Verizon Maryland, Incorporated v. Core Communications, Inc., 405 F. App'x 706

This appeal involves Verizon Maryland’s interconnection with Core Communications under the Telecommunications Act of 1996 and an ICA adopted from another CLEC; Core sought loop-based interconnection at a Maryland Verizon facility, which Verizon resisted.
Core requested interconnection that was technically feasible, at least equal in quality to that provided to others, and on nondiscriminatory terms under 47 U.S.C. § 251(c).
Verizon proposed interconnection via IOF (interOffice facilities) rather than the loop ring Core requested, and asserted loop interconnection was not required by the ICA or the Act.
The district court granted summary judgment for Verizon, holding the ICA required equal quality only to connections between carrier office switches, not loop facilities for CLECs.
The Maryland Public Service Commission found Verizon breached the ICA and acted in bad faith; the district court overturned, and the Fourth Circuit reversed, holding Verizon breached the ICA by refusing loop-based interconnection.
The case is remanded for further proceedings including damages and consideration of an implied duty of good faith and fair dealing.

Issue	Plaintiff's Argument	Defendant's Argument	Held
What interconnection quality is required under §251(c)(2) and the ICA?	Core contends loop interconnection must be equal in quality to that provided to Core or any affiliate.	Verizon argues equal quality applies only to interconnection between core carrier switches, not loop facilities.	Verizon breached the ICA by refusing loop interconnection.
Does the ICA permit loop interconnection even when IOF is available?	Loop interconnection is technically feasible and should be provided if requested.	ICA allows non-loop interconnection and permits modification only by written contract.	The ICA requires loop interconnection where technically feasible; district court erred.
Did the district court err in finding loop quality lesser than IOF quality?	Record evidence shows loop facilities could be equivalent to IOF; no clear proof of lesser quality.	District court relied on flawed findings suggesting loop is inherently lower quality.	District court erred; record does not support loop being lower quality.
Did Verizon’s conduct breach an implied duty of good faith and fair dealing?	Delays and denial of feasible interconnection reflect bad faith.	ICA and contract governing interconnection govern remedies; no implied duty shown.	Remand to address implied duty of good faith and fair dealing.

Verizon Md., Inc. v. Core Commc’ns, 377 F.3d 355 (4th Cir. 2004) (de novo review of agency interpretation; framework for interconnection duties under Act)
Verizon Communications, Inc. v. FCC, 535 U.S. 467 (U.S. 2002) ( Act prohibits regulation impeding service and obligates incumbents to allow entry of competitors)
AT&T Corp. v. Iowa Utils. Bd., 525 U.S. 366 (U.S. 1999) ( Telecommunications Act restructures markets to facilitate competition)
AT&T Wireless PCS, Inc. v. City Council of City of Virginia Beach, 155 F.3d 423 (4th Cir. 1998) (connections standards analogous to summary judgment standards for agency actions)
GTE South, Inc. v. Morrison, 199 F.3d 733 (4th Cir. 1999) ( substantial evidence review of state agency factual findings)