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05-705 GLOBAL CROSSING, INC. V. METROPHONES, INC. DECISION BELOW:423 F3d 1056 LIMITED TO QUESTION 1 PRESENTED BY THE PETITION. CERT. GRANTED 2/21/2006 QUESTIONS PRESENTED: 1. Whether 47 U.S.C. § 201(b) of the Communications Act of 1934 creates a private right of action for a provider of payphone services to sue a long distance carrier for alleged violations of the FCC's regulations concerning compensation for coinless payphone calls. 2. Whether 47 U.S.C. § 276 the Communications Act of 1934 preempts state law claims for quantum meruit and breach of implied contract based on a long distance carrier's alleged failures to compensate a payphone service provider for coinless payphone calls. LOWER COURT CASE NUMBER: 04-35287
The U.S. Supreme Court case Global Crossing Telecommunications, Inc. v. Metrophones Telecommunications, Inc., 2006 revolved around the issue of whether a long-distance carrier's failure to pay dial-around compensation for coinless payphone calls constituted a violation under section 201(b) of the Communications Act of 1934 and if it could be actionable in court by private parties under section 207. Global Crossing was accused by Metrophones of not paying full compensation for completed calls from its payphones as required by Federal Communication Commission (FCC) regulations. The District Court ruled in favor of Metrophones but this decision was reversed on appeal with the Ninth Circuit stating that FCC orders did not have force until they were enforced through litigation. However, upon reaching the Supreme Court, Justice Breyer writing for majority held that such violations are indeed actionable and can be brought before courts by private parties affected directly or indirectly due to non-compliance with FCC rules regarding payment rates set out in its orders.
In the dissenting opinion for Global Crossing Telecommunications, Inc. v. Metrophones Telecommunications, Inc., Justice Scalia argued that the majority's decision to allow a private right of action under section 201(b) of the Communications Act was an overreach by judicial interpretation. He contended that Congress did not explicitly provide this remedy in its legislation and therefore it should not be inferred by courts. Furthermore, he disagreed with the majority’s view that FCC orders can create legal rights enforceable through §207 because they are part of federal law just like statutes or regulations; instead, he believed only violations of statutory requirements could give rise to such claims. In his view, allowing lawsuits based on agency interpretations would lead to unpredictable results and undermine legislative authority.