Sprint Communications Company, L.P. Plaintiff- Appellant
Richard W. Lozier, Jr.; Nick Wagner; Geri Huser, in their official capacities asmembers of the Iowa Utilities Board Defendants - Appellees
Windstream Iowa Communications, Inc.; Office of Consumer Advocate Intervenor Defendants - Appellees
Submitted: January 11, 2017
from United States District Court for the Southern District
of Iowa - Des Moines
WOLLMAN, MURPHY, and COLLOTON, Circuit Judges.
WOLLMAN, Circuit Judge.
previously come before us on issues of abstention, Sprint
Commc'ns Co. v. Jacobs, 690 F.3d 864 (8th Cir. 2012)
(Sprint I), rev'd sub nom. Sprint
Commc'ns, Inc. v. Jacobs, 134 S.Ct. 584 (2013), and
issue preclusion, Sprint Commc'ns Co. v. Jacobs,
798 F.3d 705 (8th Cir. 2015) (Sprint II), this case
now presents the question whether the Telecommunications Act
of 1996 (Telecommunications Act or Act), preempts the Iowa
Utilities Board's (Board's) authority to compel
Sprint Communications Company, L.P. (Sprint) to pay
intrastate access charges to Windstream Iowa Communications,
Inc. (Windstream, formerly Iowa Telecom). On cross-motions
for summary judgment, the district courtdetermined that the Act
preserved the Board's authority and that Sprint thus was
not entitled to declaratory or injunctive relief. It granted
the Board's and Windstream's motions for summary
judgment and denied Sprint's motion. We affirm.
ago, Sprint partnered with MCC Telephony of Iowa, L.L.C.
(Mediacom) to provide Voice over Internet Protocol (VoIP)
voice telephony to Mediacom's customers. The VoIP calls
at issue in this case were nonnomadic, intrastate
longdistance calls-that is, the calling and the called
parties were situated in fixed geographic locations in
different exchanges in Iowa.
VoIP calls originated on Mediacom's cable network in
Internet Protocol (IP) format. They were then routed to
Sprint, which converted them from IP format to Time Division
Multiplexing format for delivery on the Public Switched
Telephone Network (PSTN). After Sprint converted the format,
it delivered the calls to Windstream on exchange access
trunks, over which Sprint routed long-distance calls.
Windstream then connected the calls to end users. For years,
Sprint paid Windstream intrastate access charges based on the
rates set forth in the tariff that Windstream had submitted
to the Board.
adopted the position in 2009, however, that the calls were
not subject to intrastate access charges, claiming that the
Telecommunications Act preempted state regulation of VoIP
traffic. Sprint discontinued paying the intrastate access
charges to Windstream and also began withholding payment of
other, undisputed amounts. Sprint explained that withholding
such additional payments allowed it to recover the intrastate
access charges that it erroneously had paid over the years.
In response, Windstream threatened to discontinue access
service to Sprint, which would block calls that Sprint routed
filed a complaint with the Board, alleging that Sprint had
properly disputed the intrastate access charges and that its
decision to withhold payment was appropriate under
Windstream's tariff. Sprint requested emergency relief to
prevent Windstream from blocking calls. Windstream thereafter
agreed to continue to provide access service to Sprint as
long as Sprint remained current on newly billed intrastate
access charges. Sprint then moved to withdraw its complaint,
arguing that its claim was no longer ripe because
Windstream's agreement to continue to provide access
service granted Sprint the relief it had requested from the
Board. The Board granted Sprint's motion to withdraw the
complaint, but nonetheless decided to reach the merits of the
underlying dispute, "i.e., whether VoIP calls
are subject to intrastate regulation." Sprint
Commc'ns, Inc., 134 S.Ct. at 589. Sprint argued that
the Board lacked jurisdiction to decide the underlying
dispute, which Sprint described as "whether it [was]
proper for [Windstream] to charge traditional access charges
on the traffic [that] originated as" VoIP traffic. The
Board "disagreed, ruling that the intrastate fees
applied to VoIP calls." Sprint Commc'ns,
Inc., 134 S.Ct. at 589. The Board later denied
Sprint's application for reconsideration.
April 2011, Sprint filed suit in federal district court
against members of the Board in their official capacities,
seeking a declaration that the Board's order compelling
Sprint to pay intrastate access fees was contrary to federal
law, as well as an injunction prohibiting the Board from
enforcing its order. Sprint's complaint set forth one
count, entitled "Preemption of State Regulation of
Information Services." Sprint maintained that the
disputed intrastate long-distance VoIP calls were
"information services" under the Communications Act
of 1934, as modified by the Telecommunications Act, and that
the Communications Act preempted the authority of state
utilities commissions to regulate information services. The
district court permitted Windstream and the Iowa Office of
Consumer Advocate to intervene and participate in the
same day it filed its federal complaint, Sprint also
petitioned for review of the Board's order in Iowa state
court. The federal district court initially abstained from
exercising jurisdiction and dismissed the case without
prejudice. On appeal, we affirmed the decision to abstain,
but vacated the judgment of dismissal and remanded the case
to the district court with instructions to enter a stay of
proceedings. Sprint I, 690 F.3d at 869. The Supreme
Court granted Sprint's petition for certiorari, concluded
that abstention was inappropriate, and reversed our judgment.
Sprint Commc'ns, Inc., 134 S.Ct. at 593-94. We
thereafter vacated our panel opinion, again reversed the
judgment of dismissal, and remanded the case to the district
court for further proceedings. Sprint Commc'ns Co. v.
Jacobs, 746 F.3d 850 (8th Cir. 2014).
the United States Supreme Court was considering the
abstention question, the state trial court ruled on
Sprint's petition for review of the Board's order. As
relevant here, the state court rejected Sprint's argument
that the Board lacked "jurisdiction to approve and
enforce [the] tariff that permitted [Windstream] to charge
Sprint . . . intrastate access charges on
non-nomadic VoIP traffic." It affirmed the Board's
order and later denied Sprint's motion for
state trial court issued its ruling in September 2013, well
before the federal case was remanded to district court
following our March 2014 order. On remand, the district court
gave preclusive effect to the state trial court's
determination that federal law did not preempt state
regulation of intrastate VoIP traffic and thus dismissed
Sprint's federal complaint for failure to state a claim.
We reversed and remanded, "conclud[ing] that Congress
did not intend that issue-preclusion principles bar
federal-court review of the issue involved here."
Sprint II, 798 F.3d at 708. While we expressed no
view on the merits of the case, we framed the issue as
"whether the nonnomadic intrastate long-distance VoIP
calls at issue are information services, payment for which
should be governed by a reciprocal compensation agreement, or
telecommunications services subject to state access
charges." Id. On remand, the district court did
not decide whether the calls were information services or
telecommunications services. It determined instead that
§ 251(g) of the Telecommunications Act preserved state
authority to regulate the VoIP calls, regardless of their
classification, and that the Act "did not preempt the
state tariffs [under which] Sprint was charged." D. Ct.
Order of Dec. 30, 2015, at 13.
argues that the district court erred in declining to classify
the nonnomadic, intrastate long-distance VoIP calls as
information services or telecommunications services.
According to Sprint, our articulation of the issue presented
was essential to the holding in Sprint II and thus
constituted the law of the case. Sprint contends that
"the upshot of the binding formulation that this Court
provided . . . was that, if the calls at issue were . . .
information service[s], " the Act's reciprocal