3. Should the California Commission Proceed with the Application?

At this time, the Commission will only address the question of whether to proceed with consideration of the application of North County.

3.1. Positions of Parties on the Issue of Whether to Proceed with Consideration of the Application of North County at this Time

The motions of MetroPCS and the Wireless Coalition argue against proceeding with a consideration of the North County application at this time.

MetroPCS argues that if this Commission does not dismiss North County's Application, then:

... it should hold the proceeding in abeyance pending (a) the resolution of MetroPCS' Petition for Review of the FCC decisions that currently is before the United States Court of Appeals for the District of Columbia (the "MetroPCS Petition for Review") and (b) FCC action in the traffic pumping proceeding.²⁵

MetroPCS argues that "In other similar circumstances, the Commission has found it appropriate to delay the resolution of proceedings pending the outcome of parallel federal cases where such `uncertainty' exists."²⁶ In particular, MetroPCS states that "[i]n its D.C. Circuit appeal, MetroPCS will assert that the FCC committed reversible error by abdicating its responsibility to set an appropriate rate for North County and will ask the Court to remand the proceeding to the FCC with instructions to set a rate."²⁷ MetroPCS also cites the FCC's Traffic Pumping NPRM, which addresses asymmetric traffic flows. MetroPCS notes that if its proposal in that proceeding is granted, "this Commission will have performed a useless act by devoting its time, attention and resources to setting a compensation rate for North County."²⁸

The Wireless Coalition argues in its Motion to Hold in Abeyance that:

Although the FCC's recent decision in that matter deferred the issue of what constitutes reasonable compensation to this Commission, it retained for itself any decisions regarding the key threshold liability issues which, from a prudential standpoint, should be resolved before any resources are expended to set a hypothetical rate.²⁹

The Wireless Coalition, like MetroPCS, also cites the MetroPCS Petition for Review as a source of uncertainty.³⁰ The Wireless Coalition argues that:

... in order to conserve the valuable resources of this Commission and all interested parties, while also preserving the rights of all parties, and to otherwise avoid potentially inconsistent rulings and jurisdictional conflicts, the Application should be held in abeyance until the federal case is finally resolved, at which time the issues will either be ripe for consideration or rendered moot.³¹

The Wireless Coalition argues further that holding the proceeding in abeyance will not prejudice either party.

In its response to the motions, North County argues that "the Commission, as the FCC has indicated, is the proper forum to decide the issue of what is the just and reasonable rate for North County's services, during the entire time period in question."³²

North County, although conceding that the FCC "may take action to preempt state judicial enforcement of North County's implied contract claims, or may attempt to over-ride the Commission's rate determination, or may take some other action that moots this proceeding," argues that "no intent on the part of the FCC to do so can be inferred..."³³

North County also argues against holding the proceeding in abeyance. North County contends that awaiting "pending federal appeals would seriously undermine [the Commission's] ability to carry out its responsibilities." North County further contends that waiting until the FCC decides the liability issue is not necessary because "North County may bring, and in fact has pending, implied contract causes of action in state court..."³⁴

In reply, MetroPCS argues:

North County fails to acknowledge that setting a rate prior to the resolution of MetroPCS v. FCC, and any determination by the FCC or any court of any liability by the wireless carriers to North County for intercarrier compensation, would be a complete waste of the Commission's time. It simply makes no sense for this Commission to devote precious resources to setting a rate prior to any determination that there is an implied contract or other legal obligation to which a rate must be applied.³⁵

In particular, MetroPCS argues that a decision adopting a rate at this time would be "merely advisory."³⁶ More specifically, MetroPCS contends that:

The requisite case or controversy is lacking in this instance. North County has alleged no wrongdoing in its Petition, and has pointed to no interim or final decision in any of the many forums it has visited that would create liability to pay the rate that North County asks this Commission to set.³⁷

MetroPCS also contends that the controversy is not ripe for resolution at this time. MetroPCS argues:

North County also fails to mention a fundamental threshold that it must get over to set a rate - there must be ripeness. Ripeness, in this context, means that the rate must apply to something. Here, however, the rate will apply to nothing, since absent a voluntary agreement no charges for terminating traffic may be applied.³⁸

Regarding the prosecution of this application, MetroPCS summarizes its position as follows:

Further, this petition is the classic situation where holding the proceeding in abeyance would serve the public interest. There is uncertainty as to the lawfulness of the FCC's abdication of authority and a reversal by the Court of Appeals will completely abrogate this proceeding. Accordingly, the Commission should act in the interests of judicial economy and act to hold the proceedings in abeyance, should it not choose to simply dismiss North County's Application outright.³⁹

In its reply, the Wireless Coalition raises arguments similar to those of MetroPCS. The Wireless Coalition states:

The pending petition for review of the FCC NCC Order before the D.C. Circuit, and the parties' future proceedings before the FCC, will not just potentially affect the matters at issue before the Commission in this matter; they will directly and unequivocally determine the viability of the Application itself.⁴⁰

The Wireless Coalition also contends that "the Commission (and all parties) could easily spend countless resources trying to establish `reasonable compensation' in these circumstances only to have the Application rendered moot."⁴¹ The Wireless Coalition then continues:

The Commission will certainly recall the heavy price such proceedings can impose on all parties involved, including the Commission, when a new FCC decision obliges the Commission to change course in the middle of costing proceedings and start over again.⁴²

To illustrate this point, the Wireless Coalition then provides a series of citations to the Commission's experience in the unbundled network element proceeding:

See e.g., D.99-11-050 (which finally set unbundled network element ("UNE") prices for then Pacific Bell Telephone Company after the Commission's multi-year efforts that resulted in the establishment of a TSLRIC pricing standard for UNEs (D.96-08-021) were modified to comply with the FCC's later edict on TELRIC pricing for UNEs (D.98-02-106)).⁴³

3.2. Discussion: Consideration of the Application of North County is not Appropriate at this Time

The question before the Commission is whether to consider at this time the application of North County. On this question, we conclude that it is not prudent to commit Commission resources to a consideration of this application at this time. Furthermore, since statutory deadlines limit the time that the Commission can take to process a proceeding, it is not a preferred Commission policy to hold a proceeding "in abeyance" while awaiting the actions of courts or other regulatory agencies. Instead, we will dismiss the application of North County without prejudice.

On the question before us - whether to proceed at this time - the arguments of MetroPCS and the Wireless Coalition are convincing. First, it makes no sense to proceed with this matter while it is before the D.C. Circuit. Initially, both parties sought resolution of this entire matter by the FCC, and MetroPCS is appealing the FCC's decision to the D.C. Circuit. The decision of that court may lead to a resolution of this matter, and will likely shed light on the many jurisdictional issues that the parties have raised in the FCC proceeding and in this proceeding, as well. Thus, awaiting the court decision may either resolve this matter or provide guidance that facilitates action by this Commission.

Second, we take to heart the Wireless Coalition's reminder to this Commission of the years of effort that the Commission and telecommunications companies spent in the unbundling proceedings of the 1990's that were rendered irrelevant by subsequent judicial and FCC actions, as well as by technological and market developments. It is incontrovertible that this Commission's efforts to cost and price call services were both complex and costly for all involved. In light of this experience and the current limitations on resources arising from California's budgetary constraints, it would certainly be unwise to proceed with a consideration of this application without a clear commitment from the FCC to use the results of California's regulatory efforts and a determination that MetroPCS is liable for payment to North County.

For these reasons, it is not prudent to proceed with consideration of this application until the resolution of the appeal to the D.C. Circuit and a determination of liability by the FCC. Since holding this proceeding in abeyance is not the preferred administrative practice at this Commission, it is reasonable to dismiss this application without prejudice. Following action by the D.C. Circuit Courts and the FCC, North County may refile its application. At that time, parties may renew their motions concerning jurisdictional issues, which we have not considered here. Since we dismiss this application, A.10-01-003 is closed.

²⁵ MetroPCS Motion at 25. The traffic pumping proceeding to which MetroPCS refers is Establishing Just and Reasonable Rates for Local Exchange Carriers, Notice of Proposed Rulemaking, FCC 07-176, ¶1 WC Docket No. 07-135, rel. October 2, 2007 ("Traffic Pumping NPRM").

²⁶ Id.

²⁷ Id.

²⁸ Id. at 26.

²⁹ Wireless Coalition's Motion to Hold in Abeyance at 1-2.

³⁰ Wireless Coalition's Motion to Hold in Abeyance at 3.

³¹ Id.

³² North County Response to Motions at 7.

³³ Id. at 8.

³⁴ Id. at 14.

³⁵ MetroPCS Reply to North County Response at 2-3.

³⁶ Id. at 4.

³⁷ Id. at 5.