The Commission's long-standing refusal to classify VoIP services continues to feed litigation between telecommunications carriers. Previously, a coalition of carriers asked the courts to decide the issue and it appears likely the FCC will address VoIP at least prospectively, but in the meantime, cases like this will persist.
In the latest case, CLEC Pac-West and IXC Verizon Business sparred in dueling Petitions for Declaratory Ruling stemming from a primary jurisdiction referral by a U.S. District Court in California. The petitioners offer vastly different approaches to resolving the dispute.
As background, Verizon has refused to pay originating access charges billed by Pac-West for calls delivered to Verizon toll-free service customers (toll-free services are originated by dialing 800, 888, 877 or 866 prefixes, i.e., "8YY" calls). Pac-West receives these calls, which are originated in VoIP format, conducts a database lookup to determine that the carrier is Verizon, converts the call to TDM format to hand-off to Verizon and then delivers the call to Verizon. For this, Pac-West bills its tariffed interstate access charges to Verizon.
Pac-West's petition focuses on a narrow legal question concerning the origination of 8YY traffic. Pac-West seeks a declaratory ruling that Verizon may not refuse to pay these access charges on the grounds that the call originated in IP format. Specifically, Pac-West seeks a ruling that Verizon must pay applicable tariffed access charges regardless of whether the call originates in IP format or as a TDM call. Pac-West argues that the Commission need not classify VoIP services generally, but only needs to address the particular 8YY access services that Pac-West provides.
Pac-West argues that, by its nature, 8YY traffic always is access traffic. IXCs such as Verizon sell a "called party pays" service to their subscribers and in turn "constructively and actually order" originating access services from carriers like Pac-West. It contends that VoIP traffic is "telecommunications" (regardless of whether it is a "telecommunications service" -- the pending question involving VoIP). Access service is defined to include origination or termination of "telecommunication", which, Pac-West argues, renders irrelevant whether the call originated as VoIP or as TDM. Either way, Pac-West's access charges apply to the traffic.
Verizon's petition, on the other hand, attacks the language of Pac-West's tariff, regardless of the legal question at issue. Relying on recent cases involving YMax and Northern Valley Telephone Company, Verizon argues that Pac-West's tariff violates FCC tariffing rules and thus is void ab initio. Verizon contends that Pac-West's tariff prior to June 9, 2010 failed to contain specific rates and unlawfully contained cross-references to other tariffs. It contends that the tariff after June 9, 2010 is unlawfullly vague in its explanation of the rates and still contains unlawful cross-references. Verizon invites the Commission to rule that Pac-West could not collect access charges under its tariff, and if it does so, Verizon contends, the decision would "effectively end the federal court litigation."
The FCC sought comment on the two petitions. Comments were due yesterday, but it will take a few days to be sure that all comments are posted to the docket.