DC Circuit Asks AT&T to Respond to Intervenor Request to Rehear VoIP Symmetry Case

The case "presents a question of exceptional importance: Whether a court may go beyond the arguments presented by a petitioner and vacate a federal agency’s order on the basis of its own research," said intervenors Bandwidth.com, Broadvox-CLEC and Level 3 in their Dec. 30 petition (in Pacer) for rehearing and rehearing en banc. "Many decisions of this Court hold that a court may not do so, and therefore rehearing is also warranted because the panel’s decision is contrary to controlling precedent. ... Moreover, the panel’s research led to an erroneous conclusion that will impede the deployment of advanced telecommunications networks."

The petition is "very persuasive" but still looks like a long shot, said Andrew Schwartzman, Georgetown Law Institute for Public Representation senior counselor. "It is interesting that the court didn't ask the FCC what it thinks. Although the court often denies rehearing without even soliciting a response, the odds of rehearing are always very long and even longer when the agency itself doesn't seek rehearing." None of the litigants we queried commented.

The three-judge panel sided with AT&T in overturning the FCC VoIP symmetry decision that allowed local phone competitors to collect higher end-office switching charges for routing over-the-top long-distance calls to local customers. The judges remanded the commission's February 2015 declaratory ruling that found CLECs, in partnership with over-the-top VoIP providers, were offering the "functional equivalent" of end-office local switching and thus could charge long-distance carriers such as AT&T associated access charges, instead of lower tandem switching charges (see 1611180063).

Bandwidth.com and the others said the panel's error was easy to explain, though the substance of the dispute was more complicated. "The panel decided this case on the basis of an argument that was not raised by petitioner AT&T; relied on six authorities not cited in any brief; and erred in its analysis of the question that the panel rather than petitioner raised," the intervenors wrote. They said the FCC rejected AT&T's argument that because the VoIP providers don't physically interconnect the VoIP calls to individual customer lines, the end-office switching charges don't apply. AT&T renewed its argument in court, with its brief noting it was willing to pay lower tandem switching access charges, but it didn't argue the FCC erred by failing to consider whether those charges ought to apply to the VoIP calls at issue, said the intervenors.

"The panel nevertheless stated that the 'key question' in the case is 'what distinguishes end-office switching from tandem switching?'" the intervenors wrote. "The panel then cited six authorities not cited in any brief and concluded that the Commission had not adequately answered the question the panel rather than AT&T presented. This Court has repeatedly held that a panel is limited to deciding the questions presented by the petitioner and may not conduct its own research to decide different questions. Moreover, it is clear that the panel’s detour led to an incorrect answer: the expert agency correctly determined that the service at issue is analogous to end office switching rather than tandem switching -- as the Commission and the intervenors would have explained in their briefs if AT&T had properly raised that argument."

The judges' "fundamental error was to conclude that tandem switches provide the 'call control' functions the Commission identified as the essence of end office switching. They do not," the intervenors wrote. "Tandem switches send calls to another switch, usually the end office switch, while end office switches send calls to the called party and control the call. In a VoIP call, the VoIP provider and its telecommunications carrier partner provide the same functions as an end office switch; unlike tandem switches, they do not send calls to another switch. Therefore, there is no basis for the panel’s holding that the Commission needs to explain why the service provided by VoIP providers 'qualif[ies] as the functional equivalent of end-office switching and not tandem switching.'"