The Tenth Circuit Court of Appeals issued its opinion in Qwest Corp. v. Colorado Public Utilities Comm’n on Friday, August 26, 2011.
The Tenth Circuit affirmed in part and reversed in part the district court’s decision. “In order to facilitate competition in the local telephone service market, federal law requires incumbent local exchange carriers (ILECs), such as Qwest, to lease certain parts of their telecommunications networks to competitive local exchange carriers (CLECs), such as Cbeyond. ILECs are relieved of this obligation if, among other circumstances, the number of ‘business lines’ in a local exchange reaches a certain threshold because, in the FCC’s view, a sufficient number of business lines shows that it would be economic for CLECs to invest in their own infrastructure. The term ‘business line’ and the method of counting business lines are defined in 47 C.F.R. § 51.5. The parties disagree as to which types of a particular network element—UNE loops—are included in the business line count. The district court held that UNE loops serving non-business customers are included in the business line count and that non-switched UNE loops are not included in the business line count.” The parties cross-appealed the decision.
The Court affirmed the district court and held that 47 C.F.R. § 51.5 plainly states that all UNE loops count towards the number of business lines in a wire center, regardless of whether it is used to serve a business or non-business customer. However, the Court also found that “the FCC’s interpretation of § 51.5 is consistent with existing reporting requirements, whereas the defendants’ interpretation would require state utility commissions to obtain data relating to CLECs’ use of UNEs in order to determine whether a UNE was connected to a switch or not.” The district court was reversed in part because “the FCC’s interpretation is not plainly erroneous or inconsistent with the language of the regulation, [and the Court had to] defer to the FCC’s position and hold that the business line count includes UNE loops that are not connected to switches.”