Opinion
Case No. 97-CV-76336
November 15, 2001
MEMORANDUM OPINION AND ORDER DENYING MOTION TO DISMISS COUNT 1
This is a telecommunications/commercial dispute. Plaintiff Building Commissions, Inc. (BCI), a Michigan corporation, is suing Ameritech Services, Inc. (Ameritech Services), a foreign corporation, and Ameritech Michigan (Ameritech-MI), a Michigan corporation, (collectively Ameritech) for actions arising out the parties' relationship in the telecommunications industry in Southeastern Michigan.
Under the Court's Memorandum Opinion and Order, filed June 21, 2001, the following claims as alleged in BCI's Consolidated Third Amended Complaint (Third Complaint), continue in-suit: (1) Count 6, claiming breach of the MOSCOM/Emerald Contract, (2) Count 7, claiming breach of implied warranty of merchantability as it relates to the MOSCOM/Emerald Contract, and (3) Count 1, claiming a violation under § 202(a) of the 1934 Telecommunications Act. The Court directed Ameritech to file a paper as to the viability of Count 1 within 30 days. See Memorandum and Order at 33.
In response to the Court's order, Ameritech filed a motion to dismiss Count 1 on the grounds that the claim has not been pled with specificity and because sections 251 and 252 of the 1996 Telecommunications Act provide BCI's only avenue for relief. BCI has filed a response, contending the doctrine of primary jurisdiction does not apply and that it has plead a viable claim under § 202(a).
II.
In its Memorandum Opinion and Order of June 21, 2001, the Court said the following regarding BCI's claim under § 202(a):
For the first time in its Third Consolidated Amended Compliant, BCI makes a claim against Ameritech for violation of § 202(a) of the 1934 Act. Section 202(a) provides:
It shall be unlawful for any common carrier to make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with like communication service, directly or indirectly, by any means or device, or to make or give any undue or unreasonable preference or advantage to any particular person, class of persons, or locality, or to subject any particular person, class of person, or locality to any undue or unreasonable prejudice or disadvantage.
47 U.S.C. § 202 (a). Essentially, section 202 prohibits unreasonable discrimination by common carriers, such as Ameritech, in the provision of telecommunication services. Under this statute, the Federal Communications Commission (FCC) has promulgated regulations requiring common carriers to provide services to resellers, such as BCI, done the same terms that such services are provided to end users, or customers. See Regulatory Practices Concerning Resale and Shared Use of Common Carrier Services and Facilities, 60 F.C.C.2d 261 (1976).
BCI generally claims that Ameritech violated section 202(a) by discriminating against BCI and its customers in favor of Ameritech's own customers. Ameritech has not had an opportunity to respond to this claim. While BCI may have a viable claim against Ameritech under § 202, see National Comm. Ass'n, Inc. v. AT T Corp., 46 F.3d 220 (2d Cir. 2001) (upholding jury verdict on § 202 claim by reseller of long distance phone service against common carrier), Ameritech should have the opportunity to present arguments to the contrary. See Digital Comm. Network, Inc. v. AT T Wireless Services, Inc., 63 F. Supp.2d 1194 (C.D. Ca. 1999) (invoking doctrine of primary jurisdiction in § 202(a) case).
See 47 U.S.C. § 153 (10) (defining "common carrier").
The January Order stated that Ameritech could not file any papers unless directed by the Court.
At the time the Memorandum Opinion and Order was issued, only the Westlaw cite was available.
In National Comm., supra, the Court of Appeals for the Second Circuit set forth the elements of a § 202(a) claim as follows: "(1) whether the services are "like;" (2) if so, whether the services were provided under different terms and conditions; and (3) whether any such difference was reasonable." 238 F.3d at 127.
In reviewing the parties' papers, it appears that Ameritech is basically arguing that BCI has not plead its § 202(a) claim with specificity. It does not argue that the Court should defer ruling on this claim under the doctrine of primary jurisdiction. BCI, however, chose to address the issue of primary jurisdiction in great detail in responding to Ameritech's motion. Because Ameritech has not argued primary jurisdiction, the Court will not address the issue.
As to whether BCI has properly plead a claim under § 202(a), while Ameritech is partially correct that the allegations under BCI's § 202(a) claim are similar to its allegations under its § 251 claim (previously dismissed), there is a key difference. As the Court construed BCI's § 251 claim, it pertained to the centrex agreements between BCI and Ameritech and Ameritech's alleged breach of its statutory duties under § 251 with respect to those agreements. BCI's § 202(a) claim, on the other hand, is based on the overall allegation that Ameritech provides services to its customers under different terms and conditions than it provides to BCI, and in turn, to BCI's customers. In other words, BCI says that Ameritech discriminates between its own customers and BCI. This is precisely what is prohibited under § 202(a). Paragraph 66 of BCI's Third Complaint sets forth the allegations of discriminatory treatment. These allegations include that (1) Ameritech makes customers who wish to change to BCI pay termination fees, but Ameritech "waives" such fees for those who want to switch to Ameritech, (2) Ameritech requires BCI to pay deposits based on an account structure that is different from Ameritech's customers, which does not require deposits, (3) Ameritech refuses to make timely and accurate customer account switches to BCI, while making timely and accurate customer account switches to Ameritech. While the Court agrees with Ameritech in that BCI's claim could have been better plead, overall the Court finds that BCI has adequately plead a claim for relief under § 202(a).
Accordingly, Ameritech's motion is DENIED.
SO ORDERED.