Filed: Oct. 30, 2012
Latest Update: Feb. 12, 2020
Summary: Case: 11-13998 Date Filed: 10/30/2012 Page: 1 of 25 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 11-13998 _ D.C. Docket No. 2:98-cv-02581-JEO MARTHA SELF, an Individual,llllllllllll llllllllllllllllllllllllllllllll Plaintiff - Appellant, versus BELLSOUTH MOBILITY, INC., a Corporation, AMERICAN CELLULAR COMMUNICATIONS CORPORATION, CINGULAR WIRELESS, LLC, llllllll Defendants - llllllll Third Party Plaintiffs - llllllll Appellees, GTE WIRELESS INCORPORATED, a Corpo
Summary: Case: 11-13998 Date Filed: 10/30/2012 Page: 1 of 25 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 11-13998 _ D.C. Docket No. 2:98-cv-02581-JEO MARTHA SELF, an Individual,llllllllllll llllllllllllllllllllllllllllllll Plaintiff - Appellant, versus BELLSOUTH MOBILITY, INC., a Corporation, AMERICAN CELLULAR COMMUNICATIONS CORPORATION, CINGULAR WIRELESS, LLC, llllllll Defendants - llllllll Third Party Plaintiffs - llllllll Appellees, GTE WIRELESS INCORPORATED, a Corpor..
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Case: 11-13998 Date Filed: 10/30/2012 Page: 1 of 25
[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 11-13998
________________________
D.C. Docket No. 2:98-cv-02581-JEO
MARTHA SELF,
an Individual,llllllllllll
llllllllllllllllllllllllllllllll Plaintiff - Appellant,
versus
BELLSOUTH MOBILITY, INC.,
a Corporation,
AMERICAN CELLULAR COMMUNICATIONS CORPORATION,
CINGULAR WIRELESS, LLC,
llllllll Defendants -
llllllll Third Party Plaintiffs -
llllllll Appellees,
GTE WIRELESS INCORPORATED,
a Corporation, et al.,
llllllll Defendants,
AT & T MOBILITY, LLC,
llllllll Defendant - Appellee,
Case: 11-13998 Date Filed: 10/30/2012 Page: 2 of 25
FEDERAL COMMUNICATIONS COMMISSION, et al.,
llllllll Third Party Defendants.
________________________
Appeal from the United States District Court
for the Northern District of Alabama
________________________
(October 30, 2012)
Before TJOFLAT, CARNES, and JORDAN, Circuit Judges.
CARNES, Circuit Judge:
Spurred on by Congress, the Federal Communications Commission issued
an order requiring telecommunications carriers to make payments into a Universal
Service Fund for subsidizing services for certain categories of consumers. The
carriers’ mandatory payments into the fund were calculated based on their
interstate and intrastate revenues. The FCC allowed the carriers to recover the
amount of their payments by charging their customers a monthly fee.
After the order went into effect and the carriers made payments into the
fund and collected fees from their customers, a federal appeals court held that the
FCC had exceeded its authority by including intrastate revenues in the calculation
of the payments the carriers were required to make. The court did not decide what
should be done about the money the carriers had already paid into the fund or
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about the fees the customers had already paid to the carriers. The FCC, however,
issued orders determining that the court decision would not be applied
retroactively and that there would be no refunds of the payments that the carriers
had made. The question remains what should happen to the intrastate portion of
the fees that the customers paid to reimburse the carriers for the payments they
made to the fund. Are the customers entitled to a refund of any portion of the fees
they paid the carriers even though the FCC has denied the carriers a refund of any
portion of the payments the carriers made to the fund?
That is the motivating issue in this case, but it is not the specific question
presented by this appeal. Instead, the question we have is whether the district
court has subject matter jurisdiction to decide that issue. In answering that
question, we are reminded of Justice Holmes’ view about the comparative
difficulty of deciding cases. He said that “when you walk up to the lion and lay
hold the hide comes off and the same old donkey of a question of law is
underneath.”1 In our experience that view is not always accurate, but it is here.
The best way for us to get the hide off the lion in this case is to summarize the
1
Letter from Oliver Wendell Holmes, Jr. to Frederick Pollock (Dec. 11, 1909), in
1 Holmes – Pollock Letters: The Correspondence of Mr. Justice Holmes and Sir Frederick
Pollock 1874–1932 156 (Mark DeWolfe Howe ed., 2nd ed. 1941).
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applicable law, including the relevant FCC orders, before setting out the
procedural history and facts. Be forewarned that there is a lot of hide.
I.
Congress passed the Telecommunications Act of 1996, Pub. L. No. 104-
104, 110 Stat. 56, to ensure that all Americans have access to a baseline level of
affordable telecommunications services. To help achieve that goal, the Act directs
the FCC to create “specific, predictable and sufficient Federal and State
mechanisms to preserve and advance universal service.” 47 U.S.C. § 254(b)(5).
The Act also lists several “[u]niversal service principles” that the FCC must follow
when creating those federal and state mechanisms.
Id. § 254(b). One principle is
that telecommunications services should be available to consumers “in all regions
of the Nation, including low-income consumers and those in rural, insular, and
high cost areas.”
Id. § 254(b)(3). Another principle is that “schools and
classrooms, health care providers, and libraries should have access to advanced
telecommunications services.”
Id. § 254(b)(6).
The Act does not allocate any funds to finance the FCC’s creation and
administration of the “universal service support mechanisms.”
Id. § 254(a)(1); see
also
id. § 254(d). Instead, it provides that all interstate telecommunications
carriers “shall contribute, on an equitable and nondiscriminatory basis, to the . . .
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mechanisms established by the [FCC] to preserve and advance universal service.”
Id. § 254(d). In other words, carriers must fund any universal service support
mechanisms that the FCC creates under its § 254(b) authority.
The FCC implemented the Act’s universal service requirements by issuing a
“Universal Service Order” in May 1997. In re Fed.-State Joint Bd. on Universal
Serv., 12 FCC Rcd. 8776 (1997) [hereinafter “Universal Service Order”], aff’d in
part and rev’d in part by Tex. Office of Pub. Util. Counsel v. FCC,
183 F.3d 393
(5th Cir. 1999). That order created “universal service support mechanisms” for
four different categories of need: high-cost areas, low-income consumers, rural
healthcare providers, and schools and libraries.
Id. at 8787, 8792–97. All four
categories of support were financed through a Universal Service Fund (“USF”),
which was in turn funded by mandatory contributions from interstate
telecommunications carriers.
Id. at 8797; see also
id. at 8780–81. The
contributions used to finance the high-cost and the low-income support
mechanisms were based solely on the carriers’ interstate revenues.
Id. at 9201; see
also
id. at 9198. The contributions used to support schools, libraries, and rural
healthcare providers, however, were based in part on the carriers’ intrastate
revenues.
Id. at 9203–05; cf. id. at 9192 (“[T]he Commission has jurisdiction to
assess contributions for the universal service support mechanisms from intrastate
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as well as interstate revenues . . . .”).
The Universal Service Order authorized carriers to recover their mandatory
USF contributions from certain customers.
Id. at 9198–99. Specifically, the order
stated that “carriers will be permitted, but not required, to pass through their
contributions to their interstate access and interexchange customers.”
Id. at 9199
(emphasis added). It seems odd to describe the carriers as “pass[ing] through their
contributions” by requiring customers to pay them, but such is FCC-speak. The
Universal Service Order did not specify how the carriers should pass through their
USF contributions if they chose to do so (which, of course, they did). The order
did provide that any passing through had to be done “in an equitable and
nondiscriminatory fashion.”
Id. at 9209; see also
id. at 9199. Carriers started
making their mandatory USF contributions and passing them through to customers
on January 1, 1998.
Id. at 8813.
In later orders, the FCC appointed the Universal Service Administrative
Company to administer all universal service program activities. See, e.g., In re
Changes to the Bd. of Directors of the Nat’l Exch. Carrier Assoc., Inc., 12 FCC
Rcd. 18400, 18407, 18415 (1997); see also 47 C.F.R. § 54.701(a). That company
is responsible for, among other things, “billing [carriers], collecting contributions
to the universal service support mechanisms, and disbursing universal service
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support funds.” 47 C.F.R. § 54.702(b).
After the FCC issued the Universal Service Order, several carriers
challenged it by filing petitions for review in various federal courts of appeals.
See generally 28 U.S.C. § 2344 (“Any party aggrieved by [a] final order [of the
FCC] may, within 60 days after its entry, file a petition to review the order in the
court of appeals wherein venue lies.”). The Judicial Panel on Multidistrict
Litigation consolidated those challenges in the Fifth Circuit, which resolved all of
them in Texas Office of Public Utility Counsel v. FCC,
183 F.3d 393 (5th Cir.
1999).
The Texas Office decision resolved a number of issues about the legality of
different parts of the Universal Service Order, but only one of the rulings is
relevant here. The Fifth Circuit decided that the FCC had “exceeded its
jurisdictional authority when it assessed contributions . . . based on the combined
intrastate and interstate revenues of interstate telecommunications providers.”
Id.
at 409. The Court reasoned that, because the FCC has no jurisdiction to regulate
intrastate telecommunications matters, it could not calculate carriers’ USF
contributions based on a percentage of their intrastate revenues. See
id. at 447–48.
For that reason, the Court “reverse[d] that portion of the [Universal Service] Order
that includes intrastate revenues in the calculation of universal service
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contributions.”
Id. at 448; see also
id. at 449 (“[We] deny the FCC jurisdiction
over . . . universal service contributions based on intrastate revenues.”).
That is what the Fifth Circuit decided in Texas Office, but equally important
for our purposes is what the Court did not decide in that case. The Court did not
decide the legality of those parts of the Universal Service Order that allowed
carriers to pass through their USF contributions to customers. Nor did the Court
decide whether the Universal Service Administrative Company must refund the
intrastate-revenue-based USF contributions it had already collected from carriers.
Neither of those issues was before the Court.
The Fifth Circuit released its Texas Office decision on July 30, 1999, with
the mandate scheduled to issue on September 20, 1999. See In re Fed.-State Joint
Bd. on Universal Serv., 15 FCC Rcd. 1679, 1685 (1999) [hereinafter “Fifth Circuit
Remand Order”]. Before the mandate issued, the FCC moved for a stay of
proceedings, which the Court granted in part by ordering that its mandate would
issue on November 1, 1999.
Id. Until that date, the FCC, via the Universal
Service Administrative Company, continued to collect some of the USF
contributions from carriers based on a percentage of their intrastate and interstate
revenues.
During the period between January 1, 1998 (when the FCC’s Universal
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Service Order became effective), and November 1, 1999 (when the Texas Office
mandate issued), the Universal Service Administrative Company collected from
carriers about $1.6 billion in USF contributions that were based on the carriers’
intrastate revenues. See In re Fed.-State Joint Bd. on Universal Serv. Access
Charge Reform Univ. Serv. Contribution Methodology, 23 FCC Rcd. 6221, 6227
(2008). Many carriers passed through their USF contributions to customers by
charging them a monthly USF fee. One of those carriers was AT&T, the
defendant in this case, and one of its customers was Martha Self, the plaintiff.
After the Fifth Circuit issued the Texas Office decision but before the
mandate issued on November 1, 1999, the FCC released what it has titled a “Fifth
Circuit Remand Order.” See 15 FCC Rcd. 1679. That order acknowledged that
the Texas Office decision had held “that the Commission had exceeded its
jurisdictional authority by assessing contributions . . . based, in part, on the
intrastate revenues of universal service contributors.”
Id. at 1684. To cure that
defect, the FCC’s Fifth Circuit Remand Order “eliminated intrastate revenues from
the contribution base[s]” of the schools and libraries support mechanism and also
from the rural healthcare providers support mechanism (the only two that were
funded using USF contributions based in part on intrastate revenues).
Id. at 1685.
The FCC replaced those contribution formulas with a new one that calculated the
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carriers’ USF contributions by using a percentage of their interstate and
international revenues.
Id. at 1685–86. Most importantly for present purposes,
the Fifth Circuit Remand Order specified that the changes to the USF contribution
bases would apply prospectively and would become effective on the same day that
the mandate issued for the Texas Office decision, November 1, 1999.
Id. at 1685;
see also
id. at 1679. That order did not mention the possibility of any refund.
On December 6, 1999, AT&T filed with the FCC a petition for
reconsideration and clarification of its Fifth Circuit Remand Order. See In re
Fed.-State Joint Bd. on Universal Serv. Access Charge Reform, 20 FCC Rcd.
13779, 13780 (2005) [hereinafter “2005 Bureau Order”]. The petition asked the
FCC to “reconsider its decision to implement the Fifth Circuit’s decision on a
prospective basis.”
Id. at 13780–81. The petition also asked the FCC “to provide
retroactive refunds for [AT&T’s] contributions based on intrastate revenues for
the period from January 1, 1998 through October 31, 1999.”
Id. at 13781. AT&T
states in its brief to this Court that it represented to the FCC that any refunds from
the USF “would be passed on to its customers.” Appellee Br. 3–4.
The FCC did not respond to AT&T’s petition for more than five years. In
August 2005, the FCC’s Wireline Competition Bureau issued an order addressing,
but not resolving, the petition. This “2005 Bureau Order” “clarif[ied] the
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Commission’s decision in the [FCC’s 1999] Fifth Circuit Remand Order to apply
the Fifth Circuit decision prospectively,” which meant that the changes to the USF
contribution formulas “became effective on a prospective basis, beginning
November 1, 1999.” 20 FCC Rcd. at 13783 (2005) (emphasis omitted). The 2005
Bureau Order also reiterated the view that the Texas Office decision did not affect
those parts of the Universal Service Order that authorized carriers to pass through
their USF contributions to customers. See
id. at 13779, 13781. The order did not
address AT&T’s request for a refund.2
A few years later, on April 11, 2008, the FCC finally issued an order
denying AT&T’s 1999 petition for reconsideration and a refund. See In re Fed.-
State Joint Bd. on Universal Serv. Access Charge Reform Universal Serv.
Contribution Methodology, 23 FCC Rcd. 6221 (2008) [hereinafter “2008 Order”].
This 2008 Order again clarified that carriers “may recover their [USF]
contributions from customers through rates charged for all services,”
id. at 6224,
and it confirmed that the Texas Office decision applies only “prospectively,”
id. at
2
It is not clear whether an order issued by the FCC’s Wireline Competition Bureau is a
“final order[] of the Federal Communications Commission” within the meaning of 28 U.S.C. §
2342. We do not resolve that issue here because it does not affect the outcome of this case. We
do note, however, that the FCC has treated the 2005 Bureau Order as if it were issued by the full
Commission. See, e.g., In re Fed.-State Joint Bd. on Universal Serv. Access Charge Reform
Universal Serv. Contribution Methodology, 23 FCC Rcd. 6221, 6224 (2008) (describing the
2005 Bureau Order as one in which “we clarified” the impact of the Fifth Circuit’s Texas
Office decision).
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6226. Because the court decision does not apply retroactively, the FCC
concluded, AT&T is not entitled to a refund of the intrastate-revenue-based USF
contributions, which AT&T paid to the Universal Service Administrative
Company before the Texas Office mandate issued on November 1, 1999.
Id. at
6222.
The FCC’s 2008 Order justified its prospective treatment of the Texas
Office decision and its denial of a refund to carriers by reasoning that “retroactive
application” of that decision “would work a manifest injustice” on current
customers and on the universal service support mechanisms.
Id. at 6227.
According to the FCC, “a decision to compel refunds would require [the Universal
Service Administrative Company] to refund to the contributing carriers more than
one billion dollars in monies already disbursed to thousands of schools, libraries
and rural health care providers.”
Id. Recouping that already-distributed money
and sending it back to carriers “would be a bit like unscrambling eggs.”
Id. at
6228 (quotation marks omitted).
The FCC also reasoned that, because it was not feasible to get the money
back from schools, libraries, and rural healthcare providers, the Universal Service
Administrative Company would have to raise the revenue for a refund by raising
the USF assessments on current carriers.
Id. at 6227. Those current carriers
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would, in turn, likely pass through the higher USF assessments to their current
customers.
Id. at 6227–28. The FCC explained:
The net effect of any such refund would be that 2008 consumers
subsidize charges that should have been paid by consumers in 1998
and 1999 had the Commission assessed only interstate and
international revenue (and excluded intrastate revenue). In our view,
such an outcome—higher USF charges to today’s customers—would
be fundamentally at odds with our Section 254 mandate to preserve
and advance universal service. Today’s consumers would have to
shoulder the burden of the refunds while having no responsibility for
causing the underlying problem. The harms to today’s end-users and
to the universal service system itself would be undeniable should
retroactive effect be given to the Fifth Circuit decision.
Id. at 6227 (footnotes omitted).
On top of all that, the FCC continued, there would be large administrative
costs and burdens of issuing a refund.
Id. at 6228. Carriers would have to spend
an “enormous” amount of time to track down customers from the 1990s just to
give them a small refund.
Id. The cost of locating those former customers could
potentially “overwhelm the amounts available for distribution as refunds.”
Id. at
6228–29. For those reasons, the FCC’s 2008 Order refused to apply the Texas
Office decision retroactively and denied AT&T’s request for a refund of the
intrastate-revenue-based USF contributions, which AT&T had paid to the
Universal Service Administrative Company between January 1, 1998 and October
31, 1999. See
id. at 6222.
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II.
We now turn to the facts of this case, which are undisputed. In February
1995, before Congress passed the Telecommunications Act of 1996, Martha Self
entered into a contract with AT&T for interstate cellular phone service. A few
years later, AT&T notified her that, beginning with the January 1998 billing cycle,
it was going to start charging her a “per-line Universal Service Support charge.”
That charge was AT&T’s pass through of the USF contributions it was required to
make under the FCC’s Universal Service Order. Cf. 47 C.F.R. § 69.131
(authorizing telecommunications carriers to recover their USF contributions from
customers on a “per-line basis”); In re Telecomms. Relay Serv., N. Am.
Numbering Plan, 17 FCC Rcd. 24952, 24975–76 (2002) (explaining that carriers
may recover their USF contributions as a “separate universal service line-item
charge”).
Unhappy about the new charge on her cell phone bill, Self filed a putative
class action against AT&T in Alabama state court in September 1998. Her
complaint asserted a number of state law claims, including breach of contract and
unjust enrichment. AT&T timely removed the case to federal district court.
Not much happened in the case for several years after it was removed
because AT&T and other telecommunications carriers were busy challenging the
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FCC’s Universal Service Order in the Fifth Circuit’s Texas Office proceedings. In
March 2000, which was four months after the mandate had issued in the Texas
Office case, the district court stayed proceedings in this case pending the outcome
of AT&T’s petition to the FCC for reconsideration of the 1999 Fifth Circuit
Remand Order. The case sat still for four more years.
In October 2004, Self filed a fifth amended complaint, which is the relevant
one for this appeal, re-alleging her state law claims of breach of contract and
unjust enrichment. She also added two federal claims under the Federal
Communications Act, 47 U.S.C. § 151 et seq. The first of those FCA claims
alleged that AT&T had violated § 201(b), which provides that “[a]ll charges,
practices, classifications, and regulations for and in connection with . . .
communication service, shall be just and reasonable.” Self’s second FCA claim
alleged that AT&T had violated § 202(a), which makes it unlawful “for any
common carrier to make any unjust or unreasonable discrimination in charges,
practices, . . . or services.” See generally 47 U.S.C. § 206 (authorizing actions
against carriers for violations of the FCA).
Self’s theory of recovery for the claims in her fifth amended complaint is
that between January 1, 1998 and October 31, 1999, AT&T passed through to its
customers a USF support charge that was based, in part, on intrastate revenues.
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Because the Texas Office decision declared that those intrastate-revenue-based
USF contributions were unlawfully assessed on carriers, it follows that AT&T had
charged Self and customers like her unlawful fees to reimburse itself for
contributions that had been unlawfully assessed. Thus AT&T charged Self and
other customers unlawfully calculated fees. Charging customers those fees, Self
claims, was a breach of the cell phone service contract, an unlawful taking, and an
“unjust or unreasonable” charge in violation of 47 U.S.C. § 201(b) and § 202(a).
As a remedy for AT&T’s alleged misconduct, Self and her putative class members
seek a refund of the intrastate-revenue-based USF fees that AT&T charged its
customers between January 1, 1998 and October 31, 1999.
After Self filed her fifth amended complaint, the district court lifted its stay
of proceedings and the case started moving again. Self and AT&T eventually filed
cross motions for summary judgment. AT&T’s motion contended that all of
Self’s claims should be dismissed for lack of subject matter jurisdiction because
they are improper collateral attacks in the district court on final orders of the FCC.
Self’s motion asked the district court to declare that it does have jurisdiction over
her claims.
The district court withheld a ruling on the parties’ cross motions for
summary judgment until the FCC released its 2008 Order. Less than two weeks
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after that FCC order issued, the district court entered its own order resolving the
parties’ motions. The court made a number of rulings, but only one of them is at
issue in this appeal. The court ruled that it lacks jurisdiction to decide Self’s FCA
claims, her state law breach of contract claim, and her state law unjust enrichment
claim “to the extent that they seek retroactive application of the Texas Office
holding.”3
III.
At first blush, it would seem that the district court has jurisdiction over all
of Self’s claims based on a variety of statutes, including those creating federal
question jurisdiction, 28 U.S.C. § 1331, diversity jurisdiction,
id. § 1332, and
supplemental jurisdiction,
id. § 1367(a). And beyond those more general grants of
3
The district court did not dismiss all of Self’s claims for lack of jurisdiction. It
concluded, for example, that “[t]o the extent that the plaintiff asserts claims of unjust and
unreasonable charges under [47 U.S.C.] § 201(b) (e.g., collecting more than was authorized,
using a greater factor than allowed by the FCC), the court does have jurisdiction to entertain the
same.” Self and AT&T continued to litigate that and other claims after the district court ruled on
the parties’ cross motions for summary judgment. AT&T later filed a renewed motion for
summary judgment on all of Self’s remaining claims (those that the court had not already
dismissed for lack of jurisdiction), and the court granted in full AT&T’s renewed motion. It was
then that Self filed her notice of appeal.
Self does not challenge the court’s grant of summary judgment to AT&T on all of her
claims that the court concluded it did have jurisdiction to hear. She has raised only the issue of
whether the court “erred in holding that it was without jurisdiction to hear Self’s federal and state
law claims for a refund of universal service fees.” Appellant Br. 1. Accordingly, when we refer
to “Self’s claims” and “Self’s claims for a refund,” we are referring to the claims that are relevant
to this appeal—those that the district court dismissed for lack of jurisdiction when it ruled on the
parties’ initial cross motions for summary judgment.
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jurisdiction, the Federal Communications Act gives district courts jurisdiction
over any claims brought under that statute. See 47 U.S.C. § 207 (“Any person
claiming to be damaged by any common carrier subject to the provisions of this
chapter may . . . bring suit for the recovery of the damages for which such
common carrier may be liable under the provisions of this chapter, in any district
court of the United States of competent jurisdiction.”).
But things are not always as they seem. There is another statute in the mix,
and it provides that: “The court of appeals (other than the United States Court of
Appeals for the Federal Circuit) has exclusive jurisdiction to enjoin, set aside,
suspend (in whole or in part), or to determine the validity of . . . all final orders of
the Federal Communications Commission made reviewable by section 402(a) of
title 47 . . . .” 28 U.S.C. § 2342 (emphasis added). Section 402(a) states that
“[a]ny proceeding to enjoin, set aside, annul, or suspend any order of the
Commission under this chapter . . . shall be brought as provided by and in the
manner prescribed in [28 U.S.C. § 2342].” 47 U.S.C. § 402(a).
Because the courts of appeals have exclusive jurisdiction over claims to
enjoin, suspend, or invalidate a final order of the FCC, the district courts do not
have it. See FCC v. ITT World Commc’ns, Inc.,
466 U.S. 463, 468,
104 S. Ct.
1936, 1939 (1984) (“Exclusive jurisdiction for review of final FCC orders . . . lies
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in the Court of Appeals.”). That means district courts cannot determine the
validity of FCC orders. See Nat’l Ass’n of State Util. Consumer Advocates v.
FCC,
457 F.3d 1238, 1247 (11th Cir. 2006) (explaining that 28 U.S.C. § 2342
“vests exclusive jurisdiction in the courts of appeals to determine the validity of all
final orders of the Commission” (alterations omitted)).
The district court reasoned that 28 U.S.C. § 2342 deprived it of jurisdiction
to hear Self’s claims for a refund because “in order to adjudicate [her] claims it is
necessary to determine, in part, the validity of certain actions of the FCC.” The
court acknowledged that the Texas Office decision had held that the FCC could
not assess intrastate revenues of service providers in calculating USF
contributions. It went on to note that the FCC’s Fifth Circuit Remand Order and
its 2008 Order determined that Texas Office did not apply retroactively to events
occurring before the mandate for that decision issued on November 1, 1999. Self,
however, is seeking a refund of fees that she paid before that date—namely, the
USF fees that AT&T charged her between January 1, 1998 and October 31, 1999.
According to the district court, in order to rule that those USF fees were
unlawfully assessed it would have to decide that the Texas Office decision should
be applied retroactively to the fees Self paid before November 1, 1999, which
would contradict the prospective-only determinations in the two FCC orders. For
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that reason, the district court concluded that Self’s claims against AT&T
challenged the validity of the two FCC orders, and under 28 U.S.C. § 2342 it
lacked jurisdiction to decide such challenges. That is why the court dismissed
Self’s claims for lack of jurisdiction. Self disagrees with that reasoning and result.
IV.
With the hide off, this case does reduce to what Justice Holmes would call a
donkey of a question of law: Do Self’s claims necessarily conflict with final
orders of the FCC and thereby depend on the district court being able to
collaterally review the correctness or validity of those orders? We agree with the
district court that the answer is yes.
In order to establish that she was unlawfully charged a portion of AT&T’s
intrastate-revenue-based USF contributions, Self relies on the Fifth Circuit’s
Texas Office decision. That decision does not help her unless it applies to fees
that were charged between January 1, 1998 and October 31, 1999, which is the
only period during which Self was charged fees based on AT&T’s intrastate
revenues. If, as the FCC orders in question determined, the Texas Office decision
does not apply to any fees charged before the mandate issued in that case on
November 1, 1999, then Self loses. It follows that Self’s claims necessarily
depend on her establishing that at least parts of the FCC’s Fifth Circuit Remand
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Order and its 2008 Order are wrong as a matter of law or are otherwise invalid.
She may seek review of the relevant parts of those orders and attempt to establish
the invalidity of them in the court of appeals, after seeking reconsideration in the
FCC, see 28 U.S.C. § 2344, but she may not seek collateral review of them by
filing claims in the district court, see
id. § 2342; ITT World
Commc’ns, 466 U.S.
at 468, 104 S.Ct. at 1939–40.
Self tries to disguise the donkey by arguing that her claims do not attack the
validity of a final FCC order because “there is no order of the FCC that required
[AT&T] to extract USF charges from its customers.” Appellant Br. 45. She
insists that because there is no FCC order compelling carriers to pass through their
intrastate-revenue-based USF contributions, her position that AT&T wrongfully
charged her those fees does not conflict with any FCC order. We are convinced
that it does.
Although no FCC order compels carriers like AT&T to recover their USF
contributions from customers, at least three FCC orders expressly permit carriers
to do so. The Universal Service Order states that carriers are “permitted . . . to
pass through their contributions,” 12 FCC Rcd. at 9199, the Fifth Circuit Remand
Order reiterates that carriers may “recover[] their universal service contributions
[through] an end-user charge,” 15 FCC Rcd. at 1693, and the 2008 Order
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“reconfirm[s] that [carriers] may recover their universal service contributions
through rates charged for all of their services,” 23 FCC Rcd. at 6222. To prevail
on her claims, Self must establish that carriers are not permitted to pass through to
their customers the cost of their contributions, which would mean that the FCC
orders are wrong or invalid. The district court correctly concluded that it lacks
jurisdiction to review those orders.
Self also contends the district court erred in ruling that her claims for a
refund conflict with the FCC’s 2008 Order, which is the one that denied AT&T’s
request for a refund from the Universal Service Administrative Company. She
argues that the 2008 Order applies only to “carriers seeking refunds of USF fees
that carriers were required to pay,” and points out that she is not a carrier but is
instead a customer seeking a refund from a carrier. Appellant Reply Br. 2. She
asserts that the order is “silent as to the retroactive application of Texas Office to
refund requests by customers,” Appellant Reply Br. 4, and because the 2008 Order
does not address whether Texas Office applies retroactively to refund requests by
customers, the district court would not have to review and invalidate that order to
decide that Texas Office applies retroactively to her claims.
We disagree with Self about the scope of the 2008 Order. It did not decide
only that carriers are not entitled to a refund. In the petition leading to that order,
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Case: 11-13998 Date Filed: 10/30/2012 Page: 23 of 25
AT&T sought reconsideration of the Fifth Circuit Remand Order and asked the
FCC to do two things: (1) determine that the Texas Office decision applied
retroactively, and (2) order that refunds be given to carriers “for contributions
based on intrastate revenues for the period from January 1, 1998 through October
31, 1999.” 2005 Bureau Order, 20 FCC Rcd. at 13780–81. The FCC’s 2008
Order denied both requests, reconfirming the agency’s view that Texas Office
applies only prospectively. See 2008 Order, 23 FCC Rcd. at 6226–27. The FCC
denied AT&T a refund in the 2008 Order because the Commission adhered to its
earlier decision that Texas Office did not apply retroactively.
Id. at 6222. Self’s
argument is based on the false premise that the FCC’s 2008 Order did not decide
that the Texas Office decision applies prospectively only—from November 1,
1999 forward. It did decide that, and so did the FCC’s earlier Fifth Circuit
Remand Order.
Finally, Self contends that her claims for a refund do not seek to invalidate
any FCC order because the Universal Service Order is “void ab initio” as a result
of the Texas Office decision. Appellant Br. 39. She cites to decisions holding that
agency actions that exceed the agency’s jurisdictional authority are “a mere
nullity,” Dixon v. United States,
381 U.S. 68, 74,
85 S. Ct. 1301, 1305 (1965), and
she argues that because the FCC acted beyond its authority in imposing on carriers
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a USF contribution based on their intrastate revenues, we should treat the
Universal Service Order as if it never existed. And if the order never existed, she
continues, then there was no FCC order between January 1, 1998 and October 31,
1999 that authorized AT&T to charge its customers intrastate-revenue-based USF
fees. If so, then AT&T had no legal authority to charge her those fees.
This argument puts the cart before the donkey. For the district court to
decide that the Universal Service Order is void ab initio, it would have to first
decide that the Texas Office decision applies retroactively to invalidate that order
from the beginning, that is, from the date the order became effective on January 1,
1998. In order to do that, the district court would have to decide that the Universal
Service Order and the FCC orders determining that Texas Office does not apply
retroactively are invalid because they exceed the agency’s jurisdictional authority.
As we have already stated several times, that is something that the district court
lacks jurisdiction to decide. Because the district court lacks jurisdiction to review
the FCC’s orders at all, it lacks jurisdiction to decide whether the orders are
invalid because they are outside the jurisdictional authority of the agency. Cf.
King v. Cessna Aircraft Co.,
505 F.3d 1160, 1165 (11th Cir. 2007) (explaining
that an appellate court that lacks jurisdiction to review a trial court’s decision also
lacks jurisdiction to review whether the trial court had jurisdiction over the case);
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Main Drug, Inc. v. Aetna U.S. Healthcare, Inc.,
475 F.3d 1228, 1229–30 (11th Cir.
2007) (same). To pin the tail on the donkey: a court without jurisdiction to
review agency actions lacks jurisdiction to decide whether the agency had
jurisdiction to act as it did.
The district court correctly decided that it lacked jurisdiction to decide
Self’s claims.
AFFIRMED.
25