Pacific Bell v. Cook Telecom, Inc.

This case presents a question of first impression in the circuit courts concerning the proper interpretation of certain sections of the Telecommunications Act of 1996: Can a paging company enter into “reciprocal compensation arrangements for the transport and termination of telecommunications”? The Federal Communications Commission (FCC) answers “yes.” We hold that the relevant statutory provisions are ambiguous and that we must, therefore, defer to the interpretation offered by the FCC.

STATUTORY BACKGROUND

A. Local Competition

The Telecommunications Act of 1996, Pub.L. 104-104, 100 Stat. 56 (codified as scattered amendments to the Communications Act of 1934, 47 U.S.C. § 151 et seq.) (the Act) is designed to foster competition in local telecommunications markets. See U.S. West Communications v. MFS Intelenet, Inc., 193 F.3d 1112 , 1116 (9th Cir. 1999) (petition for rehearing and petition for rehearing en banc filed Oct. 22, 1999); In the Matter of Implementation of the-Local Competition Provision in the Telecommunications Act of 1996, 11 F.C.C.R. 15499 ¶ 1 (1996) (First Report and Order) (“In the new regulatory regime, [the FCC] and the states remove the outdated barriers that…