Mediacom Southeast LLC v. BellSouth Telecommunications, Inc.
672 F.3d 396
| 6th Cir. | 2012Background
- AT&T sought to offer video service (U-verse) in Hopkinsville under a perpetual 1886 statewide telephone franchise.
- Hopkinsville and Kentucky League of Cities sued to require a separate cable franchise, settled with AT&T recognizing no new franchise was needed for U-verse.
- Mediacom intervened, contending AT&T needed a cable franchise and that the district court should reject AT&T's franchise scope as a matter of law.
- The district court granted AT&T's 12(b)(6) motion, relying on a prior attorney general opinion and on settlement-fact findings to conclude the franchise permits IP video.
- The district court discounted Mediacom’s pleaded facts and treated settlement facts as controlling, and ultimately dismissed the case.
- On appeal, the Sixth Circuit reversed and remanded, holding the district court erred in the standard of review and in crediting the settlement agreement over the complaint.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper standard for motion to dismiss | Mediacom argues AT&T bears burden at dismissal and facts support plausible claim. | AT&T contends standard focuses on whether IP video is within its franchise, with no need for extensive discovery. | District court burdened Mediacom; reversal for correct standard. |
| Use of settlement agreement to resolve factual questions | Complaint facts control; agreement is not binding on the issue since it conflicts with well-pleaded facts. | Agreement supports characterization of U-verse as described therein. | Court improper to credit settlement over the complaint; cannot convert to summary judgment. |
| Whether U-verse falls within the existing franchise requires factual development | U-verse is more akin to one-way cable TV and may not be covered by the 1886 franchise. | IP video could be within franchise depending on interpretation; discovery needed for factual record. | More discovery and factual development required; not resolvable on the pleadings. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (Supreme Court 2009) (pleading standard requires plausible claims)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (Supreme Court 2007) (concrete plausibility pleading standard)
- Winget v. JP Morgan Chase Bank, N.A., 537 F.3d 565 (6th Cir. 2008) (court may consider integral documents on motion to dismiss)
- Rondigo, L.L.C. v. Twp. of Richmond, 641 F.3d 673 (6th Cir. 2011) (documents referenced in complaint may be considered if central)
- Office of Consumer Counsel v. Southern New England Tel. Co. d/b/a AT&T Conn., 515 F. Supp. 2d 269 (D. Conn. 2007) (one-way nature of IP video discussed in regulation context)
- Ohio Tel. & Tel. Co. v. Steen, 85 N.E.2d 579 (Ohio Com. Pl. 1949) (early view on franchise scope and technology evolution)
- Ball v. Am. Tel. & Tel. Co., 86 So.2d 42 (Miss. 1956) (franchise scope deemed broad against device-by-device expansion)
- Iqbal, Ashcroft v. Iqbal, 129 S. Ct. 1937 (Supreme Court 2009) (pleading standard referenced for plausibility)
- Twombly, Bell Atl. Corp. v., 127 S. Ct. 1955 (Supreme Court 2007) (pleading standard established)