 F.3d at 675. This requirement is not as easily met
by the Defendants. AT&T does not dispute that “res judicata can apply as a result of a prior
administrative proceeding,” Cincinnati Bell Tel. Co. v. PUCO, 466 N.E.2d 848, 852 (Ohio
1984), nor does it challenge Defendants’ assertion that PUCO’s decision in the Certification
Order, as affirmed by the Certification Rehearing, constituted a “final decision on the merits.”
See Office of Consumers’ Counsel v. Public Utils. Com., 475 N.E.2d 782, 784 (Ohio 1985)
(holding an order by PUCO determining fuel component rates constituted a “valid final
judgment” entitled to preclusive effect under the doctrine of res judicata). Whether PUCO
backtracked on rehearing from its initial determination of the “telephone exchange service”
issue, however, presents a close question.

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AT&T argues that since PUCO, in its Certification Rehearing, clarified “we are not
deciding in this case the issues pending in Intrado’s arbitration proceedings,” Certification
Rehearing at *28, but addressed “ONLY the fundamental question as to Intrado’s right, as a
telephone company under Rule 4901:1-7-01(S), O.A.C., to request AN interconnection
agreement pursuant to Chapter 4901:1-7, O.A.C., and Sections 251 and 252 of [the Act],” id.,
that it expressly reserved the issue of whether Intrado’s service provided “telephone exchange
service” for the pending arbitration proceedings. AT&T Reply, at 6. This argument, while not
without merit, ultimately fails as well.
PUCO did indeed conduct a more thorough treatment of the issue of whether Intrado
qualified under the federal law definition of “telephone exchange service” in the arbitration case.
See Arbitration Award, at *33 (stating at the outset that “notwithstanding that we decided in prior
cases that Intrado provides telephone exchange service, we will conduct an analysis of 47 U.S.C.
§ 153(47)”). As PUCO made clear at the time, however, its decision to revisit the issue in the
arbitration proceeding did not change the fact that it had already decided the issue both in the
underlying certification case, and other cases (such as the Embarq case, discussed infra). In the
Certification Order PUCO determined that “Intrado is a telecommunications carrier engaged in
the provision of telephone exchange service pursuant to Section 251 of the Act.” Certification
Order at *3. Then, in the Certification Rehearing, PUCO expressly affirmed its decisions
regarding Intrado’s status as a telecommunications carrier. See Certification Rehearing, at *31
(“In regard to AT&T Ohio’s argument that the Commission incorrectly determined that Intrado
is a telecommunications carrier pursuant to federal law, AT&T Ohio’s application for rehearing
should be denied.”).

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Part of PUCO’s determination of Intrado as a telecommunications carrier involved
concluding that Intrado “engaged in the provision of telephone exchange service,” and therefore
if AT&T had still disputed this finding, it should have appealed the certification case to the
Supreme Court of Ohio, as provided O.R.C. §§ 4903.11-13. Since it did not, PUCO’s decision
regarding Intrado’s provision of “telephone exchange service,” while not as in depth as the
discussion of the issue in the arbitration case, nevertheless represented a binding final decision
by the agency.
The Sixth Circuit has recognized that under Ohio law, “[r]es judicata and collateral
estoppel generally apply to quasi-judicial decisions made by administrative agencies from which
no appeal has been taken.” Burkholder v. Bower Tiling Serv., No. 93-3115, 1995 U.S. App.
LEXIS 218, at *5 (6th Cir. Jan 5, 1995) (unpublished) (citing Wade v. City of Cleveland, 456
N.E.2d 829, 831-32 (Ohio 1982)). Since AT&T chose not to appeal PUCO’s decision that
Intrado’s service constitutes “telephone exchange service” under federal law in the certification
case, “that decision would normally be res judicata.” Id.
The fourth and final requirement for issue preclusion is a due process concern. The party
against whom estoppel is sought, AT&T in this case, must have had a full and fair opportunity to
litigate the issue in the prior proceeding. AT&T makes similar arguments with respect to this
last requirement as it made against requirements one and two, with equally unpersuasive force.
AT&T claims that it did not have such a full and fair opportunity to contest whether Intrado’s
service meets the federal definition of “telephone exchange service,” “because Intrado’s
application sought only to be certified under state law as a CLEC.” AT&T Reply at 6. AT&T
goes so far as to claim that “[n]one of the interveners’ comments [in the certification case]
discussed whether Intrado’s service qualifies as ‘telephone exchange service’ under federal law.”
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AT&T Reply at 3. A review of the discussion in the Certification Rehearing plainly shows,
however, that AT&T, OTA, and Cincinnati Bell all disputed the appropriateness of PUCO’s
making federal law determinations of Intrado’s service, as well as the merits of that decision,
including its qualification as providing “telephone exchange service.” See Certification
Rehearing at *21-24.
Moreover, as stated above, if AT&T believed that it had not received a full and fair
opportunity to litigate the precise issue of whether Intrado provides “telephone exchange
service,” under the Act, AT&T could have appealed PUCO’s decision to the Supreme Court of
Ohio. AT&T neglected to do so, and thus waived the opportunity to litigate the issue further.
2. The prior “Embarq” case
Defendant PUCO’s decision in the prior arbitration case between Intrado and another
ILEC, United Telephone Company of Ohio (“Embarq”),7 provides further support for finding
that the issue of Intrado providing “telephone exchange service” has already been conclusively
decided by PUCO, and should be barred by issue preclusion here. In the Embarq arbitration,
Embarq opposed Intrado’s interconnection on the very same basis as AT&T does here. See
Embarq Arbitration Award, 07-1216-TP-ARB, at 9.8 There, as here, Intrado contended that it
was “seeking to exercise its rights to local interconnection for the purpose of provisioning
telephone exchange services, as provided for pursuant to Section 251(c).” Id. at 3. Embarq, like
AT&T does here, contested Intrado’s service meeting the appropriate definition for “telephone
exchange service,” claiming, “that all of the services provided by Intrado are not strictly
telephone exchange services.” Id. at 47. PUCO held that it had already conclusively established
7

Ohio P.U.C. Case No. 07-1216-TP-ARB.
As stated in the Arbitration Award: “Issue 2: Can Embarq deny Intrado its rights under Section 251(c) and 252 of
the [Act] and Ohio law by claiming that Intrado: (1) does not offer telephone exchange services or exchange access.
. .?”
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that Intrado’s service provided “telephone exchange service” under the Act, and thus barred
Embarq from rehashing the identical issue again:
With respect to the arguments raised specific to the issue of whether Intrado is
engaged in the provision of telephone exchange services or exchange access
service, the Commission agrees with Intrado that this issue was already
generically addressed in the context of Intrado’s certification proceeding (071199) and that, for the most part, Embarq has reiterated its position as previously
stated in 07-1199. Therefore, Embarq’s arguments with respect to this issue are
denied and the Commission determines that Embarq cannot generically deny
Intrado its rights under Sections 251(c) and 252 of the 1996 Act and Ohio law by
claiming that Intrado does not offer telephone exchange services or exchange
access and does not serve retail end users.
Id. at 13.
AT&T should be similarly precluded here from denying Intrado its rights by claiming
Intrado does not offer telephone exchange service. The Embarq arbitration decision, above,
came after Intrado’s certification case (No. 07-1199). PUCO’s holding in Embarq, above,
ameliorated any ambiguity there may have been as to whether it had definitively decided the
issue of Intrado’s provision of “telephone exchange service.” The Embarq arbitration decision
represents a similarly-situated ILEC attempting to re-litigate the same issue that AT&T raises
here, and was barred from doing so by PUCO. PUCO’s dicta in refusing to decide the issue
there reinforces, if not controls, this Court’s finding that the issue is barred by res judicata.
For these reasons, and those stated above, the Court finds that AT&T’s challenge to
Defendant PUCO’s determination that Intrado provides “telephone exchange service” for the
purpose of compelling interconnection pursuant to Section 251(c)(2) (Count One) is barred by
the doctrine of issue preclusion. A discussion of claim preclusion is therefore unnecessary.

B. PUCO’s Order for AT&T to Establish Interconnection on Intrado’s Network

-16-

AT&T challenges PUCO’s order in the Arbitration Award requiring AT&T to establish a
POI on Intrado’s network pursuant to the general duty of AT&T to allow interconnection under
Section 251(a). As part of its award on Intrado’s arbitration petition, PUCO determined that
“AT&T would need to establish a POI on Intrado’s selective router for the delivery of its end
users’ 911 calls to PSAP customers of Intrado.” Arbitration Award at *81. Counts Two and
Three of AT&T’s Complaint allege that PUCO’s order was an arbitrary and capricious abuse of
authority because: (i) neither Intrado nor AT&T raised Section 251(a) interconnection as an issue
for arbitration; (ii) a competing carrier’s request for interconnection with an ILEC’s network is
governed exclusively by Section 251(c)(2); and (iii) Congress did not give state commissions the
authority to implement Section 251(a) in an arbitration. AT&T Initial Brief, at 3. The Court
examines AT&T’s assignments of error seriatim.
1. Was the issue of Section 251(a) interconnection sufficiently raised below?
AT&T argues first that PUCO’s ordering interconnection on Intrado’s network under
Section 251(a) was contrary to the Act since neither Intrado nor AT&T ever raised Section
251(a) interconnection as an issue for arbitration, and the Act expressly prohibits state
commissions from arbitrating issues the parties did not raise. See Complaint, ¶¶ 33, 40; 47
U.S.C. § 252(b)(4)(A). PUCO does not dispute AT&T’s claim that it made this order pursuant to
Section 251(a). See PUCO Brief at 11. PUCO does not agree, however, that it was bound to
decide the issue presented of where to locate the POI in this case strictly based on how the
parties chose to plead the case. PUCO argues that by relying on Section 251(a) it was merely
exercising its authority under the Act to establish a logical, lawful POI to promote
interconnection between AT&T and Intrado. Id. at 17. Intrado, for its part, argues that the
potential application of Section 251(a) in the interconnection was discussed at length by parties
-17-

in the arbitration case, and that “AT&T’s arguments confuse a party’s right to raise issues under
Section 252(b)(2) of the Act with PUCO’s right to apply all applicable law.” Intrado Brief, at
28.
Section 252(b)(2)(4) of the Act states:
The State commission shall limit its consideration of any petition under
paragraph (1) [providing the right for a party to the interconnect agreement
negotiations to petition a State commission to arbitrate open issues] (and any
response thereto) to the issues set forth in the petition and in the response, if any,
filed under paragraph (3) [providing for the non-petitioning party’s response to
the petition for arbitration].
47 U.S.C. § 252(b)(4)(A).
Accordingly, this Court has previously held that “[t]he Act provides that a party
petitioning a state commission must provide relevant documentation concerning unresolved
issues,” MCI Telecomms. Corp., 279 F. Supp. 2d 947, 949 (S.D. Ohio 2003) aff’d, 376 F.3d 539
(6th Cir. 2004), and “[t]hereafter, under § 252(b)(4)(A), the state commission ‘shall limit its
consideration of any petition . . . to the issues set forth in the petition and in the response.’” Id.
Given that PUCO acknowledged that “neither party has raised an issue relating to
interconnection under 251(a)” in this case, Arbitration Award at *38, AT&T’s claim would
appear to have merit. Moreover, this Court does not defer to PUCO’s prior statements of its
authority to apply Section 251(a) without it having been raised, see id., at *37, as this question of
the state commission’s fidelity to the Act is one the Court reviews de novo.
Under the unambiguous language of the Act, PUCO cannot arbitrate the issue if Intrado
did not raise it in its petition for arbitration. The question for the Court becomes whether “open
issues” are defined broadly or narrowly. In its petition for arbitration, Intrado raised the issue of
whether the POI or POIs were to be located solely on AT&T’s network or on Intrado’s network.

-18-

Specifically, Intrado proposed that “in geographic areas in which Intrado has been selected as the
primary provider of 911 services and E911 Services, AT&T’s network must interconnect with
Intrado’s 911/E911 network.” See Intrado Petition for Arbitration, TRF Docket No. 90-9348TP-TRF, at 29. Thus, the issue of whether Intrado’s arrangement with AT&T would include
compelling AT&T to interconnect on Intrado’s network was raised, albeit not explicitly pursuant
to PUCO’s authority under Section 251(a) as opposed to Section 251(c). AT&T argues that this
is not sufficient, and insists that the more specific issue of interconnection under Section 251(a)
must have been raised.
In MCI Telecommunications Corporation v. Michigan Bell Telephone, 79 F. Supp. 2d
768 (E.D. Mich. 1999), a case also involving district court review of a state commission’s
interconnection arbitration award, the petitioner ILEC (Ameritech) claimed that the state
commission lacked jurisdiction to impose certain terms (regarding benchmarks and penalties) on
the parties in their interconnection agreement because these issues were not raised in the
arbitration petition or response. See MCI Telcoms. Corp., 79 F. Supp. 2d at 774. The court
dismissed Ameritech’s claim that the issues were not sufficiently raised as “disingenuous,”
finding that “[w]hile MCI’s Petition for Arbitration did not include specific proposed
performance benchmarks and penalties,” id., that MCI had raised the issue of quality of service
generally, and, more importantly, Ameritech’s response had included its proposed standards for
benchmarks and procedures to ensure quality of service. Additionally, the parties’ subsequently
filed proposed arbitration decisions set forth competing specific benchmarks and penalties, and
at the arbitration hearing the parties directed testimony to their respective proposals for these
performance standards. Id. The court therefore found that the issues of benchmarks and

-19-

penalties were sufficiently raised despite not being specifically identified as an issue for
arbitration in the competitor’s initial petition for arbitration.
In essence, the court in MCI v. Michigan Bell found that particular “open issues” within
the parties’ disputed terms need not necessarily be specifically plead or identified as an issue for
arbitration to be competently adjudicated by the state commission. 9 So long as it is clear from
examining the record of the underlying arbitration petition that “the parties had the opportunity
to be heard on this issue,” id., the commission does not violate Section 252(b)(4)(A) in making a
determination on that issue.
Here, as in MCI v. Michigan Bell, AT&T’s claim that interconnection pursuant to Section
251(a) was not raised by parties is easily dispelled by the fact that both AT&T and Intrado
discussed extensively the potential for Section 251(a)’s applicability in their respective briefs
submitted to PUCO in the arbitration proceedings.10 See Arbitration Rehearing at *36 (“AT&T
discussed Section 251(a) at length on the record in arguing against Intrado’s desire to have
AT&T establish a POI on Intrado’s network.”). AT&T, therefore, took advantage of more than
sufficient opportunities to be heard, both in the initial arbitration hearings and on rehearing of the
arbitration award, regarding its position against PUCO’s ordering a POI on Intrado’s network
under Section 251(a) as opposed to having POIs only on the ILEC network as provided by
Section 251(c). See, e.g., Arbitration Award at *47; Arbitration Rehearing at *27-28.
9

47 U.S.C. § 252(b)(1) states:
(1) Arbitration. During the period from the 135th to the 160th day (inclusive) after the date on
which an incumbent local exchange carrier receives a request for negotiation under this
section, the carrier or any other party to the negotiation may petition a State commission to
arbitrate any open issues.

10

Defendant Intrado cites numerous locations in AT&T’s post-hearing brief and transcripts of its witnesses’
testimony from the arbitration proceeding discussing Section 251(a) in the specific context of whether the
prospective POI could be established on Intrado’s network. See AT&T’s Initial Post-Hearing Brief at 13-17, 30-34
(Record Index No. 25) (Attachment No. 18 to Intrado Brief); Vol. I. Tr. at 51 (Record Index No. 54) (Attachment
No. 19 to Intrado Brief); Vol. II Tr. at 58-59, 88 (Record Index No. 23) (Attachment No. 16 to Intrado Brief).
-20-

In relying on Section 251(a) to craft its order on the POI for the parties’ interconnection
in the Arbitration Award, PUCO was not independently raising and deciding an issue that the
parties had not put forth for arbitration, which the Act prohibits. Indeed, the issue of where the
POI was to be located was one of the primary open issues of contention. AT&T cannot claim
unfair prejudice or surprise by PUCO’s reliance on Section 251(a) to establish a POI on Intrado’s
network, as AT&T contemplated and argued against PUCO doing that very thing both in its
briefing, and at the hearings on Intrado’s arbitration petition. AT&T’s argument represents a
misguided and unrealistically narrow interpretation of the “open issue” limitation to PUCO’s
ability to determine the matters up for arbitration. This Court finds that the issue of whether
PUCO should order a POI to be located on Intrado’s network pursuant to its authority under
Section 251(a) was sufficiently raised and was, therefore, appropriate for adjudication in the
Arbitration Award.
2. PUCO’s authority to order interconnection under Section 251(a)
Second, Plaintiff AT&T argues that regardless of whether the issue was sufficiently
raised, PUCO lacked the authority to order the parties to establish a point of interconnection on
Intrado’s network pursuant to Section 251(a). AT&T contends that a competing carrier’s request
to interconnect with an ILEC’s network is governed exclusively by Section 251(c), and is subject
to the provisions therein, which only includes a requirement for the ILEC to accommodate
interconnection on the its own network. See 47 U.S.C § 251(c). AT&T maintains, therefore,
that PUCO’s express reliance on Section 251(a) for its authority to order the POI on Intrado’s
network was a violation of the Act. Complaint, ¶ 38.
The defendants do not dispute that PUCO is not authorized to rely on Section 251(c) to
order a POI on a network other than AT&T’s, and therefore its decision to locate the POI on
-21-

Intrado’s network for those 9-1-1 calls to PSAPs served by Intrado was necessarily made
pursuant to Section 251(a). PUCO defends its reliance on Section 251(a) to determine the
appropriate POI in this case, pointing to Section 251(a)’s provision that every
telecommunications carrier has a general duty to interconnect directly or indirectly with the
facilities of other telecommunications carriers. 47 U.S.C. § 251(a)(1). PUCO Brief at 12.
Similarly, Intrado asserts that PUCO lawfully exercised its authority to apply all applicable law,
including Section 251(a), in its decision of where to locate the POI. Intrado Brief at 25.
Resolving the parties’ dispute on this issue requires the Court to analyze the structure of
duties and obligations regarding interconnection which the Act imposes on telecommunications
carriers. Section 252(b) outlines the scope of interconnection agreements reached through
compulsory arbitration in front of the state commission, such as the agreement in this case, as
distinguished from interconnection agreement terms arrived at by parties through voluntary
negotiation which the Act affords wider discretion. See 47 U.S.C. § 252(a)(1).11 Under Section
252, in resolving open issues “and imposing conditions upon the parties to the agreement,” the
state commission shall, inter alia, “ensure that such resolution and conditions meet the
requirements of section 251.” 47 U.S.C. § 252(c)(1).
Section 251 “provides a graduated set of interconnection requirements and other
obligations designed to foster competition in telecommunications markets, particularly local
markets.” In the Matter of Petition of CRC Communications, Case No. FCC 11-83 (2011), at 2
(adding that “[t]he nature and scope of these obligations vary depending on the type of service
provider involved.”). The FCC has further explained the structure of Section 251 as follows:

11

Section 252(a)(2) states that, when engaging in voluntary negotiations, “an incumbent local exchange carrier may
negotiate and enter into a binding agreement with the requesting telecommunications carrier or carriers without
regard to the standards set forth in 47 USCS § 251(b), (c).”
-22-

Sections 251(a) through 251(c) create a three-tiered hierarchy of escalating
obligations based on the type of carrier involved. Section 251(a) imposes
relatively limited duties on all telecommunications carriers; section 251(b)
imposes more extensive duties on telecommunications carriers that are LECs; and
section 251(c) imposes the most extensive duties on LECs that are incumbent
LECs.
Guam Pub. Util. Comm’n, 12 FCC Rcd. 6925, ¶ 19 (1997).

12

First, Section 251(a) provides the general duties of telecommunications carriers
(regardless of distinction) to provide interconnection:
(a) General duty of telecommunications carriers. Each telecommunications carrier
has the duty-(1) to interconnect directly or indirectly with the facilities and equipment of
other telecommunications carriers; and
(2) not to install network features, functions, or capabilities that do not comply
with the guidelines and standards established pursuant to section 255 or 256 [47
USCS § 255 or 256].
Other district courts in this circuit have described Section 251(a) as “a general duty with
many statutory limitations, depending on the type of carrier.” T-Mobile USA, Inc. v. Armstrong,
No. No. 3: 08-36-DCR, 2009 U.S. Dist. LEXIS 44525, at *9 (E.D. Ky. May 20, 2009) (“In
addition, the relevant regulatory language does not contradict the statutory language -- it clarifies
that the method of interconnection should skew in favor of the requesting carrier unless
extenuating circumstances exist. 47 C.F.R. § 20.11.”).
Section 251(b) provides further obligations for “local exchange carriers,” including the
duty: (1) not to prohibit or impose unreasonable conditions on the resale of telecommunications
services; (2) to provide, to the extent feasible, number portability; (3) to provide dialing parity to
12

The FCC’s implementing regulations and published declaratory rulings on the Act’s statutory scheme are
instructive in our inquiry. See, e.g., Mich. Bell Tel. Co. v. MCI Metro Access Transmission Servs., 323 F.3d 348,
352 (6th Cir. 2003) (stating “state commissions are directed by provisions of the Telecommunications Act of 1996,
47 U.S.C.S. § 251 et seq., and Federal Communication Commission (FCC) regulations in making decisions, which
are subject to federal court review. At the same time, the Act gives the state commissions latitude to exercise their
expertise in telecommunications and needs of the local market.”); Michigan Bell Tel. Co. v. Strand, 305 F.3d 580,
586 (6th Cir. 2002) (“[W]e consider the FCC’s interpretation of the Act persuasive authority because Congress
authorized the FCC to issue rules ‘to implement the requirements’ of § 251.”).
-23-

competing providers; (4) to afford access to poles, ducts, conduits, and rights-of-way of
competing carriers; and (5) to establish reciprocal compensation arrangements for the transport
and termination of telecommunications. Section 251(b)’s duties are not at issue here, but
nevertheless help provide context for interpreting the statutory scheme, infra.
Finally, Section 251(c) provides additional obligations for ILECs, specifically, in
addition to those in Section 251(a) and 251(b). With respect to interconnection, Section
251(c)(2) states that, “[i]n addition to the duties contained in subsection (b), each incumbent
local exchange carrier has the following duties:
(2) Interconnection. The duty to provide, for the facilities and equipment of any
requesting telecommunications carrier, interconnection with the local exchange
carrier’s network-(A) for the transmission and routing of telephone exchange service and
exchange access;
(B) at any technically feasible point within the carrier's network;
(C) that is at least equal in quality to that provided by the local exchange
carrier to itself or to any subsidiary, affiliate, or any other party to which the
carrier provides interconnection; and
(D) on rates, terms, and conditions that are just, reasonable, and
nondiscriminatory, in accordance with the terms and conditions of the agreement
and the requirements of this section and section 252 [47 USCS § 252].”
47 U.S.C. § 251(c)(2); see also, e.g., Verizon N. Inc. v. Strand, 367 F.3d 577, 581 (6th Cir. 2004)
(“The Act also prescribes a more specific mandate for incumbents by requiring them to share
their networks with competitors through three mechanisms: 1) permit competitors to purchase
local services at wholesale rates for resale to end users; 2) permit competitors to lease unbundled
elements of the incumbent’s network; and 3) permit competitors to interconnect their facilities to
the incumbent’s network.”) (citations omitted)).
The question for this Court, then, is whether PUCO, when making its determinations
pursuant to a request for arbitration brought specifically under 251(c), which parties do not

-24-

dispute was the case here, is limited by Section 251(c)(2)’s requirement that ILECs provide for
interconnection on their own network, or whether it may order the POI to be established on
either carrier’s network under the more general duty of telecommunications carriers to provide
interconnection under Section 251(a). As is not unusual in this area, no clear answer to this
question presents itself, either from the language and structure of the Act or from commission
and court decisions.13 Based on the following analysis, however, the Court finds that the better
interpretation of the Act, particularly in light of recent FCC rulings, is that Section 251(c)’s
applicability in this case does not prevent PUCO from deciding issues under Section 251(a),
including the issue of where the appropriate place is to establish the POIs for Intrado’s new
service in its interconnection with AT&T.
AT&T vigorously maintains that when a requesting carrier seeks interconnection with an
ILEC for the purpose of providing telephone exchange service in the ILEC’s territory, the only
provision that applies is Section 251(c), in particular subsection 2. A plain reading of Section
251(c) itself negates AT&T’s claim, however, as the opening prefatory clause of Section 251(c)
states that the obligations it provides for ILECs are “in addition to the duties contained in
subsection (b).” At the very least, therefore, Section 251(b)’s requirements still apply to ILECs
when a requesting carrier is seeking interconnection under Section 251(c). Thus, AT&T is
incorrect to claim that Section 251(c)(2) is the only applicable provision of the Act in
adjudicating and reviewing an interconnection request, given Section 251(c)’s direction that at
least one other section also applies.

13

See AT&T Corp. v. Iowa Utilities Bd., 525 U.S. 366, 397 (1999) (“It would be gross understatement to say that
the 1996 Act is not a model of clarity. It is in many important respects a model of ambiguity or indeed even selfcontradiction.”).
-25-

The Act’s language is ambiguous, however, as to whether ILECs can be compelled to
interconnect under Section 251(a), in addition to their express interconnection obligations under
Section 251(c)(2) and (b). Section 251(c)’s failure also to mention the general obligations in
Section 251(a) could reflect an intentional decision by Congress to exclude Section 251(a) from
applying to ILECs when Sections 251(c) applies. The FCC’s ruling in In the Matter of Petition
of CRC Communications, Case No. FCC 11-83, 26 FCC Rcd. 8259 (2011), cleared up the
question by holding the following:
[W]e conclude that requests made to incumbent LECs [ILECs] for
interconnection and services pursuant to sections 251(a) and (b) are subject to
state commission arbitration as set forth in Section 252.
26 FCC Rcd. 8259, at 11.
Hence, AT&T’s broad claim that PUCO has no authority whatsoever to arbitrate issues of
interconnection under Section 251(a) is defeated by the ruling in CRC Communications. See
AT&T Brief at 30. As the FCC also states at the outset of its opinion, “[w]e also clarify that
rural incumbent LEC’s obligations under sections 251(a) and (b) can be implemented through
the state commission arbitration and mediation provisions in Section 252 of the Act.” 26 FCC
Rcd. at 1.
Indeed, the FCC’s express purpose for its Declaratory Ruling in CRC Communications,
which was issued in the interim since the parties filed their briefs in this matter, was to “to clarify
statutory rights under section 251 of [the Act] in light of apparently conflicting determinations in
several states.” Id. The FCC acknowledged that “the Act is ambiguous as to whether the section
252 arbitration process can be invoked to implement and enforce the obligations in sections
251(a) and (b),” id. at 10, which is precisely the predominant issue here.

-26-

In CRC Communications the FCC confirmed that whether or not a given ILEC is
specifically obligated to allow interconnection on their own networks under Section 251(c) (as
AT&T is here), another carrier can also compel the ILEC to interconnect under the more general
duty of all telecommunications carriers to provide interconnection under Section 251(a). For
example, the FCC states that “the obligation to fulfill the requirements set forth in sections
251(a) and (b) does not arise from, or depend upon, the section 251(c)(1) duty to negotiate in
good faith.” Id. AT&T espouses the opposite reading by arguing that Section 251(c)(2) is the
only applicable section in Intrado’s arbitration petition. AT&T Brief at 26. AT&T’s, however,
is a constricting and unfaithful view of the Act, and that interpretation has been discredited by
the FCC:
For example, under such a reading of section 251, competitive LECs could not be
compelled to interconnect with other competitive LECs under section 251(a), nor
provide such competitors with any services set forth in section 251(b). We find
that this reading of the Act does not comport with the plain language and design
of section 251.
CRC Comm’s, 26 FCC Rcd. 8259 at 10 (emphasis added).
If a competitor LEC can compel interconnection to another competitor LEC under
Section 251(a), as the FCC’s Declaratory Ruling in CRC Communications states, it follows that
an ILEC can be compelled to interconnect with a competitor LEC under Section 251(a) as well.
ILECs, after all, have greater obligations to interconnect than competitor LECs, not the other
way around, as is well-established under the requirements of Section 251. AT&T is,
accordingly, mistaken in arguing that Section 251(a) does not provide a basis for compelling
interconnection on a competitor ILEC’s network, such as Intrado’s.
The particular context of the FCC’s discussion of permissible areas for arbitration under
Section 251 in CRC Communications was that of “rural” incumbent LECs and the so-called
-27-

“rural exemption” in Section 251(f)(1).14 See id. at 6 (opening the Discussion section stating,
“[w]e believe it is important to remove the uncertainty surrounding the proper interpretation of
sections 251 and 252 in situations where the rural exemption applies”). The FCC’s interpreting
the rural exemption explains why the ruling did not expressly hold that state commissions were
free to arbitrate Section 251(a) issues as part of arbitrating Section 251(c)(2) requests, because
the very nature of the rural exemption is that Section 251(c)’s enhanced obligations to ILECs do
not apply to those that qualify under it. See CRC Comm’s., 26 FCC Rcd. at 9 (“We also clarify
that a rural carrier’s exemption under section 251(f)(1) offers an exemption only from the
requirements of section 251(c) and does not impact its obligations under sections 251(a) or
(b).”). Nevertheless, the Court finds that the same holding would apply to standard ILECs who
do not qualify for the rural exemption, as, once again, non-exempt ILECs are under the strictest
obligations of any telecommunications carrier to provide interconnection.
AT&T argues, not entirely without merit, that Defendants provide “no” legal support for
their position that PUCO was authorized to arbitrate and decide an interconnection issue under
Section 251(a) when the request for interconnection was initially made by Intrado under
251(c)(2). The FCC in CRC Communications, with its special competence in interpreting and
implementing the Act,15 has since weighed in on the side of Defendants, concluding that “[w]e
therefore reject the arguments of some commenters that oppose state arbitration of Section
251(a) and (b) requirements without recognizing any alternative forum for enforcement of those
14

See 47 U.S.C. § 251(f)(1) (“Subsection (c) of this section shall not apply to a rural telephone company until (i)
such company has received a bona fide request for interconnection, services, or network elements, and (ii) the State
commission determines . . . that such request is not unduly economically burdensome, is technically feasible, and is
consistent with section 254 . . . .”).
15
See Western Union Tel. Co. v. Federal Communications Com., 541 F.2d 346, 350 (3d Cir. 1976) (confirming that
“the FCC does exercise special competence with respect to the many decisions entrusted to it under the Federal
Communications Act”); see also Alliance for Cmty. Media, 529 F.3d at 776 (applying Chevron deference to the
FCC’s interpretations of the Act, stating, “pursuant to the principle of deference to administrative interpretations,
considerable weight should be accorded to an executive department’s construction of a statutory scheme it is
entrusted to administer”).
-28-

requirements.” Id. at 13. AT&T’s proposition of law that states Intrado cannot compel
interconnection on its own network from AT&T, because of Section 251(c)’s exclusive
applicability, is consequently erroneous. PUCO was justified in deciding the issue of where to
locate the POIs in the agreement, including whether to establish a POI on Intrado’s network
under Section 251(a).
3. PUCO’s authority to implement Section 251(a) in an arbitration award
AT&T insists PUCO’s decision to use Section 251(a) to locate a POI on Intrado’s
network rather than strictly on AT&T’s network was contrary to Congressional intent, which
AT&T contends limits PUCO’s authority to what is expressly granted in the Act. This Court
disagrees.
Section 252(b), which guides PUCO’s hand when making its determinations on petitions
for arbitration, instructs that “[t]he State commission shall resolve each issue set forth in the
petition . . . by imposing appropriate conditions as required to implement [the requirements of §
251].” 47 U.S.C. § 252(b)(4)(C). As the FCC states in CRC Communications:
Much of the language of section 252 speaks broadly of the states’ role in
implementing section 251. We find ample support to conclude that Congress did
not intend to restrict the arbitration authority of state commissions to matters
arising under section 251(c). For example, several of section 252’s jurisdictional
and procedural provisions, on their face, refer generally to all interconnection
disputes arising under section 251; these provisions do not restrict the arbitration
authority of state commissions to matters arising under section 251(c).
26 FCC Rcd. at 11.
The FCC bolsters its interpretation by noting that “where Congress intended to refer only
to a specific subsection of section 251, it did so expressly,” id. at 12 (referring, e.g., to Sections
252(d)(1), (d)(3), (g), and (j)). Thus, Section 252(b)’s reference to Section 251 as a whole

-29-

evidences Congress’s intent to include issues under Section 251(a) among those the state
commission is tasked to arbitrate.
In sum, AT&T’s argument that PUCO has no authority to determine issues outside
Section 251(c)(2) in this context of a competing carrier seeking interconnection with an ILEC
under Section 251(c)(2) is contrary to the Act, as most recently clarified by the FCC. AT&T’s
position is also contrary to Congress’s intent behind the Act to bestow state commissions with
broad authority to mediate and arbitrate disputes between telecommunications carriers, and to
promote the goal of bringing increased competition in the local telephone exchange market. See
MCI Telcoms. Corp., 79 F. Supp. 2d at 780; see also Quick Communs., Inc. v. Mich. Bell Tel.
Co., 515 F.3d 581, 585 (6th Cir. 2007) (stating that Congress’s “over-arching purpose” behind
the Act was “to end local telephone company monopolies and promote competition in local
telephone markets”).
4. Review of PUCO’s decision for arbitrariness
Upon finding that PUCO had proper authority to decide the duly raised issue of where to
locate the POIs between AT&T and Intrado’s respective networks, the factual decision PUCO
made to locate a POI on Intrado’s selective router when Intrado is the 911 service provider to the
PSAP will be upheld unless shown to be arbitrary and capricious. See MCI Telecomms. Corp.,
279 F. Supp. 2d at 953. For the reasons below, the Court finds PUCO’s decision was based on
the rational and responsible review of parties’ proposals on the matter; thus, the decision was not
arbitrary or capricious.
In its Arbitration Award, PUCO provided lengthy and reasonable explanations for
ordering a POI to be established on Intrado’s network, as it has ordered in previous arbitrations.
See Arbtiration Award at *81. PUCO weighed evidence provided by Intrado that establishing
-30-

POIs on Intrado’s network for routing the 9-1-1 call traffic destined for its PSAP customers
would be the most efficient arrangement for efficiently delivering 9-1-1 calls and thus would
better serve individuals requiring emergency assistance. Id. at *78-80.16 AT&T complains that
this setup unfairly shifts costs to the ILEC; however, the Court finds no evidence of AT&T being
made to unfairly bear inequitable costs. The system PUCO ordered entails a mutual sharing of
costs, where “each party is responsible for getting its end users’ 911 calls to the selective router
of the 911 service provider to which a 911 call is destined.” Id.
PUCO furthermore duly considered AT&T’s objections to the scheme, and even altered
its initial ruling in light of AT&T’s concerns. See Arbitration Rehearing at *37 (granting
AT&T’s application for rehearing “in order to clarify that, as in the previous Intrado arbitration
awards, any POI AT&T would have to establish at an Intrado selective router would have to be
within AT&T's service area”). Far from being arbitrary or capricious, PUCO’s order that parties
establish reciprocal POIs on both AT&T’s network and on Intrado’s network was demonstrative
of a reasonable decision made in light of the evidence and facts presented to it. See Killian, 152
F.3d at 520. Counts Two, Three, and Four of AT&T’s Complaint are therefore dismissed.17
C. AT&T’s Remaining Challenges to PUCO’s Arbitration
1.

PSAP-to-PSAP Transfers

Count Five of AT&T’s Complaint alleges that PUCO’s Arbitration Award on Issues 5(a)
and 5(b) requiring AT&T to enter into transfer arrangements with certain non-carrier, third party
16

“Intrado explains that its proposal to require two geographically diverse POIs on Intrado’s network when Intrado
is the 911 service provider makes sense as the critical nature of 911 communications demands diversity and
redundancy (Intrado Ex. 1 at 27). Intrado further asserts that geographically diverse routes for 911 traffic are
consistent with industry guidelines and recommendations (Id. at 28).” Arbitration Award at *79.
17
Count Four of AT&T’s Complaint originally challenged PUCO’s ruling regarding charges for certain “ports” on
Intrado’s Selective Router as part of its order establishing a POI on Intrado’s network. Complaint, ¶ 45-46. AT&T
also attacked AT&T’s alleged failure to require the POI on Intrado’s network to be within the Local Transport Area
in which Intrado provides service. Complaint, ¶ 47. As AT&T chose not to argue in support for these claims, the
Court has no basis for finding these factual decisions arbitrary or capricious, and therefore upholds PUCO’s rulings
with respect to these issues.
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PSAPs to establish the ability to transfer 911 calls from its PSAP customers to Intrado’s PSAP
customers was unlawful, arbitrary and capricious because it compelled action with entities not
party to the interconnection agreement. See Arbitration Award at *89-92. PUCO argues in
defense that the general duty under Section 251(a) for telecommunications carriers, including
AT&T, to interconnect with other carriers authorized PUCO to order that a framework be created
as part of the interconnection agreement to ensure that “inter-selective router capabilities can be
provisioned once requested” by the customer PSAPs. PUCO Brief at 30.
AT&T lists three legal infirmities with PUCO’s conclusion that Section 251(a) applied
and allowed it to include terms and conditions regarding third-party PSAP interconnections.
First, since Intrado did not specifically ask for PUCO to arbitrate any issues under Section
251(a), the issue was not “open” for PUCO to resolve on that basis. Second, as before, AT&T
argues that interconnection between competing carriers and ILECs is exclusively governed by
Section 251(c)(2), and Section 251(a) issues are not arbitrable under Sections 252(b) in any case.
Finally, AT&T points to PUCO’s prior statement in the Embarq arbitration proceeding that
PSAP-to-PSAP transfers “do not involve interconnection of a competing carrier’s network with
an ILEC’s network,” to be saying that these transfers are not interconnections and therefore
cannot be ordered under Section 251(a)’s duty to interconnect. See AT&T Brief at *33.
As with AT&T’s prior contention that PUCO wrongfully adjudicated an issue that was
not “open” for arbitration, here, too, AT&T’s claim on that basis is misguided. The issues
regarding the architecture of the network created through AT&T and Intrado’s interconnection
agreement, including “inter-selective router trunking” to allow for transfers of calls between
PSAPs on different Selective Routers (interoperability), was raised in Intrado’s petition for
arbitration. See, e.g., Intrado Petition for Arbitration, TRF Docket No. 90-9348-TP-TRF, at 31-32-

32. The fact that Intrado never asked PUCO to impose this duty on AT&T under Section 251(a),
specifically, as AT&T complains, does not mean the issue was not “open” for arbitration
pursuant to Section 252(b).
AT&T in the alternative denies PUCO’s authority to arbitrate any issues under Section
251(a) whatsoever, including this decision regarding PSAP transfer agreements. This broad
attack fails here, see Section B, supra. PUCO may adjudicate any open issues the parties have
left to resolve in their agreement, including those arising under Section 251(a). Under Section
252(b)(1), the state commission is charged with arbitrating “any open issues” that the two
carriers are unable to agree. 47 U.S.C. § 252(b). The FCC has unequivocally clarified that this
includes issues arising under Section 251(a):
We find it consistent with the structure and purpose of the Act for the state
commissions, which are tasked with, at a minimum, arbitrating or reviewing any
agreements relating to section 251(b) obligations, to also review issues relating to
section 251(a) interconnection where issues relating to both sets of obligations are
implicated in the same request for interconnection.
See CRC Comm’s, 26 FCC Rcd. at 12.
Having established that nothing in the Act prevents PUCO from adjudicating outstanding
issues within the Parties’ interconnection agreement arising under Section 251(a), Defendant
PUCO’s factual determination that a framework should be established to route calls properly to
various PSAPs warrants the utmost deference from this Court. AT&T provides nothing of
substance to suggest that PUCO’s decision represents anything but a reasonable structuring of
the interconnection terms supported by sufficient evidence in the record. As PUCO explains in
its brief, the requirement does not preclude the necessary input from the third-party PSAPs for
the contemplated arrangements. PUCO merely ordered AT&T and Intrado to provide the

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necessary framework on their networks to facilitate PSAP-to-PSAP call transfer capabilities in
preparation for the agreements. PUCO Brief at 30.
This Court finds PUCO’s order that parties establish a framework for facilitating thirdparty transfer arrangements with prospective customer PSAPs was not in any way arbitrary or
capricious, and is a valid requirement. Count Five of AT&T’s Complaint is dismissed.
2. Rates to be charged to Intrado for AT&T’s non-covered services
AT&T’s final challenge, in Count Six of the Complaint, disputes the rate charging
scheme established by PUCO which orders Intrado to pay AT&T “the lowest rate in effect at the
time for Ohio CLECs” for services provided by AT&T not contained in the interconnection
agreement. Complaint, ¶ 52. AT&T contends that setting a mandatory charge violates the
FCC’s “all-or-nothing” rule prohibiting competing carriers like Intrado from adopting an isolated
rate from another carrier’s interconnection agreement with that ILEC. Like any other carrier,
argues AT&T, Intrado should be forced to negotiate the rates of AT&T’s products or services
provided which are not covered by the agreement.
Defendant PUCO’s determinations on issues such as rates to be charged between parties
to an interconnection agreement are protected against second guessing by this Court from all but
the most arbitrary exercises of its competent authority. The Sixth Circuit has reinforced the
statements from commentators that “‘intricate matters, such as rate-setting and determining the
feasibility of regulatory mandates, lie beyond the core of judicial competence.’” Mich. Bell Tel.
Co., 323 F.3d at 352 (quoting Philip J. Weiser, Federal Common Law, Cooperative Federalism,
and the Enforcement of the Telecom Act, 76 N.Y.U. L. Rev. 1692, 1724 (2001)); see also Mich.
Bell. Tel. Co. v. Level 3 Communications, Inc. 218 F. Supp. 2d 891, 894 (E.D. Mich. 2002)
(stating “this court should not sit as a surrogate public utilities commission to second-guess the
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decisions made by the state agency to which Congress has committed primary responsibility for
implementing the Act.” (citation omitted)). PUCO’s order on rate-setting for services not
covered in the agreement will therefore be afforded considerable deference by this Court.
“Interconnection” and “network elements” services provided to the competing carrier by
the ILEC pursuant to an interconnection agreement “must be provided ‘on rates, terms and
conditions that are just, reasonable, and nondiscriminatory.’” Bellsouth Telecomms., Inc. v.
Southeast Tel., Inc., 462 F.3d 650, 652 (6th Cir. 2006) (quoting 47 U.S.C. § 251(c)(2)(D); 47
C.F.R. § 51.5). Additionally, the FCC’s “all-or-nothing” rule requires that if requesting carrier
“wants to adopt a term or service of an existing agreement, it must opt in to the entire
agreement.” Id. at 654 (quoting Review of the Section 251 Unbundling Obligations of Local
Exch. Carriers, 19 FCC Rcd. 13494, 13496 P 1 (2004)). The Sixth Circuit in Bellsouth stated
the rule as follows:
Under the all-or-nothing rule, ILECs are required to “make available without
unreasonable delay to any requesting [CLEC] any agreement in its entirety to
which the [ILEC] is a party that is approved by a state commission . . . upon the
same rates, terms, and conditions as those provided in the agreement.” 47 C.F.R.
§ 51.809(a) (emphasis added).
Bellsouth Telecomm’s., 462 F.3d at 654 (discussing the regulatory history of the “all-or-nothing”
rule at length).
In the arbitration proceeding below, on Issue 29(b) of the Arbitration Award, PUCO
determined that “in a situation where Intrado orders a product or service for which terms and
conditions are not contained in the interconnection agreement,” Arbitration Award at *140, the
following rate scheme applies:
The Commission…will allow AT&T to charge Intrado what it charges CLECs for
the same product or service. However, if AT&T has provisioned Intrado's order,
even though it agreed to reject such orders, the Commission finds that Intrado
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should only be required to pay the lowest price in effect at that time for Ohio
CLECs and not necessarily the generic rate.
Id.
AT&T alleges that the all-or-nothing rule makes it unlawful for PUCO to allow Intrado
automatically to obtain the “lowest rates” as established by other competing carrier’s agreements
with AT&T for certain services not specifically listed or priced in the interconnection agreement,
without taking on that entire agreement. AT&T Brief at 34. Defendants PUCO and Intrado deny
the applicability of the all-or-nothing rule to PUCO’s decision on this issue. PUCO contends
that since it merely addressed rates for services outside the agreement, which AT&T has no
continuing obligation to provide, there was no resulting prejudice to AT&T from its
adjudication. PUCO Brief at 29-30. Intrado argues that the rule is only concerned with products
or services “provided under an agreement,” and PUCO’s decision expressly covers only
instances where the product or service in question is not provided for under the terms and
conditions of the interconnection agreement and where AT&T has established no separate tariff
for the service elsewhere. Intrado Brief at 32.
The Court does not accept the logic behind Intrado’s argument to the extent Intrado is
suggesting that PUCO’s order does not permit Intrado to take advantage of another agreement’s
terms. The order allows that by requiring AT&T to charge Intrado the rates for services supplied
by other CLEC agreements where there are no terms for those services within their agreement.
PUCO’s argument is more apposite, however, in emphasizing that these rates are only for
services that AT&T provides Intrado “even though it agreed to reject such orders.” Arbitration
Award at *140. AT&T even acknowledges in its Reply that this provision requiring the lowest
price charged to any other carrier only applies to orders for services made “mistakenly” by
Intrado and provided “inadvertently” by AT&T. AT&T Reply at 18. Intrado can hardly be said
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to be “seeking to avail itself of terms in [another] interconnection agreement” where it did not
intend on AT&T providing the service or produce. See Review of the Section 251 Unbundling
Obligations of Local Exchange Carriers, 19 FCC Rcd. 13494 at P 1. Moreover, AT&T is free in
these circumstances “to reject future orders for the product or service until such time as terms and
conditions are incorporated into the interconnection agreement,” Arbitration Award at *141, and
thus will not be in any way prejudiced by this pricing requirement, as it alleges.
The Court has no “‘reason to suspect that the [PUCO’s] interpretation does not reflect the
agency’s fair and considered judgment on the matter in question.’” See Talk America, Inc. v.
Michigan Bell Telephone Co. 131 S.Ct. 2254, 2263 (2011) (citation omitted). PUCO’s decision
to allocate rates for services AT&T chooses to provide to Intrado outside the scope of the
agreement at the lowest level of those charged to other CLECs was accordingly not arbitrary and
capricious. AT&T’s claims are denied, and Count Six is dismissed.
V. CONCLUSION
For the reasons stated above, this Court affirms the arbitration award of the Public
Utilities Commission of Ohio in all disputed respects. Plaintiffs’ Counts One through Six are
DISMISSED. This case is accordingly DISMISSED in its entirety.

IT IS SO ORDERED.

s/Algenon L. Marbley
Algenon L. Marbley
DATED: January 6, 2012

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