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BellSouth v. Kentucky PSC, et al., No. 10-5310/5311 (6th Cir.)

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Released: December 6, 2011
B
Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 1
RIEF FOR AMICUS CURIAE FEDERAL COMMUNICATIONS COMMISSION IN SUPPORT OF DEFENDANTS-APPELLANTS
CROSS-APPELLEES AND PARTIAL REVERSAL OF THE DISTRICT COURT
IN THE UNITED STATES COURT OF APPEALS FOR THE
SIXTH CIRCUIT
NO. 10-5310/10-5311
BELLSOUTH TELECOMMUNICATIONS, INC., D/B/A AT&T KENTUCKY,
PLAINTIFF-APPELLEE CROSS-APPELLANT,
V.
KENTUCKY PUBLIC SERVICE COMMISSION; DAVID L. ARMSTRONG, in his official
capacity as Chairman of the Public Service Commission; JAMES W. GARDNER, in
his official capacity as Vice-Chairman of the Public Service Commission;
CHARLIE BORDERS, in his official capacity as Commissioner of the Public Service
Commission,
DEFENDANTS-APPELLANTS CROSS-APPELLEES.
ON APPEAL FROM THE U.S. DISTRICT COURT FOR THE
EASTERN DISTRICT OF KENTUCKY
SHARIS A. POZEN
AUSTIN C. SCHLICK
ACTING ASSISTANT ATTORNEY GENERAL
GENERAL COUNSEL
ROBERT B. NICHOLSON
PETER KARANJIA
ROBERT J. WIGGERS
DEPUTY GENERAL COUNSEL
ATTORNEYS
RICHARD K. WELCH
UNITED STATES
DEPUTY ASSOCIATE GENERAL COUNSEL
DEPARTMENT OF JUSTICE
WASHINGTON, D.C. 20530
MAUREEN K. FLOOD
COUNSEL
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON, D.C. 20554
(202) 418-1740

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 2

TABLE OF CONTENTS

Table Of Contents ............................................................................................. i
Table Of Authorities......................................................................................... ii
Glossary.............................................................................................................v
Statement Of Interest.........................................................................................1
Question Presented ............................................................................................1
Statement Of The Case......................................................................................2
I.
Statutory And Regulatory Background......................................................2
II. Background To This Proceeding................................................................8
Argument...........................................................................................................9
I.
The FCC’s Rules Require A BOC To Commingle
Unbundled Network Elements Provided Under Section 251
With Facilities And Services Provided Under Section 271.......................9
A.
The Relevant Section 271 Checklist Items Are Wholesale
Facilities And Services That Are Subject To The FCC’s
Commingling Rule. ...............................................................................9
B.
AT&T Kentucky’s View Of Its Commingling
Obligations Is Contrary To The FCC’s Rules.....................................12
II. State Regulatory Authorities May Require A BOC To
Commingle Section 251(c)(3) Unbundled Network
Elements With Section 271 Checklist Items............................................20
Conclusion.......................................................................................................23
i

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TABLE OF AUTHORITIES

CASES

AT&T Commc’ns of Calif., Inc. v. Pac-West
Telecom, Inc., 651 F.3d 980 (9th Cir. 2011) ...............................................10
AT&T Corp. v. FCC, 220 F.3d 607 (D.C. Cir. 2000) .......................................4
AT&T Corp. v. Iowa Utils. Bd., 525 U.S. 366
(1999) ............................................................................................................2
BellSouth Telecomms., Inc. v. Se. Tel., Inc., 462
F.3d 650 (6th Cir. 2006)................................................................................2
Covad Commc’ns Co. v. FCC, 450 F.3d 528 (D.C.
Cir. 2006).......................................................................................................6
Illinois Bell Tel. Co., Inc. v. Box, 548 F.3d 607 (7th
Cir. 2008).....................................................................................................22
Nuvox Commc’ns, Inc. v. BellSouth Commc’ns,
Inc., 530 F.3d 1330 (11th Cir. 2008)........................ 2, 12, 14, 15, 16, 17, 18
Qwest Corp. v. Arizona Corp. Comm’n. 567 F.3d
1109 (9th Cir. 2009) ....................................................................................22
Qwest Corp. v. Colo. Pub. Utils. Comm’n, 656 F.3d
1093 (10th Cir. 2011) ..................................................................................10
Southwestern Bell Tel., L.P. v. Missouri Pub. Serv.
Comm’n, 530 F.3d 676 (8th Cir. 2008) .......................................................22
Talk Am., Inc. v. Michigan Bell Tel. Co., 131 S.Ct.
2254 (2011) ...................................................................................................2
U.S. Telecom Ass’n v. FCC, 359 F.3d 554, 589-90
(D.C. Cir. 2004).........................................................................................5, 7
Verizon Commc’ns, Inc. v. FCC, 535 U.S. 467
(2002) ............................................................................................................4
Verizon New England, Inc. v. Maine Pub. Utils.
Comm’n, 509 F.3d 1 (1st Cir. 2007) ...........................................................22
ii

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ADMINISTRATIVE DECISIONS

Applications Filed for the Transfer of Certain
Spectrum Licenses and Section 214
Authorizations in the States of Maine, New
Hampshire, and Vermont from Verizon
Commc’ns Inc. and its Subsidiaries to Fairpoint
Commc’ns, Inc.
, 23 FCC Rcd 514 (2008) ...................................................11
Petition of ACS of Anchorage, Inc. Pursuant to
Section 10 of the Communications Act of 1934, as
amended, for Forbearance from Sections
251(c)(3) and 252(d)(1) in the Anchorage Study
Area,
22 FCC Rcd 1958 (2007) ..................................................................11
Petition of Qwest Corp. for Forbearance Pursuant
to 47 U.S.C. § 160(c) in the Omaha Metropolitan
Statistical Area,
20 FCC Rcd 19415 (2005) ........................................ 11, 18
Petition of Qwest Corp. for Forbearance Pursuant
to 47 U.S.C. § 160(c) in the Phoenix, Arizona
Metropolitan Statistical Area,
25 FCC Rcd 8622
(2010) ..........................................................................................................12
Review of the Section 251 Unbundling Obligations
of Incumbent Local Exchange Carriers, 18 FCC
Rcd 16978 (2003), vacated in part and
remanded, U.S. Telecom Ass’n v. FCC,
359 F.3d
554 (D.C. Cir. 2004)....................... 5, 6, 7, 10, 12, 13, 14, 15, 16, 17, 19, 21
Review of the Section 251 Unbundling Obligations
of Incumbent Local Exchange Carriers, 20 FCC
Rcd 2533 (2005), aff’d, Covad Commc’ns Co. v.
FCC,
450 F.3d 528 (D.C. Cir. 2006)...................................................... 6, 17
Triennial Review Order Errata, 18 FCC Rcd 19020
(2003) ..........................................................................................................19

STATUTES AND REGULATIONS

The Telecommunications Act of 1996, Pub. L. No.
104-104, 110 Stat. 56 ....................................................................................2
47 U.S.C. § 151 et seq .......................................................................................1
47 U.S.C. § 251(c)(2)-(4) ..................................................................................2
iii

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47 U.S.C. § 251(c)(3) ....................................................................................1, 3
47 U.S.C. § 251(d)(2)(B) ..................................................................................3
47 U.S.C. § 252 .......................................................................................... 4, 20
47 U.S.C. § 252(b)...................................................................................... 4, 20
47 U.S.C. § 252(c)...................................................................................... 4, 20
47 U.S.C. § 252(c)(1) ............................................................................... 20, 21
47 U.S.C. § 252(d)(1)........................................................................................3
47 U.S.C. § 252(e)(4), (6) .................................................................................4
47 U.S.C. § 271 .............................................................................................1, 5
47 U.S.C. § 271(c)(2)(B)(iv).............................................................................5
47 U.S.C. § 271(c)(2)(B)(v) ..............................................................................5
47 U.S.C. § 271(c)(2)(B)(vi).............................................................................5
47 U.S.C. § 271(c)(2)(B)(x) ..............................................................................5
47 C.F.R. § 51.5 ................................................................................... 7, 16, 20
47 C.F.R. § 51.309 ..................................................................................... 8, 20
47 C.F.R. § 51.309(e) ............................................................................. 1, 7, 10
47 C.F.R. § 51.309(e)-(f).................................................................... 13, 16, 19
47 C.F.R. § 51.309(f) ....................................................................... 1, 8, 10, 12
47 C.F.R. § 51.315(c) ................................................................................. 3, 16
47 C.F.R. § 51.505(b)........................................................................................4

OTHERS

H.R. Conf. Rep. No. 104-458............................................................................2
Letter from Leonard Green, Clerk, U.S. Court of
Appeals for the Sixth Circuit to Donald B.
Verrilli, Jr., Solicitor General of the United
States, and Austin C. Schlick, General Counsel,
FCC, October 7, 2011....................................................................................1
S.Rep. 104-23 ....................................................................................................2
iv

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GLOSSARY

BOC Bell
Operating
Company
CLEC
Competitive Local Exchange Carrier
ILEC
Incumbent Local Exchange Carrier
UNE
Unbundled Network Element
v

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 7
IN THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
NO. 10-5310/10-5311
BELLSOUTH TELECOMMUNICATIONS, INC., D/B/A AT&T
KENTUCKY,
PLAINTIFF-APPELLEE CROSS-
APPELLANT,
V.
KENTUCKY PUBLIC SERVICE COMMISSION; DAVID
L. ARMSTRONG, in his official capacity as
Chairman of the Public Service Commission;
JAMES W. GARDNER, in his official capacity as
Vice-Chairman of the Public Service Commission;
CHARLIE BORDERS, in his official capacity as
Commissioner of the Public Service Commission,
DEFENDANTS-APPELLANTS
CROSS-APPELLEES.
ON APPEAL FROM THE U.S. DISTRICT COURT
FOR THE EASTERN DISTRICT OF KENTUCKY
BRIEF FOR AMICUS CURIAE FEDERAL COMMUNICATIONS COMMISSION IN
SUPPORT OF DEFENDANTS-APPELLANTS CROSS-APPELLEES AND PARTIAL
REVERSAL OF THE DISTRICT COURT
At this Court’s invitation, the Federal Communications Commission
(“FCC”) respectfully files this brief as amicus curiae.

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STATEMENT OF INTEREST

The FCC has primary responsibility for implementing and enforcing
the Communications Act of 1934, as amended, 47 U.S.C. § 151 et seq (“the
Act”). This case involves review of the district court’s interpretation of
sections 251(c)(3) (47 U.S.C. § 251(c)(3)) and 271 (47 U.S.C. § 271) of the
Act and the FCC rules and orders construing those statutory provisions. The
FCC has an interest in ensuring that the Act, its rules, and its precedents are
correctly interpreted.

QUESTION PRESENTED

1
This Court has invited the FCC to set forth its position on the
following question:
Whether, upon request by a competitive LEC, a state regulatory
commission may require a Bell operating company to
commingle unbundled network elements provided under § 251
with elements provided under § 271. 47 C.F.R. § 51.309(e)
requires incumbent LECs to “permit a requesting
telecommunications carrier to commingle an unbundled network
element … with wholesale services obtained from an incumbent
LEC,” and 47 C.F.R. § 51.309(f) requires incumbents to
“perform the functions necessary to commingle an unbundled
network element … with one or more facilities or services that a
requesting telecommunications carrier has obtained at wholesale
from an incumbent LEC.” Are § 271 elements “wholesale
services” and “facilities or services … obtained at wholesale”
such that a state regulatory commission may require them to be

1 See Letter from Leonard Green, Clerk, U.S. Court of Appeals for the Sixth
Circuit to Donald B. Verrilli, Jr., Solicitor General of the United States, and
Austin C. Schlick, General Counsel, FCC, October 7, 2011.

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commingled with § 251 elements? See Nuvox Commc’ns, Inc. v.
BellSouth Commc’ns, Inc.,
530 F.3d 1330 (11th Cir. 2008).

STATEMENT OF THE CASE

I.

STATUTORY AND REGULATORY BACKGROUND

1. The Telecommunications Act of 1996, Pub. L. No. 104-104, 110
Stat. 56 (“1996 Act”), is designed to “end[] the longstanding regime of state-
sanctioned monopolies’ in the local telephone markets,” BellSouth
Telecomms., Inc. v. Se. Tel., Inc., 462 F.3d 650, 652 (6th Cir. 2006) (quoting
AT&T Corp. v. Iowa Utils. Bd., 525 U.S. 366, 371 (1999)), and to “open[] all
telecommunications markets to competition,” H.R. Conf. Rep. No. 104-458,
at 1. Congress recognized that prospective entrants faced critical challenges
if they hoped to compete with the pre-existing monopoly local telephone
companies – known as incumbent local exchange carriers (“ILECs”) – such
as AT&T Kentucky. As the Supreme Court recently explained, “[b]efore the
1996 Act, a new, competitive LEC could not compete with an incumbent
carrier without basically replicating the incumbent’s entire network.” Talk
Am., Inc. v. Michigan Bell Tel. Co., 131 S.Ct. 2254, 2258 (2011).
To address this formidable barrier to entry, new section 251(c) of the
Communications Act, added by the 1996 Act, entitles competitive carriers to
enter local telephone markets by utilizing the ILECs’ networks in various
ways. See 47 U.S.C. § 251(c)(2)-(4); S.Rep. 104-23, at 5 (explaining that the
2

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1996 Act “requires telecommunications carriers with market power over
telephone exchange or exchange access service to open and unbundle
network features and functions to allow any customer or carrier to
interconnect with the carrier’s facilities.”).
Section 251(c)(3) of the Act requires ILECs to lease certain “network
elements” to competitive local exchange carriers (“CLECs”) “on an
unbundled basis.” 47 U.S.C. § 251(c)(3). This requirement allows CLECs to
lease parts of an ILEC’s network to provide competitive communications
services. Before a CLEC can lease an “unbundled network element”
(“UNE”) from an ILEC, however, the Act requires the FCC to determine
whether the CLEC’s lack of access to that UNE would “impair” the CLEC’s
ability to provide service to its customers. 47 U.S.C. § 251(d)(2)(B). If
impairment is found, an ILEC generally must provide UNEs to any
requesting CLEC. 47 U.S.C. § 251(c)(3). An ILEC also must permit a
CLEC to combine UNEs, and upon request, the ILEC itself must combine
UNEs for the CLEC – even if those UNEs are not already combined in the
ILEC’s network. See 47 C.F.R. § 51.315(c).
Section 252(d)(1) of the Act provides that rates for UNEs under section
251(c)(3) must be cost-based, and may include a reasonable profit. 47 U.S.C.
§ 252(d)(1). The FCC’s rules require those regulated cost-based rates to be
3

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calculated under a Total Element Long-Run Incremental Cost (“TELRIC”)
methodology. See 47 C.F.R. § 51.505(b). The Supreme Court has upheld the
TELRIC methodology as lawful and consistent with the statute. Verizon
Commc’ns, Inc. v. FCC, 535 U.S. 467 (2002).
Section 252 establishes the procedures that ILECs and their
competitors must follow when implementing section 251(c)(3)’s unbundling
obligations. 47 U.S.C. § 252. ILECs and CLECs may voluntarily negotiate
contracts (called interconnection agreements), but if those negotiations fail,
disputed issues are referred to state commissions for mandatory arbitration.
See 47 U.S.C. § 252(b) and (c). All interconnection agreements approved or
arbitrated by state commissions are subject to review in federal district court
to determine whether they “meet[] the requirements” of sections 251 and 252
and the FCC’s implementing rules. 47 U.S.C. § 252(e)(4), (6).
2. Until it was vacated in light of the 1996 Act, a judicial consent
decree barred the Bell Operating Companies (“BOCs”) – the local telephone
companies that became independent in 1984 when the Bell System was
broken up – from providing long distance telephone service originating in
their traditional areas of local service. See AT&T Corp. v. FCC, 220 F.3d
607, 611 (D.C. Cir. 2000) (BOCs “continued to have a monopoly in local
phone service” and the consent decree “prohibited [them] from offering so-
4

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called ‘interLATA’ or long distance service”) (citations omitted). The 1996
Act superseded that decree and established a process by which a BOC (such
as AT&T Kentucky) could obtain such authority from the FCC by satisfying
certain conditions. See 47 U.S.C. § 271. “In particular, section 271(c)(2)(B)
of the Act specifies the ‘competitive checklist’ of access and interconnection
requirements that BOCs must meet before they are allowed to offer in-region
long-distance services.” Review of the Section 251 Unbundling Obligations
of Incumbent Local Exchange Carriers, 18 FCC Rcd 16978, 17382 (¶ 650)
(2003) (“Triennial Review Order”), vacated in part and remanded, U.S.
Telecom Ass’n v. FCC, 359 F.3d 554, 589-90 (D.C. Cir. 2004) (“USTA II”).
3. Until 2003, the services and facilities on the section 271 competitive
checklist included some of the same network elements that the FCC
2
concluded should be subject to unbundling under section 251(c)(3). In a
series of orders, however, the FCC determined that CLECs would not be
impaired without access to certain of those elements and accordingly deleted

2 Specifically, checklist items 4 through 6 and 10 require: “[l]ocal loop
transmission from the central office to the customer’s premises, unbundled
from local switching or other services” (47 U.S.C. § 271(c)(2)(B)(iv));
“[l]ocal transport from the trunk side of a wireline local exchange carrier
switch unbundled from switching or other services” (47 U.S.C. §
271(c)(2)(B)(v)); “[l]ocal switching unbundled from transport, local loop
transmission, or other services” (47 U.S.C. § 271(c)(2)(B)(vi)); and
“nondiscriminatory access to databases and associated signaling necessary for
call routing and completion” (47 U.S.C. § 271(c)(2)(B)(x)).
5

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– or “delisted” – them from the list of mandatory UNEs under section 251.
As a result, ILECs, including the BOCs, are not required to provide the
delisted services and facilities at cost-based rates under sections 251 and
3
252.
Although BOCs no longer have to offer those delisted elements under
section 251(c)(3), the FCC held in 2003 that BOCs retain “an independent
obligation” to provide these items to satisfy section 271(c)(2)(B). Triennial
Review Order, 18 FCC Rcd at 17384 (¶ 653). Section 271, however, does not
require BOCs to combine the checklist items upon a CLEC’s request. Id., 18
FCC Rcd at 17385-86 (¶¶ 657-58 and n.1990). Nor does section 271 require
BOCs to offer those items at the cost-based TELRIC pricing standard that
applies to section 251(c)(3) UNEs. Id., 18 FCC Rcd at 17386-89 (¶¶ 656-64).
Instead, the FCC construed section 271 to require BOCs to offer those items
– unbundled from one another – at rates, terms, and conditions that are just,
reasonable, and nondiscriminatory within the meaning of sections 201(b) and
202(a) of the Act. Id., 18 FCC Rcd at 17386, 17389 (¶¶ 656, 662-64). The
D.C. Circuit found that the more limited requirements for providing CLECs

3 See Review of the Section 251 Unbundling Obligations of Incumbent
Local Exchange Carriers, 20 FCC Rcd 2533, 2644-59 (¶¶ 204-225) (2005)
(“Triennial Review Remand Order”), aff’d, Covad Commc’ns Co. v. FCC,
450 F.3d 528 (D.C. Cir. 2006) (declining to impose an unbundling obligation
with respect to unbundled local switching and shared transport).
6

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access to the section 271 checklist items represent “important respects” in
which sections 251 and 271 of the Act differ. USTA II, 359 F.3d at 589-90.
As for the remaining UNEs that ILECs must continue to offer under
section 251(c)(3), the FCC eliminated its prior categorical ban on
4
“commingling” such elements. Triennial Review Order, 18 FCC Rcd at
17342 (¶ 579). The FCC’s rules define commingling as “the connecting,
attaching, or otherwise linking of an unbundled network element, or a
combination of unbundled network elements, to one or more facilities or
services that a requesting telecommunications carrier has obtained at
wholesale from an incumbent LEC, or the combining of an unbundled
network element, or a combination of unbundled network elements, with one
or more such facilities or services.” 47 C.F.R. § 51.5. Thus, under the FCC’s
rules since 2003, “an incumbent LEC shall permit a requesting
telecommunications carrier to commingle an unbundled network element or a
combination of unbundled network elements with wholesale services
obtained from an incumbent LEC.” 47 C.F.R. § 51.309(e). Further, the
ILEC must “perform the functions necessary to commingle an unbundled

4 Prior to the Triennial Review Order, the FCC’s rules prevented a CLEC
from connecting a UNE loop or an EEL (i.e., a particular combination of
network elements) to tariffed access services used as interoffice transmission
facilities. See TRO, 18 FCC Rcd at 17338 (¶ 570).
7

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network element … with one or more facilities or services that a requesting
telecommunications carrier has obtained at wholesale from an incumbent
LEC.” 47 C.F.R. § 51.309(f).

II.

BACKGROUND TO THIS PROCEEDING

1. The proceeding that led to this appeal began in 2004 when AT&T
Kentucky asked the Kentucky Public Service Commission (“KyPSC”) to
authorize the carrier to amend its interconnection agreements with CLECs to
implement the changes in law made by the FCC in the Triennial Review
Order and the subsequent Triennial Review Remand Order. After an
administrative proceeding that also involved several CLECs, the KyPSC
issued a final order on December 12, 2007. See R.E. No. 43, Ex. 1 (KyPSC
Order). As relevant to this case, the KyPSC held that AT&T Kentucky is
required to commingle section 251 UNEs or combinations of UNEs with any
service, network element, or other offering that it is obligated to make
available pursuant to section 271. Id. at 12-16.
2. On February 6, 2008, AT&T Kentucky filed a complaint in federal
district court challenging the KyPSC’s order, and on February 22, 2010, the
district court set aside that ruling with respect to the “commingling” issue.
The district court found that the FCC’s commingling rule, 47 C.F.R. §
51.309, applies to facilities and services provided under section 271. R.E.
8

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No. 66, Memorandum Opinion and Order, pp. 22-23. But the court
concluded that the commingling obligation had no practical effect in this case
because, in the court’s view, AT&T Kentucky is “not obligated to sell § 271
loops, transport, and switching.” Id. at 23.
3. AT&T Kentucky and the KyPSC both appealed this aspect of the
district court’s decision. This Court held argument on October 6, 2011.
Following oral argument, the Court invited the FCC to file a brief setting
5
forth its views on how this issue should be resolved.

ARGUMENT

I.

THE FCC’S RULES REQUIRE A BOC TO COMMINGLE
UNBUNDLED NETWORK ELEMENTS PROVIDED
UNDER SECTION 251 WITH FACILITIES AND
SERVICES PROVIDED UNDER SECTION 271

A. The Relevant Section 271 Checklist Items Are Wholesale

Facilities And Services That Are Subject To The FCC’s
Commingling Rule.

This Court should “defer to [the FCC’s] interpretation of its
regulations, even in a legal brief, unless the interpretation is plainly erroneous
or inconsistent with the regulations or there is any other reason to suspect that
the interpretation does not reflect the [FCC’s] fair and considered judgment

5 Consistent with the Court’s invitation letter, the FCC in this amicus brief
addresses only the “commingling” question and expresses no view on other
questions presented by this case.
9

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on the matter in question.” Talk Am., 131 S.Ct. at 2261 (quotations and
citations omitted); see also Qwest Corp. v. Colo. Pub. Utils. Comm’n, 656
F.3d 1093, 1098 (10th Cir. 2011) (deferring to FCC rule interpretation
contained in amicus brief); AT&T Commc’ns of Calif., Inc. v. Pac-West
Telecom, Inc., 651 F.3d 980, 998 (9th Cir. 2011) (same).
As we explain below, FCC orders make clear the agency’s view that a
BOC is required under FCC rules to commingle UNEs provided under
section 251(c)(3) with facilities and services provided under section 271.
FCC rule 51.309(e) provides that “an [I]LEC shall permit a requesting
telecommunications carrier to commingle an unbundled network element or a
combination of unbundled network elements with wholesale services
obtained from an [I]LEC.” 47 C.F.R. § 51.309(e). See also Triennial Review
Order, 18 FCC Rcd at 17342 (¶ 579) (“[A]n [I]LEC shall permit a requesting
telecommunications carrier to commingle a UNE or a UNE combination with
one or more facilities or services that a requesting carrier has obtained at
wholesale from an incumbent LEC.”). Further, Rule 51.309(f) provides that
“an [I]LEC shall perform the functions necessary to commingle an unbundled
network element or a combination of unbundled network elements with one
or more facilities or services that a requesting telecommunications carrier has
obtained at wholesale from an [I]LEC.” 47 C.F.R. § 51.309(f).
10

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Thus, the only pertinent question not explicitly addressed in the FCC’s
rules is whether section 271 checklist items are “wholesale” facilities and
services that fall within the scope of rule 51.309(e)-(f), as well as paragraph
579 of the Triennial Review Order. On multiple occasions, the FCC has
explained that they are. See, e.g., Petition of Qwest Corp. for Forbearance
Pursuant to 47 U.S.C. § 160(c) in the Omaha Metropolitan Statistical Area,
20 FCC Rcd 19415, 19448-50 (¶¶ 62-68) (2005) (“Qwest Omaha Order”)
(describing Qwest’s “wholesale obligations” under section 271(c), and the
“wholesale offerings” Qwest provides competitors to fulfill those
obligations); Petition of ACS of Anchorage, Inc. Pursuant to Section 10 of the
Communications Act of 1934, as amended, for Forbearance from Sections
251(c)(3) and 252(d)(1) in the Anchorage Study Area, 22 FCC Rcd 1958,
1962-63 (¶ 8) (2007) (describing the Qwest Omaha Order as “rel[ying] on the
continued availability of wholesale access to Qwest’s network under section
271”); Applications Filed for the Transfer of Certain Spectrum Licenses and
Section 214 Authorizations in the States of Maine, New Hampshire, and
Vermont from Verizon Commc’ns Inc. and its Subsidiaries to Fairpoint
Commc’ns, Inc., 23 FCC Rcd 514, 528 (¶ 23) (2008) (explaining that
“FairPoint has agreed to adhere to the Verizon Section 271 Performance
Assurance Plan in each of the three states in order to avoid disrupting the
11

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 19
provision of wholesale services.”); Petition of Qwest Corp. for Forbearance
Pursuant to 47 U.S.C. § 160(c) in the Phoenix, Arizona Metropolitan
Statistical Area, 25 FCC Rcd 8622, 8662 (¶ 75) (2010) (discussing
“wholesale access rights under section 271” which “are not priced at cost-
based rates”). Because it is well established that section 271 checklist items
are “facilities or services that a requesting telecommunications carrier has
obtained at wholesale from an [I]LEC,” 47 C.F.R. § 51.309(f); see also
Triennial Review Order, 18 FCC Rcd at 17342 (¶ 579), the FCC’s rules
require a BOC such as AT&T Kentucky to commingle those facilities and
services with section 251(c)(3) UNEs. Accord, Nuvox Commc’ns, Inc. v.
BellSouth Commc’ns, Inc., 530 F.3d 1330 (11th Cir. 2008).

B.

AT&T Kentucky’s View Of Its Commingling Obligations
Is Contrary To The FCC’s Rules.

AT&T Kentucky nonetheless contends that the commingling
requirement does not apply to section 271checklist offerings. AT&T Br. 49-
12

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 20
56; AT&T Reply Br. 11-24. AT&T Kentucky’s reading of the FCC’s rules
6
and orders is incorrect, and this Court should reject it.
1. There is no merit to AT&T Kentucky’s claim that the commingling
requirement imposed by rule 51.309 and the Triennial Review Order applies
only to those wholesale services that are tariffed. AT&T Br. 56-58; AT&T
Reply Br. 20. The rule does not restrict commingling to tariffed services;
rather, an ILEC has an obligation to commingle section 251(c)(3) UNEs with
“wholesale services” and “facilities or services … obtained at wholesale.”
See 47 C.F.R. § 51.309(e)-(f). The Commission pointedly explained when it
adopted the rule in the TRO that it included all “facilities or services that a
requesting carrier has obtained at wholesale from an incumbent LEC pursuant
to any method other than unbundling under section 251(c)(3) of the Act.”
Triennial Review Order, 18 FCC Rcd at 17342 (¶ 579) (emphasis added).

6 Although AT&T Kentucky’s arguments on appeal are flawed for the
reasons we discuss below, we also believe that the district court erred (though
for different reasons). The district court agreed with AT&T Kentucky that a
BOC is under no obligation to commingle section 251(c)(3) UNEs with
section 271 checklist offerings because, according to the court, a BOC “is not
obligated to sell § 271 loops, transport, and switching.” R.E. No. 66,
Memorandum Opinion and Order, p.23. The district court erred in reaching
that conclusion. As set forth above, see p.6, the FCC has held that BOCs
retain “an independent obligation” to provide loops, transport, and switching
to satisfy section 271(c)(2)(B). Triennial Review Order, 18 FCC Rcd at
17384 (¶ 653). Accordingly, this Court should set aside the district court’s
“commingling” ruling, consistent with the reasoning set forth herein.
13

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 21
Thus, as the Eleventh Circuit correctly noted in Nuvox, while “tariffed
services are listed as examples of wholesale services” in the Triennial Review
Order, that order “does not indicate that such lists are exhaustive.” 530 F.3d
at 1334. Rather, “[l]anguage like ‘e.g.’ and ‘including’ indicates that tariffed
services were being used as examples of services eligible for commingling.”
Id.
Nor is AT&T Kentucky’s argument supported by the FCC’s statement
that ILECs “should ‘effectuate commingling by modifying their interstate
access service tariffs to expressly permit connections with UNEs and UNE
combinations.’” AT&T Br. 57-58 (quoting Triennial Review Order, 18 FCC
Rcd at 17345 (¶ 581)). According to AT&T Kentucky, because “§ 271
elements are generally provided under commercial agreements – that is,
private contracts – between BOCs and competitors,” AT&T Br. 56-57, “the
commingling rule must not apply to services (such as § 271 elements) that are
not provided in interstate tariffs.” Id. at 58. But AT&T Kentucky overlooks
that the FCC, in the next paragraph, explained that “[b]y eliminating the
commingling restriction, we will ensure that competitive LECs will be able to
obtain all available UNEs, UNE combinations, and wholesale services, albeit
at the rates established pursuant to tariffs, interconnection agreements, or
other contracts.” Triennial Review Order, 18 FCC Rcd at 17345 (¶ 582,
14

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 22
n.1793) (emphasis added). Accordingly, the Triennial Review Order clearly
anticipated that an ILEC’s commingling obligation would encompass
services and facilities provided under commercial agreements.
2. AT&T Kentucky further argues that the FCC in the Triennial
Review Order declined to apply its combination rule to section 271 network
elements. AT&T Br. 50-55; AT&T Reply Br. 11-13. That contention is
correct but irrelevant to the issues before this Court. AT&T Kentucky relies
on footnote 1990 of the Triennial Review Order, which states, “[w]e decline
to require BOCs, pursuant to section 271, to combine network elements that
no longer are required to be unbundled under section 251.” 18 FCC Rcd at
17386 (¶ 655, n.1990). However, as the Eleventh Circuit in Nuvox correctly
explained, “[t]his footnote addresses combinations of section-271 elements
with other section-271 elements, not the commingling of section-251
elements with section-271 elements,” which is the issue in this case. 530
F.3d at 1334 (emphasis in original).
AT&T Kentucky disagrees with this understanding of footnote 1990 on
the basis that “[t]here is no substantive difference between ‘combining’ and
‘commingling.’” AT&T Br. 50-51; AT&T Reply Br. 16-17. Although that
might be true in terms of the physical operations performed to accomplish
combinations and commingling, as a legal matter the terms refer to separate
15

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 23
and distinct obligations imposed on ILECs by the FCC’s rules. A
commingled arrangement requires an ILEC to link or connect (1) a section
251(c)(3) UNE to (2) a wholesale facility or service, a universe that includes
section 271 checklist offerings. See 47 C.F.R. § 51.5; 47 C.F.R. § 51.309(e)-
(f); Triennial Review Order, 18 FCC Rcd at 17342 (¶ 579). A
“combination,” by contrast, requires the ILEC to link or connect two or more
section 251(c)(3) UNEs. See 47 C.F.R. § 51.315(c) (“Upon request, an
incumbent LEC shall perform the functions necessary to combine unbundled
network elements….”) (emphasis added). Because the FCC’s rules only
require ILECs to “combine” section 251(c)(3) UNEs with other section
251(c)(3) UNEs, footnote 1990 is most reasonably read to hold that an ILEC
is not required to combine non-UNEs with non-UNEs or, as the Nuvox court
explained, section 271 checklist items with other section 271 checklist items.
See 530 F.3d at 1334. The footnote does not address the distinct
commingling obligation that applies to section 251 UNEs.
3. Relatedly, AT&T Kentucky argues that requiring an ILEC to
commingle section 251(c)(3) UNEs and section 271 checklist offerings would
“undermine[] federal policy” because it would allow CLECs “to buy a pre-
combined set of facilities” known as the “UNE-Platform.” AT&T Br. 53; see
also AT&T Reply Br. 17. The UNE-Platform – which the FCC discontinued
16

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 24
by rule in 2005 – is a combination of three network elements offered at cost-
based TELRIC rates under sections 251 and 252: (1) an unbundled loop; (2)
unbundled local circuit switching; and (3) shared transport. See Triennial
Review Remand Order, 20 FCC Rcd at 2537 (¶ 5); see also id at 2641-59 (¶¶
199-225) (“delisting” unbundled local circuit switching in combination with
shared transport as section 251(c)(3) UNEs and thus ending availability of the
UNE-Platform).
AT&T Kentucky’s policy concern is misplaced. No BOC is under an
obligation to re-create the UNE-Platform by application of the commingling
rule, for two independent reasons. First, as explained above, the FCC has
delisted unbundled local circuit switching and shared transport as UNEs that
must be offered under section 251(c)(3); those elements are now offered
strictly pursuant to the section 271 competitive checklist. And the FCC has
determined that BOCs are not required to combine section 271 checklist
items with one another. Triennial Review Order, 18 FCC Rcd at 17386 (¶
655, n.1990); see also Nuvox, 530 F.3d at 1334. Thus, no BOC is obligated
under the FCC’s rules – and, as a consequence, no state commission may
order a BOC – to combine the unbundled local circuit switching and shared
transport pieces of what used to comprise the now-defunct UNE-Platform to
satisfy its commingling duties.
17

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 25
Second, section 271 does not require BOCs to offer checklist items at
the cost-based TELRIC pricing standard that applies to section 251(c)(3)
UNEs. As the Nuvox court recognized, “[I]LECs are permitted to charge
market rates for section-271 elements, making them distinguishable from the
cost-based facilities mandated under the original UNE platform.” Nuvox, 530
7
F.3d at 1335. It follows that faithful application of the commingling rule for
section 271 checklist offerings will not resurrect the defunct UNE-Platform.
4. AT&T Kentucky’s arguments on language deleted from the final
version of the Triennial Review Order also are not persuasive. Paragraph 584
of that order originally stated:
[W]e require that incumbent LECs permit commingling of UNEs
and UNE combinations with other wholesale facilities and
services, including elements offered pursuant to section 271 and
any services offered for resale pursuant to section 251(c)(4) of
the Act.

7 AT&T Kentucky mistakenly relies on the Qwest Omaha Order to argue
that it has no “legal mandate” to commingle section 251(c)(3) UNEs with
section 271 checklist items. See AT&T Br. 51, AT&T Reply Br. 22-23,
quoting Qwest Omaha Order, 20 FCC Rcd at 19455 (¶ 82). In the Qwest
Omaha Order
, the FCC explained that Qwest, a BOC like AT&T Kentucky,
had “introduc[ed] a commercial product designed to replace” the UNE-
Platform, “even in the absence of a legal mandate to do so.Qwest Omaha
Order,
20 FCC Rcd at 19455 (¶ 82). As set forth above, that statement is
consistent with the FCC’s view that a BOC is not required to re-create the
UNE-Platform under the commingling rule. It cannot be read to eliminate a
BOC’s obligation to commingle section 251(c)(3) UNEs with section 271
checklist items.
18

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 26
18 FCC Rcd at 17347 (¶ 584). The final version of the order does not include
the italicized language. Triennial Review Order Errata, 18 FCC Rcd 19020,
19022 (¶ 27) (2003).
The unqualified language of rule 51.309 is plain on its face: it requires
an ILEC to commingle an unbundled network element or a combination of
unbundled network elements with wholesale facilities and services. See 47
C.F.R. § 51.309(e)-(f). By its terms, the rule does not exclude section 271
checklist items. And the FCC has repeatedly found that section 271 offerings
are “wholesale” facilities and services. See pp.11-12, above. Accordingly,
the amendment to the language in paragraph 584 of the Triennial Review
Order does not narrow the broad terms of the rule.
A separate amendment to the Triennial Review Order further
undercuts AT&T Kentucky’s contention. As the KyPSC points out (KyPSC
Reply Br. 12), the same Errata on which AT&T Kentucky relies also
removed the following sentence from footnote 1990 of the Triennial Review
Order: “We also decline to apply our commingling rule, set forth in part
VII.A. above, to services that must be offered pursuant to [those] checklist
items.” Triennial Review Order Errata, 18 FCC Rcd at 19022 (¶ 31). If any
significance at all were attached to the unexplained Errata amendments, then
the deletion of that sentence would reinforce that commingling of section
19

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 27
251(c)(3) UNEs with section 271 checklist items is in fact required under
Rule 51.309 and the Triennial Review Order.

II.

STATE REGULATORY AUTHORITIES MAY REQUIRE A
BOC TO COMMINGLE SECTION 251(c)(3) UNBUNDLED
NETWORK ELEMENTS WITH SECTION 271
CHECKLIST ITEMS

As set forth above, section 252 of the Act establishes the procedures
that ILECs and their competitors must follow when implementing section
251(c)(3)’s unbundling obligations. 47 U.S.C. § 252. ILECs and CLECs
may voluntarily negotiate interconnection agreements, but if those
negotiations fail, disputed issues are referred to state commissions for
mandatory arbitration. See 47 U.S.C. § 252(b) and (c). Importantly, “[i]n
resolving by arbitration … any open issues and imposing conditions on the
parties to the agreement, a State commission shall ensure that such resolution
and conditions meet the requirements of section 251 …, including the
regulations prescribed by the [FCC] pursuant to section 251.” 47 U.S.C. §
252(c)(1).
The commingling rule, 47 C.F.R. § 51.309, is just such a regulation
that state commissions are charged with enforcing when arbitrating disputed
issues in interconnection agreements. Commingling, by definition, involves
section 251(c)(3) UNEs. See 47 C.F.R. §§ 51.5, 51.309. Indeed, the FCC’s
authority to require commingling is founded on section 251: when it lifted
20

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 28
the restrictions on commingling in the Triennial Review Order, 18 FCC Rcd
at 17343 (¶ 581), the FCC explained that “section 251(c)(3) of the Act grants
[it] authority … to adopt rules to permit the commingling of UNEs and
combinations of UNEs with wholesale services, including interstate access
services.” It follows that a state regulatory authority such as the KyPSC,
consistent with rule 51.309, may require a BOC to commingle section
8
251(c)(3) UNEs with section 271 network elements. Were this not the case,
it would be impossible for a state regulatory authority to effectively carry out
its duty to ensure compliance with the FCC’s rules implementing section 251.
See 47 U.S.C. § 252(c)(1).
AT&T Kentucky disagrees, relying on decisions from several other
courts of appeals to argue that states lack authority to enforce section 271
requirements. See AT&T Br. 50; AT&T Reply Br. 6-11. In each of those
cases, the court of appeals held that a state commission lacked authority
either to set rates for section 271 network elements, or to require a BOC to
unbundle “new” or “additional” network elements pursuant to section 271,
over and above those elements that the FCC requires the BOCs to unbundle

8 A state regulatory authority could not properly require a BOC to re-create
the UNE-Platform under the commingling rule because doing so would be
inconsistent with the FCC’s rules and orders implementing section 251 and,
thus, in violation of section 252(c)(1) of the Act. See pp. 16-18, above.
21

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 29
9
pursuant to sections 251(c)(3) Here, the issue is whether the KyPSC can
enforce an FCC rule promulgated pursuant to section 251 that requires BOCs
to commingle section 251(c)(3) UNEs with section 271 network elements.
Thus, the KyPSC in the proceeding below did not “implement § 271” (AT&T
Br. 50); rather, it fulfilled its duty under section 252(c)(1) of the Act to
enforce the FCC’s rules implementing section 251, notably, the commingling
requirement set forth in rule 51.309.

9 See Illinois Bell Tel. Co., Inc. v. Box, 548 F.3d 607, 612-13 (7th Cir. 2008)
(rejecting a state commission’s attempt to require a BOC to charge cost-based
rates for section 271 network elements); Verizon New England, Inc. v. Maine
Pub. Utils. Comm’n,
509 F.3d 1, 7-9 (1st Cir. 2007) (rejecting a state
commission’s attempt to require a BOC to provide delisted UNEs at cost-
based rates pursuant to section 271); Southwestern Bell Tel., L.P. v. Missouri
Pub. Serv. Comm’n,
530 F.3d 676, 682-83 (8th Cir. 2008) (same); Qwest
Corp. v. Arizona Corp. Comm’n.
567 F.3d 1109, 1115-17 (9th Cir. 2009)
(same).
22

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 30

CONCLUSION

The Court should reverse the judgment of the district court to the
extent indicated above.
Respectfully
submitted,
SHARIS A. POZEN
AUSTIN C. SCHLICK
ACTING ASSISTANT ATTORNEY
GENERAL COUNSEL
GENERAL
PETER KARANJIA
ROBERT B. NICHOLSON
DEPUTY GENERAL COUNSEL
ROBERT J. WIGGERS
ATTORNEYS
RICHARD K. WELCH
DEPUTY ASSOCIATE GENERAL
UNITED STATES
COUNSEL
DEPARTMENT OF JUSTICE
WASHINGTON, D.C. 20530
/s/ Maureen K. Flood
MAUREEN K. FLOOD
COUNSEL
FEDERAL COMMUNICATIONS
COMMISSION
WASHINGTON, D.C. 20554
(202) 418-1740
December 6, 2011
23

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 31
IN THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
BELLSOUTH TELECOMMUNICATIONS, INC., D/B/A
AT&T KENTUCKY,
PLAINTIFF-APPELLEE CROSS-
APPELLANT,
v.
KENTUCKY PUBLIC SERVICE COMMISSION;
DAVID L. ARMSTRONG, IN his official capacity as
NO. 10-5310/10-5311
Chairman of the Public Service Commission;
JAMES W. GARDNER, in his official capacity as
Vice-Chairman of the Public Service
Commission; CHARLIE BORDERS, in his official
capacity as Commissioner of the Public Service
Commission,
DEFENDANTS-APPELLANTS CROSS-
APPELLEES.
CERTIFICATE OF COMPLIANCE
Pursuant to the requirements of Fed. R. App. P. 32(a)(7), I hereby
certify that the accompanying “Brief for amicus Curiae Federal
Communications Commission in Support of Defendants-Appellants Cross-
Appellees and Partial Reversal of the District Court” in the captioned case
contains 4,977 words.

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 32
/s/ Maureen K. Flood
Maureen K. Flood

Counsel
Federal Communications Commission
Washington, D.C. 20554
(202) 418-1740 (Telephone)
(202) 418-2819 (Fax)
December 6, 2011
2

Case: 10-5310 Document: 006111147623 Filed: 12/06/2011 Page: 33
10-5310 and 5311

IN THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

BellSouth Telecommunications, Inc., dba AT&T Kentucky

v.

Kentucky Public Service Commission, et al.

CERTIFICATE OF SERVICE

I, Maureen K. Flood, hereby certify that on December 6, 2011, I
electronically filed the foregoing Brief for Amicus Curiae Federal
Communications Commission in Support of Defendants-Appellants Cross-
Appellees and Partial Reversal of the District Court with the Clerk of the
Court for the United States Court of Appeals for the Sixth Circuit by using
the CM/ECF system. Participants in the case who are registered CM/ECF
users will be served by the CM/ECF system.
Brendan J. Crimmins
Mary K. Keyer
Kellogg, Huber, et al.
BellSouth Telecommunications, Inc.
1615 M Street, N.W.
601 W. Chestnut Street
Suite 400
Room 407
Washington, DC 20036
Louisville, KY 40203
Counsel for: BellSouth
Counsel for: BellSouth
Telecommunications, Inc.
Telecommunications, Inc.
John E. Brooks Pinney
Kentucky Public Service
Commission
211 Sower Boulevard
Frankfort, KY 40601
Counsel for: Kentucky Public
Service Commission

/s/ Maureen K. Flood

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