GCB Communications, Inc. v. U.S. South Communications, Inc.
650 F.3d 1257
| 9th Cir. | 2011Background
- GCB is a payphone service provider; U.S. South issues prepaid calling cards and completed calls on GCB payphones were routed via Flex-ANI.
- Flex-ANI attaches two-digit codes (27, 29, or 70) to identify payphone-originated calls for dial-around compensation; transmission is required for compensation.
- If Flex-ANI digits are not received, the completing carrier may not be obligated to pay dial-around compensation under FCC regulations.
- The district court held that once PSPs provision Flex-ANI, they are owed compensation even if digits were not transmitted; it remanded after ruling.
- The Ninth Circuit reversed, vacated, and remanded to determine whether the Flex-ANI digits were actually transmitted into the system for the disputed calls.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether PSPs are entitled to dial-around compensation regardless of transmitted Flex-ANI. | GCB argues compensation due even if digits were not received. | U.S. South contends compensation requires transmitted digits or fault by completing/IXCs. | Remanded to decide if digits were transmitted. |
| Does FCC primary jurisdiction or deference apply to interpreting FCC orders in this context? | FCC interpretation binds; refer to agency. | district court should defer to FCC; refer under primary jurisdiction. | Agency interpretation not required; remand possible for primary jurisdiction consideration. |
| Did the district court abuse evidentiary decisions or discovery rulings? | Admitted data supported compensation. | Some exhibits were hearsay or undisclosed. | No reversible error established; issues remanded on central question. |
| Should the case be decided under the correct statutory/regulatory framework (44-1310, etc.)? | FCC payphone rules mandate compensation framework. | Compliance depends on data transmission and correct application of rules. | Remand to resolve whether the digits were transmitted and thus compensable. |
Key Cases Cited
- Chevron, U.S., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984) (agency interpretations reviewed de novo for statutory meaning)
- United States v. Westinghouse Elec. Corp., 666 F.2d 335 (9th Cir. 1982) (primary jurisdiction and agency-within-context considerations)
- Alaska v. Federal Subsistence Board, 544 F.3d 1089 (9th Cir. 2008) (prudential considerations of administrative interpretation)
- Brown v. MCI WorldCom Network Services, Inc., 277 F.3d 1166 (9th Cir. 2002) (primary jurisdiction and regulatory interpretation framework)
- CSX Transportation Co. v. Novolog Bucks County, 502 F.3d 247 (3d Cir. 2007) (waiver of affirmative defenses when raised late; court discretion)