MICHIGAN BELL TELEPHONE COMPANY, d/b/a Ameritech Michigan v. CLIMAX TELEPHONE COMPANY; John G. Strand, John C. Shea, and David A. Svanda, Commissioners of the Michigan Public Service Commission (In Their Official Capacities and not as Individuals); United States of America, Federal Communications Commission, Intervenors.
No. 98-1315
United States Court of Appeals, Sixth Circuit
Jan. 18, 2000
As Amended on Denial of Rehearing and Rehearing En Banc Feb. 16, 2000
202 F.3d 862
BOGGS, Circuit Judge
Harvey J. Messing, Gary L. Field, Loomis, Ewert, Parsley, Davis & Gotting, Lansing, MI, for Defendant.
David A. Voges (argued and briefed), Asst. Atty. Gen., Henry J. Boynton, Asst.
Mark B. Stern (briefed), Susan Pacholski (argued and briefed), U.S. Department of Justice, Civil Division, Appellate Staff, Washington, D.C., for Intervenors.
Before: JONES, BOGGS, and COLE, Circuit Judges.
BOGGS, J., delivered the opinion of the court, in which JONES, J., joined. COLE, J. (pp. 868-69), delivered a separate opinion concurring in part and dissenting in part.
AMENDED OPINION
BOGGS, Circuit Judge.
Climax Telephone Company expanded its local exchange service into the service territory of Michigan Bell Telephone Company, d/b/a/ Ameritech Michigan (“Ameritech“). Climax petitioned the Michigan Public Service Commission (the “PSC“) for arbitration of the terms, conditions, and prices for interconnection and related arrangements from Ameritech, under Section 252 of the federal Telecommunications Act of 1996 (the “FTA” or the “Act“),
Ameritech sued Climax and the Commissioners of the PSC in their official capacities, seeking declaratory and injunctive relief against enforcement of the interconnection agreement. The Commissioners moved to dismiss the complaint against them, citing provisions of the Act, the doctrine of sovereign immunity, and the Tenth and Eleventh Amendments. The district court denied the motion, and the Commissioners appeal its decision. We granted the Federal Communications Commission (“FCC“) intervenor status, and now affirm the judgment of the district court. Only the interlocutory appeal is before us—the merits of the case have not yet been considered below.
I
Climax is an established local exchange carrier (“LEC“) serving the Climax, Michigan area. On July 30, 1996, Climax filed an application with the PSC to provide local exchange service in the greater Battle Creek and Kalamazoo, Michigan area, where Ameritech is the incumbent provider. The application showed that Climax intended to establish a local calling area covering the geographical area served by four Ameritech local calling areas. In late 1996, Climax and Ameritech began negotiating an interconnection agreement and reached resolution on all but seven issues.
On March 10, 1997, just before the end of the statutory period for timely filing of petitions for arbitration, see
On June 25, 1997, the PSC adopted the decision of the arbitration panel and ordered the parties to file the interconnection agreement.1
One commissioner dis-
On September 12, 1997, Ameritech filed a complaint in federal district court against Climax and the PSC Commissioners in their official capacity. Ameritech seeks declaratory determinations that (1) certain sections of the agreement violate the Act, the implementing regulations, state law, and the United States Constitution, and (2) the PSC lacks jurisdiction to decide one of the issues. Ameritech also seeks to enjoin enforcement of those sections of the agreement, and to reform the agreement.
On November 24, 1997, the Commissioners moved to be dismissed as defendants, on grounds that (1) the district court lacked personal jurisdiction over them and (2) Ameritech failed to state a claim on which relief can be granted. The district court heard oral argument and denied the motion. The Commissioners appeal the denial of their motion to dismiss. This court ordered the Commissioners to show cause why the appeal should not be dismissed for lack of jurisdiction. See 6th Circuit Docket, Case No. 98-1315, March 25, 1998. On the Commissioners’ further showing, the order was withdrawn on the ground that district court orders denying dismissal on Eleventh Amendment grounds are appealable collateral orders. See Order, Case No. 98-1315, April 16, 1998.
II
Where the district court bases its denial of a motion to dismiss for failure to state a claim purely on the legal sufficiency of the plaintiff‘s case, we review the decision de novo. See Barrett v. Harrington, 130 F.3d 246, 251 (6th Cir. 1997) (citing RMI Titanium v. Westinghouse Electric Corp., 78 F.3d 1125, 1134 (6th Cir. 1996)). All factual allegations in the complaint are accepted as true. Nishiyama v. Dickson County, 814 F.2d 277, 279 (6th Cir. 1987) (en banc).
“Where a trial court‘s ruling on jurisdiction is based in part on the resolution of factual disputes, a reviewing court must accept the district court‘s factual findings unless they are clearly erroneous. However, review of the district court‘s application of the law to the facts is de novo.” RMI Titanium v. Westinghouse Elec. Corp., 78 F.3d 1125, 1134 (6th Cir. 1996) (internal citations removed) (citing Ynclan v. Dep‘t of the Air Force, 943 F.2d 1388, 1390 (5th Cir. 1991)).
Questions of statutory interpretation, like all matters of law, are reviewed de novo. See United States v. Brown, 915 F.2d 219, 223 (6th Cir. 1990).
A. The Telecommunications Act of 1996
Congress enacted the FTA to promote competition in all telecommunications markets, including the local service market. See H.R. Conf. Rep. No. 104-458, at 113 (1996), reprinted in 1996 U.S.C.C.A.N. 124. Title I, Part II of the Act provides standards and procedures to allow startup carriers to interconnect their networks to the incumbent carrier‘s network, to access the incumbent carrier‘s network elements piece-by-piece, to purchase the incumbent carrier‘s retail services “at wholesale rates” for resale, and to access the incumbent carrier‘s physical infrastructure and facilities for connection purposes.
The Act requires incumbent providers to negotiate in good faith with new entrants; if the parties cannot resolve their differ-
B. Issues Presented on Appeal
The Commissioners raise four issues: (1) whether they are proper parties in a federal court action filed pursuant to
Ameritech and the FCC both cite numerous district court cases, twenty-three altogether, each of which denies the state regulatory agency‘s motion to dismiss. Recently, the Seventh Circuit became the first appellate court to consider the issue. MCI Telecommunications Corp. v. Illinois Commerce Comm‘n, 168 F.3d 315 (7th Cir. 1999). The panel rejected the Commissioners’ Eleventh Amendment argument and affirmed the district court‘s denial of their motion to dismiss.
C. Jurisdiction to Decide the Appeal
“Ordinarily, appellate jurisdiction is lacking to hear an appeal from an order denying a Rule 12(b)(6) motion to dismiss since such an order is interlocutory in nature.” Suarez Corp. Indus. v. McGraw, 125 F.3d 222, 225 (4th Cir. 1997); see also Hill v. New York, 45 F.3d 653, 659 (2d Cir. 1995) (“a denial of a motion to dismiss is ordinarily considered non-final, and therefore not immediately appealable“).
The Commissioners invoke the jurisdiction of this court pursuant to
Ameritech concedes that this court has jurisdiction to hear the Commissioners’ Eleventh Amendment claim. See Puerto Rico Aqueduct and Sewer Authority v. Metcalf & Eddy, Inc., 506 U.S. 139, 142-48 (1993); Sault Ste. Marie Tribe of Chippewa Indians v. Michigan, 5 F.3d 147, 149 (6th Cir. 1993). Ameritech argues that this court does not have jurisdiction to hear the claim that the Commissioners are not proper parties, nor the claim that the Act violates the Tenth Amendment. The district court‘s order is not a proper collateral order with respect to either claim, Ameritech contends, nor is either claim “inextricably intertwined” with the Eleventh Amendment claim to confer jurisdiction. See Chambers, 145 F.3d at 797 (“pendent appellate jurisdiction ... only may be exercised when the appealable issue at hand cannot be resolved without addressing the nonappealable collateral issue“). Clearly, the Eleventh Amendment claim can be resolved without resolving either of the other claims.
All of the Commissioners’ claims are separate and independent of the issue of whether the agreement is consistent with federal law, have been conclusively decided below, and would be effectively unreviewable on appeal from a final judgment. We must decide the Eleventh Amendment claim in any event, and it would be a waste of judicial resources not to hear the other claims now. Finally, all of the Commissioners’ claims are unavailing.
D. Discussion
Although the Commissioners disagree, the case before this court is a straightforward Ex parte Young case. See Ex parte Young, 209 U.S. 123 (1908). Most district courts that have addressed this issue have applied the Ex parte Young doctrine and denied the state regulatory authorities’ motions to dismiss.2 We now do the same.
The Ex parte Young doctrine operates as an exception to the general rule of sovereign immunity that states may only be sued with their consent. Under Ex parte Young, suits against state officials seeking equitable relief for ongoing violations of federal law are not barred by the Eleventh Amendment. Ex parte Young, 209 U.S. at 159-60. The PSC not only approved the interconnection agreement, it is responsible for ongoing enforcement of the agreement. Ameritech alleges that the agreement violates federal law, and is seeking equitable relief. Taking the alleged facts as true, as we are required to do when reviewing a dismissal for failure to state a claim, Ameritech has stated a claim against the Commissioners, and thus against the state of Ohio, for equitable relief from an ongoing violation of federal law. Under Ex parte Young, Ameritech is entitled to proceed.
Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996) and Idaho v. Coeur d‘Alene Tribe, 521 U.S. 261 (1997), do not affect the application of Ex parte Young to
If Ameritech is correct in its claim that the agreement violates federal law, the PSC‘s ongoing enforcement of the interconnection agreement constitutes an ongoing violation of federal law, against which Ameritech seeks injunctive relief. Therefore, under Ex parte Young, the Eleventh Amendment does not bar Ameritech‘s suit against the Commissioners.
The Commissioners’ Tenth Amendment argument is also unavailing. The Commissioners argue that the doctrine of New York v. United States, 505 U.S. 144 (1992), and Printz v. United States, 521 U.S. 898 (1997), prohibits Ameritech‘s suit as a “commandeering” of state resources. Michigan chose to regulate interconnection agreements under the Act. It could have chosen not to participate, in which case it would not have arbitrated and reviewed the agreement between Ameritech and Climax. Michigan did, in fact, arbitrate and review the agreement, precisely the action complained of. The state cannot have it both ways. The United States did not compel its actions and, consequently, the Tenth Amendment does not bar Ameritech‘s suit. See, e.g., New York, 505 U.S. at 167, 179 (Congress may offer the states a choice of regulating activity); FERC v. Mississippi, 456 U.S. 742, 768 (1982).
Finally, the Commissioners argue that they are not proper parties under
III
On de novo review, the Commissioners’ claims in this interlocutory appeal lack merit as a matter of law. The Eleventh Amendment does not bar Ameritech‘s suit because Ameritech is seeking injunctive relief against an ongoing violation of federal law. The Tenth Amendment does not bar the suit because the federal government did not commandeer state resources. Michigan chose to regulate interconnection agreements. Finally, the Act does not jurisdictionally bar the suit. Accordingly, the district court‘s denial of the Commissioners’ motion to dismiss is AFFIRMED and the case is REMANDED for trial.
COLE, concurring in part and dissenting in part.
I am in complete agreement with the majority‘s disposition of the Commissioners’ Eleventh Amendment claim. I write separately because I do not believe that this court has jurisdiction to consider the interlocutory appeal of the Commissioners’ other claims.
Accordingly, I would affirm the district court‘s denial of the Commissioners’ motion to dismiss based on the Eleventh Amendment, but dismiss the Commissioners’ other claims for lack of jurisdiction.