The Supreme Court will hear oral argument today in the case of Talk America, Inc. v. Michigan Bell Telephone Co. to address, in plain terms, “Whether state utility commissions may require major telephone companies (like AT&T and Verizon) to provide smaller competitors access to certain parts of their network facilities at cost instead of at market rates.” (See Definition of Issues and Supreme Court party and amicus briefing available at the Supreme Court of the United States blog here.)
As previously reported, the Sixth Circuit answered no, holding, in contravention of the FCC’s own interpretation, that the incumbent telephone companies could charge the higher market rates to smaller competitors in light of the cheaper cost to build such facilities, the wide availability of entrance facilities from alternative providers, and their greater revenue potential. In short, the Court held that “there is nothing monopolistic about entrance facilities,” unlike telecommunications equipment subject to regulated pricing. Judge Sutton dissented from the majority opinion, which was written by Chief Judge Batchelder and joined by Judge Gilman, on the basis that the FCC’s interpretation of its own regulations is reasonable and should be upheld.
Both parties requested Supreme Court review of the Sixth Circuit’s decision to resolve the split in decisions from the Sixth Circuit (PDF) and the Seventh (PDF), Eighth (PDF) and Ninth Circuits (PDF). The eight amicus briefs filed are split evenly with the United States, the California Public Utilities Commission, Sprint Nextel, and Comptel, in favor of Petitioner’s position that access should be provided at cost and Centurylink, Qwest Communications International, and Windstream; Verizon; United States Telecom Association and Network Engineers; and Administrative Law Professors from Harvard Law and Florida State University College of Law in favor of Respondent’s position to uphold the Sixth Circuit decision favoring market rates.