CALDERWOOD & HARKNESS LLP 1200 K Street NW, Suite 900 Washington, D.C. 20005 Telephone: (202) 555-7400 Facsimile: (202) 555-7401
February 10, 2023
VIA CM/ECF ELECTRONIC FILING
The Honorable Claudia M. Wentworth United States District Judge United States District Court for the Eastern District of Virginia, Alexandria Division 401 Courthouse Square Alexandria, Virginia 22314
Re: *Ridgepoint Communications Inc. v. Northgate Telecommunications PLC and Northgate Networks America Inc.*, Case No. 1:22-cv-01487-CMW — Notice of Filing of Parallel Federal Communications Commission Complaint
Dear Judge Wentworth:
I am Elaine Forsythe, Responsible Partner in the Antitrust & Competition practice at Calderwood & Harkness LLP and counsel of record for Defendants Northgate Telecommunications PLC ("Northgate PLC") and Northgate Networks America Inc. ("Northgate America," and together with Northgate PLC, "Defendants") in the above-captioned matter. I write respectfully to advise the Court of a significant development bearing directly on this action — namely, the filing of a parallel administrative complaint by Plaintiff Ridgepoint Communications Inc. ("Ridgepoint" or "Plaintiff") before the Federal Communications Commission (the "FCC") on February 7, 2023. This letter is submitted as a notice filing to ensure that the Court is fully apprised of this development in connection with the pending Motion to Dismiss under Federal Rule of Civil Procedure 12(b)(6) (ECF No. 18), on which oral argument is currently scheduled for February 22, 2023. As set forth more fully below, the FCC complaint raises substantial questions regarding the interplay between this Court's jurisdiction and the FCC's primary jurisdiction over the very interconnection disputes at the center of this litigation.
I. Background of the District Court Action
On September 19, 2022, Ridgepoint commenced this action by filing a Complaint (ECF No. 1) asserting a single claim for relief under Section 2 of the Sherman Antitrust Act, 15 U.S.C. § 2. In its Complaint, Ridgepoint alleges that Defendants have engaged in unlawful monopolization by refusing to grant Ridgepoint interconnection and physical colocation access at fourteen (14) central-office and meet-me-room facilities located throughout the Mid-Atlantic region (the "Subject Facilities"). Ridgepoint defines the purported relevant market as "last-mile enterprise fiber-optic transport services" within the Philadelphia–Baltimore–Washington, D.C. corridor, and contends that Northgate's refusal to provide access to the Subject Facilities constitutes an anticompetitive refusal to deal in violation of the antitrust laws.
On November 14, 2022, Defendants filed their Motion to Dismiss Plaintiff's Complaint Pursuant to Federal Rule of Civil Procedure 12(b)(6) (ECF No. 18), arguing, inter alia, that Ridgepoint has failed to state a plausible claim for monopolization under the standards articulated by the Supreme Court in Harborview Holdings Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398 (2004), and its progeny. Ridgepoint filed its Memorandum of Law in Opposition to Defendants' Motion to Dismiss on January 9, 2023 (ECF No. 24), and Defendants filed their Reply Memorandum of Law in Further Support of the Motion to Dismiss on January 30, 2023 (ECF No. 29). The Court has scheduled oral argument on the Motion to Dismiss for February 22, 2023.
II. The FCC Complaint
On February 7, 2023 — less than two weeks before the scheduled oral argument in this Court — Ridgepoint filed a formal complaint at the Federal Communications Commission against Northgate Networks America Inc. The complaint has been docketed as FCC Docket No. WC-23-0042 and is captioned In the Matter of Northgate Networks America Inc. — Complaint Regarding Interconnection Obligations under Section 251 (the "FCC Complaint"). A true and correct copy of the FCC Complaint as publicly docketed is attached hereto as Exhibit A for the Court's reference.
In the FCC Complaint, Ridgepoint alleges that Northgate America has violated its interconnection obligations under Sections 251 and 252 of the Communications Act of 1934, as amended by the Telecommunications Act of 1996, 47 U.S.C. §§ 251, 252 (the "Communications Act"). Specifically, Ridgepoint asserts before the FCC that Northgate America's refusal to grant interconnection and physical colocation access at the same fourteen (14) central-office and meet-me-room facilities at issue in this action violates Northgate's duties as an incumbent local exchange carrier ("ILEC") under Section 251(c) of the Communications Act to provide interconnection at any technically feasible point within the carrier's network, 47 U.S.C. § 251(c)(2), and to provide nondiscriminatory access to network elements on an unbundled basis, 47 U.S.C. § 251(c)(3). Ridgepoint further alleges before the FCC that Northgate's conduct contravenes the duty to provide physical colocation of equipment necessary for interconnection or access to unbundled network elements at the Subject Facilities. See 47 U.S.C. § 251(c)(6).
Critically, the FCC Complaint challenges the same course of conduct that forms the factual predicate of Ridgepoint's Section 2 Sherman Act claim in this Court. The FCC Complaint identifies and targets Northgate's Wholesale Access Policy (the "WAP"), a company-wide policy adopted by Northgate Networks America Inc. in January 2020 that established revised terms and conditions for third-party interconnection and colocation at Northgate-operated facilities. The FCC Complaint further challenges Northgate's denial of Ridgepoint's specific interconnection requests submitted between March 2021 and August 2022 — the very same denials that Ridgepoint alleges in this action constitute unlawful monopolization. The factual narrative presented in the FCC Complaint mirrors, in all material respects, the factual allegations in Ridgepoint's Complaint before this Court.
Defendants further note that Ridgepoint is represented in the FCC proceeding by the same counsel of record that represents Ridgepoint in this action: Victoria Hargrove and Daniel Stoyanov of Hargrove, Winslow & Burke LLP, Washington, D.C.
III. Substantial Overlap Between the FCC and District Court Proceedings
The degree of overlap between the FCC Complaint and the instant action is striking and warrants the Court's careful attention. Both proceedings arise from identical operative facts: Northgate's denial of Ridgepoint's interconnection and colocation requests at the fourteen (14) specified central-office and meet-me-room facilities located in the Philadelphia–Baltimore–Washington, D.C. corridor. Both proceedings involve the same parties — Ridgepoint Communications Inc. as complainant and plaintiff, and Northgate Networks America Inc. as respondent and defendant — and both proceedings are prosecuted by the same plaintiffs' counsel.
Most significantly, both proceedings require the adjudicator to evaluate whether Northgate's Wholesale Access Policy and its application to Ridgepoint's specific interconnection requests constitute impermissible conduct — under the Communications Act before the FCC, and under Section 2 of the Sherman Act before this Court. Although the legal theories are formally distinct, the underlying factual inquiries are substantially congruent, and the regulatory determinations that the FCC will necessarily be called upon to make in the course of adjudicating the FCC Complaint bear directly on the antitrust claims pending before this Court.
In particular, resolution of the FCC proceeding will necessarily require the FCC to determine, among other things:
(a) whether the fourteen (14) Subject Facilities are subject to unbundling and interconnection requirements under Section 251 of the Communications Act, including whether Northgate America qualifies as an ILEC with respect to each such facility and whether the specific network elements at issue are required to be provided on an unbundled basis;
(b) whether Northgate's Wholesale Access Policy, as applied to Ridgepoint's interconnection requests, constitutes a commercially reasonable practice within the meaning of the regulatory framework established by the FCC, or whether it instead represents an unreasonable refusal to provide interconnection and colocation in violation of Northgate's statutory duties; and
(c) the nature and extent of Northgate's interconnection obligations with respect to the Subject Facilities — including whether those obligations encompass the specific types of physical colocation and meet-me-room access that Ridgepoint has demanded.
Each of these determinations is directly relevant to the antitrust claims in this Court. Ridgepoint's Section 2 monopolization claim rests on the theory that Northgate's refusal to provide interconnection and colocation access is anticompetitive. Yet the question of whether Northgate has any obligation to provide such access — and the terms on which such access must be provided — is precisely the type of question that Congress has committed to the specialized expertise of the FCC. The FCC's resolution of these regulatory questions will materially inform, and may be dispositive of, the factual and legal predicates of Ridgepoint's antitrust claim.
IV. Relevance to the Pending Motion and the Primary Jurisdiction Doctrine
Defendants respectfully submit that the filing of the FCC Complaint raises significant questions regarding the applicability of the primary jurisdiction doctrine to this action. The primary jurisdiction doctrine is a prudential doctrine under which a court, even where it possesses concurrent subject matter jurisdiction, should stay or dismiss an action pending determination by a specialized administrative agency where the claims at issue require resolution of questions that Congress has placed within that agency's particular competence. See United States v. W. Pac. R.R. Co., 352 U.S. 59, 63–64 (1956); Reiter v. Cooper, 507 U.S. 258, 268 (1993). The doctrine applies where there is a need for the agency's specialized expertise or where there is a danger of inconsistent rulings between the court and the agency. See Far E. Conf. v. United States, 342 U.S. 570, 574–75 (1952).
The FCC possesses precisely the type of specialized expertise and congressionally-delegated authority that the primary jurisdiction doctrine is designed to protect. Congress vested the FCC with exclusive initial jurisdiction over interconnection disputes under Sections 251 and 252 of the Communications Act, and the FCC has developed an extensive body of regulations and precedent governing the interconnection obligations of incumbent local exchange carriers. See 47 C.F.R. §§ 51.100–51.809. The technical and regulatory questions at the heart of both the FCC Complaint and this action — including the scope of Northgate's interconnection duties, the reasonableness of Northgate's Wholesale Access Policy, and the availability of specific network elements for unbundled access — fall squarely within the FCC's core regulatory mandate.
The Supreme Court's decision in Harborview Holdings Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398 (2004), is directly on point. In Trinko, the Court held that the existence of a comprehensive regulatory framework administered by the FCC is directly relevant to the scope of antitrust liability for refusal-to-deal claims in the telecommunications context. The Court specifically noted that the Telecommunications Act of 1996 "created a new regime of regulation" designed to address the very type of interconnection disputes at issue here, and that the regulatory process provides "a means of obtaining the . . . access sought by the [plaintiff]" that renders antitrust intervention less necessary and more problematic. Id. at 411–13. The Court further observed that "[a]ntitrust analysis must sensitively recognize and reflect the distinctive economic and legal setting of the regulated industry to which it applies." Id. at 411 (quoting Town of Concord v. Boston Edison Co., 915 F.2d 17, 22 (1st Cir. 1990) (Breyer, C.J.)).
The filing of the FCC Complaint powerfully reinforces the applicability of these principles. Ridgepoint itself has now recognized that the FCC is the appropriate forum for adjudicating the interconnection obligations that lie at the heart of this dispute. By filing the FCC Complaint, Ridgepoint has voluntarily submitted to the FCC the very questions that this Court would need to resolve — or at minimum would need to consider — in order to adjudicate Ridgepoint's Sherman Act claim. Allowing both proceedings to go forward simultaneously risks inconsistent determinations, duplicative proceedings, and the potential for this Court to adjudicate complex telecommunications regulatory questions without the benefit of the FCC's expert guidance.
Defendants intend to raise the primary jurisdiction doctrine more fully in a separate motion or briefing at the appropriate time. However, given the direct relevance of the FCC Complaint to the pending Motion to Dismiss and the upcoming oral argument scheduled for February 22, 2023, Defendants respectfully bring this development to the Court's attention now so that the Court may consider its implications as it deems appropriate. Defendants further note that the FCC proceeding may ultimately prove dispositive of, or materially inform, the factual and legal issues that lie at the heart of this action, and that principles of judicial economy and inter-branch comity weigh in favor of permitting the FCC to exercise its primary jurisdiction over the regulatory questions that both proceedings present.
V. Request
In light of the foregoing, Defendants respectfully request that the Court take note of the filing of the parallel regulatory proceeding before the FCC, docketed as FCC Docket No. WC-23-0042. Defendants further respectfully request leave to address the implications of the FCC Complaint — including, without limitation, the applicability of the primary jurisdiction doctrine — at the scheduled oral argument on February 22, 2023, or, alternatively, in a subsequent written filing if the Court would prefer to receive supplemental briefing on the issue.
Defendants reserve all rights to move for a stay of this action on primary jurisdiction grounds or on any other appropriate basis, and nothing in this notice filing shall be construed as a waiver of any argument, defense, or right available to Defendants in this or any other proceeding.
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Elaine Forsythe (VSB No. 48721) 1200 K Street NW, Suite 900 Washington, D.C. 20005 Telephone: (202) 555-7400 Facsimile: (202) 555-7401
Email: eforsythe@calderwoodharkness.com
Howard Bellamy (admitted pro hac vice) CALDERWOOD & HARKNESS LLP 450 Lexington Avenue, 35th Floor New York, New York 10017 Telephone: (212) 555-3200
Email: hbellamy@calderwoodharkness.com
Aaron Liu (VSB No. 56893) Monica Reyes (VSB No. 61047) CALDERWOOD & HARKNESS LLP 1200 K Street NW, Suite 900 Washington, D.C. 20005 Telephone: (202) 555-7400
Email: aliu@calderwoodharkness.com
Email: mreyes@calderwoodharkness.com
Counsel for Defendants Northgate Telecommunications PLC and Northgate Networks America Inc.
Enclosure: Exhibit A (FCC Complaint, Docket No. WC-23-0042)
CERTIFICATE OF SERVICE
I hereby certify that on this 10th day of February, 2023, a true and correct copy of the foregoing Notice of Filing of FCC Complaint and the attached Exhibit A was served on all counsel of record via the Court's CM/ECF electronic filing system, which will send a notice of electronic filing to the following:
Victoria Hargrove Hargrove, Winslow & Burke LLP 900 17th Street NW, Suite 600 Washington, D.C. 20006
Email: vhargrove@hwblaw.com
Daniel Stoyanov Hargrove, Winslow & Burke LLP 900 17th Street NW, Suite 600 Washington, D.C. 20006
Email: dstoyanov@hwblaw.com
Counsel for Plaintiff Ridgepoint Communications Inc.
________________________________________
Aaron Liu (VSB No. 56893) CALDERWOOD & HARKNESS LLP 1200 K Street NW, Suite 900 Washington, D.C. 20005
cc (via CM/ECF):
Victoria Hargrove, Hargrove, Winslow & Burke LLP Daniel Stoyanov, Hargrove, Winslow & Burke LLP