Western Radio Services Co. v. Qwest Corporation

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
WESTERN RADIO SERVICES CO., an 
Oregon corporation,
Plaintiff-Appellant,
v. No. 05-35796
QWEST CORPORATION, a Colorado
corporation; THE PUBLIC UTILITY  D.C. No.
CV-05-00159-ALA
COMMISSION OF OREGON; LEE BEYER
OPINION
Chairman; RAY BAUM,
Commissioner; JOHN SAVAGE,
Commissioner,
Defendants-Appellees.

Appeal from the United States District Court
for the District of Oregon
Ann L. Aiken, U.S. District Judge, Presiding
Argued and Submitted
November 6, 2007—Portland, Oregon
Filed July 9, 2008
Before: Edward Leavy, Raymond C. Fisher and
Marsha S. Berzon, Circuit Judges.
Opinion by Judge Berzon
8171
8174 WESTERN RADIO SERVICES v. QWEST CORP.
COUNSEL
Marianne G. Dugan (argued), Eugene, Oregon, for Western
Radio Services Co., plaintiff-appellant.
WESTERN RADIO SERVICES v. QWEST CORP. 8175
Alex M. Duarte (argued), Portland, Oregon, Qwest Corpora-
tion, Gregory B. Monson, Salt Lake City, Utah, and Timothy
W. Snider, Portland, Oregon, Stoel Rives, LLP, for Qwest
Corporation, defendant-appellee.
Erin C. Lagesen, Office of the Oregon Attorney General,
Salem, Oregon, for Lee Breyer, Chairman, Public Utility
Commission of Oregon, defendant-appellee.
OPINION
BERZON, Circuit Judge:
Under the Telecommunications Act of 1996 (“1996 Act”),
Pub. L. No. 104-104, 110 Stat. 56 (1996), “incumbent” local
exchange carriers are required to enter into interconnection
agreements with newer local exchange carriers. If the two car-
riers cannot reach agreement through negotiation, either party
may petition the state’s public utilities commission to request
arbitration of any open issues.
Western Radio Services Co. (“Western”) filed a petition
with the Oregon Public Utilities Commission (“PUC”)
requesting arbitration of its attempts to establish an intercon-
nection agreement with Qwest Corporation (“Qwest”), an
incumbent carrier. The arbitrator found for Qwest on nearly
every issue and ordered the parties to submit within 30 days
an interconnection agreement consistent with his decision for
final approval by the PUC. Qwest drafted an interconnection
agreement that it maintained accorded with the arbitrator’s
decision, but Western refused to sign it. Instead, Western
brought this action, contending that Qwest had failed to nego-
tiate in good faith under the 1996 Act, and that the PUC and
its Commissioners had violated its constitutional rights under
42 U.S.C. § 1983. In the meantime, Qwest submitted its draft
agreement to the PUC.
8176 WESTERN RADIO SERVICES v. QWEST CORP.
The district court dismissed the good faith cause of action
for lack of jurisdiction and the § 1983 cause of action as
unripe. Shortly after the district court’s decision, the PUC
approved the interconnection agreement submitted to it by
Qwest, ruling that it complied with the arbitration order.
Western appeals the district court’s decision. We hold that,
whether or not there is a private right of action encompassing
its good faith claim, Western may not sue Qwest for a failure
to negotiate in good faith until the PUC has addressed West-
ern’s good faith claim. There has now, however, been a deter-
mination by the PUC approving an interconnection
agreement, which may represent a decision by the agency on
Western’s good faith claim. We therefore remand to the dis-
trict court to allow it to consider in the first instance whether
the PUC’s decision is sufficient to permit adjudication of
Western’s good faith claim in district court and, if so, to
address in the first instance the availability of such an action
under 47 U.S.C. § 207. We also remand the § 1983 cause of
action to the district court, so that it may consider whether the
PUC determination affects its conclusion that the § 1983
claim was unripe.
STATUTORY FRAMEWORK
The Telecommunications Act of 1934 (“1934 Act”), 48
Stat. 1064, “granted the [Federal Communications Commis-
sion] broad authority to regulate interstate telephone commu-
nications.” Global Crossing Telecomm., Inc. v. Metrophones
Telecomm., Inc., 127 S. Ct. 1513, 1516 (2007). Under the
1934 Act, carriers filed tariffs with the Federal Communica-
tions Commission (“F.C.C.”) which would then approve them
or, in some cases, set them aside or alter them. Id. The 1934
Act requires that “[a]ll charges, practices, classifications, and
regulations for and in connection with” provision of telecom-
munications services be “just and reasonable,” and declares
WESTERN RADIO SERVICES v. QWEST CORP. 8177
unlawful any “charge, practice, classification, or regulation
that is unjust or unreasonable.” 47 U.S.C. § 201(b).1
The 1934 Act also authorizes persons harmed by the
actions of any “common carrier”2 to recover damages:
In case any common carrier shall do, or cause or per-
mit to be done any act, matter, or thing in this chap-
ter prohibited or declared to be unlawful . . . such
common carrier shall be liable to the person or per-
sons injured thereby for the full amount of damages
sustained . . . .
§ 206; see also § 153(32) (“The term ‘person’ includes an
individual, partnership, association, joint-stock company,
trust, or corporation.”). A person seeking damages under
§ 206 “may either make complaint to the Commission . . . ,
or may bring suit for the recovery of damages . . . in any dis-
trict court of the United States.” § 207.
The Telecommunications Act of 1996 (“1996 Act”) intro-
duced a competitive regime for local telecommunications ser-
vices. See Verizon California, Inc. v. Peevey, 462 F.3d 1142,
1146 (9th Cir. 2006). Before adoption of the 1996 Act, “local
telephone service was provided primarily by a single com-
pany within each local area.” Id. Under the new regime, “in-
cumbent local exchange carriers,” such as Qwest, are
obligated to provide “interconnection” to newer local
1
All statutory citations are to Title 47 of the United States Code unless
otherwise indicated.
2
A “common carrier” is defined as:
any person engaged as a common carrier for hire, in interstate or
foreign communication by wire or radio or interstate or foreign
radio transmission of energy, except where reference is made to
common carriers not subject to this chapter.
§ 153(10).
8178 WESTERN RADIO SERVICES v. QWEST CORP.
exchange carriers, called “requesting” carriers in the statute.
§ 251(c)(2).
“Interconnection allows customers of one [local exchange
carrier] to call the customers of another, with the calling
party’s [local exchange carrier] . . . , transporting the call to
the connection point, where the called party’s [local exchange
carrier] . . . takes over and transports the call to its end point.”
Verizon California, 462 F.3d at 1146. The 1996 Act lays out
a number of substantive requirements for the quality and
nature of interconnection that must be provided. These
include, for example, a requirement that interconnection be
provided “at any technically feasible point within the carrier’s
network” and that it be “at least equal in quality” to the inter-
connection that the incumbent carrier provides to itself.
§ 251(c)(2)(A)-(C).
If a carrier requests interconnection, the requesting carrier
and the incumbent carrier to whom the request is made have
a duty to “establish reciprocal compensation arrangements
for” interconnection. § 251(b)(5). In creating such an inter-
connection agreement, both the incumbent carrier and the
requesting carrier have a “duty to negotiate in good faith . . .
the particular terms and conditions” of such agreements.
§ 251(c)(1). The 1996 Act sets out a procedural framework
for these negotiations: First, a requesting carrier must make a
request for interconnection to an incumbent carrier, which
“may negotiate and enter into a binding agreement with the
requesting . . . carrier . . . without regard” to the substantive
standards of § 251. § 252(a)(1). The parties to the negotiation
may, if they wish, ask a state public utilities commission “to
mediate any differences arising in the course of the negotia-
tion.” § 252(a)(2).
If the parties cannot reach agreement through voluntary
negotiations or mediation, either may “petition a State com-
mission to arbitrate any open issues.” § 252(b)(1). In resolv-
ing the open issues through compulsory arbitration, a state
WESTERN RADIO SERVICES v. QWEST CORP. 8179
commission must ensure that its resolution “meet[s] the
requirements of section 251” and may “impos[e] appropriate
conditions” in order to ensure, among other things, that the
requirements of § 251 are met. § 252(b)(4)(C), (c)(1). If at
any point during the arbitration either party refuses “to partic-
ipate further in the negotiations, to cooperate with the State
commission . . . , or to continue to negotiate in good faith in
the presence, or with the assistance, of the State commission,”
such action “shall be considered a failure to negotiate in good
faith.” § 252(b)(5). Section 252 does not specify what rem-
edy, if any, is available for failure to negotiate in good faith.
Once an interconnection agreement has been adopted either
by negotiation or after compulsory arbitration, it must “be
submitted for approval” to the state commission, which must
either “approve or reject the agreement.” § 252(e)(1). Finally,
the 1996 Act provides for judicial “[r]eview of State commis-
sion actions”:
In any case in which a [PUC] makes a determination
under this section, any party aggrieved by such
determination may bring an action in an appropriate
Federal district court to determine whether the agree-
ment or statement meets the requirements of section
251 of this title and this section.
§ 252(e)(6).
PROCEDURAL HISTORY
In October of 2003, Western requested negotiations with
Qwest to establish an interconnection agreement allowing
Western access to Qwest’s network in Oregon. The negotia-
tions failed to resolve all the issues between the parties. West-
ern thereupon filed a petition for arbitration with the Oregon
PUC. Before the arbitrator, the parties submitted a stipulation
of facts as to two issues, stipulated that they had resolved
three other issues, submitted testimony, and filed opening and
8180 WESTERN RADIO SERVICES v. QWEST CORP.
responsive briefs. The arbitrator issued a decision on Septem-
ber 20, 2004.
In his decision, the arbitrator ordered that Qwest’s pro-
posed language be adopted as to all but one issue. The arbitra-
tion order instructed that “[w]ithin 30 days of the date of the
[PUC’s] final order in this proceeding, Qwest and Western
shall submit an interconnection agreement consistent with the
terms of this decision.” Western filed exceptions to the arbi-
trator’s order with the PUC, but, on October 18, 2004, the
PUC adopted the arbitrator’s decision in its entirety.
On November 10, Qwest prepared a proposed interconnec-
tion agreement, signed it, and sent it to Western by overnight
courier. A week later, on November 18, Qwest notified the
PUC that Western had “informed Qwest that it had been
unable to complete its review of the agreement, and would not
likely be able to do so for a few weeks,” that is, not until well
after the thirty-day deadline set by the arbitrator. Instead of
waiting for Western, Qwest enclosed a copy of the agreement
that it had already signed and transmitted to Western “for the
[PUC’s] information, and approval, if appropriate.” Accord-
ing to Western, it subsequently reviewed the proposed agree-
ment on November 29 and December 1, 2004, and sent e-
mails to Qwest on those dates indicating that it did not believe
the agreement was in compliance with the arbitrator’s order.
The record does not indicate what action, if any, Qwest took
in response to the e-mails.
Western did not inform the PUC of its concerns about
Qwest’s proposed interconnection agreement. Instead, on
February 3, 2005, Western filed this action, naming as defen-
dants Qwest, the PUC, and several PUC Commissioners in
their official capacities. Western alleged that the district court
had jurisdiction over its suit “pursuant to 47 U.S.C.
§ 252(e)(6), 42 [sic] U.S.C. § 207, and 28 U.S.C. §§ 1331 and
1343(a).”
WESTERN RADIO SERVICES v. QWEST CORP. 8181
In its complaint, Western’s first cause of action attacked the
PUC’s resolution of all the issues it had raised before the
agency concerning the terms of the interconnection agree-
ment. The second cause of action alleged that Qwest’s failure
to correct the proposed agreement constituted a failure to
negotiate in good faith under 47 U.S.C. §§ 251(c) and 252(A).
Western alleged that Qwest’s proposed interconnection agree-
ment did not comply with the PUC’s order in four ways, and
that when this noncompliance was brought to Qwest’s atten-
tion, Qwest “refused to negotiate in good faith to resolve the
problems.”
In its third and fourth causes of action, both brought under
42 U.S.C. § 1983, Western alleged that the PUC and its Com-
missioners violated Western’s constitutional rights by adopt-
ing the arbitrator’s order. For Qwest’s failure to negotiate in
good faith, Western sought a declaratory judgment and dam-
ages. For the PUC’s violations of the Constitution, Western
sought injunctive relief and damages.
The defendants moved to dismiss all causes of action for
lack of subject-matter jurisdiction and failure to state a claim.
See Fed. R. Civ. P. 12(b)(1), (6). In its motion to dismiss,
Qwest argued that the court had no jurisdiction to consider
any of the causes of action until the PUC approved or rejected
an interconnection agreement; that the court had no jurisdic-
tion to consider the “good faith” cause of action because it
had not been decided by the PUC; and that the good faith
cause of action “is wholly outside the jurisdiction of this
Court even after the [PUC] approves or rejects an agreement.”
The PUC and its Commissioners (“state defendants”) simi-
larly maintained that the district court had no jurisdiction over
the second cause of action, because Western had not pre-
sented its “good faith” claim to the PUC and because the PUC
had yet to approve or reject any interconnection agreement.
The state defendants also contended that Western’s § 1983
causes of action were barred by the Eleventh Amendment and
by absolute and qualified immunity.
8182 WESTERN RADIO SERVICES v. QWEST CORP.
The district court, in an opinion and order filed on July 25,
2005, dismissed the entire action. Turning first to subject-
matter jurisdiction but not indicating which causes of action
it was examining, the court held that under § 252(e), “court
review is premature and barred” until the PUC has approved
or rejected an agreement. The court explained that, in its
view, this conclusion “not only comports with a plain reading
of the Act and judicial decisions, it also is supported by sound
policy.” The court went on to hold that Western’s second
cause of action for failure to negotiate in good faith “is barred
for the reason that the Act does not permit parties to adjudi-
cate such claims in federal court.” According to the district
court, such a claim can only be “remedied through the media-
tion and arbitration process before the [PUC].” In so ruling,
however, the district court did not consider the possibility that
§ 207 supplies a cause of action such as the one Western
seeks to pursue.
Reaching the 42 U.S.C. § 1983 claims, the district court
stated only:
Finally, regarding plaintiff’s third and fourth claims
for relief pursuant to 42 U.S.C. § 1983 for money
damages, the PUC’s well founded motion to dismiss
is denied with leave to renew upon this court obtain-
ing proper jurisdiction over this matter.
Western responded by filing this appeal.3
After the notice of appeal in this case had been filed,
Qwest, over Western’s objection, sought PUC approval of the
interconnection agreement it had submitted. Western asked
that the PUC take no action on the interconnection agreement,
3
Western has not appealed dismissal of its first cause of action challeng-
ing the PUC’s resolution of the substantive issues, but has indicated its
intention instead to refile it in federal district court now that an intercon-
nection agreement has been approved.
WESTERN RADIO SERVICES v. QWEST CORP. 8183
but the PUC approved the version of the interconnection
agreement submitted by Qwest.4
ANALYSIS
I. “Good Faith” Claim.
We turn first to the question whether the district court had
jurisdiction over Western’s good faith claim, and hold that it
did. We then consider whether, as a prudential matter, West-
ern may bring its good faith claim in district court before it
has been addressed by the PUC. Concluding that it cannot, we
remand to the district court to consider whether the PUC deci-
sion approving the agreement adequately fulfills the require-
ment that the PUC first address any good faith claim and, if
so, to determine whether Western has a cause of action under
§ 207 for an incumbent local exchange carrier’s failure to
negotiate in good faith.
A. Jurisdiction.
Qwest maintains that the district court did not have subject-
matter jurisdiction over Western’s good faith claim because
the PUC had not made a “determination” to approve or reject
an interconnection agreement. See § 252(e)(6) (“In any case
in which a State commission makes a determination under
this section, any party aggrieved by such determination may
bring an action in an appropriate Federal district court . . . .”
). We conclude that, contrary to Qwest’s contentions, what-
ever finality or exhaustion requirement § 252(e)(6) might
impose does not affect the subject matter jurisdiction of the
4
We take judicial notice of the PUC’s order because its existence is “ca-
pable of accurate and ready determination by resort to sources whose
accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b); Nugget
Hydroelectric, L.P. v. Pac. Gas & Elec. Co., 981 F.2d 429, 435 (9th Cir.
1992) (taking judicial notice of the existence of decisions of the California
Public Utility Commission on force majeure claims).
8184 WESTERN RADIO SERVICES v. QWEST CORP.
district court in this case. Rather, the district court has general
federal question jurisdiction under 28 U.S.C. § 1331 to deter-
mine whether there is a cause of action under § 207 for West-
ern’s “good faith” claim.
[1] 28 U.S.C. § 1331 provides that “[t]he district courts
shall have original jurisdiction over all civil actions arising
under the Constitution, laws, or treaties of the United States.”
28 U.S.C. § 1331. Section 1331 jurisdiction covers, inter alia,
cases in which a plaintiff’s “right to relief depends upon the
construction or application” of federal law. Smith v. Kansas
City Title & Trust Co., 255 U.S. 180, 199 (1921); see also
Franchise Tax Bd. of Cal. v. Constr. Laborers Vacation Trust
for Southern Cal., 463 U.S. 1, 27-28 (1983) (holding that fed-
eral question jurisdiction under § 1331 exists when “a well-
pleaded complaint establishes either that federal law creates
the cause of action or that the plaintiff’s right to relief neces-
sarily depends on resolution of a substantial question of fed-
eral law”).
In Verizon Maryland Inc. v. Public Service Comm’n of
Maryland, 535 U.S. 635 (2002), the Supreme Court addressed
the interaction between 28 U.S.C. § 1331 and 47 U.S.C.
§ 252. Verizon brought an action in district court challenging
the Maryland Public Service Commission’s interpretation of
an interconnection agreement earlier approved by the com-
mission, as well as the commission’s order directing compli-
ance with its interpretation. Id. at 640. The Maryland
commission argued that the district court did not have subject
matter jurisdiction over the action because the interpretation
and enforcement order was not the type of “determination”
encompassed by the judicial review provision, § 252(e)(6),
and because there was no cause of action for Verizon’s claim.
See id. at 641-42. The Supreme Court saw no need to decide
whether an interpretation and enforcement decision was a
“determination” within the meaning of § 252(e)(6) because,
even if it were not, jurisdiction was available under § 1331:
“[I]f § 252(e)(6) does not confer jurisdiction, it at least does
WESTERN RADIO SERVICES v. QWEST CORP. 8185
not divest the district courts of their authority under 28 U.S.C.
§ 1331 . . . .” Id. at 642.
In reaching this conclusion, the Supreme Court reasoned
that because Verizon “seeks relief from the Commission’s
order on the ground that [the state] regulation is pre-empted
by a federal statute,” there was “no doubt” that Verizon’s
claim “presents a federal question which the federal courts
have jurisdiction under 28 U.S.C. § 1331 to resolve.” Id.(quotation marks omitted). As to the effect of § 252(e)(6), the
Supreme Court held that § 252(e)(6) “merely makes some . . .
actions by state commissions reviewable in federal court,” id.
at 643, observing that the “mere fact that some acts are made
reviewable should not suffice to support an implication of
exclusion as to others.” Id. (quoting Abbott Labs. v. Gardner,
387 U.S. 136, 141 (1967)). The Supreme Court noted that
§ 252(e)(6) “does not establish a distinctive review mecha-
nism,” and “does not distinctively limit the substantive relief
available”; instead, § 252(e)(6) reads more like “conferral of
a private right of action” than a limitation on the subject mat-
ter jurisdiction of the district court. Id. at 644; see also Pac.
Bell v. Pac-West Telecomm, Inc., 325 F.3d 1114, 1125 (9th
Cir. 2003).
Verizon Maryland also rejected the argument that the fed-
eral district court did not have subject matter jurisdiction
because there was no private cause of action to challenge the
state commission’s interpretation and enforcement order.
Without reaching the question whether a private cause of
action existed, the Court noted that “the absence of a valid (as
opposed to arguable) cause of action does not implicate sub-
ject matter jurisdiction.” Verizon Maryland, 535 U.S. at 642-
43 (quoting Steel Co. v. Citizens for a Better Env’t, 523 U.S.
83, 89 (1998)).
Here, Western argues that § 207, which permits an individ-
ual damaged by a common carrier to “bring suit for the recov-
ery of . . . damages,” provides a private right of action to sue
8186 WESTERN RADIO SERVICES v. QWEST CORP.
an incumbent carrier for failure to negotiate in good faith as
required by §§ 251 and 252 of the 1996 Act. If the court
agrees with that interpretation of § 207 and Western prevails
on the merits, Western may obtain relief; if not, it may not.
Because the availability of relief turns on interpretation of a
federal statute, we clearly have general federal question juris-
diction under § 1331. See Steel Co., 523 U.S. at 89 (“[T]he
district court has jurisdiction if the right of the petitioners to
recover under their complaint will be sustained if the . . . laws
of the United States are given one construction, and will be
defeated if they are given another.”) (internal quotation marks
omitted).
As in Verizon, the existence of § 252(e)(6), which provides
for review of some state commission actions, does not affect
this conclusion. Section 252(e)(6) does not provide a private
right of action to sue other private entities for failure to nego-
tiate in good faith. It is, rather, a judicial review provision,
permitting actions against the PUC to determine whether its
decisions are consistent with law.
[2] We so conclude from the language of § 252(e)(6) itself.
Section 252(e)(6) is titled “Review of State commission
actions” (emphasis added), and provides that “any party
aggrieved” by the determination of a state PUC “may bring an
action in an appropriate Federal district court to determine
whether the agreement [approved by the PUC] . . . meets the
requirements of section 251.” The provision makes no refer-
ence to suit against any private party, and describes an action
for “[r]eview” of whether the determination of the PUC is
consistent with the “requirements” of the relevant law, in this
case § 251.
[3] Other federal statutory provisions that allow individuals
to petition for review of an agency’s determination similarly
provide for “review” of an “order” or “action” to ensure its
consistency with the law, and do not make reference to a right
to sue a private entity. See, e.g., 5 U.S.C. §§ 702, 706(2)(A)
WESTERN RADIO SERVICES v. QWEST CORP. 8187
(permitting individuals “suffering legal wrong because of
agency action . . . within the meaning of a relevant statute”
to obtain “judicial review” of whether, among other things,
the action was “in accordance with law”); 29 U.S.C. § 160(f)
(providing that “[a]ny person aggrieved by a final order of the
[National Labor Relations] Board granting or denying . . . the
relief sought [with respect to a claim of unfair labor practices]
may obtain a review of such order” in federal court); 15
U.S.C. § 78y(a)(1) (“A person aggrieved by a final order of
the [Securities and Exchange Commission] . . . may obtain
review of the order in the United States Court of Appeal”); cf.
42 U.S.C. § 2000e-5(f) (providing that after an investigation
by the EEOC the “person aggrieved” may under certain cir-
cumstances bring a “civil action . . . against the respondent
named in the charge,” i.e., against a private party).5 In such
actions for judicial review, suit is against the agency itself or,
in some cases, agency officials. See, e.g., East Bay Auto.
Council v. N.L.R.B., 483 F.3d 628 (9th Cir. 2007) (action for
judicial review of an N.L.R.B. order under 29 U.S.C.
§ 160(f)); KPMG, LLP v. S.E.C., 289 F.3d 109 (D.C. Cir.
2002) (action for judicial review of a decision of the S.E.C.
under 15 U.S.C. § 78y); 5 U.S.C. § 7703 (in a provision
regarding “[j]udicial review of decisions of the Merit Systems
Protection Board,” specifying that “[t]he Board shall be
named respondent in any proceeding brought pursuant to this
subsection”); 5 U.S.C. § 703 (under APA, generally “the
action for judicial review may be brought against the United
States, the agency by its official title, or the appropriate offi-
cer”). Thus, § 252(e)(6) allows Western to request that a dis-
trict court review the substance of a determination by the
PUC. It does not constitute a grant of a private right of action
5
Many such judicial review provisions do not specify that the agency
action shall be reviewed to determine whether it is consistent with the law,
because the scope of review is instead found in the Administrative Proce-
dure Act (“APA”). See, e.g., KPMG, LLP v. S.E.C., 289 F.3d 109, 121
(D.C. Cir. 2002) (applying APA standard of “arbitrary, capricious, or oth-
erwise not in accordance with law,” 5 U.S.C. § 706(2)(A), to a determina-
tion by the S.E.C.).
8188 WESTERN RADIO SERVICES v. QWEST CORP.
against Qwest to enforce the duty to negotiate in good faith,
and so does not affect our jurisdiction under § 1331 to deter-
mine the availability of a private cause of action under a dif-
ferent section of the Act.
[4] For similar reasons, it does not matter whether
§ 252(e)(6) contains an exhaustion or finality requirement
and, if so, whether that requirement is jurisdictional.6 Again,
Western’s action against Qwest is not an action for judicial
review of a state commission determination; instead, Western
has sued Qwest, a private party, for damages.7 If Western
were to request review of a state commission action before an
6
The parties have referred to the “exhaustion” requirement in
§ 252(e)(6), but it may be more accurate to describe it as a type of finality
requirement. Section 252(e)(6) requires that the PUC have made a “deter-
mination,” but does not state that a party must exhaust every opportunity
to raise its specific objections to the PUC before it raises them in district
court. See Darby v. Cisneros, 509 U.S. 137, 144-45 (1993) (describing the
differences between the doctrine of exhaustion of administrative remedies
and the doctrine of finality). See also AT&T Commc’n Sys. v. Pac. Bell,
203 F.3d 1183, 1185-86 (9th Cir. 2000) (concluding that “Congress did
not intend all state procedural requirements . . . be exhausted prior to judi-
cial review by a district court” and holding that § 252(e)(6) requires only
a “operational or binding” determination by the PUC). The distinction
between finality and exhaustion requirements is sometimes significant for
jurisdictional purposes. For example, in cases brought under the Adminis-
trative Procedure Act (“APA”), finality is a jurisdictional requirement,
while some statutory exhaustion requirements may not be jurisdictional.
Compare Oregon Natural Desert Ass’n v. United States Forest Serv., 465
F.3d 977, 982 (9th Cir. 2006) (observing that APA’s finality requirement
is jurisdictional) with McBride Cotton and Cattle Corp. v. Veneman, 290
F.3d 973, 980 (2002) (statutory exhaustion requirement was not jurisdic-
tional). We need not determine, however, which type of requirement, if
any, § 252(e)(6) imposes because, as the case now stands, Western is not
bringing an action for judicial review of a PUC decision.
7
As noted, Western’s complaint did contain an action for judicial review
of the PUC’s substantive determinations about the consistency of the inter-
connection agreement with the § 251, but Western is not pursuing that
cause of action on appeal. See supra at 8181, 8182 n.3. The complaint did
not seek review of any PUC determination on the good faith issue,
because no such determination had been made.
WESTERN RADIO SERVICES v. QWEST CORP. 8189
arbitration was complete, the statutory exhaustion or finality
requirement contained in § 252(e)(6) might control.8 But as
Western has instead sued Qwest directly, and for damages,
the exhaustion or finality requirement in § 252(e)(6) has no
bearing on this court’s subject matter jurisdiction. We thus
have jurisdiction under 28 U.S.C. § 1331 to determine
whether § 207 affords a private cause of action for enforce-
ment of the good faith negotiation provisions in §§ 251 and
252, as well as whether there is a prudential requirement that
the PUC first address such a claim.
B. Prudential Limits to Adjudication by the District
Court.
[5] Although § 252(e)(6) does not deprive the district court
of jurisdiction over Western’s suit against Qwest or impose a
finality or exhaustion requirement with respect to its good
faith claim, there may nonetheless be prudential limits on the
ability of Western to bring that claim. Western argues that
§ 207 provides a private right of action for damages against
another carrier for failure to negotiate in good faith before the
state commission, whether or not the issue is first raised
before the state agency. We conclude — assuming for now
that § 207 does provide a private cause of action for good
faith claims — that prudential concerns require that Western
present its good faith claim to the PUC before bringing suit
in district court under § 207.
8
Those requirements might nonetheless not be jurisdictional. The
Supreme Court strongly suggested in Verizon Maryland that § 252(e)(6)
is not a limit on the jurisdiction of the district court, even as to those
actions for judicial review that come within its terms. See Verizon Mary-
land, 535 U.S. at 644 (noting that § 252(e)(6) reads more like a conferral
of a private right of action for judicial review than a limitation on the sub-
ject matter jurisdiction of the district court); see also McBride, 290 F.3d
at 980 (statutory exhaustion requirements are not jurisdictional unless they
contain “sweeping and direct” language indicating that they limit the juris-
diction of district courts).
8190 WESTERN RADIO SERVICES v. QWEST CORP.
[6] As a preliminary matter, we note that, contrary to West-
ern’s contentions, nothing in the statute precludes a require-
ment that Western avail itself of its remedies before the state
commission before suing Qwest under § 207. Section 207
does provide that an individual injured by a common carrier
“may either make complaint to the Commission . . . or may
bring suit . . . in any district court of the United States of com-
petent jurisdiction.” § 207 (emphasis added). But the Federal
Communications Commission is the “Commission” referred
to in § 207, not a state public utilities commission. See
§ 154(a) (“The Federal Communications Commission (in this
chapter referred to as the ‘Commission’ ”); § 153(41) (“The
term ‘State commission’ means the commission . . . which
under the laws of any State has regulatory jurisdiction with
respect to intrastate operations of carriers.”). Section 207 thus
refers not to the ability to raise claims before a state public
utilities commission, but to the procedures for bringing a
complaint before the F.C.C. under § 208. See § 208
(“Complaints to Commission”). For this reason, the election
of remedies provision in § 207 is not relevant to whether
Western must bring its claims before the PUC before proceed-
ing to either the F.C.C. or district court.
Once we have disposed of that contention quite easily, the
issue we face becomes considerably more difficult. There are,
it turns out, no precedents or doctrines that easily apply to the
question before us. The reason, undoubtedly, is that Western’s
good faith claim arises in the context of an unusual — proba-
bly unique — statutory scheme, in which a state agency —
here, the PUC — determines the provisions that must be
incorporated in a private “agreement” between private parties,
and does so by applying federal substantive law.9 Western
9
Another unusual aspect of the scheme is that, although the statute
refers to the proceedings before the state agency as “arbitration,” partici-
pation is compulsory, the parties do not choose the arbitrator, and the pro-
ceedings are not generally conducted in the manner of an arbitration. See
§ 252(b). In fact, the arbitrator essentially adjudicates the issues between
WESTERN RADIO SERVICES v. QWEST CORP. 8191
brought a good faith claim in district court, alleging that
Qwest failed to negotiate in good faith during the process
before the PUC because it drafted and submitted an intercon-
nection agreement that did not comply with the arbitrator’s
order.
The PUC process provides a remedy for failure to negotiate
in good faith during an arbitration. Under §§ 251 and 252,
state commissions have the authority to impose conditions
necessary to insure compliance with all of a local exchange
carrier’s obligations, including the obligation to negotiate in
good faith. The 1996 Act defines refusal “to cooperate with
the state commission in carrying out its function as an arbitra-
tor, or to continue to negotiate in good faith in the presence,
or with the assistance, of the State commission” as a failure
to negotiate in good faith. § 252(b)(5). In conducting the arbi-
tration, the state commission may “impos[e] appropriate con-
ditions as required to” ensure that the requirements of § 251,
which contains a local exchange carrier’s good faith obliga-
tions, are met. See §§ 251(c)(1), 252(b)(4)(C). An F.C.C. reg-
ulation interpreting these provisions indicates that state
commissions may make good faith determinations. See 47
C.F.R. § 51.301(c) (“If proven to the Commission, an appro-
priate state commission, or a court of competent jurisdiction,
the parties as would an administrative law judge, and the arbitrator’s sub-
stantive rulings may be appealed to the state commission itself. See Or.
Admin. R. 860-016-0030(1) (1998) (noting that “the Commission will use
an ALJ as arbitrator”); id. (4) (“The arbitration will be conducted in a
manner similar to a contested case proceeding, and the arbitrator will have
the same authority to conduct the arbitration process as an ALJ has in con-
ducting hearings under the Commission’s rules.”). An aspect of the pro-
ceedings that may, however, suggest an arbitration is the one that has
created so much trouble here: after the arbitrator reaches a decision, a
determination on the agreement is generally not made by the PUC until the
parties themselves submit a signed agreement. § 252(e)(1) (“Any intercon-
nection agreement adopted by negotiation or arbitration shall be submitted
for approval to the State commission. A State commission to which an
agreement is submitted shall approve or reject the agreement . . . .”).
8192 WESTERN RADIO SERVICES v. QWEST CORP.
the following actions or practices, among others, violate the
duty to negotiate in good faith . . . .”) (emphasis added)10; see
also In the Matter of Implementation of the Local Competition
Provisions in the Telecommunications Act of 1996, 11
F.C.C.R. 15499, 15571, 1996 WL 452885, at ¶ 143 (F.C.C.
1996) (“[W]e believe that state commissions have authority,
under section 252(b)(5), to consider allegations that a party
has failed to negotiate in good faith.”). The practice of state
commissions shows that they recognize that they have this
authority and have acted on it. See, e.g., In re Petition for
Arbitration of an Interconnection Agreement Between Sprint
Communications Co. L.P. with Whidbey Tel. Co., No. UT-
073031, 2008 WL 227939 (Wash. U.T.C. Jan. 24, 2008); In
re Beaver Creek Cooperative Tel. Co., No. 07-033, 2007 WL
385641 (Or. P.U.C. Jan. 29, 2007); In re Sprint Communica-
tions, No. 961173-TP, 1997 WL 294619, at *8 (Fla. P.S.C.
May 13, 1997).
Further, although Western maintains otherwise, the Oregon
PUC has a specific procedure for raising the argument that
Western has raised here — namely, that a draft interconnec-
tion agreement does not comply with the arbitrator’s order.
The PUC’s rules provide that:
Within 14 days after the [PUC] issues its arbitration
decision, petitioner must prepare an interconnection
agreement complying with the terms of the arbitra-
tion decision and serve it on Respondent. Respon-
dent shall either sign and file the agreement, or file
objections to it, within 10 days of service of it. If
10
The F.C.C. regulation also recognizes that a “court of competent juris-
diction” may determine that a carrier failed to negotiate in good faith. This
alternative does not affect our ultimate conclusion that the question must
be decided by the PUC before bringing a good faith claim. The regulation
does not directly address prudential concerns, such as exhaustion or pri-
mary jurisdiction, one way or the other. It is thus consistent with the con-
clusion that initial state commission adjudication is necessary for good
faith claims.
WESTERN RADIO SERVICES v. QWEST CORP. 8193
objections are filed, respondent shall state how the
agreement fails to comply with the arbitration deci-
sion, and offer substitute language complying with
the decision.
See Or. Admin. R. 860-016-0030(12) (1998). In this case,
Western, rather than Qwest, was the “petitioner,” because
Western is the party that petitioned for arbitration. See
§ 252(b). It appears, however, that Western did not prepare an
interconnection agreement as required by the rule, and that an
agreement was instead drafted by Qwest. It is likely that the
PUC would interpret its rules to permit whichever party did
not draft the agreement to submit objections to it, but, even
if that is not so, Western, as the “petitioner,” could have
drafted its own version of the agreement and submitted it to
the PUC. In either case, then, PUC procedures would have
permitted Western to make the PUC aware of its own inter-
pretation of the arbitrator’s order, and to explain why Qwest’s
version represented, in its view, a failure to negotiate in good
faith.11
Moreover, Western could not only have received a
response to its allegation that Qwest had failed to negotiate in
good faith, but could have received at least some relief in the
form of approval of an agreement consistent with the arbitra-
tor’s order.12 As noted, Western could have submitted its own
11
We do not decide whether insisting on contract provisions inconsistent
with the arbitrator’s order is a failure to negotiate in good faith. We
observe only that F.C.C. regulations and Oregon procedures make evident
that Western could have raised such an argument to the PUC and received
an answer. See In the Matter of Implementation of the Local Competition
Provisions in the Telecommunications Act of 1996, 11 F.C.C.R. 15499,
16131, 1996 WL 452885, at ¶ 1293 (F.C.C. 1996) (explaining that
“[a]bsent mutual agreement to different terms, the decision reached
through arbitration is binding,” and that “carrier might face penalties if, by
refusing to enter into an arbitrated agreement, that carrier is deemed to
have failed to negotiate in good faith”).
12
If the PUC does not “approve or reject a filed interconnection agree-
ment within 30 days of its filing,” the agreement will be “deemed
8194 WESTERN RADIO SERVICES v. QWEST CORP.
draft agreement. Had it done so, the PUC would have
reviewed it for compliance with the arbitration order whether
or not Qwest signed it — which is just what happened here,
in reverse.13
Qwest sensibly argues that Western was required to seek
these administrative remedies before the PUC in advance of
bringing suit in district court under § 207. The unusual statu-
tory scheme created in §§ 251 and 252, however, makes this
case an uncomfortable fit for the prudential doctrines we usu-
ally apply to require that an agency decide an issue in the first
instance.
As to exhaustion, in the absence of a statutory requirement,
exhaustion of administrative remedies may be required as a
prudential matter when policy factors favor it and it is not
inconsistent with Congressional intent. See Noriega-Lopez v.
Ashcroft, 335 F.3d 874, 881 (9th Cir. 2003); see also McGee
v. United States, 402 U.S. 479, 483-86 (1971). As a general
rule, however, we have applied prudential exhaustion require-
ments in actions against agencies and agency officials, and
approved.” See Or. Admin. R. 860-016-0030(12) (1998). Under those cir-
cumstances, it would be reasonable to construe the PUC’s silence as a
rejection on the merits of any good faith claims fairly presented to it. Cf.
Smith v. Digmon, 434 U.S. 332, 333 (1978) (per curiam) (explaining that
whether the habeas exhaustion requirement “has been satisfied cannot turn
upon whether a state appellate court chooses to ignore . . . a federal consti-
tutional claim squarely raised” by the petition).
13
Other state commissions also sometimes approve interconnection
agreements in the absence of participation by one party. See In re Sprint
Communications, No. 961173-TP, 1997 WL 294619, at *8 (Fla. P.S.C.
May 13, 1997) (concluding that one party had failed to negotiate in good
faith by refusing to sign a negotiated agreement and therefore approving
the proposed agreement of the other party as a final agreement); Global
Naps, Inc. v. Verizon New England, Inc., No. 03-10437, 2004 WL
1059792, at *3 (D. Mass. May 12, 2004) (noting that Global’s refusal to
sign the arbitrated agreement was a failure to negotiate in good faith for
which the PUC’s response of nonetheless enforcing that agreement was
entirely appropriate), aff’d, 396 F.3d 16 (1st Cir. 2005).
WESTERN RADIO SERVICES v. QWEST CORP. 8195
not typically in actions between two private parties. See, e.g.,
Puga v. Chertoff, 488 F.3d 812, 815 (9th Cir. 2007) (applying
prudential exhaustion requirement to habeas corpus petition
based on denial of due process during removal proceedings);
Morrison-Knudsen Co, Inv. v. CHG Int’l, Inc., 811 F.2d 1209,
1223 (9th Cir. 1987) (holding that on remand district court
should consider whether prudential exhaustion required plain-
tiffs to exhaust their administrative remedies at the Federal
Savings and Loan Insurance Corporation before bringing an
action against that agency). That the doctrine of prudential
exhaustion was crafted principally to channel actions against
agencies and agency officials is reflected in the policy con-
cerns that we have considered in applying it. For example, in
deciding whether to require exhaustion, we consider the
“agency’s interest in . . . correcting its own errors” and “en-
joying appropriate independence of decision.” See Morrison-
Knudsen, 811 F.2d at 1223; Stratman v. Watt, 656 F.2d 1321,
1326 (9th Cir. 1981); see also McGee, 402 U.S. at 484. By
bringing a private cause of action against Qwest contending
that the agreement Qwest drafted does not comport with the
PUC’s order, Western has not brought a lawsuit challenging
any “error” of the agency or otherwise directly attacking an
agency decision.
As to a closely related doctrine, primary jurisdiction, we do
apply that prudential doctrine in cases involving suits brought
by a private party against another private party. See, e.g.,
Clark v. Time Warner Cable, 523 F.3d 1110, 1115-16 (9th
Cir. 2008) (holding that an action by a telephone user against
a cable operator was within the primary jurisdiction of the
F.C.C.); Davel Telecomm. v. Qwest Corp., 460 F.3d 1075,
1080, 1089 (9th Cir. 2006) (applying doctrine of primary
jurisdiction in lawsuit between payphone service providers
and Qwest Corp.). The primary jurisdiction doctrine is “a doc-
trine specifically applicable to claims properly cognizable in
court that contain some issue within the special competence
of an administrative agency.” Davel, 460 F.3d at 1080 (inter-
8196 WESTERN RADIO SERVICES v. QWEST CORP.
nal quotation and emphasis omitted). We have applied the
doctrine of primary jurisdiction when there is:
(1) a need to resolve an issue that (2) has been
placed by Congress within the jurisdiction of an
administrative body having regulatory authority (3)
pursuant to a statute that subjects an industry or
activity to a comprehensive regulatory authority that
(4) requires expertise or uniformity in administra-
tion.
Clark, 523 F.3d at 1115 (quoting Syntek Semiconductor Co.
v. Microchip Tech. Inc., 307 F.3d 775, 781 (9th Cir. 2002)).
The doctrine of primary jurisdiction, however, is also not
a perfect fit for the statute before us. For one thing, the agency
with “regulatory authority” in this context, in the sense of
having the authority to promulgate substantive regulations, is
the F.C.C., not the state commissions. See § 251(d)(1) (“[T]he
Commission shall complete all actions necessary to establish
regulations to implement the requirements of this section.”);
United States v. Culliton, 328 F.3d 1074, 1082 (9th Cir. 2003)
(per curiam) (explaining that doctrine permits referral only to
agency that “Congress has vested with the authority to regu-
late an industry or activity”). Also, we have questioned
whether the doctrine permits referral of a case to a state, as
opposed to a federal, agency. See Cost Mgmt. Servs., Inc. v.
Wash. Nat. Gas Co., 99 F.3d 937, 949 n.12 (9th Cir. 1996)
(“We note in passing that we are not entirely persuaded that
the doctrine should be applied . . . to allow a federal court to
‘route’ issues to a state agency for resolution.”).
[7] Still, while this statutory scheme is sufficiently unusual
that the established contours of the exhaustion and primary
jurisdiction doctrines do not quite apply, the basic concerns
that underlie both doctrines have equal force here, as we shall
shortly explain. We therefore agree with Qwest that the only
sensible conclusion in this case, given the nature of Western’s
WESTERN RADIO SERVICES v. QWEST CORP. 8197
asserted cause of action and the role allotted to state commis-
sions by Congress, is that the PUC must address Western’s
good faith claim before that claim may be brought in district
court. This requirement, it bears repeating, is a prudential lim-
itation on adjudication, not a statutory or jurisdictional one.
See Laing v. Ashcroft, 370 F.3d 994, 998 (9th Cir. 2004). We
so hold for several reasons.
[8] First, while we might under other circumstances be
hesitant to require that a party bring its claim to a state agency
before raising a federal private right of action in district court,
§§ 251 and 252 give the PUC a uniquely prominent role. In
Cost Management, the plaintiffs brought a Sherman Act claim
predicated in part on a violation of state law; our hesitation
was based in part on our concern that the primary jurisdiction
doctrine is “in effect, a power-allocating mechanism,” and
therefore that a “court must not employ the doctrine unless the
particular division of power was intended by Congress.” See
99 F.3d at 949 n.12 (quoting United States v. Gen. Dynamics
Corp., 828 F.2d 1356, 1363 n.13 (9th Cir. 1987)). Here, the
federal statutory scheme specifically grants authority to a state
agency to interpret and enforce the provisions of §§ 251 and
252 (as well as the regulations the F.C.C. promulgates to
implement them), including the duty to interpret and enforce
the obligation to negotiate in good faith. See § 252(b)(1),
(e)(1)-(3).
[9] Second, although the structure of the § 207 cause of
action for violation of the duty to negotiate in good faith —
again, assuming that there is one — is unlike those in which
we have applied exhaustion and primary jurisdiction in the
past, many of the policy concerns that inform our application
of those doctrines weigh heavily in favor of PUC adjudication
in the first instance. In both contexts, we have considered the
importance of deferring to and relying on agency “expertise.”
See Clark, 523 F.3d at 1115; Gonzales v. Dept. of Homeland
Sec., 508 F.3d 1227, 1234 (9th Cir. 2007). Here, Western pri-
marily challenges Qwest’s compliance with the arbitrator’s
8198 WESTERN RADIO SERVICES v. QWEST CORP.
order. The PUC is certainly “expert” in the meaning of its
own orders, and its assessment of Qwest’s compliance would
greatly aid the district court. The PUC also has a particular
expertise in this case: The lack of good faith negotiation
alleged occurred during proceedings before the agency, mak-
ing the agency a witness to the actions about which Western
complains. The agency is thus much better situated than the
district court to “mak[e] a proper record” and determine the
facts surrounding the alleged failure to negotiate in good faith.
See Morrison-Knudsen, 811 F.2d at 1223.
[10] Third, failure to require Western to await an agency
decision in this case would permit an extremely inefficient
“bypass of an administrative remedy.” Gonzales, 508 F.3d at
1234. The unusual two-step procedure required by the statute,
in which a state commission first arbitrates an agreement and
then approves it after it is submitted by the parties, made it
possible for Western to request binding arbitration and then
wait and see whether the PUC would decide the substantive
issues in its favor. Only when the PUC did not did Western
abandon the arbitration and head to district court, rather than
either submitting its own version of the agreement or raising
objections to Qwest’s version.14 Such behavior wastes the
agency’s resources and makes it more difficult for the district
court to reach a correct decision on the good faith claim.
14
It is not clear that such deliberate bypass of the administrative scheme
is likely to recur frequently. Requesting carriers, such as Western, presum-
ably wish to enter into interconnection agreements with incumbent carriers
like Qwest, and it is not clear that Western gains any advantage in the
interim by delaying adoption of an agreement, even an imperfect one. In
fact, it is more likely that incumbent carriers, such as Qwest, have an
incentive to delay adoption of an interconnection agreement after arbitra-
tion, because they may prefer not to provide interconnection for as long
as possible. Nonetheless, there are at least two other cases pending before
this court in which Western appears to have headed directly to district
court with its good faith claim, rather than waiting for the PUC to approve
or reject an agreement. See Autotel v. Qwest Corp., No. 07-17112; Autotel
v. Central Telephone Co., No. 06-16565.
WESTERN RADIO SERVICES v. QWEST CORP. 8199
[11] Fourth, imposition of a requirement that Western
await a decision on the issue from the PUC is not only not
inconsistent with the statutory scheme, but comports with
Congressional intent insofar as it can be ascertained. Sections
251 and 252 establish a detailed structure for negotiation and
imposition of interconnection agreements. They provide that
a request for binding arbitration before a state commission
may be made “[d]uring the period from the 135th to the 160th
day (inclusive) after the date on which an incumbent local
exchange carrier receives a request for [voluntary] negotia-
tion.” § 252(b). The Act also specifies what information must
be provided in a petition to a state commission requesting
arbitration, § 252(b)(2), and requires that the “non-petitioning
party” be provided an “[o]pportunity to respond.” § 252(b)(3).
The Act goes on to lay out the duties and powers of a state
commission during arbitration, the standards the state com-
mission must apply, and the schedule on which the state com-
mission must decide to approve or reject an agreement. See
§ 252(b), (c), and (e). The inclusion of a judicial review provi-
sion in the same statutory section describing the administra-
tive proceedings, see § 252(e)(6), even though it does not
provide the cause of action for Western’s good faith damages
claim against Qwest, further suggests that Congress expected
administrative proceedings generally to come to a close
before institution of proceedings in a district court. Section
252 nowhere suggests that at any point prior to a PUC deter-
mination a carrier may turn to a district court and sue another
carrier if aggrieved by the actions of that carrier. It can hardly
be expected that Congress created such a complex scheme of
administrative arbitration if it anticipated that parties would
regularly bypass that scheme and head directly to district
court.
[12] Finally, our conclusion is consistent with the general
principle that we attempt to strike a balance between the
rights of parties to bring their private causes of action in fed-
eral court and a statutory scheme providing an alternative
means of resolution before an agency. In the context of the
8200 WESTERN RADIO SERVICES v. QWEST CORP.
Railway Labor Act (“RLA”) and the National Labor Relations
Act (“NLRA”), for example, courts have held that certain
claims must be decided by the agency in the first instance,
despite the fact that the statute nowhere explicitly states that
the agency has exclusive jurisdiction over those claims.15 See,
e.g., Konop v. Haw. Airlines, Inc., 302 F.3d 868, 881 (9th Cir.
2002) (noting that, under RLA, “controversies over the mean-
ing of an existing collective bargaining agreement must be
arbitrated” through the agency scheme established in 45
U.S.C. §§ 151a, 152); Sears, Roebuck & Co. v. San Diego
County Dist. Council of Carpenters, 436 U.S. 180, 187-88
(1978) (holding that both state and federal courts must defer
to the National Labor Relations Board when an activity is
arguably protected under § 7 or prohibited by § 8 of the
NLRA); see generally Kennecott Copper Corp. v. Costle, 572
F.2d 1349, 1357 (9th Cir. 1978). Here, Congress has estab-
lished a complex arbitration scheme administered by a state
agency that provides some potential remedy for the actions
about which Western complains. It is appropriate to require
that Western complete the arbitration process it has already
begun and obtain a decision on the questions underlying its
good faith claim before it brings its good faith claim in district
court. Applying the requirement that the agency initially
address the good faith question, we observe that the PUC has
15
The analogy to the RLA and the NLRA is not perfect. In both cases,
courts have held that the jurisdiction of the agency over certain issues is
“exclusive,” see Konop, 302 F.3d at 881; Sears, 436 U.S. at 187-88, and
the Supreme Court has acknowledged that this distinguishes the primary
jurisdiction doctrine in the context of the NLRA from the usual doctrine
of primary jurisdiction, see Sears, 436 U.S. at 200 n.29 (noting that the use
of “primary jurisdiction” in the NLRA context should not be confused
with the usual notion of primary jurisdiction, in which the court decides
only that the agency must initially address an issue, not that the court has
no authority to decide the issue). Nonetheless, although we do not hold
that agency jurisdiction is exclusive, the RLA and NLRA examples dem-
onstrate that in balancing the rights of parties immediately to raise a claim
in district court against agency authority to adjudicate an issue in the first
instance, we may conclude that the intent of Congress is best served by
requiring agency adjudication.
WESTERN RADIO SERVICES v. QWEST CORP. 8201
now approved an interconnection agreement. In its October
10, 2005 decision approving the agreement submitted by
Qwest, the PUC held that “the interconnection agreement sub-
mitted by Qwest . . . complies with” the arbitrator’s decision.
[13] It is possible that this decision satisfied any prudential
requirement that Western pursue its complaint with the PUC
before filing suit. Ordinarily, when an agency has actually
addressed an issue, the policies underlying the exhaustion
doctrine (and, we would think, the primary jurisdiction doc-
trine) are satisfied, and a party need not return to the agency
to raise it. See Abebe v. Gonzales, 432 F.3d 1037, 1041 (9th
Cir. 2005) (en banc) (when agency has actually considered
and decided an issue, the issue is exhausted despite the peti-
tioners’ failure to raise it before the agency). For two reasons,
however, we cannot be sure that the prudential requirement
we impose with regard to any § 207 lack of good faith negoti-
ation cause of action has been met.
First, at oral argument, Western suggested that its “good
faith” claim was based not only on the actions of Qwest in
failing to draft an agreement that complied with the arbitra-
tor’s order but also on Qwest’s actions throughout negotia-
tions. As far as we can determine, Western’s complaint makes
reference only to Qwest’s failure to draft a compliant agree-
ment, and does not specify any other facts or actions that
would support a good faith claim. But, until Western spells
out the full scope of its good faith claims in more detail and
either explains why they are encompassed in the existing
complaint or amends its complaint, it will not be possible to
determine the degree to which the prudential requirement we
have recognized was met by the PUC’s approval of the agree-
ment submitted by Qwest.
Second, it is not clear on what basis, if any, the PUC
decided the noncompliance issues that Western wishes to
adjudicate. On the one hand, the PUC’s ruling that Qwest’s
agreement complies with the arbitrator’s order may constitute
8202 WESTERN RADIO SERVICES v. QWEST CORP.
a decision that Qwest did negotiate in good faith. On the other
hand, the PUC order suggests that, after the arbitrator has
issued a decision, acceptance of an agreement that is consis-
tent with that decision is compulsory. The PUC’s order can be
read to imply that there are no “negotiations” after the arbitra-
tor’s decision, and to suggest that one cannot violate the duty
to negotiate in good faith after the arbitrator’s decision, even
if one submits an agreement that is not consistent with the
arbitrator’s order. It is thus not entirely clear, without further
inquiry, what the PUC’s position is on whether Qwest’s
alleged actions constitute a failure to negotiate in good faith.
[14] At the time the district court issued its decision, there
had been no PUC order approving an interconnection agree-
ment. The district court therefore had no opportunity to
address the impact of that order on this litigation, including
answering the questions we have just posed. We thus remand
to the district court to permit it to determine whether the PUC
has decided the good faith questions Western seeks to litigate,
as well as the ultimate effect of the PUC’s decision on the
current litigation. See Golden Gate Hotel Ass’n v. City and
County of San Francisco, 18 F.3d 1482, 1487 (9th Cir. 1994)
(“As a general rule ‘a federal appellate court does not con-
sider an issue not passed upon below.’ ”) (quoting Singleton
v. Wulff, 428 U.S. 106, 120 (1976)).
If the district court concludes that Western’s good faith
claims were determined, impliedly or expressly, by the PUC,
it will remain to decide whether a party may bring a good
faith claim under § 207. This question was not addressed by
the district court, likely because it was not clearly raised by
the parties.16
16
In its complaint, Western alleged that the district court had “jurisdic-
tion” over this action under “42 [sic] U.S.C. § 207.” The effect of § 207
was not briefed by either party below, and the district court did not men-
tion § 207 in its decision.
WESTERN RADIO SERVICES v. QWEST CORP. 8203
Although the question is a complex one, two of Qwest’s
arguments may be disposed of easily. Qwest suggests that
§ 207 does not permit private actions to enforce provisions of
the 1996 Act, as opposed to the 1934 Act, and maintains that
§ 207 only permits actions by customers against common car-
riers. Qwest’s first argument is inconsistent with the purpose
and function of the 1996 Act. The Supreme Court has stated
that “the 1996 Act was adopted, not as a freestanding enact-
ment, but as an amendment to, and hence part of” the 1934
Act. AT&T Corp. v. Iowa Utilities Bd., 525 U.S. 366, 386
(1999). Further, in Global Crossing Telecommunications, Inc.
v. Metrophones Telecommunications, Inc., 127 S.Ct. 1513(2007), the Supreme Court held that the cause of action con-
tained in § 207 was available to enforce an F.C.C. regulation
promulgated under 47 U.S.C. § 276(b)(1), a section added by
the 1996 Act. See id. at 1519-20; see also Valdes v. Qwest
Comm’ns Int’l, Inc., 147 F. Supp. 2d 116 (D. Conn. 2001)
(jurisdiction available under § 207 for customers to enforce
“no slamming” provision of the 1996 Act).
Global Communications also disposes of Qwest’s second
argument. In that case, the plaintiffs were not customers but
payphone operators suing to enforce an F.C.C. regulation
mandating the level of payment long distance carriers were to
provide them. 127 S. Ct. at 1515. The Court explicitly
rejected the argument that § 207 only permitted actions by
customers and not by fellow carriers. See id. at 1524.
Nonetheless, the remaining issues regarding the applicabil-
ity of § 207 are complex and should not be decided without
the participation of the F.C.C., the agency principally respon-
sible for the enforcement of the Telecommunications Act.
Whether § 207 provides a cause of action may, in fact, have
an impact on F.C.C. regulation in other contexts. For exam-
ple, determining whether § 207 provides a private right of
action for Western’s claim may involve interpreting the rela-
tionship between the terms “common carrier,” “local
exchange carrier,” and “telecommunications carrier.” Section
8204 WESTERN RADIO SERVICES v. QWEST CORP.
207 refers to damages caused by a “common carrier.” Qwest’s
duty to negotiate in good faith, however, arises from its obli-
gations as a “local exchange carrier.” See § 251(c)(1) (“each
incumbent local exchange carrier has . . . [t]he duty to negoti-
ate in good faith in accordance with section 252 of this title
the particular terms and conditions of” interconnection agree-
ments).
The relationship between these two terms is not obvious.
On the one hand, the statutory definitions and the use of the
terms in other provisions of the Acts suggest that local
exchange carriers are not necessarily a subset of common car-
riers. See, e.g., § 153(10) (definition of common carrier);
§ 153(26) (definition of local exchange carrier); § 228(d)(3),
(g)(1) (discussing common carriers and local exchange carri-
ers as distinct categories of entities). On the other hand, the
statutory definition of “telecommunications carrier” — a term
which is used along with “local exchange carrier” in § 252 —
as well as F.C.C. guidance on the relationship between com-
mon carriers and telecommunications carriers, suggests that
local exchange carriers may be common carriers for purposes
of § 207. See § 153(44) (definition of telecommunications
carrier); In the Matter of AT&T Submarine Systems, Inc., 13
F.C.C.R. 21585, 21587-88 (F.C.C. 1998) (holding that “the
term ‘telecommunications carrier’ means essentially the same
as [sic] common carrier”). As all three terms are frequently
used throughout the telecommunications acts, interpreting
them may have consequences in areas of telecommunications
law other than the reach of § 207.
In addition, interpretation of § 207 potentially implicates
the jurisdiction of the F.C.C. Section 207 offers aggrieved
individuals a choice of remedies for alleged violations of the
Telecommunications Act: they may go to the F.C.C., presum-
ably by bringing a complaint under § 208 — which provides
a mechanism for filing complaints before the F.C.C. — or to
a district court. Given that the statute provides a choice
between these two remedies, it may be logical to expect that
WESTERN RADIO SERVICES v. QWEST CORP. 8205
if a claim can be brought in district court under § 207, it also
may be brought to the F.C.C. under § 208. On the other hand,
the F.C.C. has never directly decided whether it has jurisdic-
tion over good faith claims such as Western’s.17
In sum, these questions of statutory interpretation are both
open and significant. See generally Alexander v. Sandoval,
532 U.S. 275, 286-89 (2001) (discussing private right of
action analysis). For a court to attempt to decide them “with-
out the views of the agenc[y] responsible . . . would be to
embark upon a voyage without a compass.” Mead Corp. v.
Tilley, 490 U.S. 714, 726 (1989). Consequently, if it deter-
mines that the question of the reach of § 207 with regard to
good faith causes of action must be decided, we suggest that
the district court seek the opinion of the F.C.C. as an invited
amicus curiae. See Mead Corp., 490 U.S. at 726 (remanding
to the lower court with instructions to consider the views of
the agency because the issue had not been decided below and
the agency had up to that point not offered its views on the
question); Beck v. Pace Intern. Union, 127 S. Ct. 2310, 2317
(2007) (deferring to views of the Pension Benefit Guaranty
Corporation provided in an amicus brief).
II. Section 1983 Claims.
In dismissing Western’s 42 U.S.C. § 1983 claims against
the PUC and its Commissioners, the district court stated only
that “the PUC’s well founded motion to dismiss is denied
with leave to renew upon this court obtaining proper jurisdic-
tion over this matter.” Although the district court’s holding
could be clearer, it appears to have concluded that the § 1983
17
Although 47 C.F.R. § 51.301(c) does provide that certain actions will
“violate the duty to negotiate in good faith” if they are “proven to the
[F.C.C.],” it is not clear whether this provision applies only when the
F.C.C. preempts a state commission’s jurisdiction and “assumes [its]
responsibility” with respect to an ongoing proceeding or matter. See 47
U.S.C. § 252(e)(5).
8206 WESTERN RADIO SERVICES v. QWEST CORP.
claims were not ripe for adjudication in the absence of final
agency action. We do not decide whether the district court
was correct in that regard.
Instead, we observe only that ripeness is assessed based on
the facts as they exist at the present moment. See Assiniboine
and Sioux Tribes v. Bd. of Oil and Gas Conservation, 792
F.2d 782, 788 & n.3 (9th Cir. 1986) (“Because ripeness is
‘peculiarly a question of timing,’ we look to the facts as they
exist today in evaluating whether the controversy before us is
sufficiently concrete”); see also Buckley v. Valeo, 424 U.S. 1,
114-17 (1976) (reversing Court of Appeals decision that cer-
tain claims were not ripe because, in the interim between the
Court of Appeal’s decision and Supreme Court consideration
of the case, agency action had been taken, making the claims
ripe for review); Regional Rail Reorganization Act Cases, 419
U.S. 102, 139-40 (1974) (reversing lower court holding that
case was not ripe for review because “[i]t is the situation now
rather than the situation at the time of the district court’s deci-
sion that must govern”).
As we have already noted, since the district court decision,
the PUC has issued an order approving the interconnection
agreement submitted by Qwest, and Western Radio is now
bound by the conditions of that agreement. It may well be that
this development would alter the district court’s ruling on
whether the § 1983 cause of action is sufficiently ripe to go
forward. We therefore remand to the district court for further
proceedings on this cause of action as well.
CONCLUSION
For the foregoing reasons, the decision of the district court
is VACATED and REMANDED for further proceedings not
inconsistent with this opinion.