[Federal Register Volume 63, Number 4 (Wednesday, January 7, 1998)]
[Rules and Regulations]
[Pages 990-1042]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-173]
[[Page 989]]
_______________________________________________________________________
Part III
Federal Communications Commission
_______________________________________________________________________
47 CFR Parts 0 and 1
Procedures To Be Followed When Formal Complaints Are Filed Against
Common Carriers; Final Rule
Federal Register / Vol. 63, No. 4 / Wednesday, January 7, 1998 /
Rules and Regulations
[[Page 990]]
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 0 and 1
[CC Docket No. 96-238; FCC 97-396]
Procedures To Be Followed When Formal Complaints Are Filed
Against Common Carriers
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Commission adopted a Report and Order that changed the
rules for processing formal complaints filed against common carriers.
The Report and Order adopted rules that are necessary to implement
certain provisions contained in the 1996 Act that prescribe deadlines
ranging from 90 days to 5 months for resolution of certain types of
complaints against common carriers. The rules adopted in the Report and
Order require or encourage parties to engage in pre-filing activities,
change service requirements, modify the form and content of initial
pleadings, shorten filing deadlines, eliminate pleading opportunities
that were not useful or necessary, and modify the discovery process.
EFFECTIVE DATE: March 18, 1998.
FOR FURTHER INFORMATION CONTACT: Deena Shetler (202) 418-7296. For
additional information concerning the information collections contained
in this Report and Order contact Judy Boley at 202-418-0214, or via the
Internet at jboley@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order in CC Docket No. 96-238, adopted and released on November 25,
1997. The full text of the Report and Order is available for inspection
and copying during normal business hours in the FCC Reference Center,
Room 239, 1919 M Street, N.W., Washington D.C. The complete text of
this decision may also be purchased from the Commission's duplicating
contractor, International Transcription Services, 1231 20th Street NW,
Washington D.C. 20036, (202) 857-3800.
This Report and Order contains new or modified information
collections subject to the Paperwork Reduction Act of 1995 (PRA). It
has been submitted to the Office of Management and Budget (OMB) for
review under the PRA. OMB, the general public, and other federal
agencies are invited to comment on the proposed or modified information
collections contained in this proceeding.
Paperwork Reduction Act
This Report and Order contains either a new or modified information
collection. The Commission, as part of its continuing effort to reduce
paperwork burdens, invites the general public and the Office of
Management and Budget (OMB) to comment on the information collections
contained in this Order, as required by the Paperwork Reduction Act of
1995, Pub. L. 104-12. Written comments by the public on the information
collections are due February 6, 1998. OMB notification of action is due
March 9, 1998. Comments should address: (1) whether the new or modified
collection of information is necessary for the proper performance of
the functions of the Commission, including whether the information
shall practical utility; (b) the accuracy of the Commission's burden
estimates; (c) ways to enhance the quality, utility, and clarity of the
information collected; and (d) ways to minimize the burden of the
collection of information on the respondents including the use of
automated collection techniques or other forms of information
technology.
OMB Approval Number: 3060-0411.
Title: Procedures for Formal Complaints Filed Against Common
Carriers.
Form No.: FCC Form 485.
Type of Review: Revision.
Respondents: Individuals or households; businesses or other for
profit, including small business; not-for-profit institutions; state,
local or tribal government.
------------------------------------------------------------------------
Total
No. of Est. time annual
Section/title respondents per burden
respondent (hours)
------------------------------------------------------------------------
a. Service.................. 760............ 1.0 760
b. Pleading Content 760............ 3.0 2,280
Requirements.
c. Discovery................ 380 2.25 855
(complainants).
380 1.5 570
(defendants).
Estimate for recordkeeping.. 760............ 0.5 380
d. Scanning................. 38............. 5.0 190
e. Damages.................. 380............ 1.0 380
f. Briefs................... 760............ 3.0 2,280
g. Directory of Service 4,965.......... 0.25 1,241.25
Agents.
h. Joint Statement of 760............ 2.0 1,520
Stipulated Facts and Status
Conferences.
i. Filing of Copies of 760............ 0.5 380
Proposed Orders on Disks.
j. FCC 485-Intake Form...... 380............ 0.5 190
------------------------------------------------------------------------
Total Annual Burden: 11,026.25 hours.
Estimated Costs Per Respondents: $150.00 for each respondent that
files a complaint against a common carrier, it is estimated that 380
complaints will be filed in the next year.
Needs and Uses: The information has been and is currently being
used by the FCC to determine the sufficiency of complaints and to
resolve the merits of disputes between the parties.
The Report and Order requires all complainants to personally serve
their formal complaint on the defendant, as well as serve copies of the
complaint with the Mellon Bank, the Secretary of the Commission, and
the responsible Bureau or Bureaus. This requirement will speed up the
proceeding by eliminating delays in the defendant receiving a copy of
the complaint.
Regarding changes to the pleading requirements, the Report and
Order concludes that complaints, answers, and any necessary replies
must contain complete statements of relevant facts and supporting
documentation; an inventory of all documents relevant to the complaint;
an identification of all individuals with information relevant to the
complaint; and a computation of any damages claimed. The Report and
Order concludes that each complaint must contain verification of
payment of the filing fee, a certificate of service, and certification
that each complainant has mailed a certified letter to each defendant
outlining the allegations that form the basis of the complaint it
anticipated filing with the Commission to the defendant carrier that
invited a response within a reasonable time
[[Page 991]]
period and a summary of all additional steps taken to resolve the
dispute prior to the filing of the complaints, or an explanation of why
no such steps were taken. The Report and Order concludes that each
answer must contain certification that each defendant has discussed the
possibility of settlement with each complainant prior to the filing of
the complaint, or an explanation of why such discussion was not
feasible. The Report and Order also concludes that Answers must be
filed within 20 days of service of the complaint on the defendant by
the complainant. The Report and Order requires that all pleadings be
accompanied by copies of relevant tariffs. The Report and Order
concludes that all dispositive motions be accompanied by proposed
finding of facts and conclusions of law in both hard copy and on a
computer disk, formatted to be compatible with the Commission's word
processing software. The Report and Order concludes that no amendments
to complaints will be allowed and no cross-complaints or counterclaims
may be filed. The Report and Order further requires parties to submit a
joint statement of disputed and undisputed facts and key legal issues
at least two business days prior to the scheduled date of the initial
status conference. These proposals will promote agreement on a
significant number of disputed facts and legal issues, as well as
serving to better inform the Commission of the factual and legal areas
in dispute.
The Report and Order concludes that complainants must file and
serve any requests for interrogatories, up to a limit of 10,
concurrently with their complaints, defendants must file and serve any
requests for interrogatories, up to a limit of 10, prior to or
concurrently with their answer, and complainants must file and serve
any requests for interrogatories that are directed solely at facts
underlying affirmative defenses asserted by the defendant in its
answer, up to a limit of 5, within 3 calendar days of service of the
defendant's answer. The Report and Order concludes further that
individuals who are provided access to proprietary information shall
sign a notarized statement affirmatively stating that the individual
has personally reviewed the Commission's rules and understands the
limitations they impose on the signing party. Parties must maintain a
log recording the number of copies made of all proprietary materials
and the persons to whom the copies have been provided. Upon termination
of a formal complaint proceeding, all originals and reproduction of any
proprietary materials disclosed in that proceeding, along with the log
recording persons who received copies of such materials, shall be
provided to the producing party. These requirements will lead to the
disclosure of information relevant to the resolution of formal
complaints earlier in the complaint proceeding, thus, allowing for
timely resolution of these complaints.
The Report and Order also concludes that the Commission may impose
a scanning or other electronic formatting requirement for submission of
large numbers of documents in certain cases. This requirement will
assist in the efficient management of documents in those cases where
the review of large numbers of documents is necessary to the resolution
of a dispute.
The Report and Order requires that, where the Commission has
ordered parties to attempt to negotiate a damages amount according to
an approved damages formula, the parties must submit to the Commission,
within thirty days, the written results of such negotiations. The
written statement shall contain one of the following: (1) the parties'
agreement as to the amount of damages; (2) a statement that the parties
are continuing to negotiate in good faith and a request for an
extension of time to continue such negotiations; or (3) the bases for
the continuing dispute and the reasons why no agreement can be reached.
This requirement will encourage parties to negotiate the resolution of
damages claims diligently and ensure that the failure of parties to so
negotiate will be remedied by the Commission.
The Report and Order resolves that briefs may be prohibited or
limited. Where permitted, briefs must contain all claims and defenses
that the party wants the Commission to address. Each brief must attach
all documents on which it relies and explain how each attachment is
relevant to the issues. Brief length has been shortened to 25 pages for
initial briefs and 10 pages for reply briefs. This requirement will
ensure that briefs will not be filed where they would be redundant of
filings already made with the Commission and that briefs will be filed
where necessary to the full resolution of a formal complaint.
The Report and Order requires all carriers subject to the
Communications Act of 1934, as amended, to file in writing a
designation of agent for service of process with the Commission, to
facilitate service of process in all Commission proceedings.
The Report and Order concludes that parties must file a joint
statement of stipulated facts, disputed facts and key legal issues at
least two business days prior to the initial status conference. This
requirement will serve to narrow the issues in dispute and serve as
further information to be considered in determining the necessity of
any discovery sought by the parties. The Report and Order also
concludes that parties must submit a joint proposed order memorializing
the rulings made at each status conference by the close of business on
the business day following the date the status conference was held.
Alternatively, parties may submit a transcript of the rulings made at
each status conference by the close of business on the third business
day following the date the status conference was held. This requirement
will save Commission staff time and ensure that the parties fully
understand the rulings that will impact the proceedings.
The Report and Order concludes that all proposed orders must be
submitted both as hard copies and on computer disk formatted to be
compatible with the Commission's computer system and using the
Commission's current wordprocessing software. This requirement
increasing the efficiency of the formal complaint process by providing
Commission staff with the ability to adopt proposed rules either in
whole or in part where necessary.
Finally, the Report and Order concludes that complainants are
required to submit a completed intake form with its formal complaint to
indicate that the complaint meets the threshold requirements for
stating a cause of action. This requirement will help to prevent the
filing of procedurally deficient complaints.
Summary of Report and Order
[Report and Order in CC Docket No. 96-238]
I. Introduction
1. In February 1996, Congress passed and the President signed the
Telecommunications Act of 1996 (``1996 Act''). One of the main goals of
the 1996 Act is to establish a ``pro-competitive, deregulatory''
national policy framework for the telecommunications industry. In
accordance with this goal, sections 208, 260, 271, and 275 of the Act
contain deadlines ranging from ninety days to five months for the
Commission's resolution of certain complaints filed against the Bell
Operating Companies (``BOCs''), local exchange carriers (``LECs''), and
other telecommunications carriers that are subject to the requirements
of the Act. Provisions of the 1996 Act further direct the Commission to
establish such procedures as are necessary for the review and
resolution of such
[[Page 992]]
complaints within the statutory deadlines. Prompt and effective
enforcement of the Act and the Commission's rules is crucial to
attaining the 1996 Act's goals of full and fair competition in all
telecommunications markets. Such widespread competition will ensure
that the American public derives the full benefit of such competition
through new and better products and services at affordable rates.
2. We conclude that, in order to fulfill the goals and meet the
statutory deadlines of the 1996 Act, we must revise our formal
complaint rules to provide a forum for prompt resolution of all
complaints of unreasonably discriminatory or otherwise unlawful conduct
by telecommunications carriers, and thus to reduce impediments to
robust competition in all telecommunications markets. Consistent with
the Congressional mandate to expedite the processing of formal
complaints, on November 26, 1996, the Commission released a Notice of
Proposed Rulemaking, 61 FR 67978 (December 26, 1996) (``NPRM'')
proposing changes to the rules that govern formal complaints against
common carriers. In the NPRM we articulated our goal of expediting the
resolution of all formal complaints, not just those enumerated in the
1996 Act. The NPRM sought public comment on comprehensive rule changes
and additions that would: (1) encourage parties to attempt to settle
their disputes before filing formal complaints; (2) facilitate the
filing and service of complaints and related pleadings; (3) improve the
content and utility of the initial pleadings filed by both parties,
while reducing reliance on discovery and subsequent pleading
opportunities; and (4) eliminate unnecessary or redundant pleadings and
other procedural devices.
3. In this Report and Order, we adopt certain of the proposed
rules, with some modifications. The amended rules will foster our
ability to meet the statutory complaint resolution deadlines of the
1996 Act and expedite the resolution of all formal complaints, while
safeguarding the due process interests of affected parties. The rules
we adopt today apply to all formal complaints, except complaints
alleging violations of section 255. A uniform approach will ensure that
the Commission places on all formal complaints the same pro-competitive
emphasis underlying the 1996 Act's complaint resolution deadlines. The
rules we adopt in this Report and Order shall be important tools for
promptly assessing a common carrier's compliance with the requirements
of the Act and our rules. In addition, these rules provide for suitable
remedial actions where appropriate.
4. We intend to closely monitor the effectiveness of our new
streamlined rules in promoting the pro-competitive goals of the Act. We
will not hesitate to re-visit the rules and policies adopted in this
Report and Order if we later determine that further modifications are
needed to ensure that complaint proceedings are promptly and fairly
resolved and, more generally, to promote the Act's goal of full and
fair competition in all telecommunications markets.
5. In addition, Commission staff retains considerable discretion
under the new rules to, and is indeed encouraged to, explore and use
alternative approaches to complaint adjudication designed to ensure the
prompt discovery of relevant information and the full and fair
resolution of disputes in the most expeditious manner possible. We
recently established an Enforcement Task Force, the principal mission
of which is to promote timely and appropriate enforcement of the pro-
competitive policies of the 1996 Act. Among other duties, the
Enforcement Task Force has been charged with identifying and
investigating actions by common carriers that may be hindering
competition in telecommunications markets and with initiating
enforcement actions where necessary to remedy conduct that is
unreasonable, anti-competitive or otherwise harmful to consumers. The
Enforcement Task Force is considering whether to recommend alternative
forms of complaint adjudications and enforcement actions to ensure that
the goals underlying the pro-competitive policies of the 1996 Act and
the Commission's implementing rules and orders are met. Any such
recommendation may form the basis for a subsequent Report and Order to
be considered by the Commission at a later date.
6. Finally, we note that section 207 of the Act gives any person
the option of pursuing claims for damages against common carriers based
on alleged violations of the Act either at the Commission or before a
federal district court of competent jurisdiction. Thus, parties looking
to recover monetary damages are free to weigh the advantages of
bringing their claims before a federal district court against the
benefits of proceeding under the Commission's expedited complaint
procedures.
II. Background
A. Statutory Framework for Complaints Against Common Carriers
7. Prior to enactment of the 1996 Act, sections 206 to 209 of the
Act provided the statutory framework for our rules for resolving formal
complaints filed against common carriers. Section 206 of the Act
establishes the liability of a common carrier for damages sustained by
any person or persons as a consequence of that carrier's violation of
any provision of the Act. Section 207 of the Act permits any person
claiming to be damaged by the actions of any common carrier either to
make a complaint to the Commission or bring suit in federal district
court for the recovery of such damages. Section 208(a) authorizes
complaints by any person ``complaining of anything done or omitted to
be done by any common carrier'' subject to the provisions of the Act.
Section 208(a) specifically states that ``it shall be the duty of the
Commission to investigate the matters complained of in such manner and
by such means as it shall deem proper.'' Section 209 of the Act
specifies that, if ``the Commission shall determine that any party
complainant is entitled to an award of damages under the provisions of
this Act, the Commission shall make an order directing the carrier to
pay to the complainant the sum to which he is entitled on or before a
day named.''
8. In 1988, Congress added subsection 208(b) to require that
complaints filed with the Commission concerning the lawfulness of a
common carrier's charges, practices, classifications or regulations,
must be resolved by the Commission in a final, appealable order within
twelve months from the date filed, or fifteen months from the date
filed if ``the investigation raises questions of fact of . . .
extraordinary complexity.'' In addition, Congress amended subsection
5(c)(1) to require that such decisions be made by the Commission, not
the Bureau staff pursuant to delegated authority.
B. Complaint Provisions Amended and Added by the 1996 Act
9. As amended or added by the 1996 Act, sections 208, 260, 271, and
275 of the Act all contain deadlines for the Commission's resolution of
formal complaints alleging violations under the particular section by a
common carrier.
10. Section 208. The 1996 Act amended section 208, entitled
``Complaints to the Commission.'' Section 208(b)(1) now mandates that
``the Commission shall, with respect to any investigation under
[section 208(b)] of the lawfulness of a charge,
[[Page 993]]
classification, regulation, or practice, issue an order concluding such
investigation within 5 months after the date on which the complaint was
filed,'' rather than the twelve to fifteen month deadline previously
imposed. In addition, subsection 208(b)(2) provides that any such
investigation initiated prior to enactment of subsection 208(b)(2) must
be concluded within twelve months after the date of enactment.
11. Section 260. The 1996 Act added section 260, entitled
``Provision of Telemessaging Service.'' Section 260(b) provides that:
[T]he Commission shall establish procedures for the receipt and
review of complaints concerning violations of [section 260(a)] or
the regulations thereunder that result in material financial harm to
a provider of telemessaging service. Such procedures shall ensure
that the Commission will make a final determination with respect to
any such complaint within 120 days after receipt of the complaint.
If the complaint contains an appropriate showing that the alleged
violation occurred, the Commission shall, within 60 days after
receipt of the complaint, order the local exchange carrier and any
affiliates to cease engaging in such violation pending such final
determination.
12. Section 271. The 1996 Act added section 271, entitled ``Bell
Operating Company Entry into InterLATA Services.'' Section 271(d)(6)(B)
directs the Commission to ``establish procedures for the review of
complaints concerning failures by [BOCs] to meet conditions required
for approval'' under section 271(d)(3) to provide in-region interLATA
services. Section 271(d)(6)(B) further provides that, ``[u]nless the
parties otherwise agree, the Commission shall act on such complaint
within 90 days.''
13. Section 275. The 1996 Act added section 275, entitled ``Alarm
Monitoring Services.'' Section 275(c) requires the Commission to
``establish procedures for the receipt and review of complaints
concerning violations of [section 275(b)] or the regulations thereunder
that result in material financial harm to a provider of alarm
monitoring service.'' Section 275(c) further provides that:
[S]uch procedures shall ensure that the Commission will make a
final determination with respect to any such complaint within 120
days after receipt of the complaint. If the complaint contains an
appropriate showing that the alleged violation occurred, * * * the
Commission shall, within 60 days after receipt of the complaint,
order the incumbent local exchange carrier * * * and its affiliates
to cease engaging in such violation pending such final
determination.
14. The 1996 Act also added several provisions that reference
complaint proceedings but do not contain resolution deadlines.
15. Section 255. The 1996 Act added section 255, entitled ``Access
by Persons with Disabilities.'' Section 255 requires manufacturers of
telecommunications equipment or customer premises equipment to ensure
that the equipment is ``designed, developed, and fabricated to be
accessible to and usable by individuals with disabilities'' and further
requires any providers of telecommunications services to ``ensure that
the service is accessible to and usable by individuals with
disabilities.'' Section 255 provides that ``[t]he Commission shall have
exclusive jurisdiction with respect to any complaint under this
section'' but imposes no specific resolution deadline for such
complaints. We have initiated a separate proceeding to implement the
provisions of section 255.
16. Section 274. The 1996 Act added section 274, entitled
``Electronic Publishing by Bell Operating Companies.'' Section
274(e)(1) provides that ``any person claiming that an act or practice
of any [BOC], affiliate, or separated affiliate constitutes a violation
of [section 274] may file a complaint with the Commission or bring suit
in federal district court as provided in section 207 of the Act'' and
that a ``[BOC], affiliate, or separated affiliate'' shall be liable for
damages as provided in section 206 of the Act. Similarly, subsection
274(e)(2) permits an aggrieved person to apply to the Commission for a
cease-and-desist order or to a U.S. District Court for an injunction or
order compelling compliance with section 274. None of the complaint
provisions in section 274 contain deadlines for Commission action.
17. In addition, the 1996 Act imposed other requirements on the
BOCs and other common carriers which could lead to formal complaint
actions under section 208. For example, section 254(k), entitled
``Subsidy of Competitive Service Prohibited,'' prohibits
telecommunications carriers from using non-competitive services to
subsidize services that are subject to competition. The 1996 Act also
added section 276, entitled ``Provision of Payphone Service.'' section
276(a) prohibits a BOC from subsidizing its payphone service through
its telephone exchange service operations or its exchange access
operations. Timely, responsive enforcement of provisions such as these
will be necessary to promote the 1996 Act's goal of fostering
competitive telecommunications markets.
18. We tentatively concluded in the NPRM that the provisions of the
1996 Act that specifically refer to complaint procedures do not
diminish the Commission's broad authority to investigate formal
complaints under section 208. AT&T, the sole commenter to address this
issue, agrees with our tentative conclusion, explaining that section
261(a) states that:
nothing in this part [Part II] shall be construed to prohibit the
Commission from enforcing regulations prescribed prior to the date
of enactment of the Telecommunications Act of 1996 in fulfilling the
requirements of this part, to the extent that such regulations are
not inconsistent with the provisions of this part.
According to AT&T, specific references in the Act to the Commission's
duties to resolve formal complaints under section 271 and elsewhere in
the Act affect only the time in which such matters must be decided, but
do not affect the Commission's existing authority under section 208.
19. We find that Congress' actions in specifying certain complaint
procedures and deadlines for those procedures do not restrict the
Commission's authority to resolve formal complaints pursuant to section
208. Section 261 is entitled, ``Effect on Other Requirements'' and
subsection (a) indicates Congress'' intent to leave intact the
Commission's authority except where it would be inconsistent with the
Act itself. We conclude that any references to complaint resolution
deadlines in Title II of the Act are intended to affect only the time
in which specific matters must be decided, and do not decrease the
Commission's existing authority under section 208.
III. Amendments to Rules of Practice and Procedure
A. Overview
20. The focus of this proceeding is on establishing rules and
procedures to implement the expedited complaint provisions set forth by
the 1996 Act and to speed the resolution of all formal complaints in
accordance with the pro-competitive policies underlying the 1996 Act.
Three objectives form the basis for the amendment of the formal
complaint rules, which focus on settlement efforts, enhanced pleading
content, and streamlined procedures.
21. Our first objective is to promote settlement efforts to enable
parties to resolve disputes on their own before resorting to
adjudication before the Commission. We conclude that more dialogue
between parties prior to the complaint process will reduce, and in some
cases, eliminate, the need to file formal complaints with the
Commission. Consequently, we require complainants and defendant
carriers to
[[Page 994]]
certify in their respective complaints and answers that the possibility
of settlement was discussed before the complaint was filed with the
Commission. Certification of settlement attempts will promote pre-
filing discussions and information exchanges among the disputing
parties. In situations in which disputes are not resolved, we expect
that pre-filing discussions and information exchanges will enable
parties to narrow the number and scope of the issues to be presented to
the Commission for resolution under the expedited complaint procedures.
22. Our second objective is to improve the utility and content of
pleadings, so that the complaint, answer, and any necessary reply may
serve as the principal basis upon which the Commission will make a
decision on the merits of the complaint. Under the format and content
rules, absent a waiver for good cause shown, complainants and
defendants must make factual allegations in their pleadings and supply
documentation to support such facts. To the extent that the Commission
determines that additional information is needed in the record to
resolve a complaint fully, the parties will be required to respond
quickly.
23. Our third objective is to streamline the formal complaint
process by eliminating or limiting procedural devices and pleading
opportunities that have contributed to undue delays in formal
complaints. For example, we conclude that we should modify discovery to
increase staff control over the process and limit the filing, timing,
and scope of briefs, as well as streamline the service process by
having complainants serve complaints directly on defendants. In
addition, we eliminate certain pleading opportunities that have been of
little value to the complaint resolution process, including cross-
complaints, counterclaims, motions to make a complaint definite and
certain, and amendments to complaints.
24. To advance these three objectives, we have designed rules to
speed the processing of all formal complaints. By encouraging dialogue
among the parties prior to the filing of formal complaints, many
conflicts will be settled and those complaints that are filed will have
been narrowed in scope. By requiring initial pleadings to contain
complete information and documentation, the parties and the Commission
will be better prepared to resolve disputed issues at an early stage of
the complaint process. And finally, by streamlining and eliminating
unnecessary pleading opportunities, the parties and the Commission will
be able to focus early on the essential activities and information
needed to more quickly resolve formal complaints.
B. Applicability of the Rules
1. Uniform Application of the Rules. a. The NPRM. 25. In the NPRM,
we tentatively concluded that the pro-competitive goals and policies
underlying the short complaint resolution deadlines in the Act should
apply to all formal complaints, not just to those specifically added or
amended by the 1996 Act. The NPRM proposed to implement uniform
procedures and pleading requirements to expedite the resolution of all
formal complaints and sought comment on the need for specialized rules
or procedures for handling complaints arising under particular
provisions of the Act.
b. Comments. 26. BellSouth supports applying the same procedures to
all formal complaints and the National Association for the Deaf
(``NAD'') agrees, stating that separate sets of procedures could be
confusing for complainants. The majority of parties commenting on this
issue, however, argue for special expedited procedures for those
complaints that are subject to specific statutory deadlines, with other
complaints proceeding under more relaxed or flexible timetables.
American Public Communications Council (``APCC'') expresses concern
that the new procedures will place significant burdens on complainants
and defendants. Cincinnati Bell Telephone (``CBT'') states that
sections 260(b), 271(d)(6)(B), and 275(c), which require complaints to
be resolved under ninety or 120-day deadlines, involve very specialized
subject matters, while section 208 complaints may involve any aspect of
telecommunications and therefore parties to section 208 complaints may
need more time to develop and resolve issues. GTE suggests using
separate proceedings for ``fast-track'' cases, stating that the
Commission should wait until it has gained more experience with
application of the provisions of the 1996 Act before attempting to
apply the same expedited procedures to all formal complaints.
27. Some commenters also urge the Commission to establish expedited
procedures for those complaints that are not specifically covered by a
statutory deadline but which, they argue, are needed to ensure full and
fair competition. For example, MCI proposes expedited procedures for
interconnection-related complaints pursuant to sections 251 and 252 of
the Act. Telecommunications Resellers Association (``TRA'') argues that
complaints filed by resale carriers should be processed under expedited
procedures because of the size and resource disparities between
resellers and their underlying network service providers, and because
of the unusual circumstances in which resellers have dual status as
both customers and competitors of network service providers.
28. The NAD references its comments to the Section 255 NOI, 61 FR
50465 (September 26, 1996), in which it proposed that the Commission
create procedures to coordinate with the Department of Justice
(``DOJ'') to determine the appropriate governmental authority for
reviewing complaints that arise out of a lack of access to
telecommunications services for persons with disabilities. Such
complaints could result either from the failure of a place of public
accommodation or state or local governmental entity to follow the
requirements of the Americans with Disabilities Act of 1990 (``ADA'')
or from the failure of a telecommunications manufacturer or service
provider to comply with section 255. The NAD states that its proposal
will aid parties who file section 255 complaints that may raise
jurisdictional issues.
c. Discussion. 29. We affirm our tentative conclusion that uniform
streamlined procedures and pleading requirements should be applied to
all formal complaints filed against common carriers, even those that
are not subject to specific statutory deadlines, with the exception of
complaints alleging violations of section 255. All formal complaints
should be resolved as expeditiously as possible. We find that uniform
procedures and pleading requirements will promote efficiency in the
Commission's administration of complaints and will minimize confusion
among the parties. Uniform procedures for all formal complaints will
promote the Commission's goal of expediting the resolution of these
disputes by allowing the Commission and all parties to follow one set
of rules.
30. We disagree with the commenters who support expedited
procedures only for complaints that have statutory deadlines or that
involve competitive issues for the following reasons. First, we agree
with NAD that having separate sets of procedures for certain types of
complaints would create confusion for parties who might be unclear as
to which rules to follow and might even lead to repeated and
inadvertent violations of our procedural rules. Second, we conclude
that separate complaint procedures would permit
[[Page 995]]
parties to exploit our rules by alleging certain violations in order to
manipulate the time frame or level of evidentiary support required in a
particular complaint. For example, a complainant alleging that a BOC
has violated certain provisions of the Act might be tempted to add an
allegation that the BOC has also failed to meet a condition required
for approval for provision of interLATA services in violation of
section 271, in order to take advantage of the ninety-day resolution
deadline mandated by section 271(d)(6)(B). Third, to the extent that
certain commenters contend that subjecting all complaints to expedited
procedures will unnecessarily work hardships on complainants and
defendants in cases without statutory deadlines, we note that the
Commission has considerable discretion under the amended rules to
accommodate the needs of parties in cases where no statutory deadline
applies. Finally, separate sets of procedures would be administratively
burdensome for the Commission. Not only would it be cumbersome to
promulgate separate sets of procedures, but it would decrease staff
efficiency to apply different procedural rules to different complaints.
31. We defer consideration of NAD's proposal to establish
coordination procedures with the DOJ regarding jurisdiction of
accessibility complaints in this proceeding. We will address this
proposal in our section 255 implementation rulemaking, so as to permit
the Commission to take a comprehensive approach to implementation of
section 255.
2. Applicability of the Section 208(b)(1) Deadline. a. The NPRM.
32. We stated in the NPRM that the new five-month resolution deadline
in section 208(b)(1) applies only to those formal complaints that
investigate the ``lawfulness of a charge, classification, regulation or
practice.'' Section 208(b), as originally added by Congress in 1988 in
the FCCAA, has been interpreted previously as applicable only to
complaints about matters contained in tariffs filed with the
Commission. In other words, under this interpretation, only those
complaints challenging the ``lawfulness of a charge, classification,
regulation or practice'' reflected in a tariff filed with the
Commission pursuant to section 203 of the Act have been viewed as
subject to the resolution deadlines contained in former section 208(b).
b. Comments. 33. Several commenters take a much broader view of the
scope of section 208(b). According to these commenters, the five-month
resolution deadline in section 208(b)(1), in the absence of a specific
statutory resolution deadline such as in sections 260, 275, and 271,
applies to all formal complaints filed pursuant to section 208.
Although the commenters provide little argument to support this view,
the crux of their claim appears to be that the language in section
208(b)(1) referring to ``investigation[s] into the lawfulness of a
charge, classification, regulation or practice'' is broad enough to
cover any unlawful act or omission by a common carrier which could
subject it to a complaint filed pursuant to section 208. Under this
broad interpretation of section 208(b)(1), the Commission would have a
maximum of five months to resolve any formal complaint filed pursuant
to section 208.
c. Discussion. 34. The plain language of the Act establishes that
the class of complaints subject to the deadline in section 208(b)(1) is
narrower than the class of complaints that can be filed under section
208(a). Section 208(a), inter alia, gives any person the right to
complain about ``anything done or omitted to be done'' by a common
carrier in contravention of the Act. The complaint resolution deadline
in section 208(b)(1), on the other hand, refers only to those
complaints involving investigations into the lawfulness of a ``charge,
classification, regulation, or practice'' of a carrier.
35. While there is little guidance in section 208 itself for
defining the subset of complaints covered by section 208(b), we
conclude that section 208(b)(1) covers complaints relating to the
lawfulness of those matters required to be in tariffs. Stated another
way, the deadline covers complaints relating to the lawfulness of
matters with respect to which the Commission could exercise its
prescription power under section 205. The deadlines in sections
204(a)(2)(A) (pertaining to the nature and timing of tariff
investigations by the Commission) and 208(b)(1) are identical in both
the Act, as amended by the FCCAA, and the 1996 Act. In addition, the
provision in the 1996 Act establishing the effective date for the
changes to the tariff investigation and complaint resolution deadlines
specifically states that the new deadlines in sections 204 and 208(b)
shall apply only with respect to charges, practices, classifications,
or regulations ``filed'' on or after one year after the date of
enactment. The use of the word ``filed'' connotes a tariff filing
pursuant to section 203 of the Act because it is generally pursuant to
section 203 that a ``charge, classification, regulation, or practice''
would be ``filed'' with the Commission.
36. We note, moreover, that the 1996 Act added specific resolution
deadlines for complaints filed pursuant to sections 260, 271, and 275.
It may be inferred that, because Congress added specific deadlines in
certain sections of the 1996 Act for resolving identified types of
complaint actions, and was silent as to deadlines for resolving
complaints arising from other sections of the Act, Congress did not
intend to mandate deadlines for resolving all complaints.
37. We therefore conclude that section 208(b) applies only to
formal complaints which involve ``investigation[s] into the lawfulness
of a charge, classification, regulation or practice'' contained in
tariffs filed with the Commission. In light of our complete detariffing
policy for the domestic interstate, interexchange services of
nondominant interexchange carriers and our permissive detariffing
policy for competitive access providers and competitive LECs, however,
we conclude that the interpretation should be modified to ensure that
our forbearance decisions do not eviscerate Congress' intent in
establishing the five-month resolution deadline for 208(b)(1)
complaints. As noted above, the application of the 5-month 208(b)(1)
deadline to investigations concerning a carrier's ``charge,
classification, regulation, or practice'' is triggered by the filing of
any such charge, classification, regulation or practice with the
Commission. To the extent that our detariffing decisions relieve
carriers of any obligations to make such filings, it could be argued
that complaints about matters not filed with the Commission by carriers
are not encompassed by section 208(b)(1). We conclude that Congress
clearly did not intend this result. We hold, therefore, that the
section 208(b)(1) deadline shall apply to any complaint about the
lawfulness of matters included in tariffs filed with the Commission,
and those matters that would have been included in tariffs but for the
Commission's forbearance from tariff regulation. For example,
complaints alleging that a carrier,through its non-tariffed charges,
has failed to meet the rate integration or rate averaging requirements
of section 254(g) of the Act would be subject to the section 208(b)(1)
deadline. Similarly, complaints contending that a carrier has imposed
unjust and unreasonable terms and conditions on the provision of a
service that would have been tarrifed but for our forbearance decision
would fall within the requirements of section 208(b)(1).
C. Pre-Filing Procedures and Activities
38. In the NPRM we asked parties to identify specific pre-filing
activities available to potential complainants and
[[Page 996]]
defendants that could serve to settle or narrow disputes, or facilitate
the compilation and exchange of relevant documentation or other
information prior to the filing of a formal complaint with the
Commission. It has been our experience that there is generally little
exchange of information or discussion of the dispute between parties
prior to the filing of a formal complaint and that such exchange of
information and discussion of a dispute will often lead to settlement.
We stated in the NPRM that our intent was to adopt rules or procedures
that would promote actions that could either foster the resolution of
disputes prior to filing or narrow the scope of the issues to be
resolved in formal complaints.
1. Certification of Settlement Attempts. a. The NPRM. 39. We
tentatively concluded in the NPRM that we should require that a
complainant certify in its complaint that it discussed, or attempted to
discuss, in good faith the possibility of settlement with the defendant
carrier's representative(s) prior to filing the complaint, and,
further, that failure to comply with this certification requirement
would result in dismissal of the complaint.
b. Comments. 40. Most commenters support the proposal to require a
complainant to certify in its complaint that it discussed, or attempted
to discuss, the possibility of settlement with the defendant carrier
prior to filing its complaint. These commenters agree that settlement
should be encouraged and that the certification requirement would
provide an additional incentive for parties to settle or narrow
disputed issues, thereby resulting in fewer and better-focused
complaints. GST Telecom, Inc. (``GST''), KMC Telecom, Inc. (``KMC''),
MFS Communications, Co. (``MFS''), and TRA additionally suggest that
answers should be required to contain certification that the parties
discussed, or attempted to discuss, the possibility of settlement prior
to the filing of the formal complaint. In their Joint Reply, Jones
Intercable, Inc., Centennial Cellular Corp., Texas Cable and
Telecommunications Association, Cable Television Association of
Georgia, South Carolina Cable Television Association, and Tennessee
Cable Telecommunications Association (collectively, the ``Cable
Entities'') recommend mirroring the Commission's pole attachment
procedures, which require a complaint to either summarize all steps
taken to resolve the dispute prior to filing or explain why no steps
were taken. AT&T opposes such a pre-certification requirement, arguing
that it would unduly restrict a party's ``unconditional statutory
right'' to file a section 208 complaint, citing AT&T v. FCC as support
for its proposition. BellSouth disagrees with AT&T, arguing that there
is no section 208 right to file a complaint that is not based on facts,
and that encouraging pre-complaint negotiations will facilitate all
parties' understanding of the facts. Bell Atlantic, NYNEX, and Pacific
Telesis Group (``PTG'') also disagree with AT&T's argument, stating
that AT&T v. FCC deals only with the Commission's prohibition of tariff
revisions for certain services and does not deal with section 208
complaints. Competitive Telecommunications Association (``CompTel'')
opposes the requirement of certification of settlement attempts,
arguing that parties already have sufficient motivation to settle their
disputes and that mandatory settlement discussions might force some
parties to accept unfavorable settlements.
c. Discussion. 41. We conclude that both the complainant and
defendant, as part of the complaint and answer, respectively, must
certify that they discussed, or attempted in good faith to discuss, the
possibility of settlement with the opposing party prior to the filing
of the complaint. We agree with GST, KMC, MFS, and TRA that defendant
carriers should be given equal responsibility for exploring settlement
options prior to the filing of a formal complaint. To help facilitate
meaningful discussion between disputing parties, we will adopt a
requirement that the complainant mail a certified letter outlining the
allegations that form the basis of the complaint it anticipates filing
with the Commission to the defendant carrier that invites a response
within a reasonable period of time. We further conclude that the rule
setting forth the certification requirement shall be modeled on the
Commission's existing pole attachment procedures in Sec. 1.1404(i) of
the rules. Therefore, each settlement certification must include a
brief summary of all steps taken to resolve the dispute prior to
filing. If no steps are taken, then each such certification must state
the reason(s) for such failure to conduct settlement discussions. We
find that mandating settlement discussions prior to filing a formal
complaint will result in (1) more disputes being settled amicably, and
(2) the scope of the issues in dispute in formal complaints being
narrowed where possible.
42. We disagree with CompTel's assertion that a rule requiring
mandatory settlement discussions could be used to coerce parties into
accepting unfavorable settlements. This rule requires good faith
settlement attempts, not settlement itself. Furthermore, requiring good
faith settlement attempts will not impose undue restrictions on the
right of any person to file a complaint with the Commission. We
disagree with AT&T's interpretation of the ruling in AT&T v. FCC as it
applies to the issues under consideration here. In AT&T v. FCC, the
court held that the Commission's requirement that a carrier obtain
special permission, i.e., prior Commission approval, before filing a
tariff under section 203 unlawfully interfered with the carrier's right
to file a tariff. In addition to the fact that AT&T v. FCC considers
the application of section 203, not section 208, the issue considered
in AT&T v. FCC is distinguishable from the issue before us in that the
pre-filing requirements we impose here only dictate that parties
explore settlement possibilities and do not require any Commission
approval prior to filing a formal complaint. If settlement attempts are
unsuccessful, the complainant is free to file a formal complaint. The
certification requirement will benefit the parties and the Commission
by requiring the parties to discuss the facts and issues in dispute
prior to the filing of the complaint. Such requirement may, therefore,
lead to an informal resolution of the dispute or, at the very least,
may reduce or clarify the number and scope of the issues in dispute,
consistent with Congress' intent to expedite the resolution of
disputes.
2. Neutral Industry Committee. a. The NPRM. 43. We also sought
comment on whether a committee composed of neutral industry members
would serve a needed role or useful purpose in addressing disputes over
technical and other business disputes, before parties bring their
disputes to the Commission in the form of formal complaints. We asked
commenters to address the extent to which there would be a need for
outside experts to deal with technical issues that are likely to arise
in formal complaints and whether, if such a need exists, the use of a
committee of such experts in the form of a voluntary preliminary
alternative dispute resolution (``ADR'') procedure would expedite the
resolution of complaints
b. Comments. 44. Most commenters oppose the creation of an industry
committee. Several parties argue that it would be impossible to
construct a neutral committee, PTG and TRA argue that the use of such a
committee would delay the resolution of important marketplace issues,
and AT&T and GTE argue that the committee would lack the expertise to
handle a wide variety of disputes. CBT, Communications and Energy
Dispute Resolution Associates (``CEDRA''), and NYNEX contend that
[[Page 997]]
such options are already available to parties. NYNEX additionally
states that complaints before the Commission typically involve disputes
between individual companies, rather than broad issues affecting the
industry. Some commenters, however, support the proposal. Association
of Telemessaging Services International (``ATSI''), BellSouth,
Southwestern Bell Telephone (``SWBT''), and United States Telephone
Association (``USTA'') support the use of an industry committee to
assist in resolving technical and business disputes. BellSouth added
that an industry committee could be used in conjunction with ADR
mechanisms. ATSI asserts that committee proceedings would have to be
completed within clearly established deadlines to prevent delay in
resolving disputes involving competitive issues and to ensure
compliance with the statutory complaint resolution deadlines. In
addition, GST, KMC, and MFS suggest permitting the parties and the
Commission to utilize such a committee during the complaint process, as
well as at the pre-filing stage, to resolve certain factual issues.
c. Discussion. 45. We decline to establish a committee of neutral
industry members to resolve disputes over technical and other business
issues, before parties file such disputes with the Commission as formal
complaints. We note that the majority of commenters oppose this
proposal. Several factors weigh against establishing such a committee.
First, because the committee's decisions would not be binding on the
Commission, it is possible that the committee and the Commission might
rule differently on identical issues. The usefulness of committee
decisions to resolve disputes would be diminished by such uncertainty,
as a losing party would have little incentive to accept the committee's
recommendation. Second, we agree with commenters that it would be
difficult to establish a standing committee with sufficient expertise
to resolve a range of technical and business issues because of the
breadth of knowledge and expertise that would be required. Third, we
agree with commenters that it would be administratively burdensome to
assemble a new committee for each conflict parties sought to submit to
such committee. Finally, we agree with the commenters who argue that
the potential for conflicts of interest among the committee members is
too great to be able to provide a guarantee of neutrality.
3. Additional Commenters' Suggestions. a. The NPRM 46. In the NPRM,
we invited commenters to suggest additional pre-filing requirements or
procedures to help settle or narrow disputes, or facilitate the
compilation and exchange of relevant documentation or other
information.
b. Comments. 47. ATSI, NYNEX, and USTA suggest that formal ADR
efforts be made a prerequisite to filing a complaint, while MCI and
Sprint oppose such a proposal. MCI, ICG Telecom Group (``ICG''), and
Sprint suggest that parties be required to begin their information
exchange before a complaint is filed, in order to prepare for the rapid
pace of the complaint process. PTG opposes this suggestion, arguing
that requiring such information exchanges would lead to fishing
expeditions and raise confidentiality concerns. Bell Atlantic proposes
that a potential complainant be required to provide the defendant
carrier with a statement of its claim and specify documents and
information that it believes would be material to the resolution of the
dispute, and that the carrier be required to respond in full within a
reasonable period of time before a complaint is filed. Similarly, CEDRA
and BellSouth suggest that complainants be required to serve advance
copies of their complaints on defendant carriers prior to filing such
complaints with the Commission. Finally, CompTel, Nextlink and various
cable entities suggest that the Commission offer binding arbitration or
mediation as an alternative to formal complaints, arguing that
Commission staff would be more persuasive and knowledgeable than
outside mediators or arbitrators.
c. Discussion. 48. We decline to adopt these proposals because, for
the most part, they raise potential problems that would outweigh their
potential benefits. We reject suggestions that would impose rigid
requirements for pre-filing activities. We find that these proposals
could either stifle the parties' ability to develop creative solutions
to their differences or delay unnecessarily the filing of complaints,
or both. For example, we agree with MCI and Sprint that requiring
formal ADR efforts prior to the filing of a formal complaint could
permit defendant carriers to delay the filing of formal complaints to
the detriment of customers and competitors alike. For the same reason,
we reject the suggestions by MCI, ICG, and Sprint that we should
mandate the exchange of documents and materials by potential
complainants and defendant carriers prior to the filing of a formal
complaint. Although the proposals of Bell Atlantic, BellSouth, and
CEDRA, to require the exchange of specific information identifying
claims and key facts in advance of the filing of the formal complaint,
would promote pre-filing discussions, we conclude that parties should
be afforded the widest possible latitude in conducting their settlement
efforts and not be subjected to rigid requirements. We also reject the
proposals of CompTel, Nextlink, and the cable entities to require the
Commission to arbitrate or mediate disputes at the request of the
disputing parties as an alternative to formal complaints. Such a
requirement would unnecessarily tax the Commission's resources when
there are many qualified ADR experts outside the Commission. We note
that Commission staff will work with industry members and formal
complaint parties to resolve disputes informally, both before and after
formal complaints have been filed. We see little benefit, however, in
requiring the staff to conduct such mediation or arbitration efforts in
all cases.
D. Service
49. Under section 208 of the Act and the Commission's existing
complaint rules, the staff is responsible for serving formal complaints
on defendant carriers. Currently, all formal complaints must be
initially filed with the Mellon Bank in Pittsburgh, Pennsylvania;
forwarded by the Bank to the Commission's Secretary; and then
distributed to the Common Carrier Bureau. The Common Carrier Bureau
then forwards complaints against common carriers and complaints against
international telecommunications providers to the Common Carrier
Bureau's Enforcement Division; complaints against wireless carriers are
forwarded to the Wireless Telecommunications Bureau. As a result, ten
days or more may pass before the staff receives official copies of a
complaint, reviews it for minimum compliance with the rules, and serves
it on the defendant carrier(s). It has been common for a defendant
carrier to receive a complaint twenty days after it was filed with the
Commission. Pleadings filed subsequent to the complaint are currently
served by regular U.S. mail, which may delay actual receipt of such
pleadings from three days to a week. Because of the new ninety to 120-
day statutory deadlines, the NPRM proposed to eliminate delays
associated with the current filing and service procedures by
streamlining the service process.
1. Personal Service of Formal Complaints on Defendants. a. The
[[Page 998]]
NPRM. 50. In the NPRM we sought comment on our proposals to modify the
service of formal complaints. We proposed to authorize or require a
complainant to effect service simultaneously on the following persons:
the defendant carrier, the Commission, and the appropriate staff office
at the Commission, i.e., the Chief, Formal Complaints and
Investigations Branch, Enforcement Division, Common Carrier Bureau; the
Chief, Compliance and Litigation Branch, Enforcement and Consumer
Information Division, Wireless Telecommunications Bureau; or the Chief,
Telecommunications Division, International Bureau. With regard to
service on the defendant, we proposed that a complainant would
personally serve the complaint on an agent designated by the defendant
carrier to receive such service. We proposed that the answer period
would begin to run once the complaint has been served by the
complainant on the defendant.
51. We also noted that requiring complainants to serve complaints
directly on defendants would eliminate the staff's initial review of
the complaint prior to the defendant's receipt of the complaint. To
alleviate concerns about service of deficient complaints, the NPRM
proposed to require that parties submit a completed checklist or
``intake'' form with each copy of the formal complaint to indicate: (1)
that the complaint satisfies minimum format and content requirements;
(2) that the complaint meets the various threshold requirements for
stating a cause of action under the Act and the Commission's rules; and
(3) the statutory provisions allegedly violated and any applicable
statutory resolution deadline. We based this proposal on our belief
that such an intake form could be a useful tool both to speed the
preparation and filing of complaints and to avoid or reduce the time
and resources involved in processing procedurally defective or
substantively insufficient complaints. We further noted that the intake
form could serve another useful purpose, by quickly identifying for the
staff and defendant carrier the relevant statutory provisions and any
associated statutory time constraints.
b. Comments. 52. The commenters generally support the proposal to
require parties to serve complaints simultaneously on defendants, the
Office of the Secretary, and the Bureau responsible for processing the
complaint. BellSouth, GTE, and CBT, however, are concerned that
defendants may be required to respond to deficient complaints if the
Commission eliminates its practice of reviewing complaints prior to
serving them on defendants. By contrast, MCI argues that Commission
review of a complaint is unnecessary because a defendant would
undoubtedly raise the issue if a complaint was deficient. CompTel
suggests that the Commission send the defendant a notice of receipt of
the complaint to safeguard against faulty service. BellSouth states
that section 208(a) mandates that only the Commission may serve
complaints on defendants, and suggests that the complainant serve the
defendant with a copy of the complaint and notice of intent to file
prior to the filing of the complaint with the Commission. AT&T and
NYNEX state that, while section 208(a) does require the Commission to
serve complaints on defendants, this requirement is fulfilled by
allowing complainants to serve complaints on defendants as agents of
the Commission for that limited purpose only. PTG asks the Commission
to clarify that personal service is required for the complaint.
53. Almost all of the commenters, including ATSI, BellSouth, CBT,
CompTel, GST, GTE, KMC, MFS, and TRA, support the proposal to require
complainants to submit a completed checklist or ``intake'' form with
each copy of the formal complaint. ATSI stated that using ``check-off
boxes'' to clearly indicate the specific complaint category utilized
would assist all parties and the Commission in determining quickly the
special standards and applicable deadlines. BellSouth additionally
suggests that the form include a waiver of the section 271(d)(6)(B) 90-
day resolution deadline. MCI argues that this form would be useless
because a party filing a defective complaint would be unlikely to
complete this form correctly.
c. Discussion. 54. We conclude that complainants shall be required
to effect personal service of the complaint on the defendant carrier/
designated agent simultaneously with the filing of the complaint with
the Commission's Secretary, the Chief of the division or branch
responsible for handling the complaint within the Bureau responsible
for handling the complaint, and the Mellon Bank. The complainant shall
serve two copies of the complaint with the Chief of the division or
branch responsible for handling the complaint within the Bureau
responsible for handling the complaint. The Chief will then forward one
of those copies to the defendant, in compliance with the mandate in
section 208(a) that complaints ``shall be forwarded by the Commission''
to the defendant. The allowable time period for filing an answer begins
to run on the date the complainant serves the complaint on the
defendant. Because the Common Carrier Bureau coordinates with the
International Bureau to handle international telecommunications
complaints, any formal complaint that is filed with the International
Bureau must also be filed simultaneously with the Chief, Formal
Complaints Branch, Enforcement Division, Common Carrier Bureau.
Requiring service of the complaint on the defendant carrier
simultaneously with filing the complaint with the Commission will
enable the parties and the Commission to begin prompt resolution of the
complaint, by eliminating delays that existed under the former rules.
This requirement satisfies the Commission's goal of expediting the
processing of formal complaints.
55. After consideration of commenters' concerns regarding notice to
the defendant in the event of defective service of the complaint, we
conclude that the Commission will send each defendant notice of receipt
of the complaint as a precaution against defective service. Upon
receipt of the complaint, the Commission shall promptly send notice of
receipt of the complaint by facsimile transmission to the defendant. In
addition to mailing a copy of the complaint to the defendant, the staff
will send to all parties a schedule detailing the date the answer is
due and the date of the initial status conference. The date of service
of the formal complaint upon the defendant shall be presumed to be the
same date as service on the Commission. Where, however, a complainant
fails to properly serve the complaint on the defendant, the complaint
will be dismissed without prejudice.
56. We further conclude that the complainant must file the
complaint, along with the appropriate fee, with the Mellon Bank on the
same day that it serves the complaint on the Commission and the
defendant. Although this requirement was not specifically proposed in
the NPRM, we find that requiring the complaint to be filed with the
Mellon Bank on the same day as service on the defendant and the
Commission is a natural extension of the proposal in the NPRM to
require simultaneous service of the complaint on the defendant and the
Commission. Such requirement is further justified by the fact that the
date on which the complaint is filed with the Mellon Bank is the
official commencement date of the complaint with the Commission. Thus,
the date on which the complaint is filed with the Mellon Bank is the
date on which any statutory deadlines begin to
[[Page 999]]
run and timely prosecution of such complaints requires service on the
defendant at the earliest date possible. Additionally, requiring
delivery of the complaint and fee payment to the Mellon Bank by the day
of service of the complaint on the Commission and defendant will help
the Commission to determine quickly whether the fee has been properly
paid. We also require the complainant to attach to each copy of the
intake form, a photocopy of its fee payment (check, etc.) as well as a
certificate of service. Attachment of a copy of the fee payment will
provide some assurance to the Commission and a defendant that payment
was made. Where a fee is not properly paid, the Commission will notify
both parties promptly that the complaint has been dismissed without
prejudice.
57. BellSouth, GTE, and CBT raise some valid concerns about the
possibility of defendants having to respond to deficient complaints
under our new service requirements. To address these concerns, we
require a complainant to submit a completed intake form with its formal
complaint to indicate that the complaint satisfies the procedural and
substantive requirements under the Act and our rules. The completed
intake form shall identify all relevant statutory provisions, any
relevant procedural history of the case, and, in the case of a section
271(d)(6)(B) complaint, whether the complainant desires to waive the
ninety-day resolution deadline. We disagree with MCI's assertion that a
complainant who files a defective complaint will probably be unable to
fill out the intake form properly. Rather, we find that the intake form
will serve as a checklist to guide complainants who may be unfamiliar
with the necessary components of a formal complaint and in that way
reduce the number of defective complaints filed. We conclude further
that this requirement will permit the Commission to eliminate the delay
associated with the initial review of a complaint. To the extent that
frivolous complaints are filed, the intake form requirement will assist
in weeding out such complaints prior to Commission review. The form
will identify for the Commission staff any relevant statutory
provisions and associated deadlines. Furthermore, the staff will be
alerted if there is relevant procedural history that will require
review of related non-Commission records by the staff. We note that a
defendant is not relieved of its obligation to file and serve its
answer on time by the fact that a complainant failed to correctly
complete the intake form.
58. In addition, we reject NAD's proposal to permit service of
complaints by facsimile transmission because we conclude that service
of the complaint must be accomplished in the most reliable manner
possible. Because we are requiring the defendant to submit its answer
within twenty days of receipt of the complaint, any delay or
uncertainty in the receipt of the complaint and associated documents
through facsimile transmission could unduly infringe on the defendant's
due process rights.
2. Expediting Service Generally. a. The NPRM. 59. In the NPRM, we
proposed to require service of all documents filed subsequent to the
complaint (answer, motions, briefs, etc.) by overnight delivery.
Alternatively, parties would be permitted to serve pleadings by
facsimile transmission, to be followed by hard copies sent by regular
mail delivery.
60. We further proposed to establish and maintain an electronic
directory, available on the Internet, of agents authorized to receive
service of complaints on behalf of carriers that are subject to the
provisions of the Act and of the relevant Commission personnel who must
be served. We noted that section 413 of the Act requires all carriers
subject to the Act to designate in writing an agent in the District of
Columbia for service of all process. The proposed directory would list,
in addition to the name and address of the agent, at least one of the
following: his or her telephone or voice-mail number, facsimile number,
or Internet e-mail address. We sought comment on this proposal and on
what information should be included within the service directory.
61. Finally, we recognized that the practice of routing formal
complaints against wireless telecommunications providers was unwieldy
and time-consuming. We noted that under the current rules, wireless
complaints are routed from the Common Carrier Bureau lock box at the
Mellon Bank in Pittsburgh to the Commission's Secretary, who forwards
the complaint to the Formal Complaints and Investigations Branch of the
Common Carrier Bureau's Enforcement Division, which then reviews and
forwards the complaints to the Wireless Telecommunications Bureau.
Therefore, we sought comment on our proposal to revise our rules to
provide for a separate lock box at the Mellon Bank for the receipt of
complaints against wireless telecommunications service providers.
b. Comments. 62. Commenters strongly support these proposals.
BellSouth suggests that facsimile service would be facilitated by
requiring pleading signature blocks to include facsimile and phone
numbers. SWBT additionally suggests that service include delivery by
certified mail. ICG argues that service should be by hand delivery or
overnight mail only. GST, KMC, MFS, and NAD suggest permitting service
by Internet, with NAD particularly encouraging Internet or facsimile
service of complaints and related documents to facilitate service by
consumers with disabilities. CBT opposes service by Internet because of
technical difficulties and problems with verification. CBT asks the
Commission to clarify that it will take responsibility for updating the
electronic directory and make allowances for improper service due to
mistakes in the directory. America's Carriers Telecommunication
Association (``ACTA'') suggests that carriers be able to designate
someone other than an agent located in the District of Columbia for
receipt of service, arguing that limiting service to what in many cases
will be an ``artificial agent'' in the District of Columbia is
inefficient in light of the availability of national overnight
delivery. MCI suggests that a paper directory of service agents be kept
in the Secretary's office for those parties lacking Internet access.
c. Discussion. 63. We conclude that parties must serve documents or
pleadings filed subsequent to the complaint by either hand delivery,
overnight delivery, or facsimile transmission followed by mail
delivery. Any facsimile transmission or hand delivery must be completed
by 5:30 p.m., local time of the recipient, in order to be considered
served on the date of receipt. Service by overnight delivery will be
deemed served the business day following the date it is accepted for
overnight delivery by a reputable overnight delivery service. Although
we are permitting service of pleadings subsequent to the complaint to
be by facsimile transmission, we also require that facsimile service be
accompanied by mailed hard copies to alleviate the effects of possible
faulty facsimile transmission. These requirements will ensure timely
and verifiable service. To facilitate facsimile delivery, we require
pleading signature blocks to include facsimile and telephone numbers,
as suggested by BellSouth.
64. We decline to authorize service by Internet at this time
because we have received insufficient comments on the issue, given the
significance of permitting electronic filing or service of complaint
pleadings. We may revisit this issue at a later date, following our
consideration of possible procedures for
[[Page 1000]]
the electronic filing of documents in rulemaking proceedings in GC
Docket 97-113.
65. We also reject SWBT's proposal to deliver pleadings by
certified mail. Although SWBT presumably offered this suggestion to
improve verification of service rather than speed of service, we did
not seek comment on verification procedures in the NPRM because we have
not found verification of service to be a significant problem.
66. Although we considered establishing an electronic directory of
agents designated by carriers to receive service of process, we decline
to establish such a directory at this time. We have concluded that more
review is needed to determine the most efficient means for collecting
the data necessary to establish such a directory. This data collection
may be combined with other collections of data from common carriers by
the Commission in the future. The Commission intends to reconsider this
issue in conjunction with streamlining its other data collection
procedures.
67. We recognize the need to provide complainants with the
information necessary to effect personal service on defendant carriers
as required by our rules. Accordingly, the Commission will provide
access to a listing of agents designated by carriers to receive service
of process in the Office of the Commission Secretary. In order to
establish this listing, all common carriers are required to designate
service agents within the District of Columbia, although they may
additionally identify an alternative service agent outside the District
of Columbia. For each designated agent for service of process, each
carrier is required to identify its name, address, telephone or voice-
mail number, facsimile number, and Internet e-mail address if
available. In addition, the carrier shall identify any other names by
which it is known or under which it does business, and, if the carrier
is an affiliated company, its parent, holding, or management company.
This information shall be provided to the Commission by filing it with
the Formal Complaints and Investigations Branch of the Common Carrier
Bureau. Parties are required to notify the Commission within one week
of any changes in their information. We note that ACTA's proposal to
permit designation of service agents outside of the District of
Columbia was based on the incorrect premise that overnight delivery
would fulfill our requirement of having the complainant personally
serve the complaint on the defendant. It will not. Only hand delivery
constitutes personal service for the purposes of our service
requirement. We note, however, that the complainant is not required to
hand deliver the complaint to the Commission Secretary, the Chief of
the division or branch responsible for handling the complaint within
the Bureau responsible for handling the complaint, or the Mellon Bank.
68. We establish a separate lock box at the Mellon Bank in
Pittsburgh for the receipt of complaints against wireless
telecommunications service providers. Currently, all formal complaints
against common carriers, including Wireless Telecommunications Bureau
complaints and International Bureau complaints, are filed in the
lockbox of the Common Carrier Bureau at the Mellon Bank. Because the
Common Carrier Bureau coordinates with the International Bureau to
handle international telecommunications complaints, filing the
International Bureau's complaints in the Common Carrier Bureau's
lockbox does not delay the complaint process. Providing the Wireless
Telecommunications Bureau with its own lockbox, however, will both
expedite the delivery of the complaint and verification of fee payment
to the Wireless Telecommunications Bureau, and relieve the Common
Carrier Bureau of the responsibility of reviewing wireless complaints
for routing to the Wireless Telecommunications Bureau.
E. Format and Content Requirements
69. The short resolution deadlines contained in the Act place
greater burdens on parties to provide facts and legal arguments in
their respective complaints and answers to support or defend against
allegations of misconduct by common carriers. Similarly, the short
resolution deadlines place greater demands on the Commission and its
staff to expedite the review and disposition of these complaints.
70. The Commission's rules have always required fact-based
pleadings. That is, all complaints, answers and related pleadings are
required to contain complete statements of fact, supported by relevant
documentation and affidavits. In actual practice, however, many parties
file what amount to ``notice'' pleadings similar to filings that would
be made in federal district court. Both complainants and defendants
have placed substantial reliance on self-executing discovery and
additional briefing opportunities to present their respective claims
and defenses to the Commission.
71. A principal goal of this rulemaking that was set forth in the
NPRM was to improve the utility and content of the complaint and answer
by requiring complainants and defendants to exercise diligence in
compiling and submitting full legal and factual support in their
initial filings with the Commission. The proposals in the NPRM were
designed to promote fact-based pleadings and to shift the focus of
fact-finding away from costly, time-consuming discovery and towards the
pre-filing and initial complaint and answer periods.
1. Support and Documentation of Pleadings. a. The NPRM. 72. In the
NPRM, we proposed to require that any party to a formal complaint
proceeding must, in its complaint, answer, or any other pleading
required during the complaint process, include full statements of
relevant facts and attach to such pleadings supporting documentation
and affidavits of persons attesting to the accuracy of the facts stated
in the pleadings. This would effectively prohibit defendants from
making general denials in their answers. We proposed to require a
complainant to append to its complaint documents and other materials to
support the underlying allegations and requests for relief, and
tentatively concluded that failure to append such documentation would
result in summary dismissal of the complaint. Although our rules
already required each complainant to provide a complete statement of
the facts and description of the nature of the alleged violation, we
tentatively concluded that we should require more specifically that a
complainant include a detailed explanation of the manner in which a
defendant has violated the Act, Commission order, or Commission rule in
question in the formal complaint. Such a rule, for example, would
require a complainant alleging that a BOC has ceased to meet any of the
conditions that were required for approval to provide interLATA
services pursuant to section 271(c)(2)(B) of the Act to include in its
complaint a detailed explanation of the manner in which the defendant
BOC has ceased to meet such condition or conditions, along with any
associated documentation. The NPRM also sought comment on whether we
should prohibit complaints that rely solely on assertions based on
``information and belief.'' We stated that, while assertions based on
information and belief may not be useful in deciding on the merits of a
complaint, prohibiting such assertions might inhibit a complainant's
ability to present claims of unlawful behavior against carriers under
applicable provisions of the Act.
73. We proposed to require the complaint, answer, and any
authorized reply include two sets of additional information: (1) the
name, address, and
[[Page 1001]]
telephone number of each individual likely to have discoverable
information relevant to the disputed facts alleged with particularity
in the pleadings, identifying the subjects of information; and (2) a
copy of, or a description by category and location of, all documents,
data compilations, and tangible things in the possession, custody, or
control of the party that are relevant to the disputed facts alleged
with particularity in the pleadings. We noted that this proposal, which
would enable the Commission and parties to identify quickly sources of
information, comported with an analogous requirement under the Federal
Rules of Civil Procedure. We also sought comment on what benefits, if
any, would be realized by the parties or the Commission by requiring
the identified relevant documents to be filed with the Commission along
with the complaint and answers.
74. The NPRM proposed to require parties to append copies of
relevant tariffs or tariff provisions to their complaints, answers, and
replies, noting that the current rules only encourage parties to append
such tariffs. The NPRM also proposed to modify the rules to include
expressly pleadings filed solely to effect delay in the prosecution or
disposition of a complaint as filings for improper purpose within the
meaning of Sec. 1.734 of our rules.
b. Comments. 75. Most commenters, including AT&T, BellSouth and
TRA, strongly support the proposals to require all pleadings to include
complete facts and documentation. AT&T states that supporting
affidavits and documentation are ``critical to understanding the
parties' positions on the matters at issue.'' NYNEX agrees with the
observation in the NPRM that ``[t]ypically, complainants file `bare
bones' complaints with numerous allegations, but with little or no
documentation'' and that the proposal would allow the Commission to
``process complaints more quickly, since it would have access to the
relevant information from the beginning[.]'' BellSouth suggests that
the Commission impose requirements similar to its rules for pole
attachment complaints which require detailed, fact-based complaints,
supported by extensive documentation and verifications detailing the
alleged violations.
76. Several commenters, including CBT, NYNEX, and PTG, only support
our proposals regarding complaints, and oppose our proposals regarding
answers. They state that the format and content proposals for
complaints are not overly burdensome because complainants control the
timing of the filing of the complaint and can gather information prior
to bringing the complaint. They oppose the format and content proposals
with regard to answers, however, because they argue that the
requirements will be too onerous for defendants who will have little
time to respond with such specificity in their answers, especially in
light of our proposal to reduce the time to file answers to twenty
days.
77. AT&T agrees that general denials should be prohibited. MCI,
however, contends that general denials should be permitted where a
complainant has been uncooperative with the defendant prior to the
filing of the complaint and the defendant lacks the necessary
information upon which to respond to the complaint in detail. The cable
entities state that general denials should be permitted in accordance
with the Federal Rules of Civil Procedure (``FRCP''), subject to Rule
11 sanctions, if the party intends in good faith to controvert all the
averments of a pleading or specific paragraph.
78. AT&T and PTG endorse the proposal to prohibit assertions based
solely on information and belief, stating that it would help to reduce
the number of frivolous complaints, including those brought to harass
defendants or as fishing expeditions. Many commenters, however,
including APCC, Bell Atlantic, CompTel, MCI, NYNEX, NAD, TRA, and
Teleport Communications Group (``TCG''), argue that allowances should
be made for situations in which a complainant will have difficulty
obtaining access to information that may be in the sole possession of a
defendant or third parties who might be unwilling to relinquish such
information. APCC, GTE, ICG, and TCG propose that information and
belief allegations should be permitted if the complainant pleads with
particularity facts that would establish a credible case, or supplies
affidavits stating that the necessary information is in the possession
of the defendant or an uncooperative third party. ATSI, KMC, and MFS
oppose the proposal because of the potential hardship on small or
emerging businesses. APCC and ICG also seek clarification on whether
the Commission's proposal is to prohibit complaints based solely on
information and belief, or only those allegations based solely on
information and belief.
79. AT&T and PTG note that the identification of individuals with
discoverable information should not include phone numbers because such
individuals should be contacted only through counsel. Regarding the
document production proposal, Bechtel & Cole and Ameritech support
requiring all relevant documents to be produced to the opposing party
and the Commission. Most commenters, however, such as CBT, BellSouth,
MCI, the cable entities, and PTG, express concern that the information
produced might be overbroad and argue that requiring the filing of
numerous documents with only tangential relevance to the dispute is
likely to overwhelm the Commission with materials of marginal or no use
in resolving the complaint. CBT notes that many federal courts have
opted out of compliance with the federal rule and that it would be more
efficient to respond to discovery requests than to identify and gather
the universe of available information. MCI questions whether this
requirement will be useful, stating that a party would identify as
relevant only those documents already attached as documents upon which
that party intends to rely and that party would be unable to guess at
what materials another party might find relevant. ACTA, BellSouth, and
GTE propose requiring parties to file only the documents relied upon
concurrently with the complaint and answer and any subsequently filed
brief, rather than requiring the production of all potentially relevant
documents. GST, KMC, and MFS argue that, to prevent the copying of
millions of unnecessary documents, parties should only be required to
identify documents and provide the opportunity to copy such documents.
AT&T supports the identification or attachment of documents to
complaints and answers only with respect to section 271(d)(6)(B)
complaints; otherwise, AT&T argues, all document production should
occur at the initial status conference. CBT, NYNEX, and SWBT express
concern that defendants will not have time to execute document
identification and production of this broad scope. Bell Atlantic states
that, because the Commission seldom permits depositions or broad
document searches, the provision of this information would rarely be
utilized. PTG and USTA suggest that parties be allowed to amend their
information designations without leave. Several parties, including MCI,
express doubt that such information disclosure requirements could
entirely substitute for discovery.
80. All commenters who discussed the proposal to require parties to
append copies of relevant tariffs or tariff provisions to their
complaints, answers, and replies support the proposal. No parties
commented on the proposal, to include expressly within the meaning of
[[Page 1002]]
Sec. 1.734 of our rules, that pleadings filed solely to effect delay in
the prosecution or disposition of a complaint are filings for improper
purpose.
c. Discussion. 81. We conclude that the complaint, answer, reply,
and any other required pleading are required to include full statements
of relevant, material facts with supporting affidavits and
documentation. This requirement will improve the utility and content of
pleadings by requiring parties to plead their cases with specific,
material facts and supply documentation early in the complaint process.
In order to speed resolution of all formal complaints, the Commission
must adhere to the fact-pleading process. Such quick resolution of
certain formal complaints is necessitated by the Act. Further, such
quick resolution of all formal complaints where possible is consistent
with the overall goals of the Act to promote and protect competition in
the marketplace.
82. We conclude that complainants shall be required to provide, in
their complaints, a detailed explanation of the manner in which a
defendant has violated the Act, Commission order, or Commission rule in
question. Substantive claims, or ``counts,'' based solely upon
information and belief shall be generally prohibited. A complainant may
be permitted, however, to file claims based on information and belief
if such claims are made in good faith and the complainant attaches an
affidavit to the complaint that explains why the supporting facts could
not be reasonably ascertained. Our goal is to discourage complainants
from filing claims based solely upon information and belief without
firsthand knowledge of the violation alleged. Because quick resolution
of formal complaints is essential to the Commission's goal of fostering
and preserving competition in today's deregulated telecommunications
markets, strict adherence to the Commission's fact pleading
requirements is necessary. A general rule prohibiting assertions based
solely upon information and belief will ensure that complainants
exercise diligence in preparing and submitting allegations of
misconduct against a carrier. We have considered, however, commenters'
concerns that complainants may not always have in their possession the
information that would substantiate their claims and that such
information may be in the sole possession or control of the defendant
carrier or of uncooperative third parties. Each complainant has the
general duty to provide, whenever possible, full statements of fact
supported by relevant documentation and affidavits. Complainants should
not, however, be penalized or prevented from filing a formal complaint
in those situations in which the necessary information could not have
been reasonably obtained prior to the filing of the complaint. We
conclude that this requirement strikes an equitable balance between the
Commission's need for complete information as early as possible, and
the complainant's potential difficulty in obtaining that information.
83. We disagree with the comments of the cable entities that
defendants should be permitted to make general denials if the defendant
intends in good faith to controvert all the averments of a pleading or
specific paragraph. Requiring the answer to include full statements of
relevant, material facts with supporting affidavits and documentation
will prohibit defendants from making general denials in their answers.
Specific denials supported by facts and documentation will aid the
Commission staff in understanding the nature of the dispute and
facilitate its resolution. Formal complaints often raise questions
about a rate, charge, term or condition of a particular service
offering. In our staff's experience, defendant carriers have the
requisite knowledge to specifically deny a complainant's allegations
about such charges, practices or service requirements in the vast
majority of cases. A diligent defendant should almost always have
sufficient information with which to make specific denials. We conclude
further that, contrary to MCI's suggestion, the benefits to speedy
resolution of a complaint that arise from specific denials outweigh the
potential benefit of allowing general denials as a mechanism to enforce
compliance with the pre-filing activities requirements.
84. We conclude that parties must include in the complaint, answer,
and any necessary reply, an ``information designation'' that identifies
individuals known or believed by the parties to have knowledge about
the matters in dispute. This information designation must identify such
individuals by name and business or other address and include a
description of the information possessed by that source and its
relevance to the dispute. We conclude that such mandatory information
designation will simplify, expedite, and, in some cases, eliminate the
need for time-consuming discovery. We agree with AT&T and PTG that
parties should not be required to supply the phone numbers of
individuals who should only be contacted through counsel. Therefore
parties are required to identify in the complaint, answer, and any
necessary reply only the name and address of each individual likely to
have discoverable information relevant to the disputed facts alleged
with particularity in the pleadings.
85. We conclude further that parties shall also be required to
identify in their information designations all documents in their
possession or control believed to be relevant to the matters in
dispute, including an inventory that contains for each document the
date, the source, the intended recipient(s), and a description of the
document's relevance to the dispute. We disagree with MCI's assertion
that parties will be unable to guess what kinds of material the
opposing party would regard as relevant. In most cases, parties to
formal complaints before the Commission are sophisticated business
entities who fully understand the issues before them and know which
documents in their possession or control are relevant to those issues.
We find CBT's arguments that many federal courts have opted out of
compliance with this rule's equivalent in the FRCP unpersuasive. We
note that, while we looked to the FRCP for some guidance during this
proceeding, that guidance was limited by the many differences between
federal court proceedings and Commission proceedings. Not only does the
Commission require fact-based pleadings, but certain of the
Commission's formal complaint proceedings are subject to statutory
resolution deadlines shorter than any deadline applicable to the
federal courts. Although some federal courts have opted out of
compliance with FRCP 26(a)(1), we adopt its equivalent for Commission
proceedings because it will aid us greatly in meeting statutory
deadlines under our individual procedural constraints as well as in
expediting the resolution of competitive issues that affect the
telecommunications marketplace.
86. We disagree with CBT's statement that it would be more
efficient to have parties respond to discovery requests than to have
parties identify all relevant documents in their information
designations. We find that requiring such information designations
early in the dispute will facilitate the Commission's ability to focus
on the facts and issues in the case quickly. Having such information on
hand will further expedite the Commission's consideration of the
necessity of any discovery requests early in the proceeding. We also
disagree with the suggestions by PTG and USTA to permit parties to
amend their information designations without leave. We conclude that
this would run contrary to
[[Page 1003]]
our objective of procuring as much information as early as possible.
The allowance of amendments would reduce parties' incentives to file
thorough information designations with their complaints, answers, and
replies because they will rely on their right to supplement their
designations at a later time. Accepting routinely late-obtained
information will only delay the resolution of complaints. We do
recognize, however, that parties may occasionally, after submitting
their initial pleadings, discover information that should be included
in their information designations. Accordingly, a party may submit a
request for permission to amend its information designations, along
with an explanation of why the information was not designated at the
time of the filing of the complaint, answer, or reply.
87. We do not find it necessary to require the production or
exchange of all documents identified as relevant to a dispute as a
matter of course in all cases. It will be helpful and often necessary,
however, in light of the Act's complaint resolution deadlines and the
Commission's goal of expediting the resolution of all complaints, to
have certain documents identified by the parties readily accessible to
the staff and opposing parties. Therefore we require parties to file
concurrently with the complaint, answer, and any necessary reply, only
those documents and affidavits upon which they intend to rely to
support their respective claims and defenses. Required attachments
include relevant tariffs or tariff provisions where applicable. Because
it is in each party's self-interest to support its most persuasive
arguments, we conclude that it is reasonable to rely on each party's
judgment to identify the key documents in the dispute. We acknowledge
that a party may be reluctant to divulge information that would weaken
its case, and, therefore, would probably not attach such information to
its complaint, answer, or reply. We conclude that this concern can be
adequately addressed by requiring each party to identify all such
information in their information designations, however, and opposing
parties will therefore be aware of, and have subsequent opportunity to
request, such information at the initial status conference.
88. We conclude that each party shall be required to attach
supporting affidavits and documents to any allowed briefs, along with a
full explanation in the brief of the material's relevance to the issues
and matters in dispute. Such attachments shall have been previously
identified in the parties' information designations, but need not have
been attached to the complaint, answer, or any necessary reply. We find
that this strikes an appropriate balance between the needs of the
Commission and opposing parties to have readily available information
and the hardships of producing unnecessary materials. We agree with PTG
and USTA that parties may, despite good faith efforts to file complete
submissions, later acquire documents or information upon which they
wish to rely but which they did not identify as relevant information in
their information designations. Therefore we permit a party to attach
such subsequently obtained documents, upon which the party intends to
rely, to any subsequent brief filed in the matter, provided it is
accompanied by a full explanation in the brief of the material's
relevance to the issues and matters in dispute and why such material
was not identified in the party's information designation.
89. We disagree with AT&T's suggestion that all document production
should occur at the initial status conference, except in section
271(d)(6)(B) complaints under 90-day resolution deadlines. This
document production requirement is intended to work in conjunction with
the other requirements adopted in this rulemaking, including the
requirement that parties discuss, before the initial status conference,
issues such as settlement prospects and stipulations of facts and
disputed facts. It is essential that parties be able to review the
documents produced with the initial pleadings in order to meet and
discuss these issues knowledgeably prior to the initial status
conference. Furthermore, we conclude that requiring the identification
of individuals and the identification, inventory, and production of
documents will facilitate the staff's ability to require further
disclosure of information about individuals with relevant information
and/or further production of documents when necessary.
90. We are not persuaded by the arguments of some commenters, such
as CBT, NYNEX, PTG, and SWBT, that twenty days is an insufficient
amount of time in which to prepare answers with the level of
information contemplated under these rules. We do not view defendants
as having only twenty days in which to prepare their answers. The
pleading requirements are intended to work in conjunction with the pre-
filing requirements. Thus, by the time parties reach the stage of
participating in a formal complaint before the Commission, settlement
talks will have narrowed the number and scope of issues in dispute, and
parties will have already commenced the collection and/or exchange of
relevant information that will be used to substantiate the defendant's
answer. We conclude that the imposition of these format and content
requirements on defendants is not unduly burdensome, particularly in
light of Congress' clear intent to expedite resolution of complaints to
promote the competitive goals of the Act.
91. We also disagree with Bell Atlantic that the information
produced would only be useful for depositions or broad document
searches, which are seldom permitted by the Commission. Early
identification of individuals knowledgeable about the matters in
dispute will be an important tool for the parties and the staff,
particularly in those cases where additional affidavits or other forms
of factfinding become necessary. Given our experience, and in light of
the short complaint resolution deadlines, we conclude that it is
necessary and appropriate to require parties to identify knowledgeable
individuals and potentially relevant documents early in the complaint
process.
92. We also conclude that pleadings filed solely to effect delay in
the prosecution or disposition of a complaint are filings for improper
purpose within the meaning of Sec. 1.734 of our rules. No commenters
opposed this proposal. Adoption of this definition will work in
conjunction with the new rules to further deter parties from filing
unnecessary pleadings in formal complaints before the Commission.
2. Waivers for Good Cause Shown. a. The NPRM. 93. In the NPRM, we
recognized that many of the proposed pleading requirements could be
burdensome on some individuals or parties, particularly those desiring
or compelled to proceed without the assistance of legal counsel due to
financial and other reasons. Therefore, we proposed to waive format and
content requirements for complaints, answers, and replies upon an
appropriate showing of financial hardship or other public interest
factors. We tentatively concluded that this waiver provision would help
to ensure that full effect is given to the provision in section 208 of
the Act that ``any person, any body politic, or municipal organization,
or State Commission,'' may complain to the Commission about anything
``done or omitted to be done'' by a common carrier in contravention of
the Act. We sought comment on this proposal and tentative conclusion,
as well as on what standards should be
[[Page 1004]]
used to determine ``good cause'' for waiving format and content
requirements.
b. Comments. 94. All parties commenting on this proposal support
it. APCC and NYNEX suggest that waivers should be granted primarily for
financial hardship or public interest reasons and suggest specific
revenue or asset levels to define ``financial hardship.'' ATSI argues
that complainants alleging violations of section 260, regarding the
provision of telemessaging service, should not have to make special
requests to receive good cause waivers. GST, KMC, MFS, and USTA suggest
that the Commission issue form complaints and model pleadings that pro
se complainants could either fill out or follow. GTE warns against
routine granting of waivers. The NAD suggests establishing an ombudsman
within the Commission to assist with accessibility complaints.
c. Discussion. 95. We conclude that parties may petition the staff
for waivers of the format and content requirements for complaints,
answers, and any authorized replies. Such waiver requests shall be
considered on a case-by-case basis and may be granted upon an
appropriate showing of financial hardship or other public interest
factors. We note this waiver provision will work in conjunction with
the Commission's existing general authority to waive any provision of
the rules on its own motion or on petition if good cause is shown. The
discretion to grant waivers of the format and content requirements
based on financial hardship and other public interest factors will
ensure, pursuant to section 208, that ``any person'' has the right to
complain to the Commission about acts or omissions by a carrier that
contravene the Act. For this reason, we do not agree with APCC or NYNEX
that financial hardship should be determined solely based on set
revenue or asset levels. The range of potential complainants under
section 208 is broad and may include individuals, state commissions,
municipalities, associations, and other entities of all forms and
sizes. Likewise, the size and makeup of defendant carriers will vary
greatly. Thus we conclude that waiver determinations should be made on
a case-by-case basis. The Commission shall make every effort to apply
its discretion in a consistent and fair manner to strike an appropriate
balance between strict compliance with the rules and the needs of
certain parties for more lenient requirements and timetables.
Furthermore, the Commission shall have discretion to waive or modify
some or all of its rules as appropriate when a waiver is granted for
good cause shown. For example, if the Commission grants a waiver of the
document production requirements to a party who demonstrates financial
hardship, the Commission may establish an appropriate alternative
method for review and production of documents in that matter.
96. We find that Sec. 1.721(b) of the rules contains a suggested
format for formal complaints that is clear and explicit and that no
further form complaints or model pleadings for pro se complainants are
necessary. Furthermore, the Enforcement Division of the Common Carrier
Bureau currently provides, via the Internet, direct mailings, and
public reference room access, a fact sheet designed to instruct
consumers on how to file a formal complaint with the Commission.
Finally, we conclude that the range of subjects that could conceivably
be contained within a pleading is too broad for a model pleading form
to be of much utility to pro se parties.
97. We decline to address in this proceeding NAD's proposal to
establish a Commission ombudsman to assist with accessibility
complaints in this proceeding. Such a proposal should be addressed in
our section 255 implementation rulemaking, so as to permit the
Commission to take a comprehensive approach to implementation of
section 255.
F. Answers
1. Reduction of Time to File Answers. a. The NPRM. 98. In the NPRM
we proposed to reduce the permissible time for a defendant to file an
answer to a complaint from thirty to twenty days after service or
receipt of the complaint. We tentatively concluded that this reduction
was consistent with the changes we proposed regarding the form and
content of pleadings and would not unduly prejudice the rights of any
defendant. We further tentatively concluded that this reduction in time
to answer struck the appropriate balance in distributing the burdens of
compliance with the new formal complaint resolution deadlines among the
complainants, defendants and the Commission.
b. Comments. 99. The majority of commenters, including AT&T, Bell
Atlantic, CBT, CompTel, the cable entities, MCI, TRA, and USTA support
this proposal. Ameritech, BellSouth, GTE, PTG, and SWBT contend,
however, that because complainants will have months to prepare their
complaints, requiring defendant carriers to submit detailed responses
with full legal and factual support within a twenty day window would be
unfair and unreasonably burdensome in most cases. PTG suggests that
defendants be required to file their answers within twenty days only in
complaints filed pursuant to section 271(d)(6)(B). ACTA and USTA
suggest that defendants be permitted to supplement their answers at a
later time.
c. Discussion. 100. We conclude that a defendant shall be required
to file its answer to a complaint within twenty days after receipt of
service of the complaint by the complainant. We find that reducing the
time in which to file an answer is necessary in light of the
Congressional intent to expedite the resolution of complaints alleging
anti-competitive behavior by defendant carriers. We disagree with
commenters who assert that defendant carriers will be overly burdened
by having to file answers that comply with the format and content
requirements within twenty days from the date of service. As stated
earlier, we view the defendants as having far more than twenty days in
which to prepare their answers because the pre-filing and format and
content requirements adopted in this proceeding are intended to work in
conjunction with the reduction in time to file an answer. The pre-
filing requirements will alert the defendant as to the basis of the
dispute. The actions taken by a defendant in participating in good
faith settlement negotiations should require the same collection of
information and documents that will be necessary to support its answer
in compliance with the format and content requirements. The requirement
of fully supported and thoroughly prepared complaints, furthermore,
will facilitate a defendant carrier's ability to prepare a full
response to a complaint within the twenty day period. Such pre-filing
and format and content requirements will eliminate any need to allow
defendants to supplement their answers. Permitting defendants to
supplement their answers routinely would only encourage defendants to
submit incomplete answers.
G. Discovery
101. The NPRM sought comment on a variety of ways to modify the
discovery process in light of the new statutory deadlines. Discovery is
inherently time-consuming and often fails to yield information that
aids in the resolution of a complaint. The NPRM, in conjunction with
other proposals designed to improve the content and utility of the
complaint, answer, and related pleadings, sought comment on discovery
proposals that would balance the parties' legitimate need for discovery
with the twin goals of (1)
[[Page 1005]]
meeting statutory resolution deadlines, and (2) facilitating prompt
resolution of all formal complaints.
1. Permissible Requests for Discovery. a. The NPRM. 102. In our
experience, discovery has been the most contentious and protracted
component of the formal complaint process. In the NPRM, we stated that
one of the key elements to streamlining the enforcement process was to
maximize staff control over the discovery process. We stated our
intention to examine carefully what role, if any, discovery should
continue to play in resolving formal complaints, and sought comment on
a range of options to either eliminate or modify the current discovery
process.
103. For our first approach, we sought comment on the benefits and
drawbacks of eliminating the self-executing discovery permitted under
our current rules by prohibiting discovery as a matter of right. This
proposal placed the emphasis of developing facts and arguments at the
complaint and answer stages of the proceeding, rather than on discovery
and subsequent briefing opportunities. Under this proposal, if the
record presented through such pleadings failed to provide a basis for
resolving disputes over material facts or was otherwise insufficient to
permit our resolution of a complaint, the staff would have the
discretion to authorize limited discovery at the initial status
conference, that would be held shortly after receipt of the defendant's
answer to the complaint. We sought comment on various aspects of
eliminating automatic discovery, including whether discovery was
necessary in all cases, whether such a rule would pose a hardship for
any particular segment of complainants, and what standards should apply
in the event that discovery was authorized by the staff.
104. For our second alternative approach, we sought comment on the
benefits and drawbacks of a proposed rule that would limit self-
executing discovery to something other than the thirty written
interrogatories authorized under the current rules. We asked parties to
comment on whether a more limited form of discovery as a matter of
right would accommodate a party's ability, where necessary, to identify
and present to the Commission material facts that may be in the
possession or control of the other party; whether allowing a limited
amount of discovery as a matter of right might decrease the staff's
burden in deciding discovery requests on a case-by-case basis; and
whether limiting discovery in this manner would detract from full
compliance with our rules regarding the level of detail that should be
offered in support of complaints and answers. Pursuant to this
approach, the staff would permit additional discovery only in
extraordinary cases. We sought comment on various aspects of this
approach, including whether a reduction in the number of allowable
written interrogatories would be appropriate, and whether
interrogatories should be limited to questions designed to illuminate
specific factual assertions or denials.
105. In our third alternative approach, we sought comment on
continuing to allow some limited discovery as a matter of right, but
allowing Commission staff to set limits on the scope of that discovery
and to set specific timetables for such discovery. We noted that
authorizing the staff to limit the scope of the written interrogatories
could be an effective deterrent to attempts by parties to use discovery
for purposes of delay or to gain tactical leverage for settlement
purposes. In conjunction with this approach, we proposed to require
that objections to interrogatories be filed by the date of the initial
status conference, thereby enabling staff to rule on such objections at
that time. We noted that under this proposal, extensions of time to
initiate limited discovery and file objections and motions to compel
would be granted only in extraordinary circumstances.
b. Comments. 106. The majority of commenting parties argue that the
Commission should continue to allow discovery as a matter of right.
CBT, ICG, and MCI argue that eliminating discovery as a matter of right
will cause delay due to the fact that motions requesting discovery will
almost always be filed and ICG argues further that such motions may
produce inconsistent discovery rulings. PTG argues that the prohibition
of discovery would inhibit the development of facts. Bechtel & Cole
argue that the right to discovery is necessary because defendants have
the power to protect information in their sole possession. APCC,
CompTel and TRA argue that discovery is especially necessary where the
defendant has sole possession of the information a complainant needs to
make its case, such as in the case of allegations of cross-subsidies or
discrimination. ACTA and CompTel argue that due process requires that a
complainant be able to direct its case as it sees fit.
107. Parties objecting to the elimination of discovery as a matter
of right propose several ways to streamline the discovery process. PTG
and TCG suggest that the Commission could limit discovery to twenty
written interrogatories, while USTA and GTE suggest that fifteen
interrogatories would be the appropriate number. The cable entities,
however, suggest allowing thirty discovery requests, including
interrogatories, requests for production of documents, and requests for
physical inspection of materials and facilities, to be filed ten days
after service of the complaint, an additional fifteen such discovery
requests to be filed within five days of the filing of the answer, and
allowing parties to request additional discovery thereafter. The cable
entities argue that the certainty of prompt resolution of discovery
disputes will discourage parties from making frivolous requests or
objections.
108. A number of the parties that oppose the elimination of
discovery as a matter of right suggest that discovery disputes should
be resolved at the initial status conference. Several parties argue
that it would be useful for Commission staff to use the initial status
conference to control the scope and/or scheduling of discovery. U S
West and TRA, however, argue that discovery should be limited by the
staff only with regard to timetables. TRA states that even Rule 26 of
the FRCP provides for traditional discovery, in addition to voluntary
disclosure, and states further that Commission staff should not control
the prosecution of an action. MCI suggests that requiring discovery to
be discussed at the initial status conference will help Commission
staff maintain control over the discovery process, although MCI asserts
that the proposed timing of the initial status conference is too early
in formal complaint proceedings to rule on objections to discovery.
109. To promote the resolution of discovery disputes at the initial
status conference, several parties argue that discovery requests and
objections thereto should be served and filed prior to the initial
status conference. MCI argues, however, that it would be unfair to
complainants to require discovery requests to be filed with complaints
and answers because the defendants would be able to formulate their
requests after seeing the complaint, while the complainants would be
required to formulate their requests prior to seeing the answer.
CompTel argues that the proposed timetables for objecting to
interrogatories provides insufficient time for parties to review the
interrogatories, and that therefore parties will always file objections
to interrogatories rather than answer them. CompTel suggests instead
that parties be required to respond promptly to interrogatories for
which their objections are denied. While they support retaining
discovery as a matter
[[Page 1006]]
of right, GST, KMC and MFS argue that interrogatories should be
prohibited or limited because they are often useless. If allowed,
interrogatories should not be served until after the parties file their
joint statement of stipulated facts and key legal issues, to facilitate
the targeting of disputed areas. APCC suggests that the Commission
require early discovery, including expedited rulings on discovery
disputes.
110. GTE, MCI, Nextlink and TCG argue that discovery as a matter of
right is necessary because all prior disclosures are ``voluntary'' and
parties would disclose only those facts solely in their possession that
are most favorable to their case. ICG argues that the absence of
discovery as a matter of right would preclude parties from checking the
accuracy of their opponent's disclosures. TRA is concerned that
elimination of discovery as a matter of right would result in fewer
complaints being filed with the Commission because injured parties
would lack access to information.
111. AT&T, BellSouth, NYNEX, and SWBT argue that there should be no
discovery as a matter of right. AT&T argues that abuses will continue
to occur if parties are entitled to a fixed number of interrogatories.
BellSouth argues that full discovery is always available in federal
court. MCI counters this argument by asserting that discovery should
not be the exclusive province of federal courts because courts often
make primary jurisdiction referrals to the Commission in section 207
cases. SWBT's support of the elimination of discovery is contingent
upon two requirements: (1) providing defendants with the right to
remove a formal complaint proceeding to federal court, and (2) a
complete prohibition on motions for discovery to prevent the routine
filing of such motions. TRA opposes SWBT's suggestion that the
Commission provide defendants with the right to remove formal
complaints to federal court because it argues that defendants would use
such a procedure to their tactical advantage to avoid expedited
resolution.
112. SWBT argues that discovery is not needed because parties do
not have a right to file a formal complaint and then use discovery to
determine if a claim exists. SWBT suggests that parties be required to
certify that they engaged in good faith discovery discussions and
exchanges prior to the filing of the complaint.
113. AT&T and NYNEX argue that the Commission should control all
discovery, including the scope, timing and number of interrogatories,
and issue discovery rulings at the initial status conference. NYNEX
proposes that parties be required to propound up to thirty
interrogatories with the complaint and answer and file any opposition
to such discovery five days prior to the initial status conference.
AT&T argues that discovery requests in addition to interrogatories
should be (1) only allowed in extraordinary circumstances, (2)
requested at the initial status conference, and (3) discussed with the
opposing party prior to the filing of the motion requesting such
discovery, with any opposition to such motion due in five days.
114. AT&T suggests that responses to interrogatories should be
filed with the Commission. APCC suggests that a ``good cause waiver''
should be available to grant relief to parties from discovery
limitations. Ameritech suggests, and BellSouth concurs in its Reply
comments, that the Commission implement procedures such as those
contained in section 252(b)(2) of the Act, that are applicable to
compulsory arbitration of interconnection disputes. GST, KMC and MFS
suggest the implementation of mandatory ``meet and confer'' conferences
between the parties to address procedural issues and potential disputes
prior to the initial status conference. AT&T supports the meet and
confer concept. CBT opposes mandatory meet and confer conferences,
arguing that the Commission should not be adding unnecessary
requirements for the parties to fulfill. ICG suggests that the
Commission make clear that it will not tolerate form objections and
answers. In light of the Commission's proposals to permit
interrogatories only when it determines such discovery is appropriate,
AT&T suggests deleting Sec. 1.729(e) of the Commission's rules because
it would be superfluous.
c. Discussion. 115. For the reasons discussed below, we eliminate
the rule authorizing the parties to initiate self-executing discovery.
In its place, we have adopted rules and policies that carefully balance
the rights of the parties and the need to expedite the resolution of
complaints in a number of important aspects. These new rules: (1)
require complainants and defendants to exercise diligence in compiling
and submitting facts to support their complaints and answers; (2)
discourage reliance on the often protracted discovery process as a
means to identify or develop information needed to support a complaint
or answer; (3) give parties an opportunity to make their cases for or
against limited discovery early in the proceedings; (4) reduce the need
for time-consuming motions to compel; (5) provide Commission staff with
more control over the discovery process; and (6) limit each party's
ability to use discovery for delay or other purposes unrelated to the
merits of the dispute. The 1996 Act imposed both statutory deadlines on
certain complaints and an overall pro-competitive policy on the
handling of all formal complaints, thus signifying an intent that we
resolve quickly disputes involving allegations of interference in the
development of competition in telecommunications markets. The discovery
procedures under the old rules were time consuming and were susceptible
to abuses that often caused undue delays in our consideration of the
merits of a complainant's claims. The discovery rules adopted in this
proceeding expedite the discovery process, which, in turn, expedites
the resolution of all formal complaints, in accordance with the
requirements and policies of the 1996 Act.
116. The new procedures and policies allow the staff to consider
and rule on reasonable, properly focused requests for interrogatories
and other discovery on an expedited basis as follows:
(a) With its complaint, a complainant may file with the Commission
and serve on the defendant requests for ten written interrogatories. A
defendant may file with the Commission and serve on the complainant
requests for ten written interrogatories during the period beginning
with the service of the complaint and ending with the service of the
answer.
(b) Within three calendar days following service of the answer, a
complainant may file with the Commission and serve on the defendant
requests for five written interrogatories. Such additional
interrogatories shall be directed only at specific factual allegations
made by the defendant in support of its affirmative defenses.
(c) Requests for interrogatories shall contain (1) a listing of the
interrogatories requested; and (2) an explanation of why the
information sought in each interrogatory is necessary to the resolution
of the dispute and unavailable from any other source.
(d) Oppositions and objections to the requests for interrogatories
shall be filed with the Commission and served on the propounding party
(1) by the defendant, within ten calendar days of service of
interrogatories served simultaneously with the complaint and within
five calendar days of interrogatories served following service of the
answer, (2) by the complainant, within five calendar days of service of
the interrogatories, and (3) in no event less than three calendar days
prior to the initial status conference.
[[Page 1007]]
(e) Section 1.730 of the current rules, which expressly authorizes
parties to petition for additional ``extraordinary'' discovery in the
form of requests for document production, depositions and additional
interrogatories, shall be deleted.
(f) Commission staff will be inclined to grant all reasonable
requests for interrogatories and other forms of discovery to the extent
permitted under any applicable statutory deadlines. It will issue
rulings and direct the parties accordingly at the initial status
conference.
(g) Commission staff retains the discretion to order on its own
motion, additional discovery including, but not limited to, document
production, depositions, and/or interrogatories. The staff also retains
discretion to limit the scope of permissible interrogatories and to
modify or otherwise relax the discovery available in particular cases
where appropriate.
117. These rules and policies are designed to work in conjunction
with our pre-filing and format and content requirements, which are
designed to improve the utility and content of the initial complaint
and answer filed in a section 208 proceeding. The rules as a whole are
intended to change fundamentally the nature of the formal complaint
process to enforce the Commission's long-standing requirement that
``[a]ll matters concerning a claim [be pled] fully and with
specificity.'' In adhering to these fact-pleading requirements, we will
further the pro-competitive policies of the 1996 Act by expediting the
resolution of all formal complaints. We find that these new
requirements strike a reasonable balance between, on the one hand,
providing for discovery where necessary to ensure the development of a
complete record and, on the other hand, preventing the use of discovery
as the primary means of determining if a claim exists.
118. Some commenters express doubt that parties will disclose
unfavorable information, and argue that discovery is needed to verify
the accuracy of initial disclosures. The format and content rules
address this concern by requiring that parties reveal the means by
which they determine what documents and information to disclose.
Disclosure of the nature of the inquiry should significantly reduce
concerns about accuracy, since a failure to address a patently relevant
topic will be readily apparent. The arguments of some commenters are
based on the use of the phrase ``voluntary disclosure.'' We emphasize
that the phrase ``voluntary disclosure'' refers to the fact that the
parties are obligated to disclose all information that is relevant to
the resolution of a dispute in the absence of a specific discovery
request. Use of the term ``voluntary disclosure'' does not limit the
obligation of the disclosing party to identify all information that is
relevant to the facts in dispute, including information that is
unfavorable to the disclosing party.
119. The rules adopted address MCI's concerns that it is unfair to
require complainants to file their discovery requests without an
opportunity to review the answer. First, because the parties must make
a good faith effort to resolve their dispute prior to the filing of the
complaint, the complainant will know what to expect in the defendant's
answer. Second, the rules provide the complainant with an opportunity
to seek discovery on affirmative defenses first raised in the answer.
In light of these factors and the time constraints of statutory
deadlines, MCI's fairness argument fails.
120. We disagree with the argument that the Commission should
provide discovery as a matter of right because federal court rules
provide for discovery as a matter of right, in addition to required
initial disclosures. While the Commission has often found the federal
rules instructive, it has consistently rejected wholesale adoption of
them. A significant difference exists in the procedural requirements of
actions brought before the different fora. Federal court rules require
notice pleading while the Commission's rules require fact pleading.
Notice pleading anticipates the use of discovery to obtain evidence of
the facts to support a complainant's claims, while fact pleading
requires that a complainant know the specific facts necessary to prove
its claim at the time of filing. Neither section 208 of the Act nor the
Commission's own rules and policies contemplate the expansive discovery
available in federal district court, and in fact, section 207 of the
Act gives parties the option of filing their complaints in federal
district court rather than with the Commission. We, further, disagree
with the argument that self-executing discovery is necessary because
due process requires that a complainant be able to direct its case as
it sees fit. As we have stated, our rules require that parties plead
all matters fully and specifically, and commission staff will be
inclined to grant reasonable requests for discovery to the extent
permitted under any applicable statutory deadlines. In this context, a
party's due process rights are fulfilled by being provided with the
opportunity to request discovery and present its argument to the
Commission as to why discovery is necessary in its particular case. The
fact that the Commission may deny a party's discovery request,
following consideration of the merits of such request, does not negate
the party's right to the opportunity to make its case for discovery.
121. We disagree with the commenters who state that ending self-
executing discovery will result in an avalanche of motions for
discovery, which would lengthen the discovery process and could result
in inconsistent discovery rulings. Our rules will provide for the quick
resolution of discovery disputes by the date of the initial status
conference, which will be held ten days after the answer is filed. We
note that these same commenters strongly support proposals requiring
the staff to play a more active role in the discovery process by
defining the timing and scope of necessary discovery. These rules allow
Commission staff to take a more active role in the discovery process to
meet statutory deadlines and expedite the resolution of all formal
complaints.
122. We conclude that SWBT's suggestion that the Commission require
the parties to engage in good faith discovery discussions prior to the
filing of the complaint is unduly burdensome. The Commission is already
requiring parties to engage in good faith settlement negotiations prior
to the filing of a complaint. As part of that obligation, we anticipate
that parties will exchange relevant documentation to the extent that it
would help to resolve conflicts. We also conclude that SWBT's
suggestion would be likely to raise numerous disputes after the filing
of the complaint, e.g., concerning what constitutes ``good faith
discovery,'' that would consume more time and resources than would be
saved by the implementation of such a requirement.
123. SWBT suggests that the Commission adopt a rule providing
defendants with the right to remove disputes to federal court where
broader discovery is available. We decline to adopt this suggestion
because it would eliminate rights provided to complainants in the Act.
The Act provides complainants with the choice of filing claims with the
Commission or in federal court. The 1996 Act further provides
complainants with the right to have the Commission resolve certain
types of complaints within statutory deadlines. Because those deadlines
are enforceable only at the Commission, providing a defendant with the
right to remove any claim to federal court would provide it with the
ability to eliminate the complainant's right to have its
[[Page 1008]]
dispute resolved within the applicable statutory deadline. SWBT,
furthermore, made this proposal in conjunction with its support for the
proposal to eliminate all discovery, which we have declined to adopt.
124. Additionally, we reject Ameritech's proposal that, as a means
to effective discovery, the Commission adopt disclosure requirements
similar to those in section 252(b)(2), which are for compulsory
arbitration of interconnection agreements. Such a proposal is
unworkable in light of the fact that section 252(b)(2) procedures would
not accommodate the variety of complaints that may be brought before
the Commission. Section 252(b)(2) disclosure procedures are directed at
arbitration of disputes of a particular nature before state
commissions. Our voluntary disclosure rules will provide the benefits
of that provision, the initial disclosure of relevant documentation,
while the discovery rules adopted herein contain sufficient flexibility
to be adapted to the unique circumstances of individual cases.
125. The issue of requiring a meet and confer conference to discuss
discovery disputes is addressed in the Status Conference section of
this Report and Order.
2. Reduction of the Administrative Burden of Filing Documents. a.
The NPRM. 126. In the NPRM we sought comment on methods to reduce the
administrative burden on the Commission of accepting filed documents,
either identified in initial filings or obtained through discovery,
including implementation of a computer scanning requirement for large
document productions.
b. Comments. 127. Those parties that commented on this proposal
oppose the imposition of a scanning requirement. CBT argues that such a
requirement would be a waste of resources while CompTel argues it would
be too burdensome.
c. Discussion. 128. We decline to adopt a scanning requirement for
all large document productions. Instead, we shall provide Commission
staff with the discretion, in individual cases involving the review of
a large number of documents, to require the parties to provide the
documents to the Commission in a scanned or other electronic format.
Material in any electronic format shall be indexed and submitted in
such manner as to facilitate the staff's review of the information.
Commission staff shall have discretion to reach an agreement with the
parties about the appropriate technology to be used in light of the
needs of the staff and the current cost and availability of document
management technology. Commenters opposed to the imposition of a
scanning requirement make general statements that a scanning
requirement would be unjustifiably costly and burdensome to implement.
Because such a requirement will be imposed on an individualized basis,
the staff shall decide on a case-by-case basis whether the nature of
the production involved will justify the cost and burden of electronic
formatting.
129. We also recognize that a significant number of complex
technical issues that are beyond the scope of the NPRM would have to be
addressed prior to the implementation of a comprehensive document
scanning requirement. Because scanning technology is varied and not
universally compatible, the implementation of a standardized scanning
requirement would require us to choose a single type of scanning
technology. Several complex questions would therefore arise, including,
but not limited to, what information should be placed in identifying
fields and whether the documents must be searchable by text. Because of
these complex technical questions, we decline to impose a scanning
requirement at this time, although we may address this issue again at a
later date, following our consideration of possible procedures for
allowing the electronic filing of documents in GC Docket 97-113.
3. Voluntary Agreements for the Recovery of Discovery Costs. a. The
NPRM. 130. One of the goals in the NPRM was to identify ways to
encourage parties to exercise diligence in identifying and satisfying
their discovery needs. For example, although the Commission does not
have authority to award costs in the context of a formal complaint
proceeding, we sought comment on whether encouraging formal complaint
parties to agree among themselves to a cost-recovery system for
discovery would facilitate the prompt identification and exchange of
information. As an example, we suggested that the parties could
stipulate that the losing party in the complaint proceeding would bear
the reasonable costs associated with discovery, including reasonable
attorneys' fees.
b. Comments. 131. Although GST, KMC and MFS support the Commission
encouraging parties to enter into voluntary cost recovery agreements,
Ameritech, CBT, CompTel, PTG, SWBT, and TCG oppose such a position.
CompTel, GTE, PTG, and SWBT argue that parties will be unable to agree
to a cost recovery system. Ameritech argues that parties will be
tempted to convince the decisionmaker to award enough money to the
``losing'' party to offset the costs of discovery. Ameritech suggests
the alternative of giving the factfinder the discretion to decide cost
recovery issues and award financial damages for the filing of frivolous
complaints. TCG argues that, if the Commission encouraged such
agreements, parties might not comply with discovery requests unless
they are compensated. CBT argues that discovery abuse would not be
lessened by having the loser pay the cost of discovery, since the
winning party is as likely to have abused discovery. CBT supports,
however, requiring parties to compensate each other for extraordinary
efforts to comply with discovery requests. CompTel suggests that the
Commission should set a reasonable copying fee.
c. Discussion. 132. We decline to encourage voluntary cost recovery
agreements among parties for several reasons. We conclude that recovery
of discovery costs will not be a significant problem in formal
complaints because the rules we adopt today will make extensive
discovery the rare exception rather than the general rule, regardless
of the willingness of parties to pay for discovery. Furthermore, most
of the commenters oppose this proposal. Since the majority of the
commenters are potential parties to formal complaints before the
Commission, we find it unlikely that parties would enter into such
voluntary cost recovery agreements.
4. Referral of Factual Disputes to Administrative Law Judges. a.
The NPRM. 133. In the NPRM we proposed to amend our rules to authorize
the Common Carrier Bureau and the Wireless Telecommunications Bureau,
on their own motion, to refer disputes over material facts in formal
complaint proceedings to an administrative law judge (``ALJ'') for
expedited hearing. The disputes referred would be those that cannot be
resolved without resorting to formal evidentiary proceedings, although
adjudication of novel questions of law or policy would remain outside
of the delegated authority of the ALJ. We noted that, as a practical
matter, the Bureaus would refer issues only where necessary to
determine acts or omissions, and not to determine the legal
consequences of such acts or omissions. We tentatively concluded that
expanding the Bureaus' delegated authority in this limited way would
provide the staff with an important tool for resolving disputes over
material facts that cannot be resolved without resort to formal
evidentiary proceedings.
[[Page 1009]]
b. Comments. 134. The majority of commenters support the adoption
of a rule authorizing the Common Carrier Bureau and the Wireless
Telecommunications Bureau to refer factual disputes to an ALJ for
resolution. Bechtel & Cole's support for authorizing such referral,
however, is contingent upon the establishment of deadlines for ALJs to
resolve such disputes, as well as a clear definition of the role and
responsibility of the ALJ in each case. CBT suggests that the ALJ
hearing be located at the site of the alleged violation. GST, KMC and
MFS argue generally that the procedures for referral of factual
disputes to ALJs should be clarified. BellSouth, however, opposes the
referral of factual issues to ALJs, except as a last resort, arguing
that it would only add a layer of procedural rules while still
requiring the Commission to make a legal determination on the case
itself. BellSouth supports referral of disputes to ALJs for hearing
only if the Commission adopts the pole attachment complaint rules.
c. Discussion. 135. We amend Sec. 0.291 of the rules to authorize
the Chief of the Common Carrier Bureau to designate factual disputes
for evidentiary hearings before an ALJ and clarify that the change in
the Bureau's delegated authority is intended to authorize the Bureau to
designate factual disputes for hearing even in those cases where the
facts to be determined may be considered ``novel.'' We retain, however,
the existing prohibition on the Common Carrier Bureau designating for
hearing those issues involving novel questions of law or policy which
cannot be resolved under outstanding precedents or guidelines. No
revision is required in the existing delegated authority of the
Wireless Telecommunications Bureau, which now permits it to delegate
novel factual issues for hearing.
136. Factual disputes that are referred to an ALJ for hearing shall
be referred to such ALJ through a hearing designation order. The
hearing designation order may set a recommended deadline for the ALJ to
certify the record by, and, if time permits, issue a recommended
decision on the factual dispute. The presiding judge shall certify the
record and if time permits, issue a recommended decision, pursuant to
the instructions contained in the hearing designation order, before
referring the matter back to the Commission for, inter alia, final
resolution of all outstanding factual, legal and policy issues. We
clarify that, where the Common Carrier Bureau or the Wireless
Telecommunications Bureau designates a dispute for expedited hearing,
the designating Bureau may authorize the presiding judge to schedule
the proceedings to enable such deadline to be met. We further clarify
that the Common Carrier and Wireless Telecommunications Bureaus will
not refer a factual dispute to an ALJ for hearing where the time
required by the ALJ to complete a hearing on such dispute would
preclude the Commission from meeting an applicable statutory deadline.
137. There is broad support among the commenters for the use of
ALJs to resolve factual disputes. After due consideration of
commenters' concerns about compliance with statutory deadlines, we
conclude that the existing rules provide the Commission with the
authority to request, in a hearing designation order, that disputes be
resolved by an ALJ within a set period of time consistent with the
final Commission decision complying with the statutory deadline and to
authorize ALJs to use discretion in the application of their hearing
rules to ensure compliance with the deadline recommended by the
Commission. We conclude, in addition, that the concerns of some
commenters about such referrals slowing down the complaint process are
unwarranted. The Commission's obligation to comply with statutory
deadlines is not eliminated by such referral. Referral of factual
disputes to ALJs will, in fact, expedite the process because referrals
will be used in those circumstances where the factual disputes cannot
be resolved promptly, if at all, on a written record. In such cases, it
would take longer for the Commission to resolve such disputes itself
without a hearing than it would for the Commission to do so after a
hearing before an ALJ. ALJs are, furthermore, expert triers of fact and
are well-situated to conduct their proceedings within the time frames
given by the Commission, such that sufficient time will remain for the
Commission to issue its decision in compliance with the statutory
deadline. We also conclude that ALJ hearings will be held at the
offices of the Commission in Washington, D.C., unless otherwise ordered
by the Commission. It would be impractical to provide for hearings at
the location of each dispute in light of both the time limitations that
may be imposed on the ALJs and the limited resources of the Commission.
138. Additionally, we note that the Enforcement Task Force is
currently evaluating whether it may be appropriate, in certain limited
categories of disputes, to conduct mini-trials or some other form of
live evidentiary proceeding, either before an ALJ or the Task Force. If
adopted, this test procedure, subject to careful time constraints,
would allow parties a substantially greater opportunity to present live
testimony and oral argument than is contemplated by the hearings
conducted pursuant to designation orders.
H. Status Conferences
139. The NPRM proposed to use status conferences to speed up the
formal complaint process in order to enable compliance with the newly
imposed statutory deadlines and overall streamlining of the formal
complaint procedures. The status conference proposals were intended to
work in conjunction with the modifications of the briefing and
discovery rules.
1. The Initial Status Conference. a. The NPRM. 140. We proposed to
modify our rules concerning status conferences to improve the ability
of the Commission staff to render prompt decisions and order any
necessary actions by the parties. We proposed to require that, unless
otherwise ordered by the staff, an initial status conference take place
in all formal complaint proceedings ten business days after the
defendant files its answer to the complaint. Such an early status
conference would be used to discuss such issues as claims and defenses,
settlement possibilities, scheduling, rulings on outstanding motions,
the necessity of and, if necessary, scope and/or timetable of
discovery.
b. Comments. 141. A number of commenters support scheduling the
initial status conference ten days after the filing of the answer.
Several commenters, such as CompTel, MCI, Nextlink, and PTG, however,
assert that it may be unrealistic for parties to be required to argue
all discovery issues in that short a time period. They suggest either a
second status conference or that the initial status conference be held
twenty to thirty days after the filing of the answer. AT&T, CBT, PTG,
and U S West argue that parties should continue to be permitted to
attend status conferences by telephone conference call.
142. The commenters agree that the issues to be resolved at the
initial status conference should include the scope and scheduling of
discovery and the briefing schedule. The cable entities state that they
envision the initial status conference as the ``focal point of the
complaint proceeding.'' PTG suggests the scheduling of a formal
settlement conference at that time. GST, KMC, and MFS also propose to
have parties attend ``meet and confer'' conferences prior to the
initial status conference so that
[[Page 1010]]
agreements reached and disputes remaining unresolved after the meet and
confer may be reduced to writing and given to the staff at the initial
status conference. GST, KMC, and MFS suggest that the following
subjects be discussed at the meet and confer: (1) the necessity and/or
scope of discovery beyond the exchange of documents and information
designations; (2) if depositions or affidavits are necessary, and if
so, the number and proposed dates; (3) the timetable for completion of
discovery; (4) the need or desirability of referring technical issues
to an neutral expert; (5) settlement possibilities; (6) if briefing is
necessary; (7) whether parties are willing to have damages claims
resolved separately from liability issues using the supplemental
complaint process, where such action has not already taken place; (8)
disagreements over designation of documents as confidential or
proprietary; (9) in section 271(d)(6)(B) cases, whether parties can
agree to waive the ninety-day resolution deadline; and (10) the draft
joint statement of stipulated facts and key legal issues. AT&T and the
cable entities support requiring the meet and confer, while CBT opposes
the meet and confer because it argues that the Commission should not
impose additional requirements on parties.
c. Discussion. 143. We require that the initial status conference
take place ten business days after the date the answer is due to be
filed unless otherwise ordered by the staff. Setting the initial status
conference date for ten business days after the date the answer is due
to be filed will enable Commission staff to render decisions and/or
order necessary actions promptly. Commission staff retain the
discretion to permit parties to attend status conferences by telephone
conference call on a case-by-case basis.
144. Commenters that oppose scheduling the initial status
conference for ten business days after the date the answer is due to be
filed claim that it may be unrealistic to require the parties to
address discovery issues so early in the proceeding. In response to
these commenters, we shall use a complaint with a ninety-day resolution
deadline as an example. In a ninety-day complaint, the date of the
initial status conference is 34 days into the proceeding under the
amended rules. In other words, over one third of the time allocated for
resolution of such complaint will have passed before the status
conference takes place. In the remaining fifty-six days, the parties
will be required to comply with any discovery ordered and to draft
briefs to include such discovery findings, and the staff will be
required to consider all submissions by the parties and issue a
decision taking appropriate action. Given these requirements, it is
necessary for the parties and the Commission to move the proceeding
along with great speed. Even if the complaint is not subject to such an
abbreviated schedule, the expedited resolution of all formal complaints
is essential to fostering and maintaining competition in accordance
with the goals of the 1996 Act. Furthermore, the requirement of an
early initial status conference will not be as burdensome as some
commenters envision. Our status conference requirement must be
considered in conjunction with the establishment of requirements for
pre-filing activities, format and content of pleadings, and discovery
procedures. The pre-filing activities will narrow the scope of disputed
issues. The format and content requirements will reduce the amount of
discovery that is necessary by requiring the disclosure of relevant
evidence at the complaint and answer stage of a formal complaint
proceeding. The new discovery procedures will require the filing of all
requests for discovery, as well as objections and oppositions thereto,
prior to the initial status conference, to enable the staff to address
discovery issues at the initial status conference. Finally, Commission
staff will retain the discretion to modify the scheduling of the
initial status conference when it is warranted by the facts and
circumstances of an individual case.
145. We also adopt, in part, the proposal made by GST, KMC, and MFS
to require the parties to meet and confer prior to the initial status
conference. Parties will be required to schedule and attend a meet and
confer conference amongst themselves prior to the initial status
conference to discuss the following issues: (1) settlement prospects;
(2) discovery; (3) issues in dispute; (4) schedules for pleadings; (5)
joint statements of stipulated facts, disputed facts, and key legal
issues; and (6) in a section 271(d)(6)(B) proceeding, whether the
parties agree to waive the ninety-day resolution deadline. All
proposals agreed to and disputes remaining must be reduced to writing
and submitted to the staff two business days prior to the initial
status conference. This submission is to be made separately from the
joint statement of disputed and undisputed facts and key legal issues
that is due on the same date. Our requirement that the parties meet and
confer will prepare the parties for a productive status conference
because it will require the parties to consult early on substantive and
procedural issues. The requirement to meet and confer should also
eliminate any element of surprise that might prevent parties from
reaching agreements at the status conference, due to a party needing
time to consider an opponent's newly disclosed position on a particular
issue. CBT's argument against the imposition of further requirements is
unpersuasive. The meet and confer will not require the parties to
address any new issues, but rather imposes an earlier deadline for
completing activities which the parties would have to perform in any
case.
2. Status Conference Rulings. a. The NPRM. 146. In the NPRM, we
proposed to modify the requirement that the staff memorialize oral
rulings made in status conferences. We proposed that, within twenty-
four hours of a status conference, the parties in attendance, unless
otherwise directed, would submit to the Commission a joint proposed
order memorializing the oral rulings made during the conference.
Commission staff would review and make revisions, if necessary, prior
to signing and filing the submission as part of the record. To
facilitate the submission of these joint proposed orders, we further
proposed that parties be allowed, but not required, to tape record the
staff's summary of its oral rulings or, alternatively, to transcribe
the status conference proceedings. We sought comment on these proposals
and any other alternative proposals.
b. Comments. 147. Most commenters, including ACTA, ATSI, Bell
Atlantic, GTE, and ICG, support requiring parties to file a joint
proposed order within twenty-four hours of a status conference. ACTA,
AT&T and GTE suggest that the Commission provide an alternative
procedure for parties that cannot agree on a proposed order. Bell
Atlantic suggests that the Commission provide the parties with
resources to draft the proposed order on-site following the conference,
with staff remaining available for consultation. CBT, NYNEX, and PTG
oppose requiring parties to file a joint proposed order memorializing
the status conference rulings. They argue that parties will be unable
to agree on the content of such an order and that the Commission staff
member making the ruling is in the best position to know what was
intended by the ruling. AT&T suggests that joint proposed orders would
be unnecessary if the parties have made a stenographic record.
148. Commenters are split regarding the allowance of audio
recording and/or the use of stenographers at status conferences. ICG
supports audio recording of the entire status conference. GST, KMC, and
MFS
[[Page 1011]]
support the audio recording of a summary of the staff's oral rulings,
but oppose the use of a stenographer as being unnecessary. SWBT opposes
using a stenographer because of concern that a transcribed record may
have a chilling effect on the free flow of discussions at status
conferences.
c. Discussion. 149. We require parties to provide the Commission
with a joint proposed order memorializing the rulings made at each
status conference. Because of the many important issues that will be
resolved during the status conference, a written record of the rulings
will be an essential reference and organizational tool for the parties
and the Commission. Requiring the parties to provide a joint proposed
order will allow the Commission to focus its scarce resources on other
aspects of the complaint process. Requiring the parties to submit such
joint proposed order by the end of the business day following the
status conference is necessary because compliance with rulings made at
status conference may require action within a matter of days. Such time
sensitivity requires that any confusion or dispute among the parties
over rulings made at the status conference be brought to the attention
of Commission staff as early as possible. It is instructive to note
that the Commission's ex parte rules require parties making oral ex
parte presentations to file a written memorandum with the Commission's
Office of the Secretary that summarizes the data and arguments
presented on the next business day after the presentation. It has been
our experience that parties do not have difficulties complying with
such requirement. As explained below, we have eased the burden of
compliance with this requirement by providing parties with the
opportunity to submit either the joint proposed order or a transcript
of the status conference.
150. The joint proposed order shall summarize the rulings made by
the staff in the status conference. If the parties cannot agree on all
rulings in the joint proposed order they may submit instead a joint
proposed order that contains the proposed rulings upon which they agree
and alternative proposed rulings for those rulings upon which they
cannot agree. The joint proposed order shall comply with the format and
content requirements for proposed orders, and shall be filed with the
Commission by 5:30 p.m. on the business day following the date of the
status conference, unless otherwise directed by Commission staff.
151. If parties choose to make an audio recording or
stenographically transcribe parts of the status conference, they shall
submit, in lieu of a joint proposed order, either a transcript of the
audio recording or the stenographic transcript of such status
conference within three business days following the conference, unless
otherwise directed by Commission staff. Parties will be permitted to
make an audio recording of or stenographically transcribe only those
parts of a status conference that are deemed ``on the record'' by
Commission staff at its discretion. We shall prohibit any recording in
any manner of those parts of the status conference deemed ``off-the-
record'' by the staff. Any party wishing to make an audio recording of
the staff's summary of oral rulings only must notify the staff and all
attending parties in writing of its intent at least three business days
prior to the scheduled conference. Any party wishing to make an audio
recording of those portions of a status conference that are ``on-the-
record'' must secure the agreement of the attending parties and notify
the staff of such intent at least three business days prior to the
scheduled conference. Such audio recordings shall be transcribed and
such transcript submitted as part of the record no later than three
business days after the conference, unless otherwise directed by the
staff. Parties wishing to transcribe by stenographer those portions of
a status conference that are ``on-the-record'' must secure the
agreement of the attending parties and notify the staff in writing of
such intent at least three business days prior to the scheduled
conference. Such transcript shall be submitted as part of the record no
later than three business days after the status conference, unless
otherwise directed by the staff. It is the sole responsibility of the
party or parties choosing to make an audio recording of or
stenographically transcribe any part of a status conference to make all
arrangements for such recording or transcription, including, but not
limited to, arrangements for payment of the costs of such recording or
transcription.
152. The commenters have raised legitimate concerns that the making
of a formal record of a status conference by any means may have a
chilling effect on the free exchange of information by the parties. We
emphasize that the staff will retain significant discretion to
determine in each case what is ``on-the-record'' and what is ``off-the-
record'' to prevent parties from using the record to stifle such
exchanges.
I. Cease Orders, Cease and Desist Orders, and Other Forms of Interim
Relief
153. Certain provisions added by the 1996 Act authorize the
Commission to take interim actions against LECs pending final
resolution of complaints in some instances and to order permanent
injunctive relief in others. Sections 260 and 275 of the Act contain
nondiscrimination provisions governing the provision of telemessaging
service and the provision of alarm monitoring service, respectively, by
incumbent LECs. Sections 260(b) and 275(c) require the Commission to
issue, upon an appropriate showing by the complainant of a violation
that resulted in ``material financial harm,'' an order directing the
incumbent LEC ``to cease engaging'' in such violation ``pending a final
determination'' by the Commission. Both sections provide that such
cease orders ``shall'' be issued within 60 days of the filing of a
complaint that satisfies the stated criteria. In addition, section 274,
pertaining to electronic publishing by BOCs, authorizes the Commission
(or federal district court) to issue cease and desist orders for
violations of the section. Unlike sections 260 and 275, however,
section 274 contains no deadline for issuing such orders, nor does it
predicate the issuance of such orders on a showing of material
financial harm.
1. Cease and Cease and Desist Orders Under Title II of the Act and
Other Forms of Interim Relief. a. The NPRM. 154. In the NPRM, we
invited comment on our tentative conclusion that the procedures
prescribed in Title III (section 312) of the Act for issuing cease and
desist orders are not mandatory in section 208 and related Title II
complaint proceedings, and that the complaint provisions added by the
1996 Act give the Commission additional authority to issue cease or
cease and desist orders in certain cases.
155. Section 312 prescribes certain ``Administrative Sanctions''
available to the Commission to remedy violations of the Act and the
Commission's rules and orders. Subsection 312(a) provides that the
Commission ``may'' revoke a station license or construction permit
under any one of seven enumerated factual circumstances. 47 U.S.C.
312(a). Subsection 312(b) similarly provides that the Commission
``may'' order ``any person'' who has failed to operate substantially as
set forth in a license or has otherwise violated a provision of the
Act, certain provisions of Title 18 of the United States Code, or any
rule or regulation of the Commission, to ``cease and desist'' from such
action. 47 U.S.C. 312(b). Before taking the actions prescribed in
Subsections 312 (a) and (b), Subsections 312 (c) and (d) require that
the Commission conduct ``show cause'' proceedings in which the
Commission bears both the burden of proceeding with the introduction of
evidence and the burden of proof. 47
[[Page 1012]]
U.S.C. 312 (c) and (d). We also asked commenters to address whether an
order to ``cease engaging in'' violations under sections 260(b) and
275(c) would be the same as an order to ``cease and desist'' violations
under section 274(e)(2).
2. Comments. 156. Apart from comments regarding the evidentiary
showing that should be required to obtain cease and cease and desist
orders, few commenting parties draw a distinction between the cease
orders contemplated under sections 260(b) and 275(c) and the cease and
desist order described in section 274(e)(2). Voice-Tel asserts that
cease and cease and desist orders are the same and that the language
between sections 260 and 275 differs only because section 274 gives the
complainant the option of obtaining relief in federal court.
157. Commenters are evenly divided, however, on the issue of
whether the Commission must follow the procedures prescribed in section
312 of the Act before issuing cease and cease and desist orders in
Title II complaint proceedings. Bechtel & Cole, GST, KMC, MFS, and TRA
argue that, in light of the requirement in the 1996 Act for prompt
issuance of cease orders in cases alleging violations of sections 260
and 275, Congress did not intend for section 312 hearings to apply to
cease and cease and desist orders pursuant to section 208 and related
Title II complaint proceedings. These commenters argue that the
application of section 312 show cause hearings would contravene
Congressional intent. Bell Atlantic, CompTel, PTG, and SWBT, on the
other hand, contend that section 312 hearings are a prerequisite to the
issuance of any cease or cease and desist order pursuant to the Act.
These commenters maintain that the D.C. Circuit Court decision in
General Telephone Co. of California v. FCC (``General Telephone'')
establishes that section 312 show cause hearings are required before
the Commission can issue cease and cease and desist orders.
c. Discussion. 158. Congress clearly distinguished between cease
orders in sections 260 and 275 and cease and desist orders in section
274. Both sections 260(b) and 275(c) provide that, if a complaint
contains an appropriate showing of a violation that results in material
financial harm, the Commission ``shall,'' within 60 days, issue an
order directing incumbent LECs to ``cease engaging in'' the violation
pending resolution of the complaint. Section 274(e)(2), on the other
hand, authorizes ``any person'' claiming that a BOC or BOC affiliate
has violated section 274 ``to make application'' to the Commission or
the federal district courts for a cease and desist order, but does not
specify circumstances in which a cease and desist order must be issued.
In addition, unlike sections 260(b) and 275(c), section 274(e)(2)
contains no deadline for Commission action on applications for cease
and desist orders, nor does it predicate issuance of such orders on a
showing of material financial harm by the petitioner. We therefore
disagree with VoiceTel's argument that Congress intended section 260
and 275 cease orders to be identical to section 274 cease and desist
orders.
159. Based on the express language of sections 260(b) and 275(c),
we conclude that any order issued by the Commission pursuant to these
sections must be in the nature of an injunction directed against a
defendant incumbent LEC pending a final determination on the merits of
a complainant's discrimination claims. As is customarily the case with
permanent or preliminary injunctive actions, orders issued under
sections 260(b) and 275(c) directing a LEC to ``cease engaging in'' a
particular act will either be discharged or made final depending on the
outcome of the complaint. We further conclude that, apart from the
interim enforcement actions authorized under sections 260(b) and
275(c), the Commission retains discretion under section 4(i) of the Act
to entertain requests for interim relief in other Title II complaint
proceedings involving alleged violations of the Act or our rules and
orders. We disagree with commenters who claim that section 312
procedures must be applied to requests for cease orders under sections
260(b) and 275(c), particularly since these sections make it clear that
the complainants, not the Commission, have the burden of proof. By
contrast, section 312(c) states that ``both the burden of proceeding
with the introduction of the evidence and the burden of proof shall be
upon the Commission.'' The commenters' reliance on General Telephone is
misplaced. That case stands for the proposition that the Commission may
properly invoke section 312(b) in carrying out its functions under
Title II, not that the Commission is compelled to use section 312
procedures in determining if a carrier should be required to
discontinue a particular practice on a temporary or interim basis.
Sections 260(b) and 275(c), and section 4(i) generally, clearly empower
the Commission to act promptly to restrain, on a temporary or interim
basis, apparent or prima facie violations of the Act and our rules and
orders without resorting to section 312 procedures.
160. With regard to cease and desist orders under section
274(e)(2), we conclude that Congress intended to assign the same
meaning to ``cease and desist'' orders in section 274(e)(2) as used for
``cease and desist'' orders in section 312 of the Act. Section
274(e)(2) simply authorizes parties to petition the Commission for
cease and desist orders based on alleged violations of the requirements
of section 274. There is no support in section 274 or elsewhere in the
Act for applying procedures other than those prescribed in section 312
for acting on requests for such cease and desist orders. We conclude
that, in contrast to the permanent or preliminary injunctive relief
required under sections 260(b) and 275(c), Congress intended the cease
and desist orders contemplated under section 274(e)(2) to be in the
nature of final injunctive orders to be issued in conformance with the
notice and opportunity for hearing requirements of section 312 of the
Act.
2. Legal and Evidentiary Standards. a. The NPRM. 161. We proposed
to amend our rules to delineate the legal and evidentiary standards
necessary for obtaining cease and cease and desist orders pursuant to
Title II of the Act and other forms of interim relief in section 208
formal complaint cases. We noted that creating minimum legal and
evidentiary standards would expedite the issuance of cease and cease
and desist orders within statutory deadlines and create more certainty
in the industry as to the legal and factual basis for obtaining such
injunctive or interim relief. We noted further that, when a court
considers requests for various types of interim or injunctive relief,
such as a temporary restraining order, it generally requires that the
plaintiff demonstrate four factors: (1) likelihood of success on the
merits; (2) the threat of irreparable harm absent the grant of the
injunctive relief requested; (3) no substantial injury to any other
party; and (4) that issuance of the order will further the public
interest. Courts have also required the posting of bond in some cases
prior to granting interim relief.
162. Few parties responded in detail to our requests for comment in
the Sections 260, 274, 275 NPRM regarding (1) the ``appropriate
showing'' required for the Commission to issue a ``cease'' order
pursuant to section 260(b) or 275(c); (2) whether it would be
sufficient for the complainant to make a prima facie showing of
discrimination to obtain a cease order; (3) the meaning of ``cease
engaging in'' under sections 260(b) and 275(c); and (4) whether
sections 260(b) and 275(c) give the
[[Page 1013]]
Commission the authority to issue a cease and desist order similar to
the action contemplated in section 274(e)(2) and, if so, whether the
showing required to obtain cease orders and cease and desist orders
should differ in any material way. Accordingly, the NPRM sought
additional comment on these issues and emphasized that all comments
pertaining to enforcement issues in response to the Sections 260, 274,
275 NPRM would be incorporated by reference into the instant
proceeding. We also asked parties to comment on (1) the meaning of the
terms ``material financial harm'' as used in sections 260 and 275; (2)
whether a showing of material financial harm should also be required in
order to obtain a cease and desist order under section 274; and (3) the
level of proof required to establish material financial harm in the
context of a section 208 complaint proceeding.
b. Comments. 163. Many of the commenters, including BellSouth,
CompTel, PTG, NYNEX, SWBT, and U S West, support the use of the
traditional four-prong injunction test articulated in Virginia
Petroleum Jobbers (i.e., likelihood of success, threat of irreparable
harm, no substantial injury to other parties, and the furtherance of
the public interest) for issuing cease orders pursuant to sections 260
and 275 and cease and desist orders pursuant to section 274. These
commenters claim that this test will minimize the chance of harm to a
carrier should the allegations ultimately prove to be groundless. GST,
CompTel, KMC, MFS, and PTG also argue that complainants should be
required to post a bond to pay for the carrier's damages if the
Commission later finds that the complaint was without merit.
164. TRA, ICG and the cable entities argue for more relaxed
standards, especially for resellers and small market entrants. They
urge the Commission to retain only the elements of the traditional test
relating to advancement of the ``public interest'' and ``no substantial
injury to other parties.'' ICG contends that the ``likelihood of
success'' and ``irreparable harm elements'' inherently favor the status
quo, which is contrary to Congress' goal of expediting effective local
exchange competition. According to the cable entities, the Commission
should require a moving party to show only that it has mounted a
``substantial challenge'' to a carrier's practice. TRA recommends that
if the Commission decides to apply the traditional four-part test for
injunctive or interim relief, it should define ``irreparable harm'' to
include a showing of ``serious damage to a resale carrier's business.''
165. The Alarm Industry Communications Committee (``AICC'') and
Voice-Tel argue that a prima facie showing of discrimination should be
sufficient to warrant issuance of a cease order against an incumbent
LEC pursuant to either section 260(b) or section 275(c). ATSI contends
that an ``appropriate showing'' for a cease order under section 260
would be a complainant's showing it had requested service or access
from an incumbent LEC and that such request was denied or unduly
delayed in violation of section 260 on more than one occasion and that
such violations would continue absent a cease order. According to ATSI,
the Commission should apply the following two presumptions in
considering requests for cease orders in such cases: (1) if any
incumbent LEC is offering a basic service pursuant to section 260, then
any other incumbent LEC should have the capability to do the same; and
(2) if an incumbent LEC has the capability to provide telemessaging
service, then a telemessager should be able to access the LEC's network
for purposes of providing similar telemessaging service.
166. Bell Atlantic argues that a cease or cease and desist order
could be issued under sections 260, 274, or 275 only if a complainant
produces facts that show that (1) the alleged discriminatory behavior
has occurred or will soon occur, (2) that the behavior violates the Act
and/or the Commission's rules, and (3) that it has or will cause
substantial harm to the complainant. PTG contends that cease orders
should be issued pursuant to section 260 only after the complainant has
shown by a preponderance of the evidence that an incumbent LEC has
violated section 260(a) and that the violation was the proximate cause
of the complainant's material financial harm. PTG argued that an order
to ``cease engaging'' under sections 260 and 275 should be more
difficult to obtain than an order to ``cease and desist'' under section
274 because sections 260 and 275 require a showing of ``material
financial harm.'' SWBT contends that the standard under section 274(e),
which authorizes any person to ``make application to the Commission''
for a cease-and-desist order, should be at least as demanding as
Sec. 1.722 of the Commission's rules, which requires complainants
seeking damages to demonstrate or quantify the harm suffered or damages
incurred with reasonable certainty. SWBT maintains that cease orders
under sections 260(b) and 275(c), on the other hand, should require
more stringent proof because those sections direct the Commission to
issue such orders upon an appropriate showing of material financial
harm in the complaint. Voice-Tel asserts that the Commission's
authority under sections 260, 274 and 275 is the same, contending that
the language between the two provisions is different only because
section 274 gives the complainant the option of obtaining relief in
federal court.
167. Several commenters contend that what constitutes material
financial harm under sections 260 and 275 should be decided on a case-
by-case basis. AICC, ATSI, and Voice-Tel proposed that all cases
involving denial of access or delay would always result in material
financial harm and that material financial harm need not be quantified
in such cases. BellSouth maintains that a showing of material financial
harm must establish a causal relationship between the harm and the
defendant carrier's actions and should exclude unsupported claims of
``lost opportunity.'' According to PTG, a showing of material financial
harm should consist of testimony, supported by affidavit, regarding (1)
the magnitude of the alleged harm; (2) the relationship of the harm to
the alleged violation, and (3) the impact of the harm on the
complainant's business prospects. PTG, SWBT, and USTA all argue that a
prima facie case of material financial harm must include some
quantification of the alleged harm.
168. Finally, none of the commenters, either in this proceeding or
in the Sections 260, 274, 275 NPRM, addressed the issue of whether a
showing of material financial harm, as the term is used in sections 260
and 275, should also be required in order to obtain a cease-and-desist
order under section 274, although some argued that the same standards
and procedures should (or should not) apply to cease and cease and
desist orders.
c. Discussion. 169. Notwithstanding our proposals in the NPRM, we
conclude that, apart from the specific requirements set forth in the
Act and our implementing rules and orders, it is unnecessary at this
time to prescribe the legal and evidentiary showings required to obtain
cease orders in section 260(b), 275(c), and other section 208 complaint
proceedings. We similarly conclude that we need not delineate the
showing needed for a cease and desist order under section 274(e)(2).
The commenters differ sharply over these issues. Many argue that the
four-pronged test set forth in Virginia Petroleum Jobbers should be
relaxed to promote the pro-competitive goals of the Act, while an equal
number contend
[[Page 1014]]
that the Virginia Petroleum Jobbers standard, or its equivalent, is
necessary to protect the due process rights of defendant carriers.
After weighing the various comments, we conclude that it is more
appropriate to consider requests for interim or injunctive relief on a
case-by-case basis. It is impossible to anticipate all of the various
factual circumstances that could form the basis of a complaint.
Similarly, the level and types of information necessary to sustain or
refute allegations of misconduct by carriers is likely to vary widely.
We note that the rules we adopt today will foster our ability to
consider requests for interim and injunctive relief and to order such
relief promptly in appropriate cases. In particular, our pre-filing
settlement discussion requirement should promote the ability of both
complainants and defendants to ascertain the legal and factual bases of
their dispute and submit detailed, fact-based complaints and answers
accordingly. Our new format and content requirements are designed to
ensure that both complaints and answers contain full legal and factual
support for or against the relief requested in the complaint. Thus, as
a practical matter, we do not anticipate that the absence of specific
legal and evidentiary guidelines in this Report and Order will require
complainants and defendant carriers to incur any additional or
otherwise unreasonable burdens in presenting and defending against
requests for interim injunctive relief.
170. We also conclude that we need not describe the specific
showing required of a complainant to establish ``material financial
harm'' within the meaning of sections 260 and 275 of the Act.
Generally, a complainant alleging material financial harm will be
expected to demonstrate some nexus between its financial condition or
results and the defendant carriers' allegedly unlawful behavior within
the meaning of sections 260 or 275 during the period at issue in the
complaint. In addition, the plain language of sections 260 and 275
indicate that Congress sought to enjoin only those activities that
would cause material financial harm, rather than any financial harm
whatsoever. Beyond these guidelines, we do not believe it necessary or
appropriate to delineate specific factual situations that would satisfy
this burden since the evidentiary proof of material financial harm will
likely vary widely in different cases. We agree with PTG, SWBT, and
USTA, however, that allegations of material financial harm should be
supported by documentation and affidavits sufficient to enable the
Commission to quantify such harm with reasonable certainty.
J. Damages
1. Bifurcation by the Commission and the Supplemental Complaint
Process. a. The NPRM. 171. In the NPRM we sought comment on whether the
Commission legally could and/or should bifurcate liability and damages
issues on its own motion in certain circumstances. In our experience,
the damages phase of the formal complaint process is often cumbersome
and protracted largely due to the scope and magnitude of discovery
typically requested to substantiate or refute damages claims. The
Commission noted that damages discovery is a waste of the time and
resources of both the Commission and the parties when no violation or
liability is found. The Commission further noted that the deadlines
mandated by the new statutory complaint provisions allow very little
time for complainants to present evidentiary arguments sufficient to
establish both a violation of the Act and a proper measure of damages
incurred as a consequence of such violation within the applicable
deadlines. We stated in the NPRM that our goal was to eliminate or
minimize the delay that is often inherent in damages issues.
172. In the NPRM, we proposed to encourage complainants to
bifurcate voluntarily their liability and damages issues by reserving
the right to voluntarily file a supplemental complaint for damages
after liability has been determined. This procedure was available under
the previous rule Sec. 1.722(b). Where a complainant voluntarily
bifurcated a complaint proceeding using the supplemental complaint
procedure, the Commission would defer adjudication of all damages
issues until after a finding of liability. We proposed that a
complainant's use of this provision in a formal complaint proceeding
subject to a statutory deadline would enable the Commission to make a
liability finding within such deadline and still preserve the
complainant's right to establish a damage award under a less pressing
schedule. We noted that, while bifurcation could result in a faster
complaint proceeding if no liability were found, the overall proceeding
could be significantly longer if liability was found and damages were
decided in a second, separate proceeding. We emphasized, however, that
complainants would want to avail themselves of the supplemental
complaint bifurcation approach in most instances to avoid the
possibility that the deadlines would not provide them with enough time
to develop their damages claims. We noted that bifurcation through the
voluntary supplemental complaint process would be particularly
appropriate in those cases in which a complainant sought both
prospective relief and damages incurred as the consequences of a
defendant carrier's violation of the Act or a Commission rule or order.
For example, we stated that a decision by the Commission requiring a
defendant carrier to terminate a particular practice or to provide
service to a complainant under more reasonable terms and conditions
would constitute a final, appealable order, as would a decision denying
a complainant such relief. This would be the case even if issues of
damages remained to be resolved as a result of the complainant's
decision to file a supplemental complaint. We sought comment on the
relative benefits to be gained by bifurcating liability and damages
issues in section 208 proceedings through complainants' voluntary use
of the supplemental complaint process. We also asked parties to
identify bifurcation standards that might help ensure that both
liability and damages issues are fully resolved within the earliest
practicable time frame.
b. Comments. 173. Bell Atlantic and NYNEX comment that the
Commission currently has the authority to bifurcate a complaint without
the complainant's acquiescence. BellSouth argues that not all
complaints are appropriate for bifurcation.
174. The majority of commenters support voluntary bifurcation of
liability and damages issues. CompTel, GST, ICG, KMC, MCI, MFS, TCG,
and TRA support bifurcation only if it is voluntary. CompTel argues
that forced bifurcation could impair a complainant's due process rights
by causing undue delay. ICG argues that complainants need assurances
that their damages claims will be resolved promptly following a finding
of liability with expedited discovery. TRA argues that bifurcation
should remain voluntary in light of the delay in recovering damages
which is inherent in a bifurcated proceeding.
175. CBT argues that bifurcation will reduce the time pressure of
resolving claims within five months because each phase of the case will
be simpler to deal with and, if liability is not established, the
damages claim will no longer be at issue. CBT argues further that such
bifurcation will result in a less compressed schedule and, therefore,
increase discovery opportunities. CBT contends, however, that the
damages phase would still have to be resolved
[[Page 1015]]
within the statutory deadline. GTE argues that bifurcation will prevent
the domination of discovery with damages issues. GTE and NYNEX assert
that once liability is found, a defendant will have more incentives to
settle informally. NYNEX argues that the proposed bifurcation rules
will make it easier for the Commission to resolve substantive liability
issues within the statutory deadlines while preserving the rights of
the parties to a full investigation into injury and damages. NYNEX
further argues that bifurcation decreases unnecessary costs, as a
complainant will not have to go through the expense of quantifying its
damages until it has prevailed on liability. TRA asserts that
bifurcation benefits the parties because it will speed the resolution
of liability issues and preclude unnecessary expenditures of time and
resources. SWBT contends that bifurcation will be beneficial to the
parties because the substantial time required to resolve damages issues
will not be wasted where no liability is found. GST, KMC and MFS argue
that bifurcation benefits the parties because the extensive discovery
required for damages issues will not be unnecessarily undertaken if no
liability is established.
176. MCI argues that the statutory deadline for a particular formal
complaint should be applied separately to each phase because otherwise
the parties would not have sufficient time to develop their cases
fully. TRA asserts that bifurcation effectively waives any statutory
deadline with regard to damages issues. TCG argues that bifurcation
will enable the Commission to make a liability finding within the
statutory deadlines and preserve a complainant's right to a damages
award.
177. PTG, GST, and Ameritech seek clarification that a complainant
must establish ``injury'' for a finding of liability to proceed to the
damages phase in a bifurcated proceeding. PTG argues that ``injury'' is
a necessary element of liability, however, it is not interchangeable
with ``damages'' which are the quantification of losses that result
from an injury.
c. Discussion. 178. We find that the Commission has discretion to
bifurcate liability and damages issues on its own motion pursuant to
section 208(a) of the Act. Section 208(a) authorizes the Commission
``to investigate . . . matters complained of in such manner and by such
means as it shall deem proper.'' We note, however, that the Commission
only has such discretion to the extent that such bifurcation will not
violate the statutory deadline applicable to the complaint as filed.
Therefore, all claims, that are subject to a statutory complaint
resolution deadline and include a properly supported request for
damages, require that the Commission issue a final order within the
deadline on both the liability and damages claims.
179. However, we both permit and encourage complainants to use the
supplemental complaint procedures to separate liability and damages
issues voluntarily such that damages issues will be resolved in
separate formal complaints. By using the term ``bifurcate'' in
connection with the supplemental complaint procedures, we contemplate
the filing of two separate complaints: (1) the initial complaint for
liability and any applicable prospective relief; and (2) the
supplemental complaint for damages. Resolution of the liability and
prospective relief issues on the complaint that only seeks a
determination of those issues complies with the applicable statutory
deadline because such a determination resolves all issues properly
brought before the Commission. The damages issues will not have been
brought before the Commission until, and unless, the supplemental
complaint for damages is actually filed. We modify Sec. 1.722 of the
rules to clarify this procedure.
180. Given the new complaint provisions, requiring final Commission
orders resolving certain complaints within specified time frames,
encouraging the parties to separate their liability and damages claims
into separate complaints is the most practical means to focus scarce
resources on the determination of liability issues and, when necessary,
granting prospective relief quickly. In addition, in cases where no
liability has been found, significant resources will have been saved as
a damages complaint will not have been necessary. Promoting voluntary
separation of liability and damages issues is consistent with the pro-
competitive goals and policies underlying the 1996 Act's complaint
resolution deadlines and will not adversely affect the Commission's
ability to resolve complaints raising competitive and other marketplace
disputes on an expedited basis. On the contrary, such separation will
enable the Commission and the parties to focus initial resources on
addressing allegations of anti-competitive conduct and any necessity
for prospective injunctive relief.
181. We disagree with CBT's assertion that a complainant should be
required to prosecute its liability and damages claims in a single
complaint. Nothing in the Act prohibits a complainant from choosing to
bring its liability and damages claims in separate complaints. The
supplemental complaint process is voluntary and the decision to pursue
damages in a separate proceeding is made solely by the complainant.
Further, the Commission has no basis on which to make a finding
regarding damages if such claims have not yet been presented by the
complainant. Thus, a decision on a liability complaint that reserves
the right to file a supplemental complaint for damages is a final
decision on all matters the complainant has presented to the Commission
in its complaint.
182. As a policy matter, we note that a notice of intent to seek
damages in a supplemental complaint contained in a complaint for
liability has the effect of tolling the statute of limitations for
damages claims. Moreover, a complainant may file a supplemental
complaint for damages following a finding of liability even if it gave
no notice of such intent at the time it filed its original complaint.
Thus, the distinction between the treatment of a supplemental complaint
for damages when the complainant gave notice of its intent to file such
supplemental complaint in its complaint for liability and when the
complainant failed to give notice of its intent to file such
supplemental complaint in its complaint for liability is solely the
period of time for which damages may be assessed against a defendant.
Under the circumstances, a rule that would require complainants to
prosecute damages within the statutory deadline, regardless of whether
the complainant chose to reserve its right to file a supplemental
complaint for damages, would, in fact, shorten the statute of
limitations for bringing complaints for damages in those complaints
that are subject to a statutory resolution deadline. We do not find
that it was the intent of Congress to limit the rights of complainants
in this manner.
183. We find that complainants will elect to pursue their liability
and damages claims in separate proceedings because it will be to their
advantage to postpone expending time and money developing proof of
their damages claims until after liability and issues of prospective
relief have been established. Complainants will also benefit from being
provided an extended period within which to support their damages
claims factually. Most importantly, complainants will benefit from
swifter resolution of liability issues through the filing of separate
complaints for the resolution of liability and damages issues, and,
therefore, swifter provision of the prospective relief needed to halt
allegedly anti-competitive conduct. For this reason, the provision in
the rules for complainants to file such separate
[[Page 1016]]
complaints is consistent with the Act's goal of timely resolution of
competitive issues to open markets for all potential entrants and
competitors, not just the parties to the complaint.
184. We also recognize the importance of swift resolution of
damages complaints once the liability of a defendant carrier has been
established. We agree with commenters who argue that many complainants
will bifurcate liability and damages claims only if they expect that
the Commission will conclude the damages phase rapidly. While we
believe that parties will benefit substantially from complaint
bifurcation in many instances, rules and polices must be in place to
ensure resolution of damages complaints promptly and effectively. A
paramount concern of a complainant seeking damages is to obtain
monetary relief for harm suffered as a consequence of the defendant
carrier's actions. Similarly, defendant carriers have an interest in
quickly resolving any uncertainty about the amount or extent of their
damages liability. Therefore, we will endeavor to resolve supplemental
damages complaints in the same length of time within which the
liability phase was resolved. As a general rule, damages proceedings
will be resolved within the same amount of time required to rule on the
preceding liability complaint. For example, a provider of alarm
monitoring services that elects to file a supplemental complaint for
damages, based on a finding by the Commission that the defendant
carrier is liable for a violation of section 275 of the Act, can
reasonably expect to have its damages claims resolved within a similar
120-day period. In addition, with respect to supplemental complaints
for damages that are filed following a finding of liability on a matter
that was not subject to a statutory deadline, we will endeavor to
resolve such complaints within five months of the date of filing. This
approach furthers the intent underlying the deadlines that Congress
established for different types of complaints. Establishing rules and
policies that promote swift determination of damages claims provides a
significant incentive for common carriers to comply with the Act and
the Commission's rules and orders. It also gives all complainants
reasonable assurances of the length of time a damages phase is likely
to take. Such information will help parties that plan to seek damages
weigh the benefits of bifurcating the liability and damages aspects of
their claims prior to filing a complaint with the Commission.
185. We also recognize that damages complaints often raise issues
of extraordinary factual and/or legal complexity, the resolution of
which may require substantial expenditures of time and resources by the
parties. In the paragraphs below, we discuss rules that are designed to
facilitate the computation of damages by complainants and defendants
and promote the prompt resolution of damages disputes. We believe that
these rules will help us attain our goal of resolving all damages
complaints within five months from the date filed. Nonetheless, we
believe that cases of extraordinary complexity could require
substantially more time. As a general rule, we will endeavor to resolve
such complex complaints within twelve months from the date filed.
186. We recognize the distinction commenters make between
``injury'' and ``damages,'' and agree that a party that has not shown
that it suffered an injury has not met a threshold requirement for
substantiating a claim for damages. We disagree, however, with the
assertion by these commenters that a determination of ``injury'' in a
liability complaint is necessary to proceed to a supplemental complaint
for damages when a complainant chooses to use the supplemental
complaint procedures. Contrary to the commenters' claims, proof of
``injury'' is not necessary to establish a violation of the Act within
the meaning of section 208. Section 208 of the Act only requires proof
that the defendant carrier has violated the Act or a Commission rule or
order for a complainant to prevail. Additionally, determining whether
an individual complainant has been injured and is entitled to monetary
damages does not further the pro-competitive goals and policies
underlying the 1996 Act in the same way that addressing allegations of
anti-competitive conduct and the need for injunctive relief does. That
is, the question of injury goes to the resolution of an individual
dispute rather than the resolution of a disputed issue that affects
competition in an industry. For that reason, we conclude that, where
the fact of injury does not need to be established to prevail on the
issue of liability in a complaint proceeding, a prior determination of
injury is not a prerequisite to the filing of a supplemental complaint
for damages. A complainant must always, however, prove injury and
quantify its monetary damages with reasonable certainty to prevail on
its claim for damages.
2. Detailed Computation of Damages. a. The NPRM. 187. In the NPRM
we proposed to require that any complaint or supplemental complaint
seeking an award of damages contain a detailed computation for such
claim. That is, every complaint for damages would include a computation
for every category of damages claimed, as well as identification of all
documents or material on which such computation was based. For example,
in cases in which a complainant is challenging the reasonableness of
charges or rate levels applied by a carrier to particular services
taken by the complainant, the complainant's computations would have to
identify clearly the precise nature of the service taken and applicable
charges broken down by such factors as minutes of use, traffic mileage
and volume, as well as any applicable discounts or other adjustment
factors.
b. Comments. 188. ACTA, BellSouth, CBT, GST, KMC, MFS, NYNEX, and U
S West support requiring complaints seeking an award of damages to
contain a detailed computation of damages claimed. SWBT asserts that
such a requirement should reduce the filing of frivolous claims for
speculative damages that are not subject to proof. GST, KMC and MFS
argue that such a requirement should encourage settlement by clarifying
a party's claim. The cable entities and MCI oppose such a requirement,
expressing concern that complainants may not have access to sufficient
information prior to discovery to prepare and submit detailed damages
computations or computation formulas.
189. ICG argues that the proposed detailed computation of damages
should only be required to be made in good faith and that complainants
should be provided with the opportunity to amend the complaint to
reflect an updated computation of damages following discovery. MCI
argues that requiring the complaint to contain a detailed computation
of damages would violate a complainant's due process rights and
suggests, as an alternative, requiring a complainant to outline its
damages methodology and identify what damages information it lacks.
While they do not oppose the proposed requirement that a complaint
contain a detailed computation of damages, U S West argues that the
Commission must take into account the reasonable availability of
necessary information, and TRA asserts that the Commission must be
careful not to impose an overly rigid or binding requirement with
regard to a detailed or definitive damages calculation prior to the
receipt of an answer and completion of discovery.
c. Discussion. 190. After considering the concerns raised by the
commenters, we modify the proposed rule. We require that a complainant
seeking damages must file in its complaint or supplemental complaint
either a detailed computation of damages or a
[[Page 1017]]
detailed explanation of why such a computation is not possible at the
time of filing. Commenters raise valid concerns about the ability of
complainants to substantiate damages claims at the beginning of a
formal complaint proceeding. In light of these considerations, we
require all complaints or supplemental complaints seeking an award of
damages to contain either:
(a) A detailed computation of damages, including supporting
documentation and materials; or
(b) An explanation of:
(i) What information not in the possession of the complaining party
is necessary to develop a detailed computation of damages;
(ii) Why such information is unavailable to the complaining party;
(iii) The factual basis the complainant has for believing that such
evidence of damages exists; and
(iv) A detailed outline of the methodology that would be used to
create a computation of damages with such evidence.
191. This rule strikes the appropriate balance between the need for
complainants to be diligent in establishing their claims and our
recognition that, in certain instances, a complainant may not possess
sufficient facts at the initial stages of a complaint proceeding to
prepare a detailed computation of damages alleged. This rule also is
consistent with the Commission's adoption of a policy of encouraging
complainants to have damages claims resolved separately from liability
issues using the supplemental complaint process, because it provides
the complainant with the benefit of additional time to develop and
support factually an accurate computation of damages following a
finding of liability. It would have been unduly burdensome to require a
complainant who has been unable to obtain access to substantiating
information, after it has made good faith efforts to obtain such
information, to support factually its damages claim without providing a
means to substantiate such claims. Further, such a rule would have
reduced the incentives on defendants to negotiate damages issues in
good faith.
3. Ending Adjudication With a Determination of the Sufficiency of a
Damages Calculation Method. a. The NPRM 192. In the NPRM we proposed
that the Commission's adjudication of damages should end with a
determination of the sufficiency of the computation method submitted by
the complainant, instead of making a finding as to the exact amount of
damages incurred. We stated that the benefit of such a procedure would
be that the Commission would be spared the detailed and time-consuming
investigation of the facts necessary to establish an exact amount of
damages. As an example of how such a procedure would be implemented, we
noted that a similar procedure is used in complaints dealing with pole
attachments. We sought comment on this proposal.
b. Comments. 193. CBT, CompTel, GST, and SWBT oppose a rule ending
the Commission's adjudication of damages with a determination of the
sufficiency of the computation method. CBT and CompTel argue that
parties will be unable to resolve issues remaining in dispute, such as
the numbers to be plugged into an approved method. CBT argues that such
disputes will require further Commission involvement to resolve. GST
argues that parties are entitled to a final resolution of all
substantive issues, a category it contends includes the actual amount
of damages incurred. SWBT argues that because such a procedure would
not require a complainant to meet its burden of proof, it would be a
denial of a defendant's due process rights. AT&T supports this proposal
if the Commission remains available to resolve further disputes among
the parties and provide a final resolution if the parties cannot agree
to one.
c. Discussion. 194. In cases where liability and damages claims
have been severed using the supplemental complaint process, the
Commission may end adjudication of damages with a determination of the
sufficiency of the damages computation method submitted by the
complainant. After considering the concerns raised by the commenters,
we modify the proposed rule to reflect that if the Commission finds the
damages computation submitted by the complainant unsatisfactory, the
Commission may, in its discretion, modify such computation method or
require the complainant to resubmit such computation. In addition, the
rule specifically prohibits the computation method from incorporating
an offset for a claim of a defendant against a complainant. To ensure
the parties are diligent in their negotiations to apply the approved
calculation method, we shall require that, within thirty days of the
date the damages computation method is approved and released, the
parties must file with the Commission a joint statement which will do
one of the following: (1) detail the parties' agreement as to the
amount of damages; (2) state that the parties are continuing to
negotiate in good faith and request that the parties be given an
extension of time to continue such negotiations, or (3) detail the
bases for the continuing dispute and the reasons why no agreement can
be reached. In this way, the Commission will monitor the parties'
compliance with its directive to negotiate a resolution of the dispute
in good faith using the mandated computation method.
195. This rule permits the Commission to avoid the detailed and
time-consuming investigation of the facts necessary to establish an
exact amount of damages where such investigation may reasonably be
delegated to the parties. At the same time, however, it provides a
means for parties to return to the Commission for resolution of ongoing
disputes if parties are unable to agree to a final amount of damages.
This rule encourages good faith negotiation among the parties by
requiring parties to provide detailed explanations if they fail to
resolve their dispute. We emphasize that the Commission will always
retain the right to determine the actual amount of damages in those
cases where the establishment of damages does not lend itself to such a
means of resolution. We also conclude that requiring parties to reach
an agreement within a limited time addresses the concerns raised by
some commenters that the parties would have no recourse if they are
unable to apply a damages computation method successfully.
4. Settlement Period. a. The NPRM. 196. In the NPRM we proposed, in
conjunction with the proposals to resolve liability and damages claims
separately using the supplemental complaint process, to set aside a
limited period, following a finding of liability and prior to the
damages phase, during which the parties could engage in settlement
negotiations or submit their damages claims to voluntary ADR mechanisms
in lieu of further proceedings before the Commission.
b. Comments. 197. GST, SWBT, TRA and U S West support setting aside
a limited time period, following a finding of liability, in which to
encourage settlement and/or participation in ADR. SWBT asserts that a
finding of liability increases the defendant's incentive to settle. U S
West argues that the Commission does not go far enough and that ADR
procedures should be used wherever possible to resolve entire
complaints.
c. Discussion. 198. In cases where liability and damages claims
have been severed using the supplemental complaint process, the
Commission may suspend proceedings for a period of fourteen days
following the filing of a supplemental complaint for damages, to
[[Page 1018]]
allow parties to attempt to negotiate a settlement or use ADR
procedures. The staff has the discretion to delay this period until
later in the damages phase, when warranted by the facts of an
individual case.
199. Encouraging parties to settle their disputes is in the
interests of the Commission and the parties. Commenting parties
recognize the benefits of settlements reached by the parties and
support the establishment of this settlement period to further
settlement negotiations. The timing of this settlement period is
especially useful because it follows the determination of liability. A
finding of liability will increase the parties' incentives to settle,
as a major issue formerly in dispute will have been resolved. We
recognize, however, that information disclosures may be necessary in
some cases for parties to assess adequately the amount of damages
incurred. In such cases, a settlement period immediately following the
filing of the supplemental complaint for damages may be too early in
the proceeding to be useful. Providing the staff with the discretion to
delay the settlement period until after information disclosures have
been made maximizes the Commission's ability to encourage settlement on
a case-by-case basis.
5. Referral of Damages Issues. a. The NPRM. 200. In conjunction
with the proposals to resolve liability and damages claims separately
using the supplemental complaint process, we sought comment on the
benefits of referring damages issues to ALJs for either decision
following a finding of liability or, by agreement of the parties,
mediation. We noted that such referral would be at the discretion of
the Commission staff pursuant to delegated authority, depending on the
particular facts and circumstances involved. We also sought alternative
proposals that would serve to minimize or reduce the need for costly
and protracted proceedings on the issue of damages.
b. Comments. 201. Commenters generally support the referral of
damages issues to ALJs. ICG compared this procedure to the federal
courts' use of special masters. BellSouth suggests that parties should
have the option of mediation or referral to a special master. KMC
asserts that parties need to have the right to appeal any decision on
damages made by an ALJ. GTE argues that the ALJ should have the
authority to request production of evidence. GTE seeks clarification
that an ALJ's authority would be restricted to the resolution of
damages issues.
c. Discussion. 202. We adopt a rule authorizing the Chiefs of the
Common Carrier Bureau and Wireless Telecommunications Bureau to refer
damages disputes to ALJs for either decision following a finding of
liability or, by agreement of the parties, mediation. This rule would
work in conjunction with cases in which liability and damages claims
have been severed using the supplemental complaint process. The
commenters generally support the use of ALJs to resolve damages issues.
We conclude, despite GTE's concerns regarding the authority of ALJs in
damages hearings, that special rules or procedures are not needed to
guide the ALJs in their deliberations given the narrow focus of damages
proceedings. The hearing rules provide for the designation of specific
issues in the hearing designation order. Once liability has been
determined, the question of damages is largely a factual one. ALJs are
expert triers of fact well suited to conduct fact-finding proceedings.
Regarding appeals of ALJ decisions, we note that the ALJ hearing rules
provide the means for parties to seek review of an ALJ decision. If the
parties agree to mediation, however, the right to seek review of the
ALJ's mediation resolution would be contained within the terms pursuant
to which the parties agreed to such mediation.
6. Deposit of Funds into an Escrow Account. a. The NPRM. 203. In
the NPRM we proposed that the Commission be given discretion to require
a defendant to place a deposit in an interest-bearing escrow account
following a finding of liability in cases in which liability and
damages claims have been severed using the supplemental complaint
process. The purpose of such a deposit would be to cover all or part of
the damages for which the defendant carrier may be found liable in
order to provide a complainant with some assurance that a judgment can
be readily collected. We proposed that, in exercising this discretion,
the Commission would apply standards similar to those used to determine
whether a preliminary injunction is appropriate. We emphasized that the
Commission would not administer any such account. We sought comment on
this proposal as well as alternative proposals that would serve to
facilitate and expedite the resolution of damages claims.
b. Comments. 204. Commenters are split over whether or not the
Commission could or should require the deposit of funds into an escrow
account following a finding of liability. AT&T, TRA, GST, KMC and MFS
support such a procedure. AT&T, GST, KMC and MFS further support
allowing the posting of a bond as an alternative to depositing funds
into an escrow account as a means to ensure payment. GST, KMC, and MFS
argue that preliminary injunction standards do not need to be met to
require such a bond because liability will already have been
determined. GST, KMC, and MFS argue that the Commission should require
a showing of irreparable harm and the likelihood that the defendant
will default on the damages award before requiring the posting of a
bond or the deposit of funds into an escrow account.
205. CBT, SWBT, GTE, and PTG oppose the proposal, arguing that the
Commission lacks authority to impose such a requirement. CBT, SWBT, and
PTG argue that a Commission order for payment of damages pursuant to
section 209 of the Act is not an enforceable money judgment. CBT and
SWBT argue that prospective money damages are insufficient to justify a
preliminary injunction, and that the proper compensation for any delay
in a damages award is the payment of interest. PTG asserts that such a
rule creates an unnecessary administrative burden in light of the fact
that there is no evidence of a problem in collecting damages from
carriers.
c. Discussion. 206. In cases in which liability and damages claims
have been severed using the supplemental complaint process, following a
finding of liability, the Commission shall have discretion to require a
defendant either to post a bond for, or place in an escrow account, an
amount the Commission determines is likely to be awarded, if such
relief is justified following consideration of the following factors:
(a) The likelihood of irreparable injury in the absence of such a
deposit;
(b) The extent to which damages can be accurately estimated;
(c) The balance of hardships between complainant and defendant; and
(d) Whether public interest considerations favor the posting of a
bond or establishment of an escrow account.
207. Requiring the posting of a bond or the deposit of funds into
an escrow account both protects against a defendant's future inability
to satisfy an enforceable judgment and removes the benefit a defendant
receives from delaying payment in a case. Contrary to what several
commenters suggest, neither the posting of a bond nor the deposit of
funds into an escrow account is the enforcement of a money judgment.
The rule does not provide that a complainant may execute its judgment
on the bond or account
[[Page 1019]]
following a Commission order of damages. The rule merely requires the
bond or account to be set up as a protective measure. Further, this
protective measure may only be taken following a finding of liability
and a Commission assessment of likely damages.
208. Precedent for the Commission requiring a defendant to deposit
funds into an escrow account following a determination of liability is
found in Western Union Telegraph Co. v. TRT Telecommunications Corp.,
and FTC Communications, Inc.
7. Additional Suggestions From Commenters. a. The NPRM. 209. In the
NPRM we sought alternative proposals that would serve to facilitate and
expedite the resolution of damages claims and/or minimize or reduce the
need for costly and protracted proceedings on the issue of damages.
b. Comments. 210. ACTA suggests that the Commission codify the
procedure for a complainant to litigate damages in federal court
following a finding of liability by the Commission.
211. GST suggests providing for targeted discovery during a damages
phase, arguing such discovery should be limited to initial disclosures
of witnesses, exchange of documents and one deposition for each party.
c. Discussion. 212. We decline to adopt ACTA's proposal to codify a
procedure for litigating damages claims in federal court following a
finding of liability by the Commission. The Act does not provide the
Commission with the authority to establish federal court procedures.
Although federal courts occasionally refer cases to the Commission for
resolution of liability issues, while retaining authority over damages
issues pending the Commission's liability determination, such referrals
are initiated by the courts, not the Commission.
213. We decline to adopt GST's proposal to establish special
discovery rules for a supplemental complaint proceeding. A supplemental
complaint is a formal complaint that is limited to the issue of damages
because the issue of liability has already been determined in a
separate, prior proceeding. Supplemental complaints are, therefore,
subject to the formal complaint discovery rules. We conclude that the
formal complaint discovery rules are adequate to address damage claims
and the creation of a separate set of discovery rules is unwarranted at
this time.
K. Cross-Complaints and Counterclaims
214. The Act imposes new deadlines for actions on certain
complaints ranging in length from ninety days to five months from the
date of filing. The NPRM recognized that the filing of cross-complaints
or counterclaims during a complaint proceeding could inhibit the
Commission's ability to fully resolve disputes within the mandated time
frames.
a. The NPRM. 215. We proposed to allow compulsory counterclaims
only if filed concurrently with the answer, such that the failure to
file with the answer would bar the defendant from filing such
compulsory counterclaim. We also proposed that a defendant electing to
file permissive counterclaims and cross-claims would be required to
file such pleadings concurrently with its answer, leaving the defendant
with the option of filing any barred permissive counterclaims or cross-
claims in a separate proceeding, provided that the statute of
limitations has not run. We also proposed to revise our rules to
clarify the applicability of filing fees to complaints, cross-
complaints, and counterclaims.
b. Comment. 216. CompTel and TRA support the Commission's
proposals. Most commenters, however, oppose establishing a category of
compulsory counterclaims that will be barred if not filed concurrently
with an answer. AT&T, BellSouth, PTG, and NYNEX argue that the time to
answer (twenty days) is insufficient to allow a defendant to answer the
complaint, ascertain all possible counterclaims and prepare such
counterclaims for filing and service in accordance with the proposed
format and content requirements. GTE further argues that defendants may
be reasonably unaware of their counterclaims prior to the date an
answer is due. CBT, GST, KMC, and MFS suggest that compulsory
counterclaims filed with the answer should not be subjected to the same
high levels of evidentiary support as required of the complaint. AT&T
and NYNEX support a rule requiring counterclaims and cross-complaints
not filed concurrently with the answer to be brought in separate
proceedings. CBT and U S West argue that the Commission's jurisdiction
over counterclaims is limited to instances where both parties to a
proceeding are carriers and the counterclaim involves an allegation of
a violation by the complainant that could itself be the subject of a
separate complaint before the Commission.
c. Discussion. 217. We require all cross-complaints and
counterclaims to be filed as separate, independent actions. While the
NPRM originally proposed to distinguish between the treatment of
compulsory and permissive cross-complaints and counterclaims, we have
decided that banning all cross-complaints and counterclaims is
necessary in light of the statutory deadlines in the 1996 Act. Cross-
complaints and counterclaims would not be filed until twenty days into
an ongoing proceeding, thereby shortening the time within which the
Commission may adequately consider and resolve such claims.
Establishing a category of compulsory counterclaims, furthermore, would
have created an inconsistency between the treatment of claims by
complainants and counterclaims by defendants. Under such a rule,
complainants would be permitted to file separate formal complaints
based on claims arising out of the same transaction or occurrence as a
pending formal complaint, but defendants would be barred from filing
counterclaims once the answer had been filed.
218. The rule we adopt also satisfies the concerns of some
commenters that the Commission only has jurisdiction to consider those
claims that the defendant could have filed against the complainant
independent of the ongoing litigation. That is, the Commission does not
have the authority to assert pendent jurisdiction over disputes for
which no independent jurisdictional ground exists. In light of both the
time constraints within which the Commission must work and the nature
of allowable cross-complaints and counterclaims, we conclude that all
such claims are better treated as individual complaints. To preclude
the possibility of inconsistent rulings on identical facts, a
complainant filing a formal complaint that shares any factual basis
with another formal complaint to which the complainant is a party,
whether ongoing or finally resolved, must include this fact in such
formal complaint and its accompanying formal complaint intake form. We
note that, under the broad powers of section 208, the Commission always
has the authority to consolidate separate complaint cases. Where
appropriate, the staff will have discretion to consolidate cases so
that all claims arising out of the same transaction or occurrence may
be adjudicated in a single proceeding.
219. We decline to adopt our proposal to revise our rules to
clarify the applicability of filing fees to cross-complaints and
counterclaims. Such a rule would be moot in light of the rule adopted
prohibiting all cross-complaints and counterclaims.
L. Replies
a. The NPRM. 220. We proposed to prohibit replies to answers unless
specifically authorized by the
[[Page 1020]]
Commission. We noted that our rules made filing a reply voluntary, and
that failure to reply was not deemed to be an admission of any
allegation contained in the answer, except for facts contained in
affirmative defenses. We proposed to authorize replies only upon a
complainant's motion, filed within five days of service of the answer,
showing good cause to reply to any affirmative defenses supported by
factual allegations that were different from any denials also contained
in the answer. We also proposed to provide that a complainant's failure
to file a reply to an answer would be deemed a denial of any
affirmative defenses.
221. We also proposed to prohibit replies to oppositions to
motions. We stated our belief that such replies seldom aid the
Commission in resolving factual or legal issues and were often used to
repeat information already contained within the original motion itself.
We sought comment on this and any other alternative proposals.
b. Comments. 222. Many commenters, including AT&T, BellSouth, GST,
KMC, MFS, GTE, NYNEX, and TRA support our proposals to prohibit, in
most instances, replies to defendants' answers. They agree that replies
are unnecessary and redundant as long as complainants are deemed to
have denied all affirmative defenses and are permitted to respond for
good cause, such as a showing that a defendant has misrepresented
pertinent facts. ATSI and the cable entities, however, argue that a
reply is necessary to give a complainant the opportunity to respond to
matters that might be raised for the first time in the answer and to
withdraw claims that may have been satisfactorily addressed in the
answer. NYNEX argues that a complainant should be permitted to file a
reply to an answer if it is replying to an affirmative defense and it
is relying on factual allegations that are different from any denials
contained in the answer. ICG argues that prohibiting replies would
generate more work for the Commission, in the form of responding to
motions for leave to file replies.
223. Regarding our proposal to prohibit replies to oppositions to
motions, PTG points out that Sec. 1.727(f) of the Commission's existing
rules already prohibits replies to oppositions to motions. CompTel,
GST, KMC, MFS, and GTE assert that replies to oppositions to motions
may be warranted where the opposition distorts facts or where matters
are raised for the first time in the opposition.
c. Discussion. 224. We modify our proposed rule and permit
complainants to file replies that respond only to affirmative defenses.
We shall deem any failure to reply to an asserted affirmative defense
as an admission of such affirmative defense and of any facts supporting
such affirmative defense that are not specifically contradicted in the
complaint. We note that the NPRM originally proposed to require parties
to move for leave to file replies to affirmative defenses and that
failure to reply to an affirmative defense would be deemed a denial of
such defense. The rule we adopt departs from our proposal in the NPRM
because we are persuaded by the commenters that requiring complainants
to seek leave to file replies to affirmative defenses is likely to
generate unnecessary work for the staff. Instead, we have chosen to
limit replies to those that respond to new allegations raised in an
answer in the form of affirmative defenses. Complainants will be
required to support their replies to affirmative defenses in the same
manner that they are required to support their claims in the complaint.
This requirement will aid the staff by the presentation of specific
evidence regarding each affirmative defense. General replies to
answers, however, are often redundant and unnecessary because
complainants simply repeat claims that were filed with the original
complaint. Such general replies are prohibited. We do not modify the
existing rule that prohibits replies to oppositions to motions.
M. Motions
225. The NPRM proposed to modify the rules pertaining to motions in
order to enhance the efficiency of the formal complaint process,
expedite the filing and consideration of motions, and eliminate
unnecessary or duplicative pleadings.
1. The Filing of Motions. a. The NPRM. 226. In the NPRM, we
proposed to require a party filing a motion to compel discovery to
certify that it had made a good faith attempt to resolve the matter
before filing the motion. We also proposed to eliminate motions to make
the complaint ``definite and certain,'' stating that, under the
proposed rules, complaints would have to be very definite and certain
to avoid being dismissed at the outset.
b. Comments. 227. All parties that commented on this issue agree
that the Commission should require certification of good faith attempts
to resolve discovery disputes informally as a condition to the filing
of any motion to compel. Commenters also support the proposal to
eliminate motions to make a complaint more definite and certain.
BellSouth supports eliminating motions to make complaints ``definite
and certain'' as long as the Commission will consider motions to
dismiss for failure to state a claim or failure to comply with
procedural requirements.
c. Discussion. 228. We require a party that files a motion to
compel answers to discovery requests to certify that it has made a good
faith attempt to resolve the matter before filing the motion. We
conclude, and commenting parties agree, that adoption of this rule will
limit Commission involvement in conflicts that may be easily resolved
by the parties themselves.
229. Motions to make the complaint ``definite and certain'' are
prohibited, as such motions should be superfluous under the new format
and content requirements for initial pleadings. BellSouth's suggestion
that the Commission consider motions to dismiss is inapposite to our
decision to eliminate motions to make a complaint ``definite and
certain.'' The rationale for eliminating motions to make complaints
more ``definite and certain'' is that our newly-adopted stringent
pleading requirements will ensure the filing of complaints that are
``definite and certain.'' We do not intend to prohibit the filing of
motions to dismiss a complaint for failure to state a claim or failure
to comply with procedural requirements.
2. Oppositions To Motions. a. The NPRM. 230. In the NPRM, we stated
our intent to expedite further formal complaint proceedings by
modifying the rules regarding oppositions to motions. We proposed to
make failure to file an opposition to a motion possible grounds for
granting the motion, although the filing of oppositions to motions
would remain permissive. Additionally, we proposed to shorten the
deadline for filing oppositions to motions from ten to five business
days.
b. Comments. 231. GST, KMC, MFS, NYNEX, and SWBT support the
proposal to make failure to file an opposition to a motion possible
grounds for granting the motion, arguing that it is reasonable to
require a party to articulate its reasons for opposing a motion. ACTA,
however, opposes such a proposal, arguing that if the failure to file
an opposition can be grounds for granting a motion, the filing of an
opposition will not be permissive in any real sense. AT&T warned that
failure to file an opposition to a motion should not be an automatic
basis for granting the motion.
232. Many commenters, including AT&T, BellSouth, GTE, PTG, SWBT,
and TRA, support the shortening of the period to file an opposition to
a motion to five business days. GTE suggests that the rules provide a
procedure to seek an
[[Page 1021]]
extension of time to oppose a motion when circumstances warrant it. PTG
suggests that motions be served by facsimile to give parties more time
to respond. CBT opposes the shortening of time, arguing that more time
is needed to respond to complex motions, and suggests instead that the
time for filing be reduced to ten calendar days rather than five
business days.
c. Discussion. 233. A party's failure to file an opposition to a
motion is possible grounds for granting such motion. We note that the
commenters misconstrue the meaning of the statement that it is
``permissive'' to file an opposition to a motion. This statement merely
means that the Commission does not require a party to take affirmative
steps to oppose a motion against it. This rule does not, however,
alleviate any party's burden to represent fully its own interests
before the Commission. Any party that chooses not to file an opposition
to a motion runs the risk that the motion will be granted without
consideration of that party's views. Because the Commission is
prohibited from acting in an arbitrary and capricious manner, staff
will not grant unopposed motions that are frivolous, inconsistent with
the Commission's rules, or that may create unnecessary delay.
234. The deadline to file an opposition to a motion is five
business days, with the time running from the date service is
effective. Reduction of the number of days a party has to respond to a
motion will speed up the motions process. We disagree with CBT's
suggestion to use ten calendar days rather than five business days to
determine filing due dates because we find that a reduction to ten
calendar days will not save sufficient time in light of the statutory
deadlines in the Act. Five business days will provide the opposing
party with seven calendar days to prepare, file and serve an
opposition, with exceptions for when a holiday falls in the five
business day period. Ten business days would provide the opposing party
with fourteen calendar days to prepare, file and serve an opposition,
with exceptions for when a holiday falls in the ten business day
period. In contrast to this, CBT's proposed ten calendar days would
provide the opposing party with ten to thirteen calendar days,
depending on the day of the week the motion is served and filed and the
existence of holidays. In response to PTG's suggestion that motions be
served by facsimile, we note that this proceeding adopts rules
requiring service of motions by hand-delivery, overnight delivery, or
facsimile transmission followed by mail delivery.
3. Format, Content, and Specifications of Motions and Orders. a.
The NPRM. 235. To ease the burden on Commission staff in drafting
decisional documents within short time frames, the NPRM proposed to
require all pleadings seeking Commission orders to contain proposed
findings of fact and conclusions of law with supporting legal analysis.
The NPRM also proposed that all parties submit with their procedural or
discovery motions and oppositions to such motions, proposed orders, in
both hard copy and disk, that incorporate the legal and factual bases
for granting the requested relief. The NPRM proposed that the computer
disk submissions be formatted in WordPerfect 5.1, the wordprocessing
system currently used by the Commission. Furthermore, we proposed to
require parties to conform the format of any proposed order to that of
a reported FCC order. Such proposals would reduce the burden on
Commission staff in drafting orders and letter rulings by enabling the
staff to either incorporate relevant portions of the parties'
submissions into the required orders or use the parties' submissions in
their entirety.
b. Comments. 236. ACTA and BellSouth agree with the proposal to
require all pleadings seeking Commission orders to contain proposed
findings of fact and conclusions of law with supporting legal analysis.
ACTA states that the added cost to the parties of such submissions
would be offset by the value of such filing in expediting the
resolution of cases. On the other hand, MCI, PTG, and CBT argue that
such inclusions would only be appropriate for certain pleadings, such
as briefs or motions for summary judgment, because parties may be
unprepared to make such conclusions prior to conducting discovery and
reviewing opposing pleadings.
237. Commenters generally did not oppose the proposals to require
parties making or opposing procedural or discovery motions to submit
proposed orders, in both hard copy and disk, that conform to the format
of reported FCC orders. CBT additionally suggests that parties be
allowed to submit proposed orders in formats other than WordPerfect
5.1. MCI opposes requiring parties to submit proposed orders with their
motions and oppositions proposal, arguing that such a rule will be
largely inapplicable because most motions will be discovery motions,
which are resolved by informal letter orders that are not in the format
of Commission orders. NAD argues that this proposal will be too
burdensome for consumers with disabilities.
c. Discussion. 238. After consideration of the comments received,
we modify the rule proposed and will require only those pleadings
seeking dispositive orders to contain proposed findings of fact and
conclusions of law with supporting legal analysis. We define a
dispositive order as an order that finally resolves one or more claims
in a complaint. We conclude that this requirement is justified in these
limited circumstances because it will help to ensure that issues and
arguments are better framed and presented to the Commission. We agree
with MCI, PTG, and CBT that such a requirement would not be appropriate
for interlocutory motions, such as those seeking discovery or
extensions of time. Requiring complete support for dispositive motions
will decrease substantially the number of unnecessary motions filed
with the Commission because parties will be reluctant to file motions
for which they have no factual or legal basis. This requirement will
also give Commission staff the option of incorporating the proposed
findings of fact and conclusions of law with supporting legal analysis
into orders, thereby easing the burden of drafting orders.
239. To further facilitate the drafting of orders and letter
rulings, we adopt our proposals to require parties to submit with their
procedural or discovery motions and oppositions to such motions,
proposed orders, in both hard copy and disk, that incorporate the legal
and factual bases for granting the requested relief. Although some
commenters argue that such a requirement may often be inapplicable to
discovery and too burdensome for persons with disabilities, we conclude
that the benefits of such a rule justify it. The Commission anticipates
addressing a large number of complaints on an expedited basis. In light
of the Commission's limited resources, it will be of great assistance
to Commission staff to have the relief sought or opposed by motion, and
the basis therefore, set out clearly and concisely in a proposed order
format. Having such a proposed order, in hard copy and on disk, will
assist in the timely release of orders or letter rulings on motions.
Requiring a party to articulate the relief sought in an order may also
produce more clearly focused arguments. We also conclude that this
requirement does not overly burden parties, who merely have to transfer
a portion of the text of their motions or oppositions into the format
of an order. Finally, if submission of such a draft order does place a
large
[[Page 1022]]
burden on a particular party, the staff retains the discretion to waive
this requirement on a case-by-case basis.
240. We modify our proposed rule concerning the submission of
proposed orders on disk. We require that computer disk submissions be
formatted in the Commission's designated ``wordprocessing program,''
rather than specifically ``WordPerfect 5.1,'' because the Commission
may decide to utilize different software in the future. We also decline
to adopt CBT's proposal to permit parties to submit documents in
alternative wordprocessing formats. Because of conversion difficulties,
parties will not be permitted to submit documents in any wordprocessing
format not used by the Commission. The staff has discretion to grant
waivers of this requirement to parties upon a showing that such
wordprocessing program is unavailable to them.
4. Amendments To Complaints. a. The NPRM. 241. We stated in the
NPRM that compliance with deadlines in the Act requires that a
complaint be fully developed prior to filing. In furtherance of this
goal, we proposed to prohibit the amendment of complaints except for
changes necessary under 47 CFR 1.720(g), which requires that
information and supporting authority be current and updated as
necessary in a timely manner. This would preclude a complainant from
introducing new issues late in the development of the case.
b. Comments. 242. BellSouth, PTG, and SWBT support prohibiting
amendments to complaints because such a bar will encourage compliance
with the proposed pre-filing requirements and result in a fully
developed complaint that conforms to format and content requirements.
Several commenters, however, oppose the prohibition. ACTA, GTE, ICG,
MCI, and TRA suggest allowing complaints to be amended for good cause,
e.g. if the complainant could not have reasonably ascertained certain
facts at the time of filing of the complaint. MCI expresses concern
that such a prohibition might reward monopoly carriers who withhold
information. CBT and PTG suggest that any amended complaint be treated
as a new complaint to restart the statutory resolution deadline.
c. Discussion. 243. The Act requires expedited resolution of
certain complaints. An amendment to a complaint subject to a statutory
deadline on a showing of good cause would require the resolution of
that claim in a shorter period than provided for in the statutory
deadline. We believe that the cost of expediting complaint resolutions
more than Congress anticipated would outweigh any benefit to be had
from allowing such amendments. Further, we are not persuaded by the
arguments of ACTA, GTE, ICG, TRA, and MCI that prohibiting amendments
to complaints will unduly prejudice complainants to the benefit of
defendants. We also decline to adopt the suggestion of CBT and PTG
that, instead of prohibiting amendments to complaints, we treat amended
complaints as new complaints and restart any statutory deadline on the
date of the ``new complaint.'' We are not persuaded that our
``treatment'' of an amended complaint as a new complaint would comply
with the statutory deadline requirements. We note that a complainant is
not prohibited from filing a separate formal complaint if it discovers
a new claim at some later point in the complaint process. In addition,
where appropriate, the staff may consolidate two or more complaints to
adjudicate all claims arising out of the same transaction or occurrence
in one proceeding. Thus, we adopt a rule generally prohibiting all
amendments to complaints. We note that this prohibition on amendments
in no way relieves the parties of their obligation under Sec. 1.720(g)
of the Commission's rules to maintain the accuracy and completeness of
all information and supporting authority furnished to the Commission in
a pending proceeding. In addition, we note that complainants always
have the option of filing their complaints in federal court if they
conclude that the Commission's rules will not afford them the pleading
opportunities they need. The Commission's rules have long included a
fact pleading requirement designed to ensure that a party has
sufficient knowledge of its claims before filing its complaint.
5. Additional Suggestions From Commenters. a. The NPRM. 244. In the
NPRM, we sought alternative proposals to modify the rules regarding
motions.
b. Comments. 245. BellSouth suggests that any request for an
interlocutory ruling be deemed a voluntary waiver of any applicable
statutory deadline shorter than five months. BellSouth reasons that,
given the Commission's limited resources, such a rule is the only way
to discourage the filing of time-consuming motions that will preclude
Commission staff from meeting the statutory deadlines.
246. AT&T and ICG suggest requiring parties to give advance notice
of motions to be filed.
247. PTG suggests that the Commission make a commitment to decide
all motions within thirty days of filing, rather than waiting until the
final order is issued.
c. Discussion. 248. We decline to adopt BellSouth's suggestion that
a request for an interlocutory ruling be deemed a waiver of the
applicability of any statutory deadline shorter than five months. As
discussed in the ``Damages'' section, the parties to a formal complaint
proceeding do not have the authority to waive statutory deadlines, with
the exception of the section 271(d)(6)(B) ninety-day deadline. Even if
the parties did have such authority, a rule that allowed a party to
waive a statutory deadline by filing any type of interlocutory motion
would provide a means for such party to manipulate the deadline and,
thereby, eviscerate the intent of the Act to provide expedited
resolution for certain complaints.
249. We decline to adopt a rule requiring parties to provide notice
of their intent to file a motion because we find that such a
requirement would not further the timely resolution of motions. We do
require parties to certify in any motions to compel discovery that good
faith efforts to resolve the discovery dispute were undertaken prior to
the filing of the motion. That rule will provide early notice of a
party's intent to file such a motion. Other types of motions do not
slow down formal complaint proceedings significantly because, unlike
discovery disputes, they generally do not need to be resolved to enable
parties to support their claims in briefs. Furthermore, the delivery of
all motions will be expedited by our requirement that parties serve all
motions by hand delivery, overnight delivery, or facsimile transmission
followed by mail delivery.
250. We decline to adopt a rule requiring the Commission to rule on
all motions within thirty days. The intent of this rulemaking is to
speed up resolution of formal complaints and, to the extent the early
disposition of a pending motion would further such intent, the
Commission will rule on motions as expeditiously as possible. We do
not, however, see the benefit of constraining Commission staff by
imposing a requirement that all motions be resolved within thirty days.
N. Confidential or Proprietary Information and Materials
251. In 1993, the Commission revised its rules to require a party
asserting the confidentiality of any materials subject to a discovery
request to mark clearly the relevant portions as being proprietary
information. If the proprietary designation is challenged, that party
bears the burden of demonstrating, by a preponderance of
[[Page 1023]]
the evidence, that the material falls under the standards for
nondisclosure enunciated in the Freedom of Information Act (``FOIA'').
a. The NPRM. 252. Because the format and content proposals may
require parties to exchange information and materials with their
initial pleadings, the Commission proposed to allow parties to
designate as confidential or proprietary any materials generated in the
course of a formal complaint, and not limit such designation to
materials produced in response to discovery requests. We sought comment
on this proposal as well as on whether additional procedures were
needed in light of the shortened complaint resolution deadlines in the
Act and our proposals in the NPRM to eliminate certain pleading and
discovery opportunities.
b. Comments. 253. All of the parties who commented agree that the
proposal will encourage parties to exchange information without fear of
public dissemination. While it supports the Commission's goals, ACTA
notes that the potential for abuse exists because parties may
excessively and unnecessarily label documents and information as
confidential or proprietary. MCI requests that the Commission clarify
that information considered confidential due to its proprietary,
sensitive or competitive nature cannot be withheld from production on
that ground.
c. Discussion. 254. We conclude that parties shall be allowed to
designate as confidential or proprietary any materials generated in the
course of a formal complaint proceeding. The commenters support
imposing this requirement. We find that, because all parties may have
information that is both relevant to a dispute and competitively
sensitive, parties must be assured of protection for their confidential
or proprietary information if we want to avoid the time consuming
process of resolving disputes over the treatment of documents and
information sought to be exchanged, regardless of whether the
information is produced in response to discovery requests or not. We
disagree with ACTA's contention that this requirement might be more
subject to abuse than the prior requirement limiting confidential or
proprietary designations to materials produced in response to discovery
requests. We emphasize that designating information or materials as
confidential or proprietary will not prevent the information or
materials from being produced, therefore, parties will have little to
gain by falsely claiming that materials are confidential or
proprietary. Furthermore, if a proprietary designation is challenged,
the party claiming confidentiality will continue to bear the burden of
demonstrating, by a preponderance of the evidence, that the material
designated as proprietary falls under the FOIA's standards for
nondisclosure.
255. The modification of the rule providing for designation of
material disclosed in the course of a formal complaint proceedings is
merely an extension of the previous rule, which allowed for the
designation of materials that were disclosed in response to discovery
as confidential and proprietary. In current practice, parties that
reference facts in or attach materials to briefs that have been
designated as confidential or proprietary serve two copies on opposing
parties, a public copy that has had confidential materials redacted and
is clearly marked ``Public Copy'' and a confidential copy that contains
the material that was redacted from the public copy and is clearly
marked ``Confidential Copy.'' In addition, the filing party files the
public copy with the Office of the Secretary and files the confidential
copy directly with the Commission staff attorney that is handling the
matter. This practice will not change. In addition, where a complainant
references facts in or attaches materials to its complaint that have
been designated as confidential or proprietary, the procedure is
substantially the same. A confidential copy of the complaint must be
filed under seal directly with the Branch Chief on which it is required
to serve two copies of the complaint.
O. Other Required Submissions
1. Joint Statement of Stipulated Facts. a. The NPRM. 256. The NPRM
proposed to require parties to submit a joint statement of stipulated
facts and key legal issues five days after the answer is filed. We
noted that the ``rocket docket'' rules in the United States District
Court for the Eastern District of Virginia require parties to submit
written stipulations of all uncontested facts prior to trial. We stated
our belief that requiring the parties to submit a joint statement of
stipulated facts and key legal issues at this stage might promote
agreement on a significant number of the disputed facts and legal
issues, as well as help the Commission to determine whether or to what
extent discovery is necessary.
b. Comments. 257. Most parties support this proposal. Many
commenters, however, suggest that the joint statement be submitted
later in the process to give parties more time to meet and negotiate. U
S West additionally suggests requiring a joint statement of facts in
dispute. Bechtel & Cole suggest requiring a joint statement that
includes an outline of factual claims and legal arguments, and
BellSouth suggests permitting parties to file unilateral statements if
the parties cannot reach agreement in time. PTG opposes requiring a
filing of a joint statement of facts because it believes that parties
would never stipulate to facts. CompTel also opposes the proposal,
arguing that nothing will be gained because parties will maintain the
same positions taken in their fact-based complaints or answers.
c. Discussion. 258. We conclude that parties shall be required to
submit a joint statement of stipulated facts and key legal issues. We
find that the drafting of such a statement, including the discussions
between the parties that are necessary to the drafting of such a
document, will promote settlement among the parties or, at the very
least, narrow the factual and legal issues the Commission will need to
resolve. The joint statement will further assist the Commission in
discerning exactly what the parties believe to be the most important
issues. We disagree with PTG's argument that the proposal should be
rejected because parties will be unable to stipulate to any facts. We
find it highly improbable that parties will be unable to stipulate to
any facts whatsoever. We further conclude, after consideration of U S
West's proposal, that parties shall be required to file a joint
statement of disputed facts because such a document will pinpoint the
exact facts in dispute. Thus, even where parties are unable to agree on
a single fact, that can be made clear to the staff through the joint
statement because it will include disputed facts. A clear and
unequivocal identification of the issues on which the parties cannot
agree will be especially beneficial to Commission staff when it is
resolving the need for requested discovery at an initial status
conference. We also disagree with CompTel's argument that parties will
simply maintain the same positions taken in their complaints and
answers. We find that compelling parties to meet after submission of
the complaint, answer, and any necessary reply will encourage parties
to negotiate their positions, resulting in agreement on some issues
and, at a minimum, clarification of the areas in which they disagree.
Indeed, we have occasionally required parties to submit stipulations of
fact in past complaints, and have found that the parties often are able
to reduce significantly the legal and factual issues in dispute.
[[Page 1024]]
259. Because several commenters expressed concerns about the timing
of the joint statement of stipulated facts, disputed facts and key
legal issues, we have extended the time for the filing of the
statement. Such joint statement shall be submitted to the Commission by
no later than two business days prior to the initial status conference.
We conclude that it would provide less of a benefit to the complaint
proceeding if we extended the filing date of the joint statement any
further. We have timed the filing of the joint statement to coincide
with our requirements for interrogatory requests and the ``meet and
confer'' conference that must take place prior to the initial status
conference. We find that it is important to require the parties to
discuss the factual and legal issues at this particular stage. Parties
will have just reviewed the opposing parties' initial pleadings,
documentation, and interrogatories but will not yet have participated
in the more formal initial status conference. Compelling parties to
disclose their positions on all issues in an informal manner, prior to
the initial status conference, may be more productive in terms of
settling or narrowing the issues than if the same discussion took place
after the initial status conference. The parties may feel obliged to
take firm positions on the issues in dispute after the initial status
conference has occurred. Furthermore, we emphasize that the staff has
discretion to grant additional time to submit the joint statement where
necessary or appropriate.
260. We reject BellSouth's suggestion to allow the filing of
unilateral statements. The joint statement is beneficial in large part
because it is a single document and does not require the Commission to
compare two documents to determine on which facts, each articulated
slightly differently in the separate documents, the parties agree and
disagree. The other significant benefit arises from requiring the
parties to meet and discuss all relevant facts and fully articulate
their disagreements. Neither of these benefits would be obtained by
allowing the parties to file unilateral documents, which would most
likely be highly repetitive of the facts laid out in the complaint,
answer and any necessary reply. Although Bechtel & Cole suggests that
the joint statement include an outline of factual claims and legal
arguments, we conclude that the requirement we adopt here effectively
encompasses this suggestion.
2. Briefs. a. The NPRM. 261. The NPRM sought comment on changes to
our current briefing process. First, we sought comment on prohibiting
the filing of briefs in cases in which discovery is not conducted and
requiring parties to include proposed findings of fact, conclusions of
law and legal analysis with their complaints and answers. We sought
comment on whether parties could reasonably prepare proposed findings
of fact, conclusions of law and legal analysis before reviewing the
responses to their pleadings and statements of stipulated facts.
Second, we sought comment on continuing to allow parties to file
briefs, but permitting the Commission staff to limit the scope of such
briefs. This option would add some delay to the process but would
enable the parties to review both sides of the case before briefing
their legal arguments to the Commission.
262. We also sought comment on whether the staff should be
permitted to set the timetable for completion of any briefs to give the
staff maximum flexibility and control in order to meet the various
statutory resolution deadlines. We also asked parties to identify
reasonable timetables for completion of such briefs. The NPRM proposed
to limit initial briefs to twenty-five pages and reply briefs to ten
pages in all cases.
b. Comments. 263. Bell Atlantic and NYNEX support the proposal to
prohibit briefs in cases in which discovery is not conducted. Bell
Atlantic argues that under the pre-filing procedures, parties will have
sufficient notice of the nature and basis of the complaint to argue the
legal issues fully in the complaint and answer. NYNEX states that, if
the Commission adopts its proposals to require the complainant to
include all of the legal and factual support in the initial filing,
subsequent briefs would be superfluous. Both Bell Atlantic and NYNEX
agree that, while briefs will probably be unnecessary in most cases in
which discovery is not conducted, parties should be able to ask, at the
initial status conference, for permission to file briefs on certain
narrowly-tailored issues. Most of the commenters feel that parties must
be allowed to file briefs because parties may lack the requisite
information to file findings of fact and conclusions of law in their
complaints and answers. For example, GST, MCI, PTG, Sprint, and U S
West argue that parties cannot be expected to submit findings of fact,
conclusions of law, and legal analysis prior to reviewing their
opponents' pleadings. AT&T argues that briefs are necessary to complete
the record.
264. AT&T, Bell Atlantic, GST, KMC, MFS, GTE, MCI, and SWBT support
the proposal to allow the staff to limit the scope of briefs. GTE
states that permitting parties to file briefs but limiting the subjects
of those briefs will expedite the complaint process while allowing each
party to establish a complete record. MCI argues that the initial
status conference will enable the Commission to tailor the briefing
process to fit the needs of each individual case. ACTA, ICG, and PTG,
however, oppose permitting staff to limit the scope of briefs, arguing
that parties must be permitted to argue their cases as they see fit and
on the issues they deem relevant. CBT supports allowing the staff to
limit the scope of briefs to disputed issues only, but argues that
imposing any further limitations might prejudge the outcome of the
case.
265. The commenters support the proposal to reduce the time in
which briefs must be filed. Several parties suggested specific
timetables, while others were comfortable with allowing the Commission
to set the timetable at the initial status conference.
266. Most commenters support the proposal to reduce brief page
limits to twenty-five pages for initial briefs and ten pages for reply
briefs. Several commenters, such as AT&T and PTG, request that the
staff be able to set flexible page limits or that the parties be
permitted to file for leave to file longer briefs. ACTA, ICG, and the
cable entities argue that a twenty-five page limit is insufficient.
c. Discussion. 267. The format and content rules adopted in this
proceeding require that complaints, answers, and any necessary replies
contain complete legal analysis, full documentary support, and proposed
findings of fact, conclusions of law at the time of filing. It has been
our experience that parties have used the briefing opportunity to file
documents that merely restate the arguments already contained in the
complaint, answer, and reply in cases in which discovery is not
conducted. In those cases where discovery is conducted and new material
facts are introduced into the case as a result of such discovery,
briefs are necessary to provide the parties the opportunity to revise
or further support their existing analysis in light of the new
information disclosed. Eliminating briefs where discovery is not
conducted, however, will avoid wasting the Commission's resources
reviewing documents that are of little utility, as well as provide
parties with incentive to submit complete and fully documented
complaints, answers, and replies initially. Thus, we conclude that
parties shall be generally prohibited from filing briefs in cases in
which no discovery is conducted. The
[[Page 1025]]
commenters who oppose this proposal are concerned that parties might
lack the information necessary to file findings of fact and conclusions
of law in their complaints and answers, or that briefs are needed to
complete the record. As noted by Bell Atlantic and NYNEX, however,
under the new pre-filing activities and format and content
requirements, complainants and defendants alike should have sufficient
information with which to prepare and file proposed findings of fact
and conclusions of law in their complaints, answers, and necessary
replies. We emphasize that this rule is not a complete prohibition on
the filing briefs in cases in which discovery is not conducted. The
Commission may request briefs where briefing would be helpful or is
necessary. Further, where a party believes that briefing is essential
to fully present its case, it may request such briefing and explain to
the Commission why briefing is necessary in that particular case. We
note that parties may still file briefs as a matter of right in cases
in which discovery is conducted.
268. In those cases in which briefs are permitted, each party is
required to attach all documents upon which it intends to rely to its
briefs. Parties are permitted to attach to their briefs documents that
were previously identified, and affidavits of persons previously
identified, in their information designations, along with a full
explanation in the brief of the material's relevance to the issues and
matters in dispute. Such materials need not have been attached to the
complaint, answer, or necessary reply.
269. In those cases in which briefs are permitted, such briefs are
required to include all legal and factual claims and defenses
previously set forth in the complaint, answer or any other prior
pleading submitted in the proceeding that the parties wish the
Commission to consider in rendering its decision. Claims and defenses
previously made but not reflected in the briefs shall be deemed
abandoned. Where, however, the staff limits the scope of the briefs in
a manner that does not permit parties to include claims previously
raised, the failure to include claims previously raised will not be
deemed to be an abandonment of such claims. Although the NPRM did not
specifically propose to require briefs to include all claims previously
set forth in the proceeding, we find that this requirement will
maximize the utility of briefs. Authorized briefs are a means to
facilitate the staff's ability to identify readily all legal and
factual claims and defenses made by the parties, along with full
citations to the law and the evidentiary record. This requirement
should minimize the need for the staff to sift through multiple
pleadings submitted by the parties in an effort to identify and address
each of their respective claims. In addition, this requirement will
prevent staff from having to rule on claims of questionable merit that
were identified in initial pleadings, but that the parties do not
intend to support or rely on in their briefs.
270. The Commission may limit the scope of any authorized briefs
where appropriate, and set timetables for the filing of such briefs.
Most of the commenters support these requirements, because they
understand that the Commission needs such limitations and flexibility
to accomplish its goal of meeting the statutory deadlines provided for
in the Act and expediting the processing of all formal complaints.
ACTA, CBT, ICG, and PTG argue that the staff should not limit the scope
of briefs because parties should be permitted to brief the issues that
the parties themselves deem relevant. These commenters ignore, however,
that parties are given the opportunity to file proposed findings of
fact and conclusions of law and a complete legal analysis on the issues
they deem relevant with their complaint, answer and any necessary
reply. To the extent that discovery discloses new material facts,
briefs are allowed as a matter of right. The parties also have several
opportunities to explain to the staff why particular issues should be
briefed. The staff's decision regarding the scope and timing of briefs
will be based on the content of the parties' initial pleadings and
their joint statement, as well as on information garnered from
discussions with the parties at the initial status conference and any
other status conferences held. Through these vehicles, parties have an
opportunity to identify issues they feel should be briefed and to
explain any special circumstances that may warrant a shorter or longer
filing time for briefs. Limiting the scope of briefs, when appropriate,
will help avoid unnecessary or redundant pleadings that do not
facilitate the decision-making process. The Commission's discretion to
set timetables on a case-by-case basis for the completion of briefs
will help to tailor schedules to the needs of individual complaints.
271. The page limits for allowed briefs shall be twenty-five pages
for initial briefs and ten pages for reply briefs. The statutory
deadlines imposed by the Act place great burdens on the Commission to
evaluate briefs and prepare recommended decisions within short
timeframes. We find that reducing the page limits for initial briefs
and reply briefs to twenty-five and ten pages, respectively, should
yield more focused and concise legal and factual arguments, as well as
discourage the filing of briefs containing unnecessary and redundant
information. We adopt the suggestion of several commenters to permit
parties to request leave to file longer briefs. This provision should
alleviate the concern of certain commenters that the page limits may be
insufficient in some cases. Parties shall be granted waivers of these
page limits for good cause shown.
3. Commenters' Additional Suggestions. a. The NPRM. 272. The NPRM
asked commenters to identify alternative procedures that would
facilitate the preparation and submission of clear and concise briefs
within the time constraints imposed by the Act.
b. Comments. 273. AT&T, ICG, MCI, SWBT, and U S West suggest that
the briefing process should mirror that used in federal district court,
in which the complainant files a single initial brief, followed by the
defendant's opposition brief, followed by the complainant's reply
brief. They argue that simultaneous briefing forces a defendant to
reply to a position not yet articulated, and does not give a
complainant an opportunity to reply to a defendant's reply brief, while
sequential briefing permits parties to meet each other's arguments
directly.
c. Discussion. 274. We decline to adopt the suggestions of AT&T,
ICG, MCI, SWBT, and U S West to require a sequential briefing process.
Sequential briefing consists of three stages: the complainant's initial
brief, the defendant's opposition brief, and the complainant's reply
brief. Each party must be provided with sufficient time to respond to
the brief filed in the preceding stage. We conclude that simultaneous
briefing, which can be accomplished in two stages (initial brief and
reply brief) is more appropriate in light of the time constraints
imposed by the Act. While sequential briefing is appropriate in a
notice-pleading context, in which the parties may lack information
regarding the positions of opposing parties, the benefits to be gained
by sequential briefing under the Commission's fact-pleading rules are
minimal. Under the requirements imposed in this proceeding, parties
must submit fact-pleadings and a joint statement of disputed and
undisputed facts and key legal issues, as well as attend an early
status conference, where the scope of the briefing will be discussed
and may be limited. We find
[[Page 1026]]
that these requirements will ensure that parties are fully aware of
their opponents' positions on all key factual and legal issues by the
briefing stage. Simultaneous briefing should not result in parties
being prejudiced in any way.
P. Sanctions
275. The NPRM proposed rules that will place greater burdens on
complainants and defendants to be more diligent when presenting or
defending against allegations of misconduct in violation of the Act or
the Commission's rules. Such diligence must be enforced in order to
meet the complaint resolution deadlines contained in the Act and attain
the goal of generally improving the formal complaint process.
a. The NPRM. 276. In the NPRM, we outlined the need for sanctions
which would provide sufficient incentives to ensure compliance with the
new rules. We asked interested parties to provide us with their
proposals for appropriate sanctions. We provided several examples of
specific sanctions for certain anticipated rules violations, including:
(1) summary dismissal of a complaint for a complainant's failure to
satisfy format and content requirements; (2) summary ruling or other
judgment in favor of the complainant for a defendant's failure to
respond fully and with specificity to a complainant's allegations; and
(3) the imposition of monetary fines under the Act's forfeiture
provisions for failure to file pleadings in accordance with our rules.
We asked parties to comment on these and other alternatives that might
help to ensure full compliance with the expedited complaint procedures
proposed in the NPRM.
b. Comments. 277. Most of the parties who commented generally
support the proposed sanctions. Most state that failure to satisfy the
form and content requirements should result in summary dismissal of the
complaint without prejudice. GST, GTE, KMC, MFS and SWBT argue that, in
most cases, the imposition of monetary forfeitures would be preferable
to summary grant or dismissal, which they contend should be used only
for: (1) failure by complainants to set forth allegations with
specificity; (2) failure by defendants to respond to the complaint; or
(3) failure by either party to certify that they engaged in good faith
settlement attempts. CBT, GST, KMC, and MFS suggest issuing a notice of
deficiency or show cause order prior to imposing a sanction. MCI
suggests that a defendant should be penalized for its failure to
cooperate in the pre-filing stages of a complaint proceeding by
permitting the complainant to file a complaint without sufficient facts
or documentation. MCI also suggests that a complainant should be
penalized for its failure to cooperate in the pre-filing stages by
permitting general denials where the defendant lacks necessary
information. U S West argues that, because parties seldom violate the
Commission's rules, the Commission should make quick and decisive
rulings in discovery conflicts rather than emphasize sanctions.
Communications Venture Services, Inc. (``CVS'') and SWBT suggest
imposing sanctions on attorneys as well as clients. ACTA states that
the Commission should draw an adverse inference as to material facts to
sanction discovery abuses or failure to comply with discovery rulings.
c. Discussion. 278. We conclude that no rule modifications are
necessary with regard to sanctions at this time. We have at our
disposal a wide range of sanctions to address violations or abuses of
our formal complaint rules, including summary grant or dismissal of a
complaint (in whole or in part), the drawing of adverse inferences as
to material facts, monetary forfeitures, admonishment rulings, and show
cause proceedings. Because sanctionable behavior may entail a wide
range of conduct by complainants and defendant carriers, the Commission
has considerable discretion to tailor sanctions to the individual
circumstances of a particular violation. Sanctions for a failure to
meet pleading requirements should be directed at the nature of the
failure. For example, a complainant that fails to properly support a
statement of material fact may have such statement treated as an
unproven assertion. Sanctions for discovery abuses should provide
sufficient incentives for parties to view full and early disclosure as
preferable to any potential benefits from dilatory tactics.
Q. Other Matters
279. The NPRM sought comment on the meaning of the term ``act on''
in section 271(d)(6)(B) of the Act pertaining to complaints concerning
failures by BOCs to meet conditions required for approval to provide
in-region interLATA services. In addition, the Commission stated in the
Sections 260, 274, 275 First Report and Order and the Sections 260,
274, 275 Second Report and Order that certain issues concerning
possible evidentiary standards for complaints alleging violations of
sections 260, 274, and 275 would be addressed in the Formal Complaints
rulemaking proceeding.
a. Section 271. i. The NPRM. 280. Section 271(d)(6)(B) of the Act
provides that the Commission shall ``act on'' complaints alleging
certain violations of the section within ninety days of the date filed,
unless otherwise agreed to by the parties. This is in contrast to other
complaint provisions added by the 1996 Act which mandate ``final''
action by the Commission within prescribed time periods. We tentatively
concluded in the NPRM that ``act on'' as used in section 271(d)(6)(B)
may be satisfied, where appropriate, by a determination of the Common
Carrier Bureau whether a BOC has ceased to meet the conditions required
for approval to provide in-region interLATA services, and need not
require final action by the full Commission. We sought comment on this
tentative conclusion and on the appropriate procedure or mechanism for
early notice to the Commission of the parties' agreement to extend or
waive the ninety-day resolution deadline.
ii. Comments. 281. Commenters disagree on the meaning of ``act on''
in section 271(d)(6)(B). BellSouth, CompTel, GST, KMC, MFS, and MCI
state that a Common Carrier Bureau decision constitutes ``acting on''
within the meaning of section 271(d)(6)(B) because the abbreviated
deadline for resolution is a statutory mandate for prompt relief, which
would not be fulfilled by waiting for a decision by the entire
Commission. In addition, MCI argues that a Common Carrier Bureau
decision is sufficient because the right to decide cases under section
271(d)(6)(B) is not specifically reserved to the Commission under
Sec. 0.291 of the Commission's rules. CVS, NYNEX, ICG, PTG, and SWBT,
however, argue that section 271(d)(6)(B) requires a Commission decision
because it would be contrary to Congressional intent to deny parties
the immediate right of judicial review. PTG argues that the Commission
must decide section 271(d)(6)(B) cases because, under Sec. 0.291, the
Commission has not delegated its authority to designate for hearing any
formal complaints which present ``novel questions of fact, law or
policy[,]'' nor to ``impose, reduce, or cancel forfeitures pursuant to
Section 203 or Section 503(b) * * * in amounts of more than $80,000.''
282. Regarding the notification of waiver of the section
271(d)(6)(B) ninety-day deadline, BellSouth suggests that the
complainant be required to indicate its willingness to waive the
ninety-day resolution deadline in the formal complaint intake form
proposed by the Commission to aid in the preparation and filing of
formal complaints. GST, KMC, and MFS
[[Page 1027]]
suggest that such agreement take place during ``meet and confer''
conferences, which would occur prior to the initial status conferences
pursuant to other proposals in the NPRM.
iii. Discussion. 283. Notwithstanding our tentative conclusion in
the NPRM that a decision by the Common Carrier Bureau on the merits of
the complaint satisfies the ``act on'' requirement in section
271(d)(6)(B), we conclude that we need not address this issue in this
Report and Order. We recognize the importance that Congress assigned to
the resolution of complaints alleging violations of the competitive
checklist requirements as reflected in the ninety-day ``act on''
requirement. We fully intend to act promptly on all matters pertaining
to those requirements to assure that full effect is given to the
competitive goals underlying section 271 of the Act.
284. To facilitate our handling of section 271(d)(6)(B) complaints,
we adopt a rule requiring parties to indicate whether they are willing
to waive the ninety-day deadline in their initial filings to the
Commission or, at the very latest, by the date of the initial status
conference. Parties will have the opportunity to reach an agreement
about waiver of the section 271(d)(6)(B) ninety-day deadline during the
pre-filing activities. A complainant should indicate whether or not it
is willing to waive the ninety-day deadline in the formal complaint
intake form accompanying the complaint. The defendant carrier will have
opportunity to respond to the complainant's request for waiver either
in its answer or at some earlier date. Parties will have an additional
opportunity to discuss the waiver of the ninety-day deadline in their
``meet and confer'' held prior to the initial status conference.
Because meeting a resolution deadline of ninety days will require both
strong commitment and meticulous preparation at the very start of the
complaint process, from the parties and from the Commission, a request
by the parties to waive the ninety-day deadline will be not considered
after the initial status conference. Permitting parties to waive the
ninety-day deadline at any point in the complaint process could result
in the wasteful expenditure of time and resources by the staff and the
parties. In addition, we note that even if the parties agree to waive
the ninety-day deadline in a section 271(d)(6)(B) case, it is our
intent to resolve such cases as expeditiously as possible. Thus,
parties should not relax their diligence in meeting our format and
content requirements to the fullest extent possible as a consequence of
having agreed to waive the ninety-day deadline.
b. Sections 260, 274 and 275 of the Act. 285. In the Sections 260,
274, 275 First Report and Order, 62 FR 7690 (February 20, 1997), and
the Sections 260, 274, 275 Second Report and Order, 62 FR 16093 (April
4, 1997), we deferred to the Formal Complaints rulemaking the issue of
what specific acts or omissions might be sufficient to state a prima
facie claim for relief under sections 260, 274, and 275. In that same
proceeding, we noted that the complainant has the burden of
establishing that a carrier has violated the Act or a Commission rule
or order and that burden generally does not shift at any time to the
defendant carrier. We also deferred to the Formal Complaints rulemaking
the issue of whether shifting the burden of proof from the complainant
to the defendant in complaints alleging violations of sections 260,
274, and 275 would advance the pro-competitive goals of the Act.
i. Prima facie Claim. (a). The Sections 260, 274, 275 NPRM. 286. In
the Sections 260, 274, 275 NPRM, 61 FR 39385 (July 29, 1996), we asked
parties to comment on what prima facie showing should be required of a
complainant who alleges that an incumbent LEC has violated sections 260
or 275, or that a BOC has violated section 274. Commenters were asked
to describe what specific acts or omissions would constitute a prima
facie claim for relief under those sections of the Act.
(b). Comments. 287. Commenters did not address in this rulemaking
the issue of what acts or omissions might constitute a prima facie
claim in complaints alleging violation of sections 260, 274, and 275.
In response to the Sections 260, 274, 275 NPRM, however, many parties
commented on this issue. Several commenters contend that the same
standard for a prima facie case should apply to all complaints,
including complaints alleging violations of sections 260, 274, or 275;
that is, a complainant would establish a prima facie case by alleging
facts that, if true, would constitute a violation of the Act. Several
parties, however, suggest specific standards for stating a prima facie
claim for relief under sections 260, 274, and 275. ATSI states that a
complainant alleging a violation of section 260 should be allowed to
establish a prima facie case by any showing of denied or delayed
access, or any showing of cost or quality differentials between the
incumbent's own telemessaging operations and those offered by the
complainant. ATSI further suggests that the Commission establish
certain safeguards to prevent anti-competitive conduct, and declare
that facts demonstrating a violation of these safeguards should be
sufficient to state a prima facie case of unlawfulness. According to
ATSI, because section 260 was not intended to ``mimic a legal
proceeding'' complainants should not have to undertake costly or time-
consuming preparatory work prior to filing a complaint.
288. A number of commenters oppose ATSI's proposals. U S West
argues that a section 260 complaint is a legal proceeding in which both
the complainant's and defendant's rights should be respected. BellSouth
maintains that a prima facie case should include specific allegations
of fact showing that a defendant carrier has engaged in prohibited
discrimination or cross-subsidization. A number of other commenters
argue that ATSI's proposals, if adopted, would open the floodgates for
unsubstantiated complaints against the incumbent LECs and their
affiliates.
289. NYNEX states that, in order to establish a prima facie case
pursuant to section 274, the complaint would have to contain a
description of the complainant and its interest; be sworn and notarized
and state with particularity the facts on which the complaint is based,
distinguishing between facts based on personal knowledge and facts
based on information and belief; provide a verifiable source of
statements based on information and belief; be accompanied by
supporting documentation; and identify materials the complainant has
been unable to obtain after due inquiry which it asserts are in the
possession of the BOC or its separate affiliate.
(c). Discussion. 290. We decline to adopt a rule prescribing
specific acts or omissions that would be prima facie unlawful under
sections 260, 274, and 275. Instead, we will review section 260, 274,
or 275 complaints on a case-by-case basis to resolve compliance issues.
We believe that, beyond the specific requirements of the Act and the
Commission's implementing rules and orders, it would be impracticable
to attempt to delineate specific acts or omissions that would
constitute violations of sections 260, 274 and 275. Acts or omissions
that might raise the specter of violations under sections 260, 274 and
275 are likely to vary widely. Moreover, it is possible that a
particular act or omission deemed unlawful in one context may be
perfectly reasonable in another. Therefore we will continue our
existing practice of requiring that, in the context of a section 208
complaint proceeding, a prima facie showing must
[[Page 1028]]
include allegations of fact, which if true, would establish that a BOC
has violated the Act or any implementing rule or order.
ii. Shifting the Burden of Proof to Defendant Carriers in
Complaints Alleging Violations of Sections 260, 274 and 275 of the Act.
(a). The Section 260, 274, 275 NPRM. 291. In the Sections 260, 274, 275
NPRM, we noted that in a formal complaint proceeding the complainant
generally has the burden of establishing, by a preponderance of the
evidence, that a common carrier has violated the Act or a Commission
rule or order. Ordinarily, this burden of proof does not, at any time
in the proceeding, shift to the defendant carrier. We sought comment in
the Sections 260, 274, 275 NPRM on whether, for purposes of complaints
arising under Sections 260, 274, 275, shifting the ultimate burden of
proof from the complainant to the defendant would advance the pro-
competitive goals of the Act.
(b). Comments. 292. Commenters did not address in this rulemaking
the issue of shifting the burden of proof from the complainant to the
defendant BOC or incumbent LEC in complaints alleging violations of
Sections 260, 274, and 275. A number of parties, however, commented on
this issue in response to the Sections 260, 274, 275 NPRM. The BOCs
oppose shifting the burden of proof to the defendant carrier after a
complainant establishes a prima facie case, arguing that such a
practice would force defendants to prove a negative; e.g., lack of
undue delay, unavailability of requested services, or technical
impossibility. The BOCs assert that the Administrative Procedures Act
(``APA'') requires that the burden of persuasion in complaint cases
remain on the complainant throughout and that shifting the burden of
proof in the manner proposed would encourage the filing of frivolous
complaints. SWBT and U S West object to shifting the burden of proof in
section 274 cases, claiming that, because section 274 has no statutory
resolution deadline and complainants have the option of filing their
claims in federal district court, burden shifting would promote ``forum
shopping'' by parties wishing to litigate their claims before the
Commission under more relaxed standards. In addition, U S West argues
that shifting the burden in section 274 cases would be particularly
inappropriate because section 274 involves First Amendment (private and
commercial speech) issues. BellSouth and PTG state that a defendant
would bear the burden of producing evidence only if it asserted an
affirmative defense, such as the reasonableness of its actions.
Ameritech and PTG concede that, at most, a defendant might be expected
to bear the burden of production, but not of persuasion. NYNEX proposes
that, rather than shifting the burden of proof to a defendant after a
complainant has established a prima facie case, a defendant should be
required to provide: (1) a sworn and notarized response containing an
admission or denial of all allegations in the complaint; (2) a summary
of the facts on which the response is based, distinguishing between
facts based on personal knowledge and facts based on information and
belief; (3) a verifiable source of statements based on information and
belief; (4) its defenses; and (5) supporting documentation if available
or if it can be reasonably acquired within the time allowed for
response.
293. ATSI, AT&T, AICC, MCI, and Voice-Tel all support shifting the
burden of proof to defendants once the complainant has established a
prima facie case. These commenters maintain that burden shifting is
appropriate in section 260, 274 and 275 cases because of short
resolution deadlines and the fact that the relevant information will
generally be in the possession or control of the defendant BOC or
incumbent LEC. AICC states that the BOCs' argument that the APA
prohibits shifting the burden of proof to a defendant is inapplicable
to section 275, because the applicable section of the APA, section 556,
only pertains to certain hearings and rulemakings required by sections
553 and 554, respectively, of the APA. AICC adds that the Commission
should follow its tentative conclusion in the BOC In-Region NPRM, 61 FR
39397 (July 29, 1996), and not adopt a presumption of reasonableness
favoring an incumbent LEC or its alarm monitoring affiliate when
reviewing complaints alleging violations of section 275.
(c). Discussion. 294. We decline to adopt a rule that would shift
the burden of proof to defendant BOCs or incumbent LECs in expedited
complaint proceedings pursuant to sections 260, 274 and 275 of the Act.
We do not agree with the arguments of many commenters that shifting the
burden of proof in such cases is necessary to advance the pro-
competitive goals of the 1996 Act. Nor do we agree that a rule is
required to formally shift the burden of production to a defendant
carrier after a complainant has demonstrated a prima facie case of a
violation of section 260, 274, or 275. The rules adopted in this
proceeding, particularly those pertaining to pre-filing activities and
the form and content of pleadings, are designed specifically to require
both complainants and defendants to exercise diligence in presenting
and defending against alleged violations of sections 260, 274 and 275,
as well as other sections of the Act. The new rules require full
identification of relevant documents and information in the possession,
or within the control, of both the complainant and defendant carrier,
along with prompt production or exchange of the information the parties
intend to rely on in presenting and defending against claims of
unlawfulness under provisions of the Act and the Commission's rules and
orders.
295. In addition, the staff retains in all cases the discretion to
effectively shift the burden of production in particular cases by
directing defendant carriers to produce relevant information deemed to
be within their exclusive possession or control. We note that this
discretion is conferred under section 208 of the Act which authorizes
the Commission to investigate complaints ``by such means and in such
manner as it shall deem proper.'' Moreover, even in the absence of such
action by the staff, it will be incumbent upon a defendant carrier to
respond fully to any prima facie showing made by a complainant, with
full legal and evidentiary support. A defendant that fails to provide
such a response runs the risk of an adverse ruling or an adverse
inference on a material fact.
296. We note that our decision not to adopt a rule to formally
shift the burden of production to a defendant carrier after a
complainant has demonstrated a prima facie violation of section 260,
274, or 275 is in contrast to our decision regarding section
271(d)(6)(B) complaints in the BOC In-Region Order, 62 FR 2927 (January
21, 1997). There, we concluded that the burden of production with
respect to an issue will shift to the defendant BOC after a complainant
has made a prima facie showing that the BOC has ceased to meet the
conditions for its approval to provide interLATA services under section
271(d)(3). The specificity and nature of the competitive checklist
requirements that would form the basis of a section 271(d)(6)(B)
complaint justify a rule requiring a defendant BOC to come forward with
evidence of continued compliance with section 271(d)(3). It would be
difficult, however, to attempt to anticipate all of the various factual
circumstances that could form the basis of section 260, 274, or 275
complaints. A rule that would automatically shift the burden of
production in all cases would be
[[Page 1029]]
prejudicial or otherwise unreasonably burdensome on defendant carriers.
As discussed in the preceding paragraph, the new rules give Commission
staff ample authority to effectively shift the burden of production in
cases where it is necessary to promote the full and fair resolution of
the matters in dispute.
297. Finally, we conclude, as we did in our BOC In-Region Order,
that we should not employ a presumption of reasonableness in favor of
incumbent LECs in complaint actions under sections 260 and 275,
regardless of whether the incumbent LEC is regulated as a dominant or
non-dominant carrier. As we pointed out in the BOC In-Region Order, the
``presumption of lawfulness given to non-dominant carrier rates and
practices is employed in the context of complaints alleging violations
of sections 201(b) and 202(a) of the Act, where the complainant must
demonstrate that the defendant's rates and practices are `` 'unjust and
unreasonable.' '' Sections 260 and 275 contain unqualified prohibitions
on discrimination by incumbent LECs and do not require considerations
of reasonableness as is the case under sections 201(b) and 202(a).
IV. Conclusion
298. In this Report and Order, we amend our rules governing the
filing of formal complaints to implement certain complaint provisions
added or amended by the 1996 Act, as well as to facilitate the full and
fair resolution of all complaints filed against common carriers before
the Commission. These rules of practice and procedure will promote
competition in all telecommunications markets by providing a forum for
the prompt resolution of complaints of unreasonable, discriminatory, or
otherwise unlawful conduct by telecommunications carriers.
V. Procedural Matters
A. Petitions for Reconsideration and Ex Parte Presentations
299. Parties must file any petitions for reconsideration of this
Report and Order within thirty days from publication in the Federal
Register. Parties may file oppositions to the petitions for
reconsideration pursuant to Sec. 1.106(g) of the rules.
300. To file a petition for reconsideration in this proceeding,
parties must file an original and ten copies of all petitions and
oppositions. Petitions and oppositions should be sent to the Office of
the Secretary, Federal Communications Commission, Washington, D.C.
20554. If parties want each Commissioner to have a personal copy of
their documents, an original plus fourteen copies must be filed. In
addition, participants should submit two additional copies directly to
the Common Carrier Bureau, Enforcement Division, Room 6008, 2025 M
Street, N.W., Washington, D.C. 20554. The petitions and oppositions
will be available for public inspection during regular business hours
in the Dockets Reference Room (Room 230) of the Federal Communications
Commission, 1919 M Street, N.W., Washington, D.C. 20554. Copies of the
petition and any subsequently filed documents in this matter may be
obtained from ITS, Inc., 2100 M Street, N.W., Suite 140, Washington,
D.C. 20037, (202) 857-3800.
301. Petitions for reconsideration must comply with Sec. 1.429 and
all other applicable sections of the Commission's rules. Petitions also
must clearly identify the specific portion of this Report and Order for
which relief is sought. If a portion of a party's arguments does not
fall under a particular topic listed in the outline of this Report and
Order, such arguments should be included in a clearly labelled section
at the beginning or end of the filing.
B. Final Regulatory Flexibility Analysis
302. As required by the Regulatory Flexibility Act (``RFA''), an
Initial Regulatory Flexibility Analysis (``IRFA'') was incorporated in
the Implementation of the Telecommunications Act of 1996, Amendment of
Rules Governing Procedures to be Followed When Formal Complaints Are
Filed Against Common Carriers, Notice of Proposed Rulemaking. The
Commission sought written public comment on the NPRM, including comment
on the IRFA. The comments received were not specific to the IRFA, but
are discussed below to the extent they raise concerns or make
suggestions relevant to this analysis. This present Final Regulatory
Flexibility Analysis (``FRFA'') conforms to the RFA.
a. Need for and Objectives of the Implementation of the
Telecommunications Act of 1996, Amendment of Rules Governing Procedures
to be Followed When Formal Complaints Are Filed Against Common
Carriers, Report and Order, and the Rules Adopted Herein. 303. The
Commission is issuing this Report and Order to implement certain
complaint provisions added or amended by the 1996 Act and to improve
generally the speed and effectiveness of our formal complaint process.
The 1996 Act added and, in some cases, amended, key complaint
provisions that, because of their resolution deadlines, necessitate
substantial modification of our current rules and policies for
processing formal complaints filed against common carriers pursuant to
section 208 of the Act. Some of the requirements adopted in this Report
and Order may have a significant impact on a substantial number of
small businesses as defined by section 601(3) of the RFA. Generally,
amended rules will require or encourage complainants and defendants to
engage in certain pre-filing activities, change service requirements,
modify the form of initial pleadings, shorten filing deadlines,
eliminate certain pleading opportunities that do not appear useful or
necessary, and modify the discovery process.
b. Summary of Significant Issues raised by the Public Comments in
Response to the IRFA. 304. In the IRFA, the Commission found that the
rules we proposed to adopt in this proceeding may have a significant
impact on a substantial number of small businesses as defined by
section 601(3) of the RFA. The IRFA solicited comment on alternatives
to our proposed rules that would minimize the impact on small entities
consistent with the objectives of this proceeding. No comments were
submitted directly in response to the IRFA. However, as described below
in Section 5, we have taken into account the comments submitted
generally by small entities.
c. Description and Estimate of the Number of Small Entities to
Which the Rules Adopted in the Report and Order in CC Docket No. 96-238
Will Apply. 305. The RFA generally defines small entity as having the
same meaning as the terms ``small business,'' ``small organization,''
and ``small governmental jurisdictions.'' In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act, 15 U.S.C. 632, unless the Commission has
developed one or more definitions that are appropriate to its
activities. Under the Small Business Act, a ``small business concern''
is one that: (1) is independently owned and operated; (2) is not
dominant in its field of operation; and (3) meets any additional
criteria established by the Small Business Administration (``SBA'').
Moreover, the SBA has defined a small business for Standard Industrial
Classification (``SIC'') categories 4812 (``Radiotelephone
Communications'') and 4813 (``Telephone Communications, Except
Radiotelephone'') to be small entities when they have no more than
1,500 employees. We first discuss the
[[Page 1030]]
estimated number of potential complainants, which may include entities
that are not telephone companies. Next we discuss generally the
estimated number of potential defendants, which would be included in
the total number of small telephone companies falling within the SBA's
definitions of small business concerns and small businesses. Then, we
discuss the number of small businesses within the SIC subcategories,
and attempt to refine further those estimates to correspond with the
categories of telephone companies that are commonly used under our
rules.
306. Consistent with our prior practice, we shall continue to
exclude small incumbent LECs from the definition of ``small entity''
and ``small business concerns'' for the purpose of this FRFA. We do
this because the small incumbent LECs subject to these rules are either
dominant in their field of operations or are not independently owned
and operated, they are excluded from the definition of ``small entity''
and ``small business concerns.'' Out of an abundance of caution,
however, for regulatory flexibility analysis purposes, we will consider
small incumbent LECs within this analysis and use the term ``small
incumbent LECs'' to refer to any incumbent LECs that arguably might be
defined by SBA as ``small business concerns.''
i. Potential Complainants. 307. Section 208(a) provides that formal
complaints against a common carrier may be filed by ``[a]ny person, any
body politic or municipal organization.'' Beyond this definition, the
FCC has no control or information regarding the filing frequency of
complaints, nor identities of parties that will file complaints. The
filing of complaints depends entirely upon the complainant's perception
that it possesses a cause of action against a common carrier subject to
the Act, as amended, and it is the complainant's decision to file its
complaint with the FCC. Therefore we are unable at this time to
estimate the number of future complainants that would qualify as small
business concerns under SBA's definition.
308. As noted, the RFA includes ``small businesses,'' ``small
organizations'' (non-profits), and ``small governmental
jurisdictions.'' Nationwide, there are 4.44 million small business
firms, according to SBA reporting data. A small organization is
generally ``any not-for-profit enterprise which is independently owned
and operated and is not dominant in its field.'' Nationwide, there are
275,801 small organizations. Last, ``small governmental jurisdiction''
generally means ``governments of cities, counties, towns, townships,
villages, school districts, or special districts, with a population of
less than 50,000.'' As of 1992, there were 85,006 such jurisdictions in
the United States.
ii. Potential Defendants. 309. Estimate of Potential Defendants
that may be Classified as Small Businesses. Section 208(a) provides for
the filing of formal complaints for ``anything done or omitted to be
done by any common carrier subject to this Act[.]'' The FCC has no
control as to the filing frequency of complaints because such filing
depends entirely upon the complainant's perception that it possesses a
cause of action against a common carrier subject to the Communications
Act of 1934, as amended, and it is the complainant's decision to file
its complaint with the FCC. This inability to predict the number of
future defendants necessitates conducting this FRFA based on the number
of potential small business defendants, which is the number of common
carriers that qualify as small business concerns under SBA's
definition.
310. Total Number of Telephone Companies Affected. The decisions
and rules adopted herein may have a significant effect on a substantial
number of small telephone companies identified by the SBA. The United
States Bureau of the Census (``Census Bureau'') reports that, at the
end of 1992, there were 3,497 firms engaged in providing telephone
service, as defined therein, for at least one year. This number
contains a variety of different categories of carriers, including local
exchange carriers, interexchange carriers, competitive access
providers, cellular carriers, mobile service carriers, operator service
providers, pay telephone operators, PCS providers, covered SMR
providers, and resellers. It seems certain that some of those 3,497
telephone service firms may not qualify as small entities or small
incumbent LECs because they are not ``independently owned and
operated.'' For example, a PCS provider that is affiliated with an
interexchange carrier having more than 1,500 employees would not meet
the definition of a small business. It seems reasonable to conclude,
therefore, that no more than 3,497 telephone service firms are small
entity telephone service firms or small incumbent LECs that may be
affected by this Order. We estimate below the potential defendants
affected by this order by service category.
311. Wireline Carriers and Service Providers. The SBA has developed
a definition of small entities for telecommunications companies other
than radiotelephone (wireless) companies (Telephone Communications,
Except Radiotelephone). The Census Bureau reports that there were 2,321
such telephone companies in operation for at least one year at the end
of 1992. According to the SBA's definition, a small business telephone
company other than a radiotelephone company is one employing no more
than 1,500 persons. Of the 2,321 non-radiotelephone companies listed by
the Census Bureau, 2,295 companies (or, all but twenty-six) were
reported to have no more than 1,000 employees. Thus, at least 2,295
non-radiotelephone companies might qualify as small incumbent LECs or
small entities based on these employment statistics. However, because
it seems certain that some of these carriers are not independently
owned and operated, this figure necessarily overstates the actual
number of non-radiotelephone companies that would qualify as ``small
business concerns'' under the SBA's definition. Consequently, we
estimate using this methodology that there are no more than 2,295 small
entity telephone communications companies (other than radiotelephone
companies) that may be affected by the actions taken in this Report and
Order.
312. Non-LEC wireline carriers. We next estimate more precisely the
number of non-LEC wireline carriers, including interexchange carriers
(``IXCs''), competitive access providers (``CAPs''), Operator Service
Providers (``OSPs''), Pay Telephone Operators, and resellers that may
be affected by these rules. Because neither the Commission nor the SBA
has developed definitions for small entities specifically applicable to
these wireline service types, the closest applicable definition under
the SBA rules for all these service types is for telephone
communications companies other than radiotelephone (wireless)
companies. However, the TRS data provides an alternative source of
information regarding the number of IXCs, CAPs, OSPs, Pay Telephone
Operators, and resellers nationwide. According to our most recent data:
130 companies reported that they are engaged in the provision of
interexchange services; fifty-seven companies reported that they are
engaged in the provision of competitive access services; twenty-five
companies reported that they are engaged in the provision of operator
services; 271 companies reported that they are engaged in the provision
of pay
[[Page 1031]]
telephone services; and 260 companies reported that they are engaged in
the resale of telephone services and thirty reported being ``other''
toll carriers. Although it seems certain that some of these carriers
are not independently owned and operated, or have more than 1,500
employees, we are unable at this time to estimate with greater
precision the number of IXCs, CAPs, OSPs, Pay Telephone Operators, and
resellers that would qualify as small business concerns under SBA's
definition. Firms filing TRS Worksheets are asked to select a single
category that best describes their operation. As a result, some long
distance carriers describe themselves as resellers, some as OSPs, some
as ``other,'' and some simply as IXCs. Consequently, we estimate that
there are no more than 130 small entity IXCs; fifty-seven small entity
CAPs; twenty-five small entity OSPs; 271 small entity pay telephone
service providers; and 260 small entity providers of resale telephone
service; and thirty ``other'' toll carriers that might be affected by
the actions and rules adopted in this Report and Order.
313. Local Exchange Carriers. Although neither the Commission nor
the SBA has developed a definition of small providers of local exchange
services, we have two methodologies available to us for making these
estimates. The closest applicable definition under SBA rules is for
telephone communications companies other than radiotelephone (wireless)
companies (SIC 4813) (Telephone Communications, Except Radiotelephone)
as previously detailed. Our alternative method for estimation utilizes
the data that we collect annually in connection with the
Telecommunications Relay Service (``TRS''). This data provides us with
the most reliable source of information of which we are aware regarding
the number of LECs nationwide. According to our most recent data, 1,347
companies reported that they were engaged in the provision of local
exchange services. Although it seems certain that some of these
carriers are not independently owned and operated, or have more than
1,500 employees, we are unable at this time to estimate with greater
precision the number of incumbent LECs that would qualify as small
business concerns under SBA's definition. Consequently, we estimate
that there are no more than 1,347 small LECs (including small incumbent
LECs) that may be affected by the actions taken in this Report and
Order.
314. Radiotelephone (Wireless) Carriers: The SBA has developed a
definition of small entities for Wireless (Radiotelephone) Carriers.
The Census Bureau reports that there were 1,176 such companies in
operation for at least one year at the end of 1992. According to the
SBA's definition, a small business radiotelephone company is one
employing no more than 1,500 persons. The Census Bureau also reported
that 1,164 of those radiotelephone companies had no more than 1,000
employees. Thus, even if all of the remaining twelve companies had more
than 1,500 employees, there would still be 1,164 radiotelephone
companies that might qualify as small entities if they are
independently owned and operated. Although it seems certain that some
of these carriers are not independently owned and operated, and, we are
unable to estimate with greater precision the number of radiotelephone
carriers and service providers that would both qualify as small
business concerns under SBA's definition. Consequently, we estimate
that there are no more than 1,164 small entity radiotelephone companies
that might be affected by the actions and rules adopted in this Report
and Order.
315. Cellular and Mobile Service Carriers: In an effort to further
refine our calculation of the number of radiotelephone companies
affected by the rules adopted herein, we consider the categories of
radiotelephone carriers, Cellular Service Carriers and Mobile Service
Carriers. Neither the Commission nor the SBA has developed a definition
of small entities specifically applicable to Cellular Service Carriers
and to Mobile Service Carriers. The closest applicable definition under
SBA rules for both services is for telephone companies other than
radiotelephone (wireless) companies. The most reliable source of
information regarding the number of Cellular Service Carriers and
Mobile Service Carriers nationwide of which we are aware appears to be
the data that we collect annually in connection with the TRS. According
to our most recent data, 792 companies reported that they are engaged
in the provision of cellular services and 138 companies reported that
they are engaged in the provision of mobile services. Although it seems
certain that some of these carriers are not independently owned and
operated, or have more than 1,500 employees, we are unable at this time
to estimate with greater precision the number of Cellular Service
Carriers and Mobile Service Carriers that would qualify as small
business concerns under SBA's definition. Consequently, we estimate
that there are no more than 792 small entity Cellular Service Carriers
and no more than 138 small entity Mobile Service Carriers that might be
affected by the actions and rules adopted in this Report and Order.
316. Broadband PCS Licensees: In an effort to further refine our
calculation of the number of radiotelephone companies affected by the
rules adopted herein, we consider the category of radiotelephone
carriers, Broadband PCS Licensees. The broadband PCS spectrum is
divided into six frequency blocks designated A through F. As set forth
in 47 CFR 24.720(b), the Commission has defined ``small entity'' in the
auctions for Blocks C and F as a firm that had average gross revenues
of less than $40 million in the three previous calendar years. Our
definition of a ``small entity'' in the context of broadband PCS
auctions has been approved by SBA. The Commission has auctioned
broadband PCS licenses in Blocks A through F. We do not have sufficient
data to determine how many small businesses bid successfully for
licenses in Blocks A and B. There were 183 winning bidders that
qualified as small entities in the Blocks C, D, E, and F auctions.
Based on this information, we conclude that the number of broadband PCS
licensees that might be affected by the decisions in this Report and
Order includes, at a minimum, the 183 winning bidders that qualified as
small entities in the Blocks C through F broadband PCS auctions.
d. Description of Projected Reporting, Recordkeeping and other
Compliance Requirements. 317. Below, we analyze the projected
reporting, recordkeeping, and other compliance requirements that may
apply to small entities and small incumbent LECs, and we mention some
of the skills needed to meet these new requirements. Overall, we
anticipate that the impact of these rules will be beneficial to small
businesses and other filers. By requiring better and more complete
submissions earlier in the process, these rules will reduce the need
for discovery and other information filings, thereby significantly
reducing the burden on small entities.
318. Formal Complaint Intake Form. Section 1.721 will require all
complainants to complete and submit a Formal Complaint Intake Form with
their complaints. The intake form requirement is designed to help
complainants avoid procedural and substantive defects that might affect
the staff's ability to quickly process complaints and delay full
responses by defendant carriers to otherwise legitimate complaints. In
addition, the completed form will enable the staff and the defendant
carriers to quickly identify the specific statutory provisions
[[Page 1032]]
under which relief is being sought in the complaint. Because the
proposed form would solicit information that would be already contained
in the body of the formal complaint, no additional professional skills
would be necessary to complete the form. No commenters propose
alternatives to the Formal Complaint Intake Form that would both ease
the burden of small businesses and accomplish the Commission's
objectives.
319. Pre-Filing Activities. The amended rules will require a
complainant to certify that it discussed the possibility of settlement
with the defendant carrier's representative(s) prior to filing the
complaint. Although this may delay slightly a complainant's filing of a
formal complaint, we conclude that this requirement will serve to
settle or narrow disputes, or facilitate the compilation and exchange
of relevant documentation or other information prior to the filing of a
formal complaint with the Commission. No commenters propose
alternatives to the pre-filing activities proposals in the NPRM that
would both ease the burden of small businesses and accomplish the
Commission's objectives.
320. Service. The amended rules will require complainants to
personally serve complaints directly on defendants or their registered
agents for service of process, such that the defendant's time to answer
will begin to run upon receipt of the complaint from the complainant.
Parties will be required to serve all pleadings subsequent to the
complaint by hand delivery, overnight delivery, or by facsimile
transmission followed by regular U.S. mail delivery.
321. Pleadings and Discovery. The complaint, answer, and any
authorized reply must include: (1) full statements of relevant,
material facts with all such documents and affidavits that the party
intends to rely on to support its claims or defenses; (2) the name and
address of each individual likely to have discoverable information
relevant to the disputed facts alleged in the pleadings, identifying
the subjects of information; (3) a description by category and location
of all documents in the possession, custody, or control of the party
that are relevant to the matters in dispute; (4) an inventory of all
documents and affidavits produced or identified and of all individuals
identified; (5) proposed findings of fact, conclusions of law, and
legal analysis. Claims based on information and belief will only be
accepted if they are made in good faith and the complainant states in
an affidavit why the supporting facts could not be reasonably
ascertained. Amendments to complaints will be generally prohibited. The
defendant must file its answer within twenty days after service of the
complaint. General denials are prohibited. Replies will only be
permitted to respond to affirmative defenses and failure to reply to an
affirmative defense will be considered an admission of the affirmative
defense. All motions to compel discovery must contain a certification
that a good faith attempt to resolve the dispute was made prior to
filing the motion. A party's failure to file an opposition to a motion
may constitute grounds for granting the motion. Oppositions to motions
must be filed within five business days of the filing of the motion.
All pleadings that seek Commission orders, as well as the orders
themselves, must contain proposed findings of fact and conclusions of
law, with supporting legal analysis, and these submissions must be
submitted in both hard copy and on computer disks in ``read only'' mode
and formatted in the Commission's wordprocessing program. The parties
will be required to submit a joint statement of stipulated facts,
disputed facts, and key legal issues two days prior to the initial
status conference. Briefs will be generally prohibited in cases in
which no discovery is conducted and staff will have discretion to limit
the scope and timing of any authorized briefs.
322. Self-executing discovery is eliminated and all discovery
requests shall be subject to staff authorization. The complainant must
file and serve ten written interrogatory requests concurrently with its
complaint and the defendant must file and serve ten written
interrogatory requests by the time it serves its answer. The
complainant will be permitted to file and serve an additional five
written interrogatory requests within three calendar days following
service of the answer, provided that such interrogatory requests shall
only be directed at specific factual allegations made by a defendant in
support of its affirmative defenses. Additional ``extraordinary''
discovery in the form of requests for document production, depositions
and additional interrogatories will be generally prohibited. The staff
will consider the interrogatory requests propounded, issue rulings and
direct the parties accordingly at the initial status conference and
retain discretion to limit the scope of permissible interrogatories and
modify or otherwise relax the discovery procedures in particular cases
(including possible document production, depositions, and additional
interrogatories). Staff will have discretion to require the use of
scanning or other technology on an individual case basis where review
of large numbers of documents is necessary.
323. Status Conferences. An initial status conference will take
place ten business days after the filing of the answer unless otherwise
ordered by the staff. Prior to the initial status conference, the
parties must meet and confer regarding: (1) settlement prospects; (2)
discovery; (3) issues in dispute; (4) schedules for pleadings; (5)
joint statements of stipulated facts, disputed facts, and key legal
issues; and (6) in a section 271(d)(6)(B) proceeding, whether the
parties agree to waive the section 271(d)(6)(B) ninety-day resolution
deadline. All proposals agreed to and disputes remaining after the
``meet and confer'' must be reduced to writing and submitted to the
staff two business days prior to the initial status conference. Parties
must submit a joint proposed order of the rulings made in a status
conference within twenty-four hours of the conference, unless otherwise
directed by the staff. Alternatively, if an audio recording or a
stenographer's transcription of a status conference is made, the
parties must submit, within three business days, unless otherwise
directed by the staff, and in lieu of a joint proposed order, either a
transcript of such recording and a copy of the audio recording or a
copy of the stenographer's transcript.
324. These amended rules may place a greater burden on parties,
including small business entities, to decide issues such as discovery
within a short time frame. These rules, however, will enable the
Commission to resolve many preliminary issues efficiently at the
initial status conference and thereby prevent the parties from wasting
resources through delay. The Commission retains the discretion to
reschedule the status conference to provide more time to parties who
are not under statutory deadlines.
325. Cease, Cease and Desist Orders and Other Forms of Interim
Relief. We will not delineate specific legal and evidentiary standards
for issuance of cease and cease and desist orders, but will consider
such requests on a case-by-case basis.
326. In the NPRM, in conjunction with our proposal to establish
legal and evidentiary standards for issuance of cease and cease and
desist orders, we had noted that some courts consider the following
factors prior to issuing interim relief: (1) likelihood of success on
the merits; (2) the threat of irreparable harm absent the injunction;
(3) no substantial injury to other parties; and (4) the furtherance of
the public interest.
[[Page 1033]]
Several commenters stated that a more relaxed standard should apply,
especially for resellers and small market entrants. We conclude that it
is more appropriate to consider requests for interim or injunctive
relief on a case-by-case basis. It is impossible to anticipate all of
the various factual circumstances that could form the basis of a
complaint. Similarly, the level and types of information necessary to
sustain or defend against allegations of misconduct by carriers is
likely to vary widely.
327. Damages. The Commission may exercise discretion to process a
complaint in separate liability and damages complaints on its own
motion in cases that do not involve one or more of the statutory
resolution deadlines and may also encourage complainants to voluntarily
separate their complaints into liability and damages complaints. All
complaints or supplemental complaints seeking an award of damages must
contain either a detailed computation of damages, including supporting
documentation and materials, or an explanation why such computation is
not included. The Commission may end its adjudication of damages with
the determination of the sufficiency of the damages computation method
submitted by the complainant, but retain jurisdiction over the
proceeding to the extent that the parties are unable to agree on an
exact amount of damages by applying the mandated computation method.
Parties may request a fourteen day suspension of the damages
proceedings, during which parties may attempt to negotiate a settlement
or use ADR procedures. Staff will have discretion to require a
defendant to either post a bond for or place in an escrow account the
amount the Commission determines is likely to be awarded.
328. Cross-Complaints and Counterclaims. All counterclaims and
cross-complaints will be required to be filed in separate actions. No
commenters propose alternatives to the proposals for cross-complaints
and counterclaims in the NPRM that would both ease the burden of small
businesses and accomplish the Commission's objectives. Although this
rule may require small businesses to litigate certain related claims as
independent actions, the existence of statutory deadlines makes this
necessary. Prohibiting the introduction of counterclaims and cross-
complaints late in the complaint proceeding will prevent parties from
losing such claims because they did not have sufficient time during
which to substantiate their claims.
329. Upon an appropriate showing of financial hardship or other
public interest factors, format and content requirements shall be
waived. In addition, the staff will retain discretion to take into
account the burden of most of these new requirements on a party that is
a small business entity. Finally, these rules apply only to section 208
complaints that are filed with the Commission. Complainants wishing to
assure themselves of the ability to utilize full discovery, for
example, are not precluded from filing their complaints in federal
district court.
e. Steps Taken to Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered. 330. NAD proposes
that consumers, especially pro se consumers with disabilities, be
permitted to serve complaints by facsimile transmission or Internet. We
have rejected NAD's proposal. We decline to authorize service by
Internet at this time because we have received insufficient comments on
the issue, given the significance of permitting electronic filing or
service of complaint pleadings. This issue may be addressed at a later
date, following implementation of procedures pursuant to our rulemaking
regarding the electronic filing of documents in rulemaking proceedings.
We reject NAD's proposal to permit service of complaints by facsimile
transmission because we conclude that service of the complaint must be
accomplished in the most reliable manner possible. Although we are
permitting service of pleadings subsequent to the complaint to be by
facsimile transmission, such service must be accompanied by mailed hard
copies in the event of faulty transmission. Because we are requiring
the defendant to submit its answer within twenty days of receipt of the
complaint by the complainant, any delay or uncertainty in the receipt
of the complaint would unduly infringe on the defendant's due process
rights.
331. Some commenters suggest alternatives to the rules adopted
regarding format and content and discovery. The NPRM had proposed that
information and belief allegations be prohibited. ACTA, ATSI, Bechtel &
Cole, KMC, MFS, and NAD propose that complainants be permitted to
submit allegations based on information and belief because some small
complainants and small businesses would be unable to obtain information
in the possession of large defendants. We agreed with these commenters
and the rule we adopt will permit information and belief allegations if
they are made in good faith and the complainant states in an affidavit
why the supporting facts could not be reasonably ascertained.
332. ATSI proposes that different, less rigorous complaint
procedures be implemented for complainants alleging violations of
section 260, pertaining to the provision of telemessaging service,
because many of those complainants would be fledgling small businesses.
TRA proposes special expedited procedures for resale carrier
complainants, who may be dwarfed in size and resources by their
underlying network service providers. For the following reasons, we
decline to adopt the proposals of ATSI and TRA to establish separate
complaint procedures for small business complainants. First, we
conclude that having separate sets of procedures for certain types of
complaints would create confusion for parties who might be unclear as
to which rules to follow and might even lead to continuous and
inadvertent violations of our procedural rules. Second, we conclude
that separate complaint procedures would permit parties to exploit our
rules by alleging certain violations in order to manipulate the time
frame or level of evidentiary support required in a particular
complaint. For example, a complainant alleging that a BOC has violated
certain provisions of the Act might be tempted to add an allegation
that the BOC has also failed to meet a condition required for approval
for provision of interLATA services in violation of section 271, in
order to take advantage of the ninety-day resolution deadline mandated
by section 271(d)(6)(B). Third, to the extent that certain commenters
contend that subjecting all complaints to expedited procedures will
unnecessarily work hardships on complainants and defendants in cases
without statutory deadlines, we note that the Commission will retain
considerable discretion to accommodate the needs of parties in cases
where no statutory deadline applies. Finally, separate sets of
procedures would be administratively burdensome for the Commission. Not
only would it be cumbersome to promulgate separate sets of procedures,
but it would decrease staff efficiency to apply different procedural
rules to different complaints.
333. Several commenters object to the complete prohibition on
discovery that was mentioned in the NPRM, on the grounds that small
complainants might be unable to obtain information in the sole
possession of large defendant carriers. We have taken these concerns
into account in our rule which permits parties to submit discovery
requests to be ruled upon by the initial status conference. This rule
gives parties,
[[Page 1034]]
including small businesses, an opportunity to make their cases for or
against limited discovery early in the proceedings and also limits each
party's ability to use discovery for delay or other purposes unrelated
to the merits of the dispute. This abbreviation of the discovery
process and subsequent expedited complaint resolution is necessary to
enable the Commission to foster the pro-competitive policies of the
1996 Act by resolving promptly marketplace issues that could impede the
development of competition in the telecommunications field.
334. Although these amended rules may place a greater burden on a
small business entity to provide better legal and factual support early
in the process, we conclude that it does not significantly alter the
level of evidentiary and legal support that would be ultimately
required of parties in formal complaint actions pursuant to the past
rules. It may, however, make it more difficult for complainants,
including small businesses, to gather the information needed to prevail
on their complaints. Potentially higher initial costs may be somewhat
offset by the prompt resolution of complaints and the avoidance of
protracted and costly discovery proceedings and briefing requirements.
It has been noted, for example, that the overall litigation costs of
``rocket docket'' cases in the U.S. District Court for the Eastern
District of Virginia are lower than the costs of cases that take longer
to resolve. Indeed, by requiring better and more complete submissions
earlier in the process, these amended rules reduce the need for
discovery and other information filings, thereby significantly reducing
the burden on small business entities. Although the requirement for
certification of attempted settlement of discovery disputes may delay
slightly the filing of a motion to compel, we conclude that this
requirement will serve to settle or narrow many discovery disputes.
335. CBT suggests that parties be permitted to attend status
conferences by telephone conference call to decrease burdens and
expenses for parties located outside of Washington, D.C. We agree and
will permit parties to attend by telephone conference call.
336. No commenters propose alternatives to the damages proposals in
the NPRM that would both ease the burden of small businesses and
accomplish the Commission's objectives. Although these damages rules
may require small business entities to postpone litigation of damages
issues, any increased costs will be somewhat offset by the prompt
resolution of the liability issues in complaints and the avoidance of
protracted and costly discovery proceedings and briefing requirements
in the initial proceeding. Permitting parties with a settlement period
during a damages phase can contribute to parties reaching a mutually
satisfactory solution. The bond and escrow account requirements would
only be implemented in certain situations, based upon staff
consideration of several factors, including the balance of hardships
between the complainant and defendant.
337. As noted, upon an appropriate showing of financial hardship or
other public interest factors, format and content requirements shall be
waived. APCC and NYNEX propose specific revenue levels that would
qualify a party to be eligible for a good cause waiver. GST, KMC, and
MFS suggest having parties complete a ``waiver'' form which would
contain a statement of financial hardship. We conclude that waiver
requests shall be considered on a case-by-case-basis and should not be
limited to financial hardship reasons. Such discretion to grant waivers
of the format and content requirements based on financial hardship and
other public interest factors will ensure, pursuant to section 208,
that ``any person'' has the right to complain to the Commission about
acts or omissions by a carrier that contravene the Act. For this
reason, we do not agree with APCC or NYNEX that financial hardship
should be determined solely based on set revenue or asset levels. The
range of potential complainants under section 208 is broad and may
include individuals, state commissions, municipalities, associations,
and other entities of all forms and sizes. Likewise, the size and
makeup of defendant carriers will vary greatly. Thus we conclude that
waiver determinations should be made on a case-by-case basis. The
Commission shall make every effort to apply its discretion in a
consistent and fair manner to strike an appropriate balance between
strict compliance with the rules and the needs of certain parties for
more lenient requirements and timetables. APCC also suggests that a
party that receives a good cause waiver should also be granted relief
from discovery limitations. We conclude that the Commission shall have
discretion to waive or modify some or all of its rules as appropriate
when a waiver is granted for good cause shown.
338. MFS, GST, and USTA additionally suggest that the Commission
promulgate model or form complaints or pleadings for pro se parties. We
find that Sec. 1.721(b) of the rules contains a suggested format for
formal complaints that is clear and explicit and that no further form
complaints or model pleadings for pro se complainants are necessary.
Furthermore, the Enforcement Division of the Common Carrier Bureau
currently provides, via the Internet, direct mailings, and public
reference room access, a fact sheet designed to instruct consumers on
how to file a formal complaint with the Commission. Finally, we
conclude that the range of subjects that could conceivably be contained
within a pleading is too broad for a model pleading form to be of much
utility to pro se parties.
339. Overall, we conclude that there will be a significant positive
economic impact on small entity carriers that, as a result of this
rulemaking, will find their complaints resolved expeditiously. The
establishment of these rules of practice and procedure shall, by
providing a forum for prompt resolution of complaints of unreasonable,
discriminatory, or otherwise unlawful conduct by BOCs and other
telecommunications carriers, will foster robust competition in all
telecommunications markets.
f. Report to Congress. 340. The Commission will send a copy of the
Amendment of Rules Governing Procedures To Be Followed When Formal
Complaints Are Filed Against Common Carriers, Report and Order,
including this FRFA, in a report to be sent to Congress pursuant to the
Small Business Regulatory Enforcement Fairness Act of 1996, see 5
U.S.C. 801 (a)(1)(A). A summary of this Report and Order and this FRFA
will also be published in the Federal Register, see 5 U.S.C. 604(b),
and will be sent to the Chief Counsel for Advocacy of the Small
Business Administration.
V. Ordering Clauses
341. Accordingly, It is ordered that pursuant to sections 1, 4,
201-205, 208, 260, 271, 274, and 275 of the Communications Act of 1934,
as amended, 47 U.S.C. 151, 154, 201-205, 208, 260, 271, 274, and 275,
the policies, rules, and requirements set forth herein are adopted.
342. It is further ordered that 47 CFR Parts 0 and 1, Are amended
as set forth below effective March 18, 1998.
343. It is further ordered that the Commission's Office of Public
Affairs Shall send a copy of this Report and Order, including the FRFA,
to the Chief Counsel for Advocacy of the Small Business Administration
in accordance with paragraph 603(a) of the Regulatory Flexibility Act
Pub. L. 96-354, 94 Stat. 1164, 5 U.S.C. 601, et seq. (1981).
[[Page 1035]]
344. The Report and Order Is adopted, and the requirements
contained herein will become effective March 18, 1998.
List of Subjects
47 CFR Part 0
Organization and functions (Government agencies).
47 CFR Part 1
Communications common carriers.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
Rule Changes
Parts 0 and 1 of title 47 of the Code of Federal Regulations are
amended as follows:
PART 0--COMMISSION ORGANIZATION
1. The authority citation for Part 0 continues to read as follows:
Authority: Sec. 5, 48 Stat. 1068, as amended, 47 U.S.C. 155,
225, unless otherwise noted.
2. Section 0.291 is amended by revising paragraph (d) to read as
follows:
Sec. 0.291 Authority delegated.
* * * * *
(d) Authority to designate for hearing. The Chief, Common Carrier
Bureau shall not have authority to designate for hearing any formal
complaints which present novel questions of law or policy which cannot
be resolved under outstanding precedents or guidelines. The Chief,
Common Carrier Bureau shall not have authority to designate for hearing
any applications except applications for facilities where the issues
presented relate solely to whether the applicant has complied with
outstanding precedents and guidelines.
* * * * *
PART 1--PRACTICE AND PROCEDURE
3. The authority citation for Part 1 continues to read as follows:
Authority: 47 U.S.C. 151, 154, 303, and 309(j) unless otherwise
noted.
4. Section 1.47 is amended by revising paragraphs (b) and (d), and
adding new paragraph (h) to read as follows:
Sec. 1.47 Service of documents and proof of service.
* * * * *
(b) Where any person is required to serve any document filed with
the Commission, service shall be made by that person or by his
representative on or before the day on which the document is filed.
* * * * *
(d) Except in formal complaint proceedings against common carriers
under Secs. 1.720 through 1.736, documents may be served upon a party,
his attorney, or other duly constituted agent by delivering a copy or
by mailing a copy to the last known address. See Sec. 1.736.
* * * * *
(h) Every common carrier subject to the Communications Act of 1934,
as amended, shall designate an agent in the District of Columbia, and
may designate additional agents if it so chooses, upon whom service of
all notices, process, orders, decisions, and requirements of the
Commission may be made for and on behalf of said carrier in any
proceeding before the Commission. Such designation shall include, for
both the carrier and its designated agents, a name, business address,
telephone or voicemail number, facsimile number, and, if available,
Internet e-mail address. The carrier shall additionally list any other
names by which it is known or under which it does business, and, if the
carrier is an affiliated company, the parent, holding, or management
company. Such information shall be filed with the Formal Complaints and
Investigations Branch of the Common Carrier Bureau. Carriers must
notify the Commission within one week of any changes in their
information. A paper copy of this designation list shall be maintained
in the Office of the Secretary of the Commission. Service of any
notice, process, orders, decisions or requirements of the Commission
may be made upon such carrier by leaving a copy thereof with such
designated agent at his office or usual place of residence. If a
carrier fails to designate such an agent, service of any notice or
other process in any proceeding before the Commission, or of any order,
decision, or requirement of the Commission, may be made by posting such
notice, process, order, requirement, or decision in the Office of the
Secretary of the Commission.
5. Section 1.720 is amended by revising the introductory paragraph
and paragraph (h) and adding paragraph (j) to read as follows:
Sec. 1.720 General pleading requirements.
Formal complaint proceedings are generally resolved on a written
record consisting of a complaint, answer, and joint statement of
stipulated facts, disputed facts and key legal issues, along with all
associated affidavits, exhibits and other attachments. Commission
proceedings may also require or permit other written submissions such
as briefs, written interrogatories, and other supplementary documents
or pleadings. All written submissions, both substantively and
procedurally, must conform to the following standards:
* * * * *
(h) Specific reference shall be made to any tariff provision relied
on in support of a claim or defense. Copies of relevant tariffs or
relevant portions of tariffs that are referred to or relied upon in a
complaint, answer, or other pleading shall be appended to such
complaint, answer, or other pleading.
* * * * *
(j) Pleadings shall identify the name, address, telephone number,
and facsimile transmission number for either the filing party's
attorney or, where a party is not represented by an attorney, the
filing party.
6. Section 1.721 is amended by revising paragraphs (a)(5), (a)(6),
(a)(7), (a)(8) and adding paragraphs (a)(9), (a)(10), (a)(11), (a)(12),
(a)(13), (a)(14), (c) and (d) to read as follows:
Sec. 1.721 Format and content.
(a) * * *
(5) A complete statement of facts which, if proven true, would
constitute such a violation. All material facts must be supported,
pursuant to the requirements of Sec. 1.720(c) and paragraph (a)(11) of
this section, by relevant affidavits and documentation, including
copies of relevant written agreements, offers, counter-offers, denials,
or other related correspondence. The statement of facts shall include a
detailed explanation of the manner and time period in which a defendant
has allegedly violated the Act, Commission order, or Commission rule in
question, including a full identification or description of the
communications, transmissions, services, or other carrier conduct
complained of and the nature of any injury allegedly sustained by the
complainant. Assertions based on information and belief are expressly
prohibited unless made in good faith and accompanied by an affidavit
explaining the basis for the plaintiff's belief and why the complainant
could not reasonably ascertain the facts from the defendant or any
other source;
(6) Proposed findings of fact, conclusions of law, and legal
analysis relevant to the claims and arguments set forth in the
complaint;
(7) The relief sought, including recovery of damages and the amount
of damages claimed, if known;
[[Page 1036]]
(8) Certification that the complainant has, in good faith,
discussed or attempted to discuss, the possibility of settlement with
each defendant prior to the filing of the formal complaint. Such
certification shall include a statement that, prior to the filing of
the complaint, the complainant mailed a certified letter outlining the
allegations that form the basis of the complaint it anticipated filing
with the Commission to the defendant carrier that invited a response
within a reasonable period of time and a brief summary of all
additional steps taken to resolve the dispute prior to the filing of
the formal complaint. If no additional steps were taken, such
certificate shall state the reason(s) why the complainant believed such
steps would be fruitless;
(9) Whether a separate action has been filed with the Commission,
any court, or other government agency that is based on the same claim
or same set of facts, in whole or in part, or whether the complaint
seeks prospective relief identical to the relief proposed or at issue
in a notice-and-comment proceeding that is concurrently before the
Commission;
(10) An information designation containing:
(i) The name, address, and position of each individual believed to
have firsthand knowledge of the facts alleged with particularity in the
complaint, along with a description of the facts within any such
individual's knowledge;
(ii) A description of all documents, data compilations and tangible
things in the complainant's possession, custody, or control, that are
relevant to the facts alleged with particularity in the complaint. Such
description shall include for each document:
(A) The date it was prepared, mailed, transmitted, or otherwise
disseminated;
(B) The author, preparer, or other source;
(C) The recipient(s) or intended recipient(s);
(D) Its physical location; and
(E) A description of its relevance to the matters contained in the
complaint; and
(iii) A complete description of the manner in which the complainant
identified all persons with information and designated all documents,
data compilations and tangible things as being relevant to the dispute,
including, but not limited to, identifying the individual(s) that
conducted the information search and the criteria used to identify such
persons, documents, data compilations, tangible things, and
information;
(11) Copies of all affidavits, documents, data compilations and
tangible things in the complainant's possession, custody, or control,
upon which the complainant relies or intends to rely to support the
facts alleged and legal arguments made in the complaint;
(12) A completed Formal Complaint Intake Form;
(13) Verification of the filing payment required under
Sec. 1.1105(1)(c) or (d); and
(14) A certificate of service.
* * * * *
(c) Where the complaint is filed pursuant to Sec. 47 U.S.C.
Sec. 271(d)(6)(B), the complainant shall clearly indicate whether or
not it is willing to waive the ninety-day resolution deadline contained
within 47 U.S.C. 271(d)(6)(B), in accordance with the requirements of
Sec. 1.736.
(d) The complainant may petition the staff, pursuant to Sec. 1.3,
for a waiver of any of the requirements of this section. Such waiver
may be granted for good cause shown.
Section 1.722 is revised to read as follows:
Sec. 1.722 Damages.
(a) In a case where recovery of damages is sought, the complaint
shall contain a clear and unequivocal request for damages and
appropriate allegations in support of such claim in accordance with the
requirements of paragraph (c) of this section.
(b) Damages will not be awarded upon a complaint unless
specifically requested. Damages may be awarded, however, upon a
supplemental complaint that complies fully with the requirement of
paragraph (c) of this section, based upon a finding of liability by the
Commission in the original proceeding. Provided that:
(1) If recovery of damages is first sought by supplemental
complaint, such supplemental compalint must be filed within, and
recovery is limited to, the statutory limitations contained in section
415 of the Communications Act;
(2) If recovery of damages is clearly and unequivocally requested
in the original complaint, by identification of the claim giving rise
to the damages and a general statement of the nature of the injury
suffered, such claim for damages shall relate back to the filing date
of the original formal complaint if:
(i) The complainant clearly states in the original complaint that
it chooses to have liability and prospective relief issues resolved
prior to the consideration of damages issues; and
(ii) The complainant files its supplemental complaint for damages
within sixty days after public notice (as defined in Sec. 1.4(b)) of a
decision on the merits of the original complaint.
(3) Where a complainant voluntarily elects to seek the recovery of
damages upon a supplemental complaint in accordance with the
requirements of paragraph (b)(2) of this section, the Commission will
resolve the liability complaint within any applicable complaint
resolution deadlines contained in the Act and defer adjudication of the
damages complaint until after the liability complaint has been
resolved.
(c) In all cases in which recovery of damages is sought, it shall
be the responsibility of the complainant to include, within either the
complaint or the supplemental complaint for damages filed in accordance
with paragraph (b) of this section, either:
(1) A computation of each and every category of damages for which
recovery is sought, along with an identification of all relevant
documents and materials or such other evidence to be used by the
complainant to determine the amount of such damages; or
(2) An explanation of:
(i) The information not in the possession of the complaining party
that is necessary to develop a detailed computation of damages;
(ii) Why such information is unavailable to the complaining party;
(iii) The factual basis the complainant has for believing that such
evidence of damages exists; and
(iv) A detailed outline of the methodology that would be used to
create a computation of damages with such evidence.
(d) Where a complainant voluntarily elects to seek the recovery of
damages upon a supplemental complaint in accordance with the
requirements of paragraph (b)(2) of this section, the following
procedures may apply in the event that the Commission determines that
the defendant is liable based upon its review of the original
complaint:
(1) Issues concerning the amount, if any, of damages may be either
designated by the Bureau for hearing before, or, if the parties agree,
submitted for mediation to, a Commission Administrative Law Judge. Such
Administrative Law Judge shall be chosen in the following manner:
(i) By agreement of the parties and the Chief Administrative Law
Judge; or
(ii) In the absence of such agreement, the Chief Administrative Law
Judge shall designate the Administrative Law Judge.
(2) The Commission may, in its discretion, order the defendant
either to post a bond for, or deposit into an interest bearing escrow
account, a sum
[[Page 1037]]
equal to the amount of damages which the Commission finds, upon
preliminary investigation, is likely to be ordered after the issue of
damages is fully litigated, or some lesser sum which may be
appropriate, provided the Commission finds that the grant of this
relief is favored on balance upon consideration of the following
factors:
(i) The complainant's potential irreparable injury in the absence
of such deposit;
(ii) The extent to which damages can be accurately calculated;
(iii) The balance of the hardships between the complainant and the
defendant; and
(iv) Whether public interest considerations favor the posting of
the bond or ordering of the deposit.
(3) The Commission may, in its discretion, suspend ongoing damages
proceedings for fourteen days, to provide the parties with a time
within which to pursue settlement negotiations and/or alternative
dispute resolution procedures.
(4) The Commission may, in its discretion, end adjudication of
damages with a determination of the sufficiency of a damages
computation method or formula. No such method or formula shall contain
a provision to offset any claim of the defendant against the
complainant. The parties shall negotiate in good faith to reach an
agreement on the exact amount of damages pursuant to the Commission-
mandated method or formula. Within thirty days of the release date of
the damages order, parties shall submit jointly to the Commission
either:
(i) A statement detailing the parties' agreement as to the amount
of damages;
(ii) A statement that the parties are continuing to negotiate in
good faith and a request that the parties be given an extension of time
to continue negotiations; or
(iii) A statement detailing the bases for the continuing dispute
and the reasons why no agreement can be reached.
8. Section 1.724 is amended by revising paragraphs (a), (b), and
(c) and adding new paragraphs (f), (g), (h), (i), and (j) to read as
follows:
Sec. 1.724 Answers.
(a) Any carrier upon which a copy of a formal complaint is served
shall answer such complaint in the manner prescribed under this section
within twenty days of service of the formal complaint by the
complainant, unless otherwise directed by the Commission.
(b) The answer shall advise the complainant and the Commission
fully and completely of the nature of any defense, and shall respond
specifically to all material allegations of the complaint. Every effort
shall be made to narrow the issues in the answer. The defendant shall
state concisely its defenses to each claim asserted and shall admit or
deny the averments on which the complainant relies and state in detail
the basis for admitting or denying such averment. General denials are
prohibited. If the defendant is without knowledge or information
sufficient to form a belief as to the truth of an averment, the
defendant shall so state and this has the effect of a denial. When a
defendant intends in good faith to deny only part of an averment, the
defendant shall specify so much of it as is true and shall deny only
the remainder. The defendant may deny the allegations of the complaint
as specific denials of either designated averments or paragraphs.
(c) The answer shall contain proposed findings of fact, conclusions
of law, and legal analysis relevant to the claims and arguments set
forth in the answer.
* * * * *
(f) The answer shall include an information designation containing:
(1) The name, address, and position of each individual believed to
have firsthand knowledge of the facts alleged with particularity in the
answer, along with a description of the facts within any such
individual's knowledge;
(2) A description of all documents, data compilations and tangible
things in the defendant's possession, custody, or control, that are
relevant to the facts alleged with particularity in the answer. Such
description shall include for each document:
(i) The date it was prepared, mailed, transmitted, or otherwise
disseminated;
(ii) The author, preparer, or other source;
(iii) The recipient(s) or intended recipient(s);
(iv) Its physical location; and
(v) A description of its relevance to the matters in dispute.
(3) A complete description of the manner in which the defendant
identified all persons with information and designated all documents,
data compilations and tangible things as being relevant to the dispute,
including, but not limited to, identifying the individual(s) that
conducted the information search and the criteria used to identify such
persons, documents, data compilations, tangible things, and
information;
(g) The answer shall attach copies of all affidavits, documents,
data compilations and tangible things in the defendant's possession,
custody, or control, upon which the defendant relies or intends to rely
to support the facts alleged and legal arguments made in the answer.
(h) The answer shall contain certification that the defendant has,
in good faith, discussed or attempted to discuss, the possibility of
settlement with the complainant prior to the filing of the formal
complaint. Such certification shall include a brief summary of all
steps taken to resolve the dispute prior to the filing of the formal
complaint. If no such steps were taken, such certificate shall state
the reason(s) why the defendant believed such steps would be fruitless;
(i) Where the complaint is filed pursuant to 47 U.S.C.
271(d)(6)(B), the defendant shall clearly indicate its willingness to
waive the 90-day resolution deadline contained within 47 U.S.C.
271(d)(6)(B), in accordance with the requirements of Sec. 1.736.
(j) The defendant may petition the staff, pursuant to Sec. 1.3, for
a waiver of any of the requirements of this section. Such waiver may be
granted for good cause shown.
9. Section 1.725 is revised to read as follows:
Sec. 1.725 Cross-complaints and counterclaims.
Cross-complaints seeking any relief within the jurisdiction of the
Commission against any carrier that is a party (complainant or
defendant) to that proceeding are expressly prohibited. Any claim that
might otherwise meet the requirements of a cross-complaint may be filed
as a separate complaint in accordance with Secs. 1.720 through 1.736.
For purposes of this subpart, the term ``cross-complaint'' shall
include counterclaims.
10. Section 1.726 is revised to read as follows:
Sec. 1.726 Replies.
(a) Within three days after service of an answer containing
affirmative defenses presented in accordance with the requirements of
Sec. 1.724(e), a complainant may file and serve a reply containing
statements of relevant, material facts that shall be responsive to only
those specific factual allegations made by the defendant in support of
its affirmative defenses. Replies which contain other allegations or
arguments will not be accepted or considered by the Commission.
(b) Failure to reply to an affirmative defense shall be deemed an
admission of such affirmative defense and of any facts supporting such
affirmative defense that are not specifically contradicted in the
complaint.
[[Page 1038]]
(c) The reply shall contain proposed findings of fact, conclusions
of law, and legal analysis relevant to the claims and arguments set
forth in the reply.
(d) The reply shall include an information designation containing:
(1) The name, address and position of each individual believed to
have firsthand knowledge about the facts alleged with particularity in
the reply, along with a description of the facts within any such
individual's knowledge.
(2) A description of all documents, data compilations and tangible
things in the complainant's possession, custody, or control that are
relevant to the facts alleged with particularity in the reply. Such
description shall include for each document:
(i) The date prepared, mailed, transmitted, or otherwise
disseminated;
(ii) The author, preparer, or other source;
(iii) The recipient(s) or intended recipient(s);
(iv) Its physical location; and
(v) A description of its relevance to the matters in dispute.
(3) A complete description of the manner in which the complainant
identified all persons with information and designated all documents,
data compilations and tangible things as being relevant to the dispute,
including, but not limited to, identifying the individual(s) that
conducted the information search and the criteria used to identify such
persons, documents, data compilations, tangible things, and
information;
(e) The reply shall attach copies of all affidavits, documents,
data compilations and tangible things in the complainant's possession,
custody, or control upon which the complainant relies or intends to
rely to support the facts alleged and legal arguments made in the
reply.
(f) The complainant may petition the staff, pursuant to Sec. 1.3,
for a waiver of any of the requirements of this section. Such waiver
may be granted for good cause shown.
Section 1.727 is amended by revising paragraphs (b), (c), (d), and
(e) and adding new paragraphs (g) and (h) to read as follows:
Sec. 1. 727 Motions.
* * * * *
(b) All dispositive motions shall contain proposed findings of fact
and conclusions of law, with supporting legal analysis, relevant to the
contents of the pleading. Motions to compel discovery must contain a
certification by the moving party that a good faith attempt to resolve
the dispute was made prior to filing the motion. All facts relied upon
in motions must be supported by documentation or affidavits pursuant to
the requirements of Sec. 1.720(c), except for those facts of which
official notice may be taken.
(c) The moving party shall provide a proposed order for adoption,
which appropriately incorporates the basis therefor, including proposed
findings of fact and conclusions of law relevant to the pleading. The
proposed order shall be clearly marked as a ``Proposed Order.'' The
proposed order shall be submitted both as a hard copy and on computer
disk in accordance with the requirements of Sec. 1.734(d). Where
appropriate, the proposed order format should conform to that of a
reported FCC order.
(d) Oppositions to any motion shall be accompanied by a proposed
order for adoption, which appropriately incorporates the basis
therefor, including proposed findings of fact and conclusions of law
relevant to the pleading. The proposed order shall be clearly captioned
as a ``Proposed Order.'' The proposed order shall be submitted both as
a hard copy and on computer disk in accordance with the requirements of
Sec. 1.734(d). Where appropriate, the proposed order format should
conform to that of a reported FCC order.
(e) Oppositions to motions may be filed and served within five
business days after the motion is filed and served and not after.
Oppositions shall be limited to the specific issues and allegations
contained in such motion; when a motion is incorporated in an answer to
a complaint, the opposition to such motion shall not address any issues
presented in the answer that are not also specifically raised in the
motion. Failure to oppose any motion may constitute grounds for
granting of the motion.
* * * * *
(g) Motions seeking an order that the allegations in the complaint
be made more definite and certain are prohibited.
(h) Amendments or supplements to complaints to add new claims or
requests for relief are prohibited. Parties are responsible, however,
for the continuing accuracy and completeness of all information and
supporting authority furnished in a pending complaint proceeding as
required under Sec. 1.720(g).
2. Section 1.729 is revised to read as follows:
Sec. 1.729 Discovery.
(a) A complainant may file with the Commission and serve on a
defendant, concurrently with its complaint, a request for up to ten
written interrogatories. A defendant may file with the Commission and
serve on a complainant, during the period starting with the service of
the complaint and ending with the service of its answer, a request for
up to ten written interrogatories. A complainant may file with the
Commission and serve on a defendant, within three calendar days of
service of the defendant's answer, a request for up to five written
interrogatories. Subparts of any interrogatory will be counted as
separate interrogatories for purposes of compliance with this limit.
Requests for interrogatories filed and served pursuant to this
procedure may be used to seek discovery of any non-privileged matter
that is relevant to the material facts in dispute in the pending
proceeding, provided, however, that requests for interrogatories filed
and served by a complainant after service of the defendant's answer
shall be limited in scope to specific factual allegations made by the
defendant in support of its affirmative defenses. This procedure may
not be employed for the purpose of delay, harassment or obtaining
information that is beyond the scope of permissible inquiry related to
the material facts in dispute in the pending proceeding.
(b) Requests for interrogatories filed and served pursuant to
paragraph (a) of this section shall contain a listing of the
interrogatories requested and an explanation of why the information
sought in each interrogatory is both necessary to the resolution of the
dispute and not available from any other source.
(c) A responding party shall file with the Commission and serve on
the propounding party any opposition and objections to the requests for
interrogatories as follows:
(1) By the defendant, within ten calendar days of service of the
requests for interrogatories served simultaneously with the complaint
and within five calendar days of the requests for interrogatories
served following service of the answer;
(2) By the complainant, within five calendar days of service of the
requests for interrogatories; and
(3) In no event less than three calendar days prior to the initial
status conference as provided for in Sec. 1.733(a).
(d) Commission staff will consider the requests for
interrogatories, properly filed and served pursuant to paragraph (a) of
this section, along with any objections or oppositions thereto,
properly filed and served pursuant to paragraph (b) of this section, at
the initial status conference, as provided for in Sec. 1.733(a)(5), and
at that time
[[Page 1039]]
determine the interrogatories, if any, to which parties shall respond,
and set the schedule of such response.
(e) The interrogatories ordered to be answered pursuant to
paragraph (d) of this section are to be answered separately and fully
in writing under oath or affirmation by the party served, or if such
party is a public or private corporation or partnership or association,
by any officer or agent who shall furnish such information as is
available to the party. The answers shall be signed by the person
making them. The answers shall be filed with the Commission and served
on the propounding party.
(f) A propounding party asserting that a responding party has
provided an inadequate or insufficient response to Commission-ordered
discovery request may file a motion to compel within ten days of the
service of such response, or as otherwise directed by Commission staff,
pursuant to the requirements of Sec. 1.727.
(g) The Commission may, in its discretion, require parties to
provide documents to the Commission in a scanned or other electronic
format that provides:
(1) Indexing by useful identifying information about the documents;
and
(2) Technology that allows staff to annotate the index so as to
make the format an efficient means of reviewing the documents.
(h) The Commission may allow additional discovery, including, but
not limited to, document production, depositions and/or additional
interrogatories. In its discretion, the Commission may modify the
scope, means and scheduling of discovery in light of the needs of a
particular case and the requirements of applicable statutory deadlines.
13. Section 1.730 is removed.
14. Section 1.731 is amended by revising the section heading and
paragraph (a) to read as follows:
Sec. 1.731 Confidentiality of information produced or exchanged by the
parties.
(a) Any materials generated in the course of a formal complaint
proceeding may be designated as proprietary by that party if the party
believes in good faith that the materials fall within an exemption to
disclosure contained in the Freedom of Information Act (FOIA), 5 U.S.C.
552(b)(1) through (9). Any party asserting confidentiality for such
materials shall so indicate by clearly marking each page, or portion
thereof, for which a proprietary designation is claimed. If a
proprietary designation is challenged, the party claiming
confidentiality shall have the burden of demonstrating, by a
preponderance of the evidence, that the material designated as
proprietary falls under the standards for nondisclosure enunciated in
the FOIA.
* * * * *
15. Section 1.732 is amended by revising paragraphs (a), (b), (c),
(d), (f), and adding new paragraph (h) to read as follows:
Sec. 1.732 Other required written submissions.
(a) The Commission may, in its discretion, or upon a party's motion
showing good cause, require the parties to file briefs summarizing the
facts and issues presented in the pleadings and other record evidence.
(b) Unless otherwise directed by the Commission, all briefs shall
include all legal and factual claims and defenses previously set forth
in the complaint, answer, or any other pleading submitted in the
proceeding. Claims and defenses previously made but not reflected in
the briefs will be deemed abandoned. The Commission may, in its
discretion, limit the scope of any briefs to certain subjects or
issues. A party shall attach to its brief copies of all documents, data
compilations, tangible things, and affidavits upon which such party
relies or intends to rely to support the facts alleged and legal
arguments made in its brief and such brief shall contain a full
explanation of how each attachment is relevant to the issues and
matters in dispute. All such attachments to a brief shall be documents,
data compilations or tangible things, or affidavits made by persons,
that were identified by any party in its information designations filed
pursuant to Secs. 1.721(a)(10)(i), (a)(10)(ii), 1.724(f)(1), (f)(2),
and 1.726(d)(1), (d)(2). Any other supporting documentation or
affidavits that is attached to a brief must be accompanied by a full
explanation of the relevance of such materials and why such materials
were not identified in the information designations. These briefs shall
contain the proposed findings of fact and conclusions of law which the
filing party is urging the Commission to adopt, with specific citation
to the record, and supporting relevant authority and analysis.
(c) In cases in which discovery is not conducted, absent an order
by the Commission that briefs be filed, parties may not submit briefs.
If the Commission does authorize the filing of briefs in cases in which
discovery is not conducted, briefs shall be filed concurrently by both
the complainant and defendant at such time as designated by the
Commission staff and in accordance with the provisions of this section.
(d) In cases in which discovery is conducted, briefs shall be filed
concurrently by both the complainant and defendant at such time
designated by the Commission staff.
* * * * *
(f) Initial briefs shall be no longer than twenty-five pages. Reply
briefs shall be no longer than ten pages. Either on its own motion or
upon proper motion by a party, the Commission staff may establish other
page limits for briefs.
* * * * *
(h) The parties shall submit a joint statement of stipulated facts,
disputed facts, and key legal issues no later than two business days
prior to the initial status conference, scheduled in accordance with
the provisions of Sec. 1.733(a).
16. Section 1.733 is amended by revising paragraphs (a)
introductory text, (a)(2), (a)(4), (a)(5), (a)(6), (b), (c), (d), and
(e) and adding new paragraphs (f), (g), and (h) to read as follows:
Sec. 1.733 Status conference.
(a) In any complaint proceeding, the Commission may, in its
discretion, direct the attorneys and/or the parties to appear before it
for a status conference. Unless otherwise ordered by the Commission, an
initial status conference shall take place, at the time and place
designated by the Commission staff, ten business days after the date
the answer is due to be filed. A status conference may include
discussion of:
* * * * *
(2) The necessity for or desirability of additional pleadings or
evidentiary submissions;
* * * * *
(4) Settlement of all or some of the matters in controversy by
agreement of the parties;
(5) Whether discovery is necessary and, if so, the scope, type and
schedule for such discovery;
(6) The schedule for the remainder of the case and the dates for
any further status conferences; and
* * * * *
(b)(1) Parties shall meet and confer prior to the initial status
conference to discuss:
(i) Settlement prospects;
(ii) Discovery;
(iii) Issues in dispute;
(iv) Schedules for pleadings;
(v) Joint statement of stipulated facts, disputed facts, and key
legal issues; and
(vi) In a 47 U.S.C. 271(d)(6)(B) proceeding, whether or not the
parties agree to waive the 47 U.S.C. 271(d)(6)(B) 90-day resolution
deadline.
[[Page 1040]]
(2) Parties shall submit a joint statement of all proposals agreed
to and disputes remaining as a result of such meeting to Commission
staff at least two business days prior to the scheduled initial status
conference.
(c) In addition to the initial status conference referenced in
paragraph (a) of this section, any party may also request that a
conference be held at any time after the complaint has been filed.
(d) During a status conference, the Commission staff may issue oral
rulings pertaining to a variety of interlocutory matters relevant to
the conduct of a formal complaint proceeding including, inter alia,
procedural matters, discovery, and the submission of briefs or other
evidentiary materials.
(e) Parties may make, upon written notice to the Commission and all
attending parties at least three business days prior to the status
conference, an audio recording of the Commission staff's summary of its
oral rulings. Alternatively, upon agreement among all attending parties
and written notice to the Commission at least three business days prior
to the status conference, the parties may make an audio recording of,
or use a stenographer to transcribe, the oral presentations and
exchanges between and among the participating parties, insofar as such
communications are ``on-the-record'' as determined by the Commission
staff, as well as the Commission staff's summary of its oral rulings. A
complete transcript of any audio recording or stenographic
transcription shall be filed with the Commission as part of the record,
pursuant to the provisions of paragraph (f)(2) of this section. The
parties shall make all necessary arrangements for the use of a
stenographer and the cost of transcription, absent agreement to the
contrary, will be shared equally by all parties that agree to make the
record of the status conference.
(f) The parties in attendance, unless otherwise directed, shall
either:
(1) Submit a joint proposed order memorializing the oral rulings
made during the conference to the Commission by 5:30 pm, Eastern Time,
on the business day following the date of the status conference, or as
otherwise directed by Commission staff. In the event the parties in
attendance cannot reach agreement as to the rulings that were made, the
joint proposed order shall include the rulings on which the parties
agree, and each party's alternative proposed rulings for those rulings
on which they cannot agree. Commission staff will review and make
revisions, if necessary, prior to signing and filing the submission as
part of the record. The proposed order shall be submitted both as hard
copy and on computer disk in accordance with the requirements of
Sec. 1.734(d); or
(2) Pursuant to the requirements of paragraph (e) of this section,
submit to the Commission by 5:30 pm., Eastern Time, on the third
business day following the status conference or as otherwise directed
by Commission staff either:
(i) A transcript of the audio recording of the Commission staff's
summary of its oral rulings;
(ii) A transcript of the audio recording of the oral presentations
and exchanges between and among the participating parties, insofar as
such communications are ``on-the-record'' as determined by the
Commission staff, and the Commission staff's summary of its oral
rulings; or
(iii) A stenographic transcript of the oral presentations and
exchanges between and among the participating parties, insofar as such
communications are ``on-the-record'' as determined by the Commission
staff, and the Commission staff's summary of its oral rulings.
(g) Status conferences will be scheduled by the Commission staff at
such time and place as it may designate to be conducted in person or by
telephone conference call.
(h) The failure of any attorney or party, following reasonable
notice, to appear at a scheduled conference will be deemed a waiver by
that party and will not preclude the Commission staff from conferring
with those parties and/or counsel present.
17. Section 1.734 is amended by revising paragraph (c) and adding
new paragraph (d) to read as follows:
Sec. 1.734 Specifications as to pleadings, briefs, and other
documents; subscription.
* * * * *
(c) The original of all pleadings and other submissions filed by
any party shall be signed by the party, or by the party's attorney. The
signing party shall include in the document his or her address,
telephone number, facsimile number and the date on which the document
was signed. Copies should be conformed to the original. Unless
specifically required by rule or statute, pleadings need not be
verified. The signature of an attorney or party shall be a certificate
that the attorney or party has read the pleading, motion, or other
paper; that to the best of his or her knowledge, information, and
belief formed after reasonable inquiry, it is well grounded in fact and
is warranted by existing law or a good faith argument for the
extension, modification, or reversal of existing law; and that it is
not interposed solely for purposes of delay or for any other improper
purpose.
(d) All proposed orders shall be submitted both as hard copies and
on computer disk formatted to be compatible with the Commission's
computer system and using the Commission's current wordprocessing
software. Each disk should be submitted in ``read only'' mode. Each
disk should be clearly labelled with the party's name, proceeding, type
of pleading, and date of submission. Each disk should be accompanied by
a cover letter. Parties who have submitted copies of tariffs or reports
with their hard copies need not include such tariffs or reports on the
disk. Upon showing of good cause, the Commission may waive the
requirements of this paragraph.
18. Section 1.735 is amended by revising paragraphs (b), (d), (e),
and (f) to read as follows:
Sec. 1.735 Copies; service; separate filings against multiple
defendants.
* * * * *
(b) The complainant shall file an original copy of the complaint,
accompanied by the correct fee, in accordance with part I, subpart G
(see Sec. 1.1105(1)(c) and (d)) and, on the same day:
(1) File three copies of the complaint with the Office of the
Commission Secretary;
(2) If the complaint is filed against a carrier concerning matters
within the responsibility of the Common Carrier Bureau (see Sec. 0.291
of this chapter), serve two copies on the Chief, Formal Complaints and
Investigations Branch, Enforcement Division, Common Carrier Bureau;
(3) If the complaint is filed against a wireless telecommunications
carrier concerning matters within the responsibility of the Wireless
Telecommunications Bureau (see Sec. 0.331 of this chapter), serve two
copies on the Chief, Compliance and Litigation Branch, Enforcement and
Consumer Information Division, Wireless Telecommunications Bureau;
(4) If the complaint is filed against a carrier concerning matters
within the responsibility of the International Bureau (see Sec. 0.261
of this chapter), serve a copy on the Chief, Telecommunications
Division, International Bureau, and serve two copies on the Chief,
Formal Complaints and Investigations Branch, Enforcement Division,
Common Carrier Bureau; and
(5) If a complaint is addressed against multiple defendants, pay a
separate fee, in accordance with part I, subpart G (see
[[Page 1041]]
Sec. 1.1105(1)(c) and (d)), and file three copies of the complaint with
the Office of the Commission Secretary for each additional defendant.
* * * * *
(d) The complainant shall serve the complaint by hand delivery on
either the named defendant or one of the named defendant's registered
agents for service of process on the same date that the complaint is
filed with the Commission in accordance with the requirements of
paragraph (b) of this section.
(e) Upon receipt of the complaint by the Commission, the Commission
shall promptly send, by facsimile transmission to each defendant named
in the complaint, notice of the filing of the complaint. The Commission
shall send, by regular U.S. mail delivery, to each defendant named in
the complaint, a copy of the complaint. The Commission shall
additionally send, by regular U.S. mail to all parties, a schedule
detailing the date the answer will be due and the date, time and
location of the initial status conference.
(f) All subsequent pleadings and briefs filed in any formal
complaint proceeding, as well as all letters, documents or other
written submissions, shall be served by the filing party on the
attorney of record for each party to the proceeding, or, where a party
is not represented by an attorney, each party to the proceeding either
by hand delivery, overnight delivery, or by facsimile transmission
followed by regular U.S. mail delivery, together with a proof of such
service in accordance with the requirements of Sec. 1.47(g). Service is
deemed effective as follows:
(1) Service by hand delivery that is delivered to the office of the
recipient by 5:30 pm, local time of the recipient, on a business day
will be deemed served that day. Service by hand delivery that is
delivered to the office of the recipient after 5:30 pm, local time of
the recipient, on a business day will be deemed served on the following
business day;
(2) Service by overnight delivery will be deemed served the
business day following the day it is accepted for overnight delivery by
a reputable overnight delivery service such as, or comparable to, the
US Postal Service Express Mail, United Parcel Service or Federal
Express; or
(3) Service by facsimile transmission that is fully transmitted to
the office of the recipient by 5:30 pm, local time of the recipient, on
a business day will be deemed served that day. Service by facsimile
transmission that is fully transmitted to the office of the recipient
after 5:30 pm, local time of the recipient, on a business day will be
deemed served on the following business day.
19. Section 1.736 is added under the undesignated center heading
``Formal Complaints'' to read as follows:
Sec. 1.736 Complaints filed pursuant to 47 U.S.C. 271(d)(6)(B).
(a) Where a complaint is filed pursuant to 47 U.S.C. 271(d)(6)(B),
parties shall indicate whether they are willing to waive the ninety-day
resolution deadline contained in 47 U.S.C. 271(d)(6)(B) in the
following manner:
(1) The complainant shall so indicate in both the complaint itself
and in the Formal Complaint Intake Form, and the defendant shall so
indicate in its answer; or
(2) The parties shall indicate their agreement to waive the ninety-
day resolution deadline to the Commission staff at the initial status
conference, to be held in accordance with Sec. 1.733 of the rules.
(b) Requests for waiver of the ninety-day resolution deadline for
complaints filed pursuant to 47 U.S.C. 271(d)(6)(B) will not be
entertained by the Commission staff subsequent to the initial status
conference, absent a showing by the complainant and defendant that such
waiver is in the public interest.
20. Section 1.1105 is amended by revising (1)(c) and adding (1)(d)
to read as follows:
Sec. 1.1105 Schedule of charges for applications and other filings in
the common carrier services.
----------------------------------------------------------------------------------------------------------------
Payment type
Action FCC form No. Fee amount code Address
----------------------------------------------------------------------------------------------------------------
1. * * *
c. Formal Complaints and Corr. & 159............ 150 CIZ Federal Communications
Pole Attachment Complaints, Commission, Common
except those relating to Carrier Enforcement,
wireless telecommunications P.O. Box 358120,
services, Filing Fee. Pittsburgh, PA 15251-
5120.
d. Formal Complaints Corr. & 159............ 150 CIZ Federal Communications
relating to wireless Commission, Wireless
telecommunications Telecommunications
services, including Bureau, P.O. Box
cellular telephone, paging, 358128, Pittsburgh, PA
personal communications 15251-5120.
services, and other
commercial mobile radio
services, Filing Fee.
----------------------------------------------------------------------------------------------------------------
* * * * *
Note: This attachment will not be published in the Code of
Federal Regulations
Attachment
[Approved by OMB; 3060-XXXX; Expires XX/XX/XX; Est. Avg. Burden: 30
min.]
Formal Complaint Intake Form--FCC Form 485
1. Case Name __________
2. Complainant's Name, Address, Phone and Facsimile Number, e-mail
address (if applicable):
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
3. Complaint alleges violation of the following provisions of the
Communications Act of 1934, as amended:
----------------------------------------------------------------------
4. Complaint is subject to the following statutory resolution
deadlines:
----------------------------------------------------------------------
----------------------------------------------------------------------
Answer (Y)es, (N)o or N/A to the following:
______ 5. Complaint conforms to the specifications prescribed by 47
CFR Secs. 1.49, 1.734.
______ 6. Complaint complies with the pleading requirements of 47
CFR Sec. 1.720.
______ 7. Complaint conforms to the format and content requirements
of 47 CFR Sec. 1.721:
______ a. Complaint contains a complete statement of facts,
including a detailed explanation of the manner in which the defendant
is alleged to have violated the provisions of the Communications Act of
1934, as
[[Page 1042]]
amended, or Commission rules or Commission orders.
______ b. Relevant documentation and/or affidavits are attached,
including agreements, offers, counter-offers, denials, or other
relevant documentation.
______ c. If damages are sought, contains specified amount and
nature of damages claimed.
______ d. Contains certification that complainant mailed a
certified letter outlining the allegations that form the basis of the
complaint it anticipated filing with the Commission to the defendant
carrier that invited a response within a reasonable period of time and
has, in good faith, discussed or attempted to discuss, the possibility
of settlement with each defendant prior to the filing of the formal
complaint.
______ e. Suit has been filed with the Commission, in another
court, or government agency on the basis of the same cause of action or
the same set of facts, in whole or in part. If yes, please explain:
----------------------------------------------------------------------
----------------------------------------------------------------------
______ f. Seeks prospective relief identical to the relief proposed
or at issue in a notice-and-comment proceeding that is concurrently
before the Commission. If yes, please explain:
----------------------------------------------------------------------
----------------------------------------------------------------------
______ g. Includes an information designation that contains:
______ (1) A description by category and location, of all
documents, data compilations and tangible things in the complainant's
possession, custody, or control that are relevant to the facts alleged
with particularity in the complaint; and
______ (2) The name, address, and position of each individual
believed to have firsthand knowledge of the facts alleged with
particularity in the complaint, along with a description of the facts
within any such individual's knowledge.
______ h. Attached are copies of all documents, data compilations
and tangible things in the complainant's possession, custody, or
control, upon which the complainant relies or intends to rely to
support the facts alleged and legal arguments made in the complaint.
______ i. Certificate of service is attached.
______ j. Copy of payment of $150.00 filing fee, in accordance with
47 CFR Sec. 1.1105(1)(c), is attached.
______ 8. If complaint is filed pursuant to 47 U.S.C. 271(d)(6)(B),
complainant requests waiver of the ninety day complaint resolution
deadline.
______ 9. All reported FCC orders relied upon have been properly
cited in accordance with 47 CFR Sec. 1.14.
______ 10. Copy of complaint has been served on defendant's
registered agent for service in accordance with 47 CFR Sec. l.47 (b),
(d), (h) and 47 CFR Sec. 1.735(d).
______ 11. If more than ten pages, the complaint contains a table
of contents as specified in 47 CFR Sec. 1.49(b).
______ 12. The correct number of copies, required by 47 CFR
Sec. 1.51(c), if applicable, and 47 CFR Sec. 1.735(b) have been filed.
______ 13. Complaint has been properly signed and verified in
accordance with 47 CFR Sec. 1.52.
______ 14. If complaint is by multiple complainants, it conforms
with the requirements of 47 CFR Sec. 1.723(a).
______ 15. If complaint involves multiple grounds, it complies with
the requirements of 47 CFR Sec. 1.723(b).
______ 16. If complaint is directed against multiple defendants, it
complies with the requirements of 47 CFR Sec. 1.735 (a)-(b).
Notice: Sections 206 to 209 of the Communications Act of 1934,
as amended, provide the statutory framework for rules for resolving
formal complaints filed against common carriers. Section 208(a)
authorizes complaints by any person ``complaining of anything done
or omitted to be done by any common carrier'' subject to the
provisions of the Act. Complainant must submit a completed FCC form
485 with any formal complaint to indicate that the complaint
satisfies the procedural and substantive requirements under the Act
and our rules. The information will be used to determine the
sufficiency of the complaint and to resolve the merits of the
dispute between the parties. We have estimated that each response to
this collection of information will take, on average, 30 minutes.
Our estimate includes the time to read the instructions, look
through existing records, gather and maintain required data, and
actually complete and review the form or response. If you have any
comments on this estimate, or how we can improve the collection and
reduce the burden it causes you, please write the Federal
Communications Commission, AMD-PERM, Paperwork Reduction Project
(3060-0411), Washington, D.C. 20554. We will also accept your
comments via the Internet if you send them to jboley@fcc.gov. PLEASE
DO NOT SEND COMPLETED FORMS TO THIS ADDRESS.
Remember--You are not required to respond to a collection of
information sponsored by the Federal government, and the government
may not conduct or sponsor this collection, unless it displays a
currently valid OMB control number or if we fail to provide you with
this notice. This collection has been assigned an OMB control number
of 3060-XXXX).
The Foregoing Notice is Required by the Privacy Act of 1974,
Pub. L. 93-579, December 31, 1994, 5 U.S.C. 552a(E)(3), and the
Paperwork Reduction Act of 1995, Pub. L. 104-13, October 1, 1995, 44
U.S.C. 3507.
[FR Doc. 98-173 Filed 1-6-98; 8:45 am]
BILLING CODE 6712-01-P
