3. Discussion
There is no question that the FCC's GTE Order found DSL Transport to be interstate in nature. There is also no question that DSL Transport can involve certain intrastate applications. Both CISPA and Defendants describe intrastate DSL applications, such as remote digital access to a corporate local area network (LAN). (Tr. at 40-41 and 52) Upon review of the FCC's 1998 GTE Order and the numerous legal citations provided by both parties, we find that the Commission has concurrent jurisdiction with the FCC over DSL Transport service, as set forth below, for several reasons.6 First, the FCC has not explicitly barred all state regulation. Nothing in the FCC's 1998 GTE order says the PUC cannot exercise jurisdiction over certain aspects of DSL Transport service.
Second, we find CISPA's citations to caselaw requiring "clear and manifest" intent to preempt state authority more relevant than the citations provided by Defendants. While Defendants rely on Ivy Broadcasting and McDermott to support their preemption claims, both of these cases are called into question by later court determinations stating these cases are inconsistent with the Supreme Court's modern preemption jurisprudence requiring "clearly manifest intention to broadly preempt all state law" and that they failed to consider the effect of the federal savings clause in Section 414 of the Act.7 A.S.I. Worldwide v. Worldcom, 115 F.Supp.2d at 207; See also Heichman v. American Tel. and Tel. Co., 943 F. Supp. 1212, 1220 (C.D. Cal. 1995) ("the Ivy Broadcasting court did not address the savings clause" and in McDermott "there was no issue regarding complete preemption"); Crump v. Worldcom, Inc., 128 F.Supp.2d at 554 ("circumstances where federal law completely preempts state law, so as to support removal of a state-law claim to federal court, are extremely rare.") Reliance on the cases cited by CISPA is not inappropriate, as Defendants suggest, because all three cases involve a claim of federal preemption of interstate telecommunications services.8
Under the reasoning provided by these cases, we find that Defendants have not proven "clear and manifest" congressional intent to preempt all state authority, given the savings clause in Section 414 and the provisions of Section 253(b) regarding safeguarding the rights of consumers. 9 We find support for CISPA's argument that the savings clause of Section 414 allows states to exercise their traditional police powers to safeguard consumer health, safety and welfare and to enforce their own laws with regard to interstate services provided to California customers, particularly where the state laws address misrepresentations to consumers and other marketing practices. See In re Long Distance Telecommunications Litigation, 831 F.2d 627, 633-634 (6th Cir. 1987) (holding that state law claims for fraud and deceit are not preempted by the Communications Act and that the savings clause of the Communications Act gives plaintiffs the option of pursuing their remedy at common law.) Commission action to consider this complaint will not conflict with the federal tariff or other federal laws and regulations.
Third, Defendants' reference to Re McCaw Cellular wherein the Commission stated it does not have jurisdiction over interstate services is inapposite. The statements in McCaw Cellular can be construed to refer to rates for wireless service. While the Commission is preempted with regard to wireless rates and entry, federal law does not preempt state authority over the terms and conditions of wireless service. In addition, statements by a prior Commission do not bar a future Commission from considering claims of violations of the Public Utilities Code for a service that has both intrastate and interstate components, such as DSL Transport.Fourth, we agree with CISPA that the end-to-end analysis relied on by the FCC in its 1998 GTE Order has been questioned by appellate courts as it pertains to reciprocal compensation, although there have been no appeals of the federal tariffing of DSL service. In other words, while the FCC's authority to require an interstate DSL tariff is unquestioned, the original rationale used by the FCC to require federal tariffing of DSL cannot necessarily be relied upon to support complete federal preemption of DSL Transport. We recognize that DSL Transport is distinct from reciprocal compensation issues, but we are not persuaded to rely on the end-to-end analysis to support complete preemption of Commission jurisdiction over all aspects of DSL transport service. We find it more reasonable that the Commission has the authority to enforce California public utility law as it pertains to actions by carriers, such as ASI, that are certificated to operate in California, when such enforcement does not conflict with terms of the federally approved tariff or any federal regulations.
Pacific admits that DSL Transport can be provided on an intrastate basis. There is little question that the Commission has the authority to hear a complaint relating to the terms of intrastate DSL Transport. Despite the fact that few, if any, customers purchase DSL Transport from an intrastate tariff,10 we find no conflict with federal tariffs or the FCC's GTE Order in the Commission reviewing ASI's sales and marketing practices and other service quality issues with regard to DSL Transport.
Fifth, we agree with Complainant that the FCC's line sharing order expressly invited states to decide issues surrounding sharing of the local loop, and this local loop sharing directly relates to DSL Transport. We also find it interesting that the FCC referred a complaint on DSL to this Commission. These two examples tend to refute Defendants' claim that the FCC has asserted exclusive jurisdiction over all aspects of DSL service.
Therefore, we conclude that the Commission can consider CISPA's complaint alleging violations of California public utility law and Commission orders by Defendants. We reject Defendants' assertions that the Commission does not have jurisdiction to pursue claims of fraudulent or misleading conduct, or poor service quality relating to DSL service because the FCC has required a federal tariff for that service. We agree with Defendants, however, that the scope of the complaint should not include the reasonableness of DSL rates, operating speeds and the like set forth in the federal tariff provided with Defendants' answer to the complaint because that would require us to interpret and adjudicate the federal tariff which we decline to do in this proceeding. Indeed, CISPA has stated it does not seek to modify the terms of ASI's federal tariff.11 Instead, the scope of the case should involve the interpretation and application of state law.
Specifically, this means that the scope of the complaint should be limited to some, but not all, of the issues raised by CISPA. The ALJ will convene a prehearing conference to discuss the scope of the case in more detail, as discussed below. Nevertheless, based on the complaint itself and CISPA's scoping remarks thus far, the Commission can consider allegations of Section 451 violations, including but not limited to issues surrounding service quality such as unreasonable service disruptions, limitations, or delays. The Commission can consider allegations of Section 453 violations including but not limited to alleged discriminatory treatment and unlawful business practices. The Commission may also consider alleged violations of Sections 2896 and 2891 relating to failure to furnish adequate information and improper use of customer information, respectively. The Commission may consider whether Defendants have withdrawn benefits that were available to DSL Transport customers of Pacific Bell in violation of D.00-05-021.
We also find that the Commission may consider the conduct of ASI with regard to DSL Transport provisioning prior to the filing of the federal tariff.
For all the reasons stated above, we find that Defendants' motion to dismiss should be denied.
6 We note that the FCC issued a Notice of Proposed Rulemaking (NPRM) in February 2002, which tentatively classifies wireline broadband Internet access services, such as DSL, as "information services." (See In the Matter of Appropriate Framework for Broadband Access to the Internet over Wireline Facilities and Universal Service Obligations of Broadband Providers, CC Docket No. 02-33, Computer III Further Remand Proceedings, CC Docket Nos. 95-20, 98-10, FCC 02-42 (Rel. February 14, 2002), para. 17.) The issuance of the NPRM and adoption of tentative conclusions regarding DSL services does not alter the conclusions in this ruling.
7 Both Ivy and McDermott concerned whether a complaint filed in state court, could be removed to federal court under the "complete preemption" doctrine. That doctrine applies when Congress has "so completely pre-empted a particular area that any civil complaint raising this select group of claims is necessarily federal in character" and cannot be entertained in state court. Crump, 128 F.Supp. 2d at 554. The complete preemption doctrine is not synonymous with "field" preemption. The FCC itself has not asserted that it has occupied the field of DSL service, instead acknowledging that states may regulate certain types of DSL Transport services.
8 This reasoning is further supported by Quayle v. MCI Worldcom, Inc. (N.D. Cal. Oct 22, 2001)(2001 U.S. Dist. LEXIS 17450), which denied removal of a case filed in state court to federal court based on "complete preemption" arguments. Quayle states in relevant part: Unfortunately for Defendant's position, neither the Ninth Circuit nor the Supreme Court has found the requisite Congressional intent in the FCA." (Id., *8.); ... Plaintiffs are not challenging an approved practice, nor are they contesting the reasonableness of an approved rate. Rather, they are suing over alleged misrepresentations and deceptive business practices that they interpret to be a breach of Defendant's obligation as represented in advertising and marketing materials. Thus unlike Marcus, Plaintiffs here are not asking the Court to interpret a federal law, because the practice of which they complain has not been sanctioned by the federal government; it has not achieved the force and effect of a federal statute. Rather, Plaintiffs' claims for breach of contract, and for fraudulent and deceptive business practices and unfair competition, arise under principles of state common-law and statute. (Id., *13.)
9 Even ASI's own counsel admitted he did not know whether the Commission was divested of jurisdiction regarding claims that Defendants defrauded its customers. (Tr. at 74.)
10 In response to questions raised at the prehearing conference on 12/6/01, ASI stated in a letter to the ALJ dated 2/6/02 that "there are presently no DSL Transport to ISP service customers served out of the California intrastate tariff." While a few ISPs were provided DSL Transport from ASI's intrastate tariff, "such customers have all been moved to ASI's interstate tariff...."
11 CISPA response to motion to dismiss, 11/6/01, p. 4.
