Filed: Nov. 13, 2015
Latest Update: Mar. 02, 2020
Summary: PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 15-1008 CORETEL VIRGINIA, LLC, Plaintiff – Appellant, v. VERIZON VIRGINIA, LLC; VERIZON SOUTH, INC.; MCIMETRO ACCESS TRANSMISSION SERVICES, LLC; MCI COMMUNICATIONS SERVICES, INC.; VERIZON BUSINESS GLOBAL LLC; BELL ATLANTIC COMMUNICATIONS, INC., d/b/a Verizon Long Distance, Defendants – Appellees. Appeal from the United States District Court for the Eastern District of Virginia, at Alexandria. Claude M. Hilton, Senior District Ju
Summary: PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 15-1008 CORETEL VIRGINIA, LLC, Plaintiff – Appellant, v. VERIZON VIRGINIA, LLC; VERIZON SOUTH, INC.; MCIMETRO ACCESS TRANSMISSION SERVICES, LLC; MCI COMMUNICATIONS SERVICES, INC.; VERIZON BUSINESS GLOBAL LLC; BELL ATLANTIC COMMUNICATIONS, INC., d/b/a Verizon Long Distance, Defendants – Appellees. Appeal from the United States District Court for the Eastern District of Virginia, at Alexandria. Claude M. Hilton, Senior District Jud..
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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 15-1008
CORETEL VIRGINIA, LLC,
Plaintiff – Appellant,
v.
VERIZON VIRGINIA, LLC; VERIZON SOUTH, INC.; MCIMETRO ACCESS
TRANSMISSION SERVICES, LLC; MCI COMMUNICATIONS SERVICES,
INC.; VERIZON BUSINESS GLOBAL LLC; BELL ATLANTIC
COMMUNICATIONS, INC., d/b/a Verizon Long Distance,
Defendants – Appellees.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Claude M. Hilton, Senior
District Judge. (1:12-cv-00741-CMH-TCB)
Argued: September 16, 2015 Decided: November 13, 2015
Before WILKINSON, NIEMEYER, and DUNCAN, Circuit Judges.
Affirmed by published opinion. Judge Duncan wrote the opinion,
in which Judge Wilkinson and Judge Niemeyer joined.
ARGUED: Edward Jay Tolchin, OFFIT KURMAN, P.A., Tysons Corner,
Virginia, for Appellant. Scott H. Angstreich, KELLOGG, HUBER,
HANSEN, TODD, EVANS & FIGEL, P.L.L.C., Washington, D.C., for
Appellees. ON BRIEF: Eduardo F. Bruera, KELLOGG, HUBER, HANSEN,
TODD, EVANS & FIGEL, P.L.L.C., Washington, D.C., for Appellees.
DUNCAN, Circuit Judge:
CoreTel Virginia, LLC (“CoreTel”), a telecommunications
company, has entered into interconnection agreements with
Verizon Virginia, LLC and Verizon South, Inc. (collectively
“Verizon”) in accordance with the Telecommunications Act of
1996, Pub. L. No. 104-104, 110 Stat. 56 (codified at 47 U.S.C.
§ 151 et seq.). In this second appeal arising out of a
disagreement between CoreTel and Verizon over their respective
obligations under those interconnection agreements, CoreTel
disputes the district court’s determination that it owes Verizon
$227,974.22 for the use of Verizon’s telecommunications
facilities and $138,724.47 in late-payment fees. For the
reasons that follow, we affirm.
I.
The Telecommunications Act of 1996 (the “Act”) provides the
context for this dispute between CoreTel and Verizon. As we
explained more fully in our first opinion, the Act requires
incumbent local exchange carriers such as Verizon to allow
competitive local exchange carriers such as CoreTel to connect
with end users over the incumbent’s network. See CoreTel Va.,
LLC v. Verizon Va., LLC, 752 F.3d 364, 366–68 (4th Cir. 2014)
(“CoreTel I”). Using the procedures set out in section 252 of
the Act, 47 U.S.C. § 252, carriers negotiate private agreements
2
with each other that establish the rates and terms under which
their networks will be interconnected. This case involves two
such interconnection agreements: one between CoreTel and Verizon
Virginia, and one between CoreTel and Verizon South (the
“ICAs”). 1
The ICAs govern, among other aspects of interconnection,
CoreTel’s use of Verizon’s physical telecommunications
facilities. In CoreTel I, we addressed the parties’ dispute
over what rates CoreTel must pay to use Verizon’s facilities.
See 752 F.3d at 370–72. Verizon took the position that it was
entitled to charge the rates set out in its tariffs filed with
state and federal regulatory agencies, and billed CoreTel
accordingly. CoreTel believed that the ICAs entitled it to
purchase access to Verizon facilities at a lower “total element
long-run incremental cost,” or “TELRIC” rate. 2 CoreTel declined
to pay not only the amounts set out in Verizon’s tariff-based
bills, but also the TELRIC-based amounts CoreTel contended
should have been billed.
1 We cite “the ICAs” throughout rather than distinguishing
between the Verizon Virginia ICA and the Verizon South ICA. The
two agreements are identical in all relevant respects except for
pricing, which is dealt in separate “pricing attachments.”
2 TELRIC is a cost-based pricing methodology established by
the Federal Communications Commission to encourage competition
among carriers. See, e.g., Verizon Commc’ns, Inc. v. Fed.
Commc’ns Comm’n, 535 U.S. 467, 495–96 (2002).
3
Verizon sued for breach of contract, bringing two claims
associated with CoreTel’s refusal to pay its tariff-based bills.
First, Verizon sought a declaratory judgment that, if CoreTel
failed to pay, Verizon was entitled to terminate CoreTel’s
service. Second, Verizon sought damages associated with
CoreTel’s breach of the ICAs.
In CoreTel I, we held that Verizon should have billed
CoreTel for facilities at TELRIC rather than tariff rates, and
that therefore “CoreTel was entitled to summary judgment in its
favor on . . . Verizon’s claim for declaratory relief relating
to Verizon’s facilities charges.” 752 F.3d at 372. We did not,
however, resolve Verizon’s claim for damages associated with
CoreTel’s breach of the ICAs. Rather, we remanded that claim so
that the district court could apply the proper TELRIC rates to
calculate what CoreTel owes Verizon for use of Verizon’s
facilities.
Id.
On remand, the district court held a bench trial, during
which Verizon presented the tariff-based monthly bills it had
issued to CoreTel and the “pricing attachments” to the ICAs.
The monthly bills detail (1) what facilities Verizon provided to
CoreTel; (2) whether the facility was provided by Verizon
Virginia or Verizon South and, if split between those two, the
percentage of the facility in each company’s service area; and
(3) for transport facilities billed by the mile, the number of
4
transport miles provided. The ICAs’ pricing attachments set out
the TELRIC rates associated with each type of facility. Pricing
is the only term on which the Verizon Virginia ICA and the
Verizon South ICA differ; the ICAs are otherwise identical in
all relevant respects.
From that evidence, Verizon developed a summary spreadsheet
containing an entry for every facility it provided to CoreTel
with the specific amount owed for each at TELRIC rates.
J.A. 865–99. The entries, in total, reflected debts of
$162,871.70 for Verizon Virginia facilities and $65,102.52 for
Verizon South facilities, for a total of $227,974.22 in damages.
Verizon also contended that it was entitled to late-payment
fees of 1.5% per month on the facilities charges under the ICAs.
To calculate the amount, Verizon presented another summary
spreadsheet detailing the total unpaid facilities charges
accrued (i.e., the principal) for each month and the total late
fees associated with those unpaid facilities charges. J.A. 900–
01. The late fees totaled $131,885.25.
CoreTel raised numerous objections to Verizon’s proposed
damages calculation, each of which the district court rejected
in entering judgment in favor of Verizon for the full amount it
5
sought--$227,974.22 in facilities charges and $138,724.47 in
late fees. 3 J.A. 451. This appeal followed.
II.
Under Virginia law, 4 “[t]he elements of a breach of contract
action are (1) a legally enforceable obligation of a defendant
to a plaintiff; (2) the defendant’s violation or breach of that
obligation; and (3) injury or damage to the plaintiff caused by
the breach of obligation.” Ramos v. Wells Fargo Bank, NA,
770 S.E.2d 491, 493 (Va. 2015) (citation omitted). CoreTel has
never disputed that the ICAs are valid contracts that require it
to pay for its use of Verizon’s facilities, that it has in fact
used Verizon facilities without paying for that use, or that its
failure to pay has injured Verizon.
The sole question in this appeal is whether the district
court properly calculated Verizon’s damages for CoreTel’s breach
as we instructed. CoreTel argues (1) that the district court
violated our mandate in CoreTel I by awarding as damages any
TELRIC-based facilities charges at all; (2) that even if Verizon
3The $6,839.22 difference between the late fees Verizon
calculated at the time of trial ($131,885.25) and the late fees
the district court awarded represents additional late-fee
accumulation during the two months that passed between the bench
trial and the judgment.
4The ICAs are governed by Virginia law except to the extent
federal law controls. ICAs § 28.5, J.A. 543.
6
can recover such facilities charges, the district court made
several errors in calculating the total amount owed; and
(3) that the district court further erred in calculating the
late fees CoreTel owes under the ICAs. In addressing CoreTel’s
arguments, we review the district court’s factual findings for
clear error and its conclusions of law de novo. See Helton v.
AT&T Inc., 709 F.3d 343, 350 (4th Cir. 2013).
A.
As we clarify during our discussion, several of CoreTel’s
arguments suffer from the same underlying flaw: a misperception
of the mandate rule. The mandate rule “is merely a specific
application of the law of the case doctrine.” United States v.
Pileggi, 703 F.3d 675, 679 (4th Cir. 2013) (citation omitted).
It “prohibits lower courts, with limited exceptions, from
considering questions that the mandate of a higher court has
laid to rest.” Moore v. Bennette,
517 F.3d 717, 727 (4th Cir.
2008) (citation omitted).
CoreTel appears to believe that our opinion in CoreTel I
froze not only the law of the case but also all the underlying
facts. Our remand order in CoreTel I, however, contemplated
that the district court would conduct additional fact-finding to
determine what CoreTel owes Verizon for facilities at TELRIC
rates. The only matter our mandate in CoreTel I “laid to rest”
with regard to Verizon’s facilities claims is that TELRIC rates
7
should apply, not tariff rates. The district court faithfully
followed that ruling.
B.
We first address CoreTel’s argument, under the guise of the
mandate rule, that our opinion in CoreTel I precludes Verizon
from recovering as damages any facilities charges at all.
Essentially, CoreTel interprets that opinion to have mandated
complete summary judgment in CoreTel’s favor on Verizon’s
facilities-related claims, leaving Verizon without a live claim
on which to seek damages. Thus, CoreTel argues, the district
court violated our mandate when it nonetheless awarded damages.
CoreTel misunderstands both CoreTel I and Verizon’s claims.
As we explain above, Verizon brought two claims related to its
provision of facilities to CoreTel: a declaratory-judgment claim
and a claim for damages associated with a breach of the ICAs.
In CoreTel I, we held that “CoreTel was entitled to summary
judgment in its favor on . . . Verizon’s claim for declaratory
relief relating to Verizon’s facilities charges,” because we
agreed with CoreTel that Verizon was limited to charging the
TELRIC rates for its facilities. 752 F.3d at 372 (emphasis
added). But we expressly did not resolve Verizon’s claim for
damages associated with CoreTel’s breach of the ICAs. Rather,
we “remand[ed] to the district court for consideration of . . .
8
Verizon’s damages claim.” Id. 5 Thus, the district court did not
violate our mandate when it considered Verizon’s damages claim. 6
C.
We turn next to CoreTel’s challenges to the district
court’s calculation of the outstanding facilities charges
CoreTel owes Verizon. To understand CoreTel’s arguments, some
background information about the ICAs is helpful. Under the
ICAs, the parties are to establish “interconnection points”
(“IPs”) at particular, agreed-upon locations. See ICA § 4.2.2,
J.A. 469. When a CoreTel customer calls a Verizon customer,
CoreTel is responsible for delivering that call to the relevant
Verizon IP, either by using its own facilities or by purchasing
access to Verizon’s facilities at the TELRIC rates set out in
5
CoreTel interprets this quotation to be instructing the
district court simply to undertake “the task of adding up the
damages Verizon was awarded, outside of its facilities claims.”
Appellant’s Br. at 30 (emphasis added). But the quotation comes
from a portion of CoreTel I that discusses solely Verizon’s
facilities claims, and the context makes clear that the “damages
claim” in question is Verizon’s breach-of-contract claim
associated with CoreTel’s failure to pay for facilities. See
CoreTel I, 752 F.3d at 370–72.
6
CoreTel further argues that the district court violated
our mandate by allowing Verizon to recover TELRIC-based damages
after it had contended, prior to CoreTel I, that its facilities
should be billed at tariff rates. This argument is similarly
unpersuasive. Far from a violation of the mandate, calculating
and awarding TELRIC-based damages to Verizon was the express
purpose for which we remanded this case to the district court
after CoreTel I. See id.
9
the ICAs. See
id. (“Each Party is responsible for delivering
its terminating traffic to the other Party’s relevant IP.”).
Once CoreTel delivers the call to the IP, Verizon is
responsible for delivering it the rest of the way to the call
recipient. CoreTel pays Verizon for doing so through a per-
minute “reciprocal compensation” charge. See CoreTel I,
752 F.3d at 369, 373. In fact, the ICAs define “interconnection
point” to mean “the point at which a Party who receives traffic
originating on the network of the other Party assesses
Reciprocal Compensation charges for the further transport and
termination of that traffic.” ICA § 1.37, J.A. 461.
The ICAs label the point at which CoreTel traffic passes
from CoreTel-owned facilities onto Verizon-owned facilities as
the “point of interconnection” (“POI”). 7 When CoreTel is able to
use its own facilities to deliver traffic all the way to the
relevant Verizon IP, the POI and the IP are necessarily at the
same location. But when CoreTel uses Verizon facilities to
which it has purchased access to deliver traffic to the Verizon
IP, the POI and the IP are distinct.
For such situations, the ICAs re-affirm the rule that the
mode of compensation does not switch from TELRIC-based
7
Specifically, the ICAs define “POI” to mean “the physical
location where the originating Party’s facilities physically
interconnect with the terminating Party’s facilities for the
purpose of exchanging traffic.” ICA § 1.54, J.A. 463.
10
facilities charges to reciprocal compensation until the traffic
passes the IP. See ICA § 4.2.3, J.A. 469 (“To the extent the
originating Party’s [POI] is not located at the terminating
Party’s relevant IP, the originating Party is responsible for
transporting its traffic from its POI to the terminating Party’s
relevant IP.”). In other words, CoreTel must pay TELRIC-based
facilities charges for any Verizon facilities it uses to
transport traffic between the POI and the relevant Verizon IP.
With that background in mind, we now turn to CoreTel’s
specific objections to the district court’s damages calculation.
CoreTel contends that the district court erred by (1) including
in its damages calculation any facilities charges associated
with Verizon South at all; (2) using the National Exchange
Carrier Association’s FCC Tariff No. 4 (“NECA Tariff No. 4”) to
allocate charges for facilities jointly provided by Verizon
Virginia and Verizon South; (3) using Verizon South’s TELRIC
rate to calculate damages for a multiplexer previously billed at
Verizon Virginia’s (lower) TELRIC rate; (4) including in its
damages calculation charges for transport between Verizon’s
“serving wire centers” and its IPs; (5) imposing 100% of the
TELRIC rate for certain facilities for which Verizon had
previously billed CoreTel only a percentage of its tariff rates;
and (6) failing to apply the two-year statute of limitations set
out in 47 U.S.C. § 415(a). We address CoreTel’s arguments in
11
turn below, ultimately rejecting each and affirming the district
court’s calculation of the TELRIC-based facilities charges
CoreTel owes Verizon.
1.
CoreTel first argues that it should not owe any facilities
charges at all to Verizon South because CoreTel traffic always
entered the Verizon network via Verizon Virginia facilities,
even when the traffic terminated with Verizon South. According
to CoreTel, it should have to pay only Verizon Virginia, through
whose facilities CoreTel’s traffic enters the Verizon network.
If CoreTel’s traffic thereafter uses Verizon South facilities,
CoreTel contends that Verizon Virginia, not CoreTel, should have
to compensate Verizon South for that use.
The ICAs, however, make clear that CoreTel must pay Verizon
Virginia for use of Verizon Virginia facilities and Verizon
South for use of Verizon South facilities, regardless of where
CoreTel traffic enters the Verizon network. Under section 4.2.2
of the ICAs, “[e]ach Party is responsible for delivering its
terminating traffic to the other Party’s relevant IP.”
J.A. 469. Moreover, the Verizon Virginia ICA expressly covers
“services in Verizon Virginia’s service territory . . . only,”
J.A. 612, and the Verizon South ICA expressly covers “only
services in Verizon South’s service territory,” J.A. 619. Thus,
12
the district court properly included Verizon South facilities
charges where CoreTel used Verizon South facilities.
2.
CoreTel also contends that the district court erred by
using NECA Tariff No. 4 to determine how to calculate charges
for facilities located partially in Verizon Virginia territory
and partially in Verizon South territory. NECA Tariff No. 4 is
an industry standard methodology used to establish, for
telecommunications facilities located in multiple companies’
territories, what percentage of a particular facility should be
billed by each company. It does not establish actual tariff
rates to be charged by those companies.
CoreTel does not contest that, as a general matter, NECA
Tariff No. 4 provides a proper methodology for apportioning
charges for jointly provided facilities. Instead, it argues
that the district court’s reliance on NECA Tariff No. 4 was
improper because “this Court has ruled that the ICA’s rates,
terms and conditions--not any Verizon tariff--apply to the
facilities Verizon provided.” Appellant’s Br. at 44. NECA
Tariff No. 4, however, is not a Verizon tariff; it is a tariff
filed by the National Exchange Carrier Association. Thus, the
district court’s use of NECA Tariff No. 4 did not contravene our
ruling in CoreTel I that Verizon’s tariffs do not apply here.
13
Moreover, the ICAs provide no guidance as to how billing
should be apportioned for facilities jointly provided by Verizon
Virginia and Verizon South. When the parties to a contract
“have not agreed with respect to a term which is essential to a
determination of their rights and duties,” the court supplies “a
term which is reasonable in the circumstances.” Restatement
(Second) of Contracts § 204 (1981). Here, the district court’s
decision to rely on an industry standard methodology was
eminently reasonable. 8
3.
We next address CoreTel’s contention that the district
court erred by using Verizon South’s TELRIC rate (rather than
Verizon Virginia’s) to calculate what CoreTel owes Verizon for
CoreTel’s use of a multiplexer located in Great Bridge,
Virginia. Great Bridge is in Verizon South’s territory. But
between January 2008 and March 2009, Verizon’s monthly bills
8 CoreTel’s other complaints concerning NECA Tariff No. 4
are equally unavailing. CoreTel asserts that NECA Tariff No. 4
is “inconsistent with the TELRIC methodology,” Appellant’s Br.
at 44, but offers neither an explanation of this purported
inconsistency nor any alternative method for apportioning
facilities charges for jointly provided facilities. CoreTel
also incorrectly claims that Verizon did not introduce NECA
Tariff No. 4 at trial. Although it is true that Verizon did not
introduce the entire nationwide tariff (most of which would have
been irrelevant), Verizon did introduce into evidence the
specific billing percentages from NECA Tariff No. 4 it relied
on. Those percentages appeared on Verizon’s monthly bills to
CoreTel, and CoreTel did not contest their accuracy at trial.
14
identified that multiplexer as being provided by Verizon
Virginia. At trial, Verizon introduced evidence that this was a
mistake and that the multiplexer should always have been
associated with Verizon South. Accordingly, in its damages
request, Verizon billed the Great Bridge multiplexer at the
Verizon South TELRIC rate (which is substantially higher than
the Verizon Virginia rate), except for the months for which its
bills had affirmatively associated the multiplexer with Verizon
Virginia. For those months, Verizon gave CoreTel the benefit of
the purported billing error and charged the lower Verizon
Virginia rate.
As CoreTel’s president conceded at trial, there is no
dispute that the Great Bridge multiplexer is located in Verizon
South territory. See J.A. 405–06. Nevertheless, CoreTel
contends that Verizon did not catch this mistake in previous
estimates of the damages CoreTel owes it, and should not be
permitted to “change the facts at its whim, after remand.”
Appellant’s Br. at 46.
CoreTel’s argument is without merit. Verizon was entitled
to present its evidence at trial that the Great Bridge
multiplexer should always have been billed at Verizon South’s
rate, just as CoreTel was entitled to counter with Verizon’s
monthly bills and prior damages calculations that showed the
Great Bridge multiplexer being associated with Verizon Virginia
15
at times. The district court considered both parties’ evidence,
and it did not clearly err in finding that Verizon’s was more
persuasive, particularly given CoreTel’s president’s concession
that the Great Bridge multiplexer is in Verizon South territory.
4.
We turn next to CoreTel’s argument that the district court
erred by including in its damages calculation charges for
transport between Verizon’s “serving wire centers” and the
relevant Verizon IP. This is essentially a dispute about the
definition of the term “entrance facility.” The ICAs define
“entrance facility” to mean “the facility between a Party’s
designated premises and the Central Office serving that
designated premises.” ICA § 1.25, J.A. 460. CoreTel contends
that when it purchases use of an entrance facility, transport to
the relevant Verizon IP is included in that purchase. Verizon,
on the other hand, contends that an entrance facility ends at
the Verizon switch nearest to CoreTel’s premises--Verizon calls
this the “serving wire center”--and that CoreTel therefore must
purchase additional transport to get its traffic to the relevant
Verizon IP.
Verizon’s interpretation adheres more closely to the
language of the ICAs. The ICAs’ definition establishes that an
entrance facility begins at “[CoreTel]’s designated premises”
and ends at Verizon’s “Central Office serving that designated
16
premises.” Id. The ICAs define “Central Office” as “a local
switching system for connecting lines to lines, lines to trunks,
or trunks to trunks for the purpose of originating/terminating
calls over the public switched telephone network.” ICA § 1.11,
J.A. 458. Thus, the entrance facility ends at the Verizon
switch nearest the point of interconnection, and CoreTel must
pay for any additional transport needed to reach the relevant
Verizon IP, which, as we have explained, may be located at a
different point. The district court did not err by including
charges for such transport in its damages calculation.
5.
We next address CoreTel’s argument that the district court
erred by imposing 100% of the TELRIC rate for certain facilities
for which Verizon had previously billed CoreTel only a
percentage of its tariff rates. CoreTel contends that Verizon’s
bills show it only partially used the facilities in question and
should therefore be billed only a partial TELRIC rate. The
district court, however, found that the facilities in question
had been completely dedicated to CoreTel’s use, and as we
explain below, that finding was not clearly erroneous.
Under Verizon’s tariffs, different rates applied to certain
facilities, depending on what type of access the customer
17
required--switched access or special access. 9 When CoreTel
customers used a single Verizon facility for both special and
switched access, Verizon charged the two rates proportionally on
its tariff-based monthly bills. See, e.g., J.A. 694 (billing
57.14% of the tariff rate for switched access and 42.86% of the
tariff rate for special access). The TELRIC rates, however, do
not differentiate between special and switched access. Thus,
when Verizon re-calculated its bills applying TELRIC rates, it
simply charged 100% of the TELRIC rate for facilities that had
previously been split between special and switched access.
In several instances, Verizon’s tariff-based bills stated a
proportional charge for one type of access, but omitted a
counterpart for the other type. See, e.g., J.A. 694 (billing
57.14% of the tariff rate for switched access without a
corresponding line-item for special access). At trial, Verizon
presented evidence that these omissions were billing errors and
that CoreTel had in all cases used the entire facility. CoreTel
disputed that evidence, arguing that the omissions actually
9 “Special access” occurs when the facility in question is
used for a dedicated, exclusive connection between two
particular users. Under “switched access,” in contrast, a
facility is not dedicated to a particular end user. See, e.g.,
WorldCom, Inc. v. Fed. Commc’ns Comm’n, 238 F.3d 449, 453 (D.C.
Cir. 2001). A detailed understanding of the difference is not
necessary here--the salient points are that Verizon’s tariffs
establish a different rate for each type of access, and that
Verizon charged a blended rate when a single facility was used
for both types.
18
showed that CoreTel had used only part of the relevant
facilities and should therefore be charged only part of the
TELRIC rate for those facilities.
The district court found that “[t]he invoices do not
support CoreTel’s argument,” and that the relevant facilities
“were entirely dedicated to CoreTel’s use,” and therefore
included 100% of the TELRIC rate for the relevant facilities in
its damages calculation. J.A. 448. We will overturn a district
court’s factual finding as clearly erroneous only if we are
“left with a definite and firm conviction that a mistake has
been committed.” Evergreen Int’l, S.A. v. Norfolk Dredging Co.,
531 F.3d 302, 308 (4th Cir. 2008) (citation omitted). And “[i]n
cases in which a district court’s factual findings turn on
assessments of witness credibility or the weighing of
conflicting evidence during a bench trial, such findings are
entitled to even greater deference.”
Helton, 709 F.3d at 350.
Here, the district court’s finding that CoreTel used 100%
of the facilities in question was based on its weighing of
conflicting evidence--Verizon’s original bills charging CoreTel
for only part of certain facilities against Verizon’s evidence
that those original bills were mistaken. CoreTel contends that
the district court should have weighed that evidence
differently, but falls far short of showing that the district
court clearly erred. Accordingly, we affirm the district
19
court’s determination that CoreTel owes Verizon 100% of the
TELRIC rate for the facilities CoreTel used.
6.
Finally, we address CoreTel’s contention that the district
court should have applied the two-year statute of limitations
set out in 47 U.S.C. § 415(a), which requires that “[a]ll
actions at law by carriers for recovery of their lawful
charges . . . be begun within two years from the time the cause
of action accrues.” Were that statute of limitations to apply,
Verizon would be barred from seeking facilities charges incurred
before July 2010. We hold that CoreTel waived reliance on
47 U.S.C. § 415(a) by failing to raise this defense below.
Before the district court, CoreTel never mentioned the
statute of limitations in 47 U.S.C. § 415(a). Instead, it
sought to apply the statute of limitations set forth in
subsection (b) of the same statute, which applies to “complaints
against carriers for the recovery of damages not based on
overcharges.” 47 U.S.C. § 415(b). The parties’ briefing before
the district court focused on whether the section 415(b) statute
of limitations could apply to an action between two
telecommunications carriers concerning a breach of an
interconnection agreement, as opposed to a complaint against a
telecommunications carrier by a customer of that carrier. The
district court declined to apply section 415(b), and CoreTel
20
does not take issue with that decision on appeal. Rather, it
attempts to show that it sufficiently raised a statute-of-
limitations defense based on section 415(a) to preserve the
issue for appeal.
When a party fails to raise a statute-of-limitations
defense before the district court, it waives the right to do so
on appeal. See, e.g., Verizon Md., Inc. v. Global NAPS, Inc.,
377 F.3d 355, 369 (4th Cir. 2004). It is not enough for a party
to raise “a non-specific objection or claim.” In re Under Seal,
749 F.3d 276, 287 (4th Cir. 2014). “[I]f a party wishes to
preserve an argument for appeal, the party must press and not
merely intimate the argument during the proceedings before the
district court.”
Id. (citation omitted). In other words, the
party must raise the argument in a manner sufficient “to alert
the district court to the specific reason” the party seeks
relief. United States v. Bennett,
698 F.3d 194, 199 (4th Cir.
2012).
In support of its contention that it sought to apply
section 415(a) before the district court, CoreTel points only to
(1) its statement in its answer that Verizon’s counterclaims are
“barred by the statute of limitations,” J.A. 94; (2) a reference
in its post-bench-trial proposed findings of fact to section 415
in general (without specifying a subsection); and (3) its
citation of a case to the district court that applied
21
section 415(b), but whose reasoning (CoreTel asserts) is equally
applicable to section 415(a). See Reply Br. at 29. In none of
these instances did CoreTel invoke section 415(a) with anything
close to the specificity that would have been required to alert
the district court that it needed to analyze whether that
statute might bar certain damages Verizon sought. Accordingly,
CoreTel has waived any right it may have had to assert
section 415(a)’s statute of limitations on appeal.
D.
Having affirmed the district court’s calculation of the
TELRIC-based facilities charges CoreTel owes Verizon, we turn to
CoreTel’s challenge of the district court’s award of $138,724.47
in late fees to Verizon. CoreTel argues (1) that it cannot owe
late fees under the ICAs because Verizon has never issued it
formal bills at the proper TELRIC rates, (2) that Virginia law
limits any late fees to 5% per year rather than the ICA-
prescribed 18% per year that the district court imposed, and
(3) that the principal on which any late fees are calculated
should be offset by certain payments Verizon has withheld from
CoreTel during the course of this litigation. As we explain
below, we do not find CoreTel’s arguments persuasive.
1.
CoreTel argues that Verizon’s failure to issue formal
TELRIC-based bills precludes Verizon from charging late fees.
22
As a general matter, the ICAs’ billing provisions plainly
authorize late fees. Section 28.8.1 of the ICAs requires each
party to submit “on a monthly basis an itemized statement of
charges incurred by the other Party during the preceding
month(s) for services, facilities or arrangements provided
hereunder.” J.A. 546. Section 28.8.7 of the ICAs subjects
CoreTel to a late-payment charge on any “[c]harges which are not
paid by the due date stated on Verizon’s bill.” J.A. 547.
Verizon issued monthly bills to CoreTel, but its bills were
based on tariff rates. We have held that those rates were
improper. See CoreTel I, 752 F.3d at 372. But when the party
receiving a bill disputes the amount purportedly due, the ICAs
do not permit that party to refuse to pay anything at all for
the billed services. Rather, under Section 28.8.3, the party
remains obligated to “pay when due . . . all undisputed
amounts.” J.A. 546. CoreTel has never argued that it should
receive facilities from Verizon for free; its position has
always been that it should pay under TELRIC rates. But CoreTel
elected not to pay even that undisputed amount--an amount it
could have estimated based on the information in Verizon’s
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tariff-based bills. CoreTel therefore incurred late fees under
the ICAs. 10
2.
CoreTel further argues that Virginia law requires any late-
fee award to be limited to 5% per year. CoreTel relies on Va.
Code Ann. § 6.2-400, which provides that “[a]ny lender or seller
may impose a late charge for failure to make timely payment of
any installment due on a debt, whether installment or single
maturity, provided that such late charge does not exceed five
percent of the amount of such installment payment.” Here,
Verizon sought and the district court awarded late fees at
18% per year (1.5% per month) based on the ICAs’ provision in
Section 28.8.7 that late fees “shall be an amount specified by
Verizon which shall not exceed a rate of one and one half
percent . . . of the overdue amount (including any unpaid
previously billed late payment charges) per month.” J.A. 547.
Once an ICA has been approved by a state utilities
commission, its provisions are not subject to attack on state-
10 CoreTel also contends that Verizon waived any right to
collect late fees because each of the monthly bills in the
record contain a line item specifying $0.00 in “Late Payment
Charges Applied.” See J.A. 639, 714, 753. The ICAs’ anti-
waiver provision bars this argument. See ICA § 28.18, J.A. 551
(“A failure or delay of either Party to enforce any of the
provisions hereof, to exercise any option which is herein
provided, or to require performance of any of the provisions
hereof shall in no way be construed to be a waiver of such
provisions or options.”).
24
law grounds. In Core Commc’ns, Inc. v. Verizon Md. LLC, we
explained that, by requiring state-commission approval of ICAs,
the Act “creates a narrowly defined time and forum for
identifying and evaluating any state-level policy that might
invalidate part or all of an ICA,” rendering ICAs immune from
“any subsequent attack on the basis of a state law principle.”
744 F.3d 310, 323 (4th Cir. 2014). Virginia’s state utilities
commission approved both of the ICAs at issue here, including
their late-fee provisions. Thus, CoreTel may not now claim that
those provisions violate Virginia law. 11
3.
Finally, CoreTel argues that the district court should have
reduced the principal amount on which CoreTel’s late fees were
calculated to account for certain payments Verizon has withheld
from CoreTel during the course of this litigation. The
withholdings in question arise from the terms of the stay of
judgment the district court entered pending our decision in
CoreTel I. Under that judgment, Verizon would have been
entitled to a net payment from CoreTel of $890,000. J.A. 101–
02, 105. Rather than posting a bond as a condition for the stay
pending appeal, CoreTel agreed that Verizon would be able to
11
This principle also dooms CoreTel’s argument that the
district court’s late-charges award constitutes impermissible
liquidated damages under Virginia law.
25
withhold future reciprocal-compensation payments from CoreTel
“to satisfy in part the stipulated judgment.” J.A. 104. After,
in CoreTel I, we reversed and remanded the portion of the
district court’s judgment dealing with Verizon’s facilities
claims, the parties did not re-negotiate the terms of the stay,
and Verizon continued to withhold reciprocal-compensation
payments. At the time of the bench trial, Verizon had withheld
approximately $92,000. See J.A. 264.
CoreTel contends that every time Verizon withheld a
reciprocal-compensation payment that would otherwise have been
due to CoreTel, CoreTel’s outstanding balance for facilities
charges should have been reduced by an equal amount. But the
terms of the stay provide no support for CoreTel’s position.
The stay requires only that Verizon apply the withheld payments
“to satisfy in part the stipulated judgment,” and do not specify
any particular portion of the judgment to which the payments
must be applied. Thus, Verizon was free to apply its withheld
payments however it saw fit. For example, Verizon could have
paid down the late fees themselves instead of the principal on
which the late fees are calculated. The evidence before the
district court did not establish exactly how Verizon applied the
withheld payments, but it did make clear that Verizon had
applied them in a way that did not reduce CoreTel’s outstanding
facilities charges. Thus, the district court properly based its
26
late-fee calculation on the entire amount of those outstanding
facilities charges.
III.
For the foregoing reasons, the judgment of the district
court is
AFFIRMED.
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