United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 25, 1998 Decided December 22, 1998
No. 98-1019
BellSouth Corporation, et al.,
Appellants
v.
Federal Communications Commission,
Appellee
AT&T Corporation, et al.,
Intervenors
Appeal of an Order of the
Federal Communications Commission
Laurence H. Tribe argued the cause for appellants. With
him on the briefs were Jonathan S. Massey, Michael K.
Kellogg, Charles R. Morgan, William B. Barfield, M. Robert
Sutherland, Jim O. Llewellyn and David G. Frolio. Walter
H. Alford entered an appearance.
Christopher J. Wright, General Counsel, Federal Commu-
nications Commission, argued the cause for appellee. With
him on the briefs were Daniel M. Armstrong, Associate
General Counsel, John E. Ingle, Deputy Associate General
Counsel, Laurence N. Bourne, Counsel, and Brian M. Hoffs-
tadt, Special Counsel.
David W. Carpenter argued the cause for intervenors
AT&T Corporation, et al. With him on the briefs were Peter
D. Keisler, Mark C. Rosenblum, Roy E. Hoffinger, Donald B.
Verrilli, Jr., Anthony C. Epstein, Ian Heath Gershengorn,
William Single, IV, Sue D. Blumenfeld, David P. Murray,
Charles C. Hunter, Catherine M. Hannan, Daniel L. Bren-
ner, Neal M. Goldberg, David L. Nicoll, Richard J. Metzger,
Emily M. Williams, Genevieve Morelli, Robert J. Aamoth,
Richard S. Whitt, Riley M. Murphy, Danny E. Adams, Brad
E. Mutschelknaus, John J. Heitmann, Jonathan E. Canis
and James J. Freeman. Theodore. Whitehouse entered an
appearance.
Joel I. Klein, Assistant Attorney General, U.S. Department
of Justice, Philip D. Bartz, Acting Assistant Attorney Gener-
al, Catherine G. O'Sullivan, Nancy C. Garrison, Robert B.
Nicholson, Mark B. Stern, Jacob M. Lewis, and Alisa B.
Klein, Attorneys, were on the briefs for intervenor United
States of America.
William T. Lake, John H. Harwood, II and Robert B.
McKenna were on the brief for intervenor U S WEST, Inc.
Kenneth S. Geller, Donald M. Falk, Harold S. Reeves,
Theodore A. Livingston and John E. Muench were on the
brief for intervenor Ameritech Corporation.
Before: Edwards, Chief Judge, Wald and Sentelle,
Circuit Judges.
Opinion for the Court filed by Chief Judge Edwards.
Separate statement filed by Circuit Judge Sentelle,
concurring in the result.
Edwards, Chief Judge: This petition for review represents
yet another attack by BellSouth Corporation on the constitu-
tionality of the Telecommunications Act of 1996 (the "Act").
Just this past term, BellSouth challenged the validity of s 274
of the Act, 47 U.S.C. s 274 (Supp. II 1996), which limits the
ability of Bell operating companies ("BOCs") to provide "elec-
tronic publishing." See BellSouth Corp. v. FCC, 144 F.3d 58
(D.C. Cir. 1998) ("BellSouth I"). In this earlier case, Bell-
South claimed that s 274 was an unconstitutional bill of
attainder, because the subjects of its restrictions, the BOCs,
are singled out by name. In the instant case, BellSouth
Corporation, BellSouth Telecommunications, Inc., and Bell-
South Long Distance, Inc. (collectively "BellSouth") challenge
the validity of s 271 of the Act, 47 U.S.C. s 271 (Supp. II
1996), which prevents the BOCs from immediately providing
in-region long distance telephone service absent satisfaction
of certain statutory criteria.
Once again, BellSouth claims that the challenged provision,
here s 271, is an unconstitutional bill of attainder and, in
addition, that it results in a denial of equal protection and a
violation of the separation of powers doctrine. BellSouth also
seeks to overturn the Federal Communications Commission's
("FCC") denial of its application to provide long distance
service in South Carolina, see Application of BellSouth Corp.,
et al. Pursuant to Section 271 of the Communications Act of
1934, as amended, To Provide In-Region, InterLATA Ser-
vices In South Carolina, 13 F.C.C.R. 539 (1997) ("Order"),
contesting both the FCC's finding that BellSouth is foreclosed
from petitioning to provide service under s 271(c)(1)(B), and
the FCC's findings regarding BellSouth's compliance with
certain "competitive checklist" items under s 271. We found
no merit in the claims raised in BellSouth I and this challenge
fares no better.
We hold that s 271 does not violate any of the constitution-
al provisions raised by BellSouth. The section does not
violate the bill of attainder clause, because it does not inflict
"punishment" on BellSouth. Instead, it is a rational and
nonpunitive congressional enactment that serves to open tele-
communications markets. Section 271 also does not violate
the equal protection clause, because Congress had a rational
basis for singling out the BOCs, i.e., the unique nature of
their control over their local exchange areas. Finally, s 271
does not violate the separation of powers doctrine, because
Congress did not substitute its judgment for that of a court;
rather it simply altered the prospective effects of a consent
decree, which it was surely free to do.
We also find that the FCC was correct in concluding that
BellSouth is foreclosed from petitioning to provide service
under s 271(c)(1)(B), because BellSouth has failed to demon-
strate that no "qualifying requests" for access and intercon-
nection have been made. Moreover, given our finding that
BellSouth is foreclosed from providing service under
s 271(c)(1)(B), we can find no reason to address the competi-
tive checklist issues.
I. Background
As we noted in BellSouth I, the Telecommunications Act of
1996, Pub. L. No. 104-104, 110 Stat. 56 (1996), "changed the
entire telecommunications landscape." 144 F.3d at 61.
Therefore, in order to put the instant case in proper focus, we
begin with an overview of the industry landscape prior to the
passage of the Act, as well as the Act itself.
A.The Telecommunications Market and the 1996 Act
In 1982, the American Telephone & Telegraph Company
("AT&T") executed a consent decree, settling an antitrust suit
brought by the Government in 1974. That decree, as modi-
fied by the District Court, is known as the Modification of
Final Judgment ("MFJ"). United States v. American Tel.
and Tel. Co., 552 F. Supp. 131 (D.D.C. 1982), aff'd sub nom.
Maryland v. United States, 460 U.S. 1001 (1983). The princi-
pal element of the MFJ was the requirement that AT&T
divest itself of its local exchange monopolies. BellSouth's two
local operating companies, Southern Bell Telephone and Tele-
graph Company and South Central Bell Telephone Company,
were among the twenty-two BOCs spun off as a result of the
decree. Each of the twenty-two BOCs were grouped into
seven unaffiliated regional Bell operating companies
("RBOCs"). Due to mergers, there are now only five
RBOCs, one of which is BellSouth.
The MFJ prohibited the BOCs from certain lines of busi-
ness, including the provision of long distance services across
different "Local Access and Transit Areas" ("interLATA ser-
vices"), because of the BOCs' "bottleneck" power over the
local exchange facilities. See 552 F. Supp. at 223-24. (For
the remainder of this opinion, we will refer to interLATA
services as long distance services.) The MFJ also provided
that the BOCs could petition for relief from these prohibi-
tions, including the prohibition against providing long dis-
tance services, if the petitioning BOC could show "that there
is no substantial possibility that it could use its monopoly
power to impede competition in the market it seeks to enter."
Id. at 231.
Over the life of the MFJ, the District Court granted nearly
300 waivers easing the restrictions of the decree. A few of
these waivers were related to the long distance service re-
striction, but they were limited to the provision of services
such as paging, time-of-day information, toll-free services, 911
services, international services, and cellular services. Howev-
er, no BOC ever successfully petitioned under the MFJ to
provide long distance telephone services.
In 1996, Congress passed the Act, by which it sought to
open all telecommunications markets, including local tele-
phone markets. To this end, many provisions of the Act were
made generally applicable to incumbent local exchange carri-
ers. For example, ss 251 and 252 require all incumbents to
permit new carriers to compete for local customers and set
forth procedures that incumbents must follow in order to
open their local markets to competition. See 47 U.S.C.
ss 251-252 (Supp. II 1996).
A critical feature of the Act is found in s 601(a)(1). This
provision eliminated the prospective effects of the MFJ by
providing that "[a]ny conduct or activity that was, before the
date of enactment of this Act, subject to any restriction or
obligation imposed by the [MFJ] shall, on and after such
date, be subject to the restrictions and obligations imposed by
the Communications Act of 1934 as amended by this Act and
shall not be subject to the restrictions and the obligations
imposed by [the MFJ]." Telecommunications Act of 1996
s 601(a)(1), 110 Stat. at 143.
In addition to the Act's generally applicable provisions and
the elimination of the future effects of the MFJ, Congress
enacted ss 271 through 276, special provisions applicable only
to the BOCs listed in s 153(4) of the Act. BellSouth is
governed by these provisions. As noted in BellSouth I, "[i]n
general these provisions simply maintained, and in most cases
loosened, various restrictions to which the BOCs were already
subject under the MFJ." 144 F.3d at 61. In other words,
generally speaking, the BOCs were better off in terms of
business market opportunities under the Act than they had
been under the MFJ.
Section 271, the section at issue in this case, provides that
the BOCs may immediately begin providing some categories
of long distance services that were previously restricted
under the MFJ. These services include "out-of-region" long
distance services, i.e., long distance services originating out-
side the state(s) in which a BOC is authorized to provide local
telephone service, and "incidental" long distance services,
such as audio and video programming and commercial mobile
services. See 47 U.S.C. s 271(b)(2), (g). Section 271 pre-
vents a BOC from immediately providing in-region long dis-
tance services. But this restriction may be overcome by
fulfilling the requirements of s 271(c) and (d).
In order to provide in-region long distance services, a BOC
must first demonstrate that either s 271(c)(1)(A), known as
Track A, or s 271(c)(1)(B), known as Track B, has been
satisfied. Track A requires a BOC to show that it has
entered into an agreement to provide access and interconnec-
tion to "one or more unaffiliated competing providers of
telephone exchange service ... to residential and business
subscribers." Id. s 271(c)(1)(A). Track B, on the other
hand, requires a BOC to show that "no such provider has
requested the access and interconnection described in subpar-
agraph (A)" three months prior to the BOC's application. Id.
s 271(c)(1)(B). Such a request is called a "qualifying re-
quest." See Order p 59. In addition, even if a BOC has
received a qualifying request, it may still proceed under
Track B if the party that made the request either failed to
negotiate in good faith or failed to comply with an implemen-
tation schedule in an interconnection agreement. See 47
U.S.C. s 271(c)(1)(B); SBC Communications Inc. v. FCC,
138 F.3d 410, 413-14 (D.C. Cir. 1998) ("SBC Communica-
tions") (providing further explanation of Track A and Track B
requirements).
If a BOC satisfies either Track A or B, it must then show
that it offers the items listed in s 271(c)(2)(B), the "competi-
tive checklist." See 47 U.S.C. s 271(d)(3)(A). Included on
the competitive checklist are things such as nondiscriminatory
access to 911 and E911 services, adequate operational support
systems, nondiscriminatory access to unbundled network ele-
ments, and contract service arrangements at a wholesale
discount. See id. s 271(c)(2)(B). A BOC must also be willing
to provide its in-region long distance service through a sepa-
rate subsidiary as required by s 272, and must persuade the
FCC that its provision of long distance service "is consistent
with public interest, convenience, and necessity." See id.
s 271(d)(3)(B), (C).
B.Procedural History
BellSouth filed an application on September 30, 1997 to
provide in-region long distance services in South Carolina.
See Order p 1. It claimed that it had met the requirements of
Track B as interpreted by the FCC in Application of SBC
Communications Inc., Pursuant to Section 271 of the Com-
munications Act of 1934, as amended, To Provide In-Region,
InterLATA Services In Oklahoma, 12 F.C.C.R. 8685 (1997)
("Oklahoma Order"), aff'd, SBC Communications, 138 F.3d
410 (D.C. Cir. 1998). See Order p 52. It also contended that
it had generally offered all fourteen checklist items. See
Brief in Support of Application by BellSouth for Provision of
In-Region, InterLATA Services in South Carolina at 17-57,
reprinted in Joint Appendix 317-57.
The FCC denied BellSouth's application, because it found
that qualifying requests had been made for the services in
South Carolina. See Order p 67. Accordingly, BellSouth was
not eligible to proceed under Track B. See id. It also found
that BellSouth did not generally offer all fourteen checklist
items. See id. p 240. BellSouth timely petitioned for review
of the FCC's decision in this court on January 13, 1998.
C.Other Relevant Developments
Since BellSouth filed its appeal, three cases relevant to this
appeal have been decided. On March 20, 1998, this court
decided SBC Communications, denying SBC's petition to
review the so-called Oklahoma Order. In that case, SBC
sought review of the FCC's denial of its request to provide in-
region long distance services in Oklahoma. SBC argued that
it had satisfied Track A, because another entity was providing
service to 20 customers in the region. SBC argued in the
alternative that it had satisfied Track B. The FCC denied
SBC's request, because it found that SBC had not satisfied
either Track A or Track B.
This court denied SBC's petition to review the FCC's
decision, because it found that the other entity providing
service in-region was doing so free of charge, and it was
reasonable for the FCC to interpret "competing provider" in
Track A to require an "actual commercial alternative to the
BOC." SBC Communications, 138 F.3d at 416 (internal
quotation marks omitted). This court also found that SBC
had not satisfied Track B. Particularly relevant to this case,
this court approved the FCC's interpretation that "Track B
was foreclosed the moment a provider requested interconnec-
tion so long as [the FCC] could predict that the carrier would,
after implementing the agreement, provide competitive ser-
vice to both residential and business customers, at least
predominantly over its own facilities." Id. at 417. Because
SBC had received qualifying requests that satisfied the
FCC's interpretation of Track B, it could not seek to provide
long distance services under that track.
On May 15, 1998, this court decided BellSouth I, holding
that s 274, which limited the ability of the BOCs to provide
electronic publishing, was not a bill of attainder, nor did it
violate the BOCs' right to free speech under the First
Amendment. Although BellSouth I addressed many of the
bill of attainder issues raised in this case, there are differ-
ences between s 274 and s 271 that make this case somewhat
different from that one.
On September 4, 1998, the Fifth Circuit decided SBC
Communications, Inc. v. FCC, 154 F.3d 226 (5th Cir. 1998)
("SBC Communications (5th)"), in which SBC had argued
that all of the Special Provisions of the Act, 47 U.S.C. ss 271-
276, were unconstitutional. Reversing the district court, the
Fifth Circuit found that the provisions did not constitute a bill
of attainder, did not violate the separation of powers require-
ment, and did not violate the equal protection clause. It also
found that the electronic publishing restrictions did not vio-
late the BOCs' right to free speech under the First Amend-
ment.
In the light of these developments, we now review the
FCC's denial of BellSouth's application to provide long dis-
tance services in South Carolina.
II. Analysis
This appeal presents five issues, three of which concern the
constitutionality of s 271, and two of which concern the
FCC's administration of the 1996 Act. We begin with Bell-
South's bill of attainder challenge.
A.Bill of Attainder
Article I, section 9, clause 3 of the Constitution provides
that "[n]o Bill of Attainder or ex post facto Law shall be
passed." Although the prohibition against bills of attainder
was one of the original guarantees of civil liberty, and has
existed for over two hundred years, the Supreme Court has
relied on it only five times to strike down legislation. See
United States v. Brown, 381 U.S. 437 (1965); United States v.
Lovett, 328 U.S. 303 (1946); Pierce v. Carskadon, 83 U.S. (16
Wall.) 234 (1872); Ex parte Garland, 71 U.S. (4 Wall.) 333
(1866); Cummings v. Missouri, 71 U.S. (4 Wall.) 277 (1866).
Despite the infrequency with which this clause arises in
litigation, however, its meaning has nevertheless continued to
evolve.
In our most recent bill of attainder case, BellSouth I, we
addressed issues similar to those raised in this case. Howev-
er, that decision dealt with s 274 of the Act, and the differ-
ences between s 274 and s 271 distinguish BellSouth I from
the instant case.
First, s 274 sunsets on February 8, 2000. See 47 U.S.C.
s 274(g)(2). Section 271 has no such sunset date. In addi-
tion, s 274 allows the BOCs to provide electronic publishing if
they do so through a separate affiliate. Section 271 allows
the BOCs to provide in-region long distance services through
a separate affiliate, but only after they have received the
approval of the FCC by satisfying the requirements of
s 271(c) and (d). Finally, s 274 added restrictions on the
BOCs that had been lifted from the MFJ in 1991. Section 271,
however, is merely a revised version of the MFJ restrictions
covering the provision of long distance services that were still
in effect when the Act was passed.
As we explained in BellSouth I, when the Constitution was
drafted, "bills of attainder" were acts that sentenced named
persons to death without the benefit of a trial. See BellSouth
I, 144 F.3d at 62. By the end of the nineteenth century,
however, the Supreme Court had included penalties short of
death among those prohibited by the bill of attainder clause.
See id. Today, the prohibition against bills of attainder
prevents any "legislative acts, no matter what their form, that
apply either to named individuals or to easily ascertainable
members of a group in such a way as to inflict punishment on
them without a judicial trial." United States v. Lovett, 328
U.S. 303, 315 (1946). Thus, under the most current interpre-
tations of the bill of attainder clause, a law is prohibited if it
(1) applies with specificity, and (2) imposes punishment.
As we made clear in BellSouth I, see 144 F.3d at 62-63,
both of these elements must be present before we will find an
unconstitutional bill of attainder. Indeed, the Supreme Court
has required both specificity and punishment before it will
find that a law constitutes a bill of attainder. In its most
recent bill of attainder cases, Selective Service System v.
Minnesota Public Interest Research Group, 468 U.S. 841, 851
(1984), and Nixon v. Administrator of General Services, 433
U.S. 425, 469-72 (1977), the Court has clearly stated that
satisfaction of the specificity prong alone is not sufficient to
find that a particular law implicates the bill of attainder
clause, let alone violates it. See Selective Service, 468 U.S. at
851 ("Even if the specificity element were deemed satisfied by
[the statutory provision in question], the statute would not
necessarily implicate the Bill of Attainder Clause. The pro-
scription against bills of attainder reaches only statutes that
inflict punishment on the specified individual or group.")
(emphasis added); Nixon, 433 U.S. at 471-72 ("[T]he Act's
specificity--the fact that it refers to appellant by name--does
not automatically offend the Bill of Attainder Clause.").
The Court's jurisprudence on this point is hardly surpris-
ing, because
[l]egislative measures often grant or withhold benefits or
burdens from precisely identified individuals or groups.
A bailout for Chrysler might be seen as a burden to
Ford, a subsidy to Lockheed as a competitive blow to
Boeing, a private bill for a favored constituent as a
severe disappointment to a neighbor, a tax break for one
company as a punishment for a competitor. Yet the bill
of attainder ban has, quite properly, never been regarded
as an obstacle to all such measures--a guarantee that all
lawmaking activity will proceed through majestic gener-
alities. Although the Supreme Court once struck down a
statute exempting American Express by name from a
generally applicable economic regulation, that decision
was itself overruled two decades later, when the Court
upheld a law permitting two identified vendors to contin-
ue hawking their wares in New Orleans' French Quarter
but forbidding all of their competitors to do so.
It is only laws that inflict punishment on legislatively
specified individuals that the bill of attainder ban con-
demns, and the examples noted above make plain that
not all burdens may be deemed punishments for this
purpose even when legislative "specification" is shown.
Laurence H. Tribe, American Constitutional Law s 10-5,
650-51 (2d ed. 1988) (footnotes omitted).
In addition, we also note that, as in BellSouth I, both
parties have assumed "that the Bill of Attainder Clause
protects corporations as well as individuals." BellSouth I,
144 F.3d at 63. Although we make the same assumption
here, it is obvious that there are differences between a
corporation and an individual under the law. Thus, any
analogy between prior cases that have involved individuals
and this case, which involves a corporation, must necessarily
take into account this difference.
Turning to the first step in the bill of attainder analysis,
there is no doubt that s 271 singles out the BOCs by name.
See 47 U.S.C. ss 153(4)(A), 271(a). Thus, because the section
applies with specificity, the first prong of the bill of attainder
query is satisfied.
The next question, then, is whether s 271 inflicts "punish-
ment" on the BOCs. To answer this question, we must look,
as we did in BellSouth I, see 144 F.3d at 64, to the "three
necessary inquiries" articulated in Selective Service, which in
turn are based on the Court's analysis in Nixon:
(1) whether the challenged statute falls within the histor-
ical meaning of legislative punishment; (2) whether the
statute, "viewed in terms of the type and severity of
burdens imposed, reasonably can be said to further
nonpunitive legislative purposes"; and (3) whether the
legislative record "evinces a congressional intent to pun-
ish."
Selective Service, 468 U.S. at 852 (quoting Nixon, 433 U.S. at
473, 475-76, 478). As we noted in BellSouth I, the second
factor invariably appears to be "the most important of the
three." 144 F.3d at 65. However, in this case, we assign no
particular weight to any of the three factors, because we find
that none of the three inquiries result in a finding that the
challenged legislation constitutes punishment.
1.The Historical Meaning of Legislative Punishment
Our first inquiry under Selective Service and Nixon is
whether s 271 falls within the historical meaning of legisla-
tive punishment. In the earliest cases construing the provi-
sion, the only punishment prohibited by the bill of attainder
clause was a sentence of death. See Nixon, 433 U.S. at 473.
However, the Court long ago extended the protections of the
clause to include "bills of pains and penalties." Id. at 474.
Bills of pains and penalties "historically consisted of a wide
array of punishments: commonly included were imprison-
ment, banishment, and the punitive confiscation of property
by a sovereign." Id. (footnotes omitted). In the Court's
most recent jurisprudence, the definition of punishment "has
expanded to include legislative bars to participation by indi-
viduals or groups in specific employments or professions."
Selective Service, 468 U.S. at 852. For example, the Court
has held that barring an individual from holding office in a
labor union falls within the list of historical punishments
forbidden by this clause. See United States v. Brown, 381
U.S. 437 (1965). BellSouth argues that s 271 falls under this
last category, because it imposes unique restrictions on the
BOCs' ability to provide long distance services in-region.
BellSouth made this same argument with respect to s 274
in BellSouth I. See 144 F.3d at 64-65. In that case, al-
though s 274 permitted the BOCs to enter into the electronic
publishing market through structurally separated affiliates,
we assumed, arguendo, that the BOCs were not permitted to
participate in that market at all. We then rejected the
challenge to the statute, in part, on the ground that "the
Supreme Court in Brown strongly suggested that line-of-
business restrictions pose no bill of attainder concerns." 144
F.3d at 65. Likewise, we see no concerns in this case.
Even leaving aside our analysis in BellSouth I, the Su-
preme Court has said that "[a] statute that leaves open
perpetually the possibility of [overcoming a legislative restric-
tion] does not fall within the historical meaning of forbidden
legislative punishment." Selective Service, 468 U.S. at 853.
BellSouth attempts to nullify this point by citing the Court's
earlier opinion in Brown saying that "inescapability" is not
"an absolute prerequisite to a finding of attainder." 381 U.S.
at 457 n.32. The Brown decision cited, as an example, the
famous post-Civil War case, Ex parte Garland, 71 U.S. (4
Wall.) 333 (1866), which involved a challenge to a statute
requiring attorneys to swear that they had not participated in
the rebellion against the Union before they could practice in
federal court. See Brown, 381 U.S. at 447. The Court in
Garland struck down the provision as a bill of attainder,
because it was found to be a "legislative act[ ] inflicting
punishment on a specific group: ... lawyers who had taken
part in the rebellion and therefore could not truthfully take
the oath." Id.
This case is a far cry from Garland and other such cases,
however. Section 271 only requires that, in order to prevent
the creation of monopolies, the BOCs must open their local
telephone markets to competition. Thus, much like the stat-
ute in Selective Service, which simply required individuals to
register for the draft before they would be eligible for
financial aid, s 271 leaves open the very real possibility that
the BOCs may qualify to provide long distance services in-
region by simply meeting the requirements of that section.
Cf. Selective Service, 468 U.S. at 853. Viewed in this light,
s 271's requirements are no different than numerous regula-
tory measures aimed at particular industries that have never
been held to inflict punishment.
For example, it would be patently absurd, we think, for an
inorganic chemical manufacturing company to argue that
because it must comply with environmental laws specific to
that industry, Congress has "punished" it in violation of the
bill of attainder clause. Leaving aside the nonpunitive pur-
pose of such laws, it is clear that the environmental laws
perpetually leave open the possibility that the company may
still manufacture lawful products by simply employing the
appropriate pollution control techniques or devices.
Moreover, the cases in which employment bars have been
struck down are those in which the ban was used as "a mode
of punishment ... against those legislatively branded as
disloyal." Nixon, 433 U.S. at 474; see Brown, 381 U.S. 437
(1965) (striking down statute that imposed sanctions on one
who was a member of the Communist Party and an officer or
employee of a labor union); Lovett, 328 U.S. 303 (1946)
(striking down statute that cut off the salary of three named
employees based on their membership in the Communist
Party); Garland, 71 U.S. (4 Wall.) 333 (1866) (striking down
statute that required attorneys to take oath that they had not
aided the Confederacy before being allowed to practice in
federal court); Cummings, 71 U.S. (4 Wall.) 277 (1866) (strik-
ing down amendments to state constitution that barred people
from teaching as well as other professions because they had
aided or sympathized with the Confederacy). When the
Court extended "punishment" to include employment bars, it
did so because it was concerned that the government had
imposed restrictions that violated the fundamental guarantees
of political and religious freedom. Here, there is no indica-
tion that run-of-the-mill business regulations, such as s 271,
implicate these same concerns. Thus, it is difficult to see how
s 271 can be equated with the employment bar cases relied
upon by BellSouth.
Furthermore, we note that the Supreme Court has ap-
proved other line-of-business restrictions without ever sug-
gesting that the restrictions constituted "punishment." See,
e.g., FCC v. National Citizens Comm. for Broad., 436 U.S.
775 (1978) (upholding FCC rules banning broadcast licensee
from owning newspaper in same market); Board of Gover-
nors of Fed. Reserve Sys. v. Agnew, 329 U.S. 441 (1947)
(upholding conflict-of-interest statute that prevented employ-
ees of securities underwriting firms from simultaneously
working for banks that belong to Federal Reserve System).
Thus, we find that s 271 does not fall within the list of
historical punishments recognized by the Court.
2.Furthering Nonpunitive Purposes
As we noted in BellSouth I, even if a statute does not fall
within the historical definition of punishment, our inquiry
under the bill of attainder clause does not end. Instead, we
must ensure that a nonpunitive legislative purpose is served
by the legislation in order to prevent "Congress from circum-
venting the clause by cooking up newfangled ways to punish
disfavored individuals or groups." BellSouth I, 144 F.3d at
65. Thus, we must now determine whether s 271 furthers
nonpunitive legislative purposes. See BellSouth I, 144 F.3d
at 65; Siegel v. Lyng, 851 F.2d 412, 418 (D.C. Cir. 1988).
Before we begin our analysis of s 271 under this prong, we
note that we must proceed carefully when characterizing a
statute as one that "reasonably can be said to further nonpun-
itive legislative purposes." Nixon, 433 U.S. at 475-76. We
recognize, for example, that a statute that names an individu-
al and sentences him to death is a bill of attainder, without
regard to whether Congress could articulate some nonpuni-
tive purpose for the execution, such as the protection of public
safety. See Brown, 381 U.S. at 458. In other words, we
must ensure that " 'the nonpunitive aims of an apparently
prophylactic measure [are] sufficiently clear and convincing,' "
BellSouth I, 144 F.3d at 65 (quoting Tribe, supra, s 10-5, at
655), before we find that it does not constitute a bill of
attainder.
The Supreme Court has consistently looked to nonpunitive
purposes when assessing whether a statute inflicts punish-
ment. As early as 1889, the Court recognized that, even
though employment bars were considered punitive in Cum-
mings and Garland, a law that imposed certain requirements
on individuals before they could practice medicine did not
constitute a bill of attainder. See Dent v. West Virginia, 129
U.S. 114 (1889). In distinguishing the earlier cases of Cum-
mings and Garland, the Court stated:
There is nothing in these decisions which supports the
positions for which the plaintiff in error contends. They
only determine, that one who is in the enjoyment of a
right to preach and teach the Christian religion as a
priest of a regular church, and one who has been admit-
ted to practise the profession of the law, cannot be
deprived of the right to continue in the exercise of their
respective professions by the exaction from them of an
oath as to their past conduct, respecting matters which
have no connection with such professions. Between this
doctrine and that for which the plaintiff in error contends
there is no analogy or resemblance. The constitution of
Missouri and the act of Congress in question in those
cases were designed to deprive parties of their right to
continue in their professions for past acts, or past expres-
sions of desires and sympathies, many of which had no
bearing upon their fitness to continue in their profes-
sions. The law of West Virginia was intended to secure
such skill and learning in the profession of medicine that
the community might trust with confidence those receiv-
ing a license under authority of the State.
Dent, 129 U.S. at 128.
The Court later found in Hawker v. New York, 170 U.S.
189, 197 (1898), that a law prohibiting convicted felons from
practicing medicine did not inflict punishment and therefore
was not a bill of attainder. In so finding, the Court stated
that "[t]he State is not seeking to further punish a criminal,
but only to protect its citizens from physicians of bad charac-
ter." Id. at 196. The Court also noted that, although there
may be alternate ways of determining good character, it was
up to the legislature to make this decision:
It is no answer to say that this test of character is not in
all cases absolutely certain, and that sometimes it works
harshly. Doubtless, one who has violated the criminal
law may thereafter reform and become in fact possessed
of a good moral character. But the legislature has power
in cases of this kind to make a rule of universal applica-
tion, and no inquiry is permissible back of the rule to
ascertain whether the fact of which the rule is made the
absolute test does or does not exist.
Id. at 197.
The Court again embraced the point that burdensome
regulation cannot simply be equated with punishment in De
Veau v. Braisted, 363 U.S. 144, 160 (1960). In that case, the
Court held that a statute prohibiting convicted felons from
being officers of a waterfront union did not violate the bill of
attainder clause:
Clearly, s 8 embodies no further implications of appel-
lant's guilt than are contained in his 1920 judicial convic-
tion; and so it manifestly is not a bill of attainder....
The question in each case where unpleasant conse-
quences are brought to bear upon an individual for prior
conduct, is whether the legislative aim was to punish that
individual for past activity, or whether the restriction of
the individual comes about as a relevant incident to a
regulation of a present situation, such as the proper
qualifications for a profession. No doubt is justified
regarding the legislative purpose of s 8. The proof is
overwhelming that New York sought not to punish ex-
felons, but to devise what was felt to be a much-needed
scheme of regulation of the waterfront, and for the
effectuation of that scheme it became important whether
individuals had previously been convicted of a felony.
Id. (citation omitted).
This court, too, has had occasion to determine whether
certain legislation constituted forbidden punishment or legiti-
mate, nonpunitive regulation. In Siegel v. Lyng, Siegel had
been the President, Director, and majority shareholder of a
company that was cited for flagrant and repeated violations of
the Perishable Agricultural Commodities Act ("PACA"). See
851 F.2d at 413. Under that Act, someone who was formerly
"responsibly connected" with a violator of the Act was barred
from employment with any other licensee under the Act for
one year. See id. at 414-15. The court found that this
prohibition did not inflict "punishment" under the bill of
attainder clause, see id. at 417, because there were legitimate
justifications for the employment bar:
This Court recently echoed Congress' express purpose
behind the PACA enforcement regime, including the
employment restrictions: namely, that the Act's "special
sanctions against dishonest or unreliable dealing" "help
instill confidence in parties dealing with each other on
short notice, across state lines and at long distances...."
[Veg-Mix, Inc. v. United States Dep't of Agric., 832 F.2d
601, 604 (D.C. Cir. 1987)]. This legislative and executive
resolve to guarantee that PACA transactions by firms
employing persons "responsibly connected" to disciplined
licensees be conducted with easy-to-monitor, scrupulous
compliance with the Act is ample justification for the
temporary employment bar.
Id. at 418 (footnote omitted); see also Zwick v. Freeman, 373
F.2d 110, 119-20 (2d Cir. 1967) (finding that the same PACA
employment bar was not a bill of attainder).
Likewise, in Dehainaut v. Pena, 32 F.3d 1066, 1071-72 (7th
Cir. 1994), the Seventh Circuit was asked to determine the
constitutionality of an Office of Personnel Management policy
that indefinitely barred former air traffic controllers who had
participated in a strike against the federal government from
reemployment with the Federal Aviation Administration
("FAA"). The court found that the policy did not constitute a
bill of attainder and, in so finding, the court specifically stated
that:
Even where a fixed identifiable group--such as the fired
controllers--is singled out and a burden traditionally
associated with punishment--such as permanent exclu-
sion from an occupation--is imposed, the enactment may
pass scrutiny under bill of attainder analysis if it seeks to
achieve legitimate and non-punitive ends and was not
clearly the product of punitive intent. Put differently,
"[t]he question in each case where unpleasant conse-
quences are brought to bear upon an individual for prior
conduct, is whether the legislative aim was to punish that
individual for past activity, or whether the restriction of
the individual comes about as a relevant incident to a
regulation of a present situation, such as the proper
qualifications for a profession."
....
... Here, by contrast, we find an adequate nexus be-
tween the restriction imposed and the legitimate govern-
mental purpose. President Reagan determined that the
intermingling of controllers who had been fired for strik-
ing with those who had replaced them would interfere
with the safety and efficiency of the FAA's operations.
Id. (citations omitted); see also 2 Ronald D. Rotunda & John
E. Nowak, Treatise on Constitutional Law: Substance and
Procedure s 15.9(c), at 476-77 (2d ed. 1992) ("[W]henever the
Court is confronted with the claim that legislation constitutes
a bill of attainder, it must determine whether the designation
of persons based on past conduct simply names individuals for
punishment or whether the designation promotes a nonpuni-
tive goal based on reasonable criteria over which the individu-
al has some control."); Tribe, supra, s 10-5, at 655 ("Even
measures historically associated with punishment--such as
permanent exclusion from an occupation--have been other-
wise regarded when the nonpunitive aims of an apparently
prophylactic measure have seemed sufficiently clear and con-
vincing.").
Thus, even if the restrictions of s 271 were equivalent to an
employment bar--an assumption that we do not endorse--the
section would not offend the bill of attainder clause if it
furthers nonpunitive purposes. The question, then, is wheth-
er there is convincing evidence of legitimate, nonpunitive
purposes furthered by s 271 that prevent us from striking it
down. We believe there is.
First, s 271 was passed as part of the 1996 Act, an act that
Congress hoped "would 'provide for a pro-competitive, dereg-
ulatory national policy framework ... by opening all telecom-
munications markets to competition.' " SBC Communica-
tions, 138 F.3d at 413 (quoting H.R. Conf. Rep. No. 104-458,
at 1 (1996)). As we explained in SBC Communications,
changing the entire telecommunications landscape was a mon-
umental and difficult task for Congress. Deregulating the
long distance services market was particularly difficult:
The question of how best to achieve that goal ... was the
subject of great debate. Some thought that the local and
long-distance markets should be open to all competitors
immediately. Others believed that the BOCs should
have to wait until actual competition was introduced in
their local markets before providing interLATA service,
since it was claimed that the long-distance market is
already competitive. As might be expected for an issue
of this economic significance, an extended lobbying strug-
gle ensued. The end product was a compromise between
the competing factions.
States and localities were no longer to sanction local
monopolies; they are now barred from "prohibiting the
ability of any entity to provide ... intrastate telecommu-
nications service." 47 U.S.C.A. s 253(a) (West Supp.
1997). The BOCs are obliged to provide any requesting
carrier with nondiscriminatory interconnection to their
networks and nondiscriminatory access to unbundled net-
work elements at reasonable rates, terms, and conditions;
they must also offer telecommunications services at
wholesale rates for resale to end users. 47 U.S.C.A.
s 251(c).
Id.
Second, it is clear that requiring the BOCs to comply with
s 271 is not punitive, but, rather, legitimately based on the
infrastructure they control. As the legislative history notes,
The seven BOCs provide over 80% of local telephone
service in the United States. Several hundred other
carriers provide the balance of local service. While some
competition has developed in the local business service
and exchange access markets, local residential service
remains a monopoly service.
H.R. Rep. No. 104-204, pt.1, at 49 (1995). And, as we found in
BellSouth I, "[b]ecause the BOCs' facilities are generally less
dispersed than [those of other competitors], they can exercise
bottleneck control over both ends of a telephone call in a
higher fraction of cases than can [other competitors]." 144
F.3d at 67.
Furthermore, prior to the passage of the Act, the BOCs
were subject to the MFJ because of their peculiar character-
istics and assets, and it was perfectly proper for the legisla-
ture to look at the MFJ's findings as evidence of the BOCs'
dominance in the market. Thus, it was proper for the
legislature to consider the prior judicial findings embodied in
the MFJ, not because Congress seeks to punish the BOCs
based on that decree, but, rather, because it hopes "to devise
what [i]s felt to be a much-needed scheme of regulation" in
the long distance services market. See De Veau, 363 U.S. at
160. And, "for the effectuation of that scheme," see id., it was
important to treat the BOCs differently, because, as the
District Court found in approving the MFJ, preventing the
BOCs from providing long distance services was "clearly
necessary to preserve free competition in the interexchange
market." 552 F. Supp. at 188.
In addition, as we noted in BellSouth I, Congress may read
the evidence before it in a different way than might this court
or any other, so long as it remains clear that Congress was
pursuing a legitimate nonpunitive purpose. See 144 F.3d at
66. In other words, it does not matter that Congress argu-
ably could have enacted different legislation in an effort to
open the long distance markets to competition. The main
point here is that it cannot be legitimately "suggested that
the risks of anticompetitive conduct were so feeble that no
one could reasonably assert them except as a smokescreen for
some invidious purpose (much less for the specific invidious
purpose of 'punishing' the BOCs)." Id. And just as the
Court in Hawker acknowledged that ex-felon status was "not
in all cases [an] absolutely certain" test of character, "and
that sometimes it works harshly," 170 U.S. at 197, such a
determination does not render legislation unconstitutional
under the bill of attainder clause.
In sum, we find that s 271 furthers legitimate, nonpunitive
purposes: Congress required the BOCs to open their local
markets to competition before allowing them to enter the long
distance services market in-region, because, due to the unique
infrastructure controlled by the BOCs, they could exercise
monopoly power. Moreover, there is adequate support for
this reasoning, particularly in light of the MFJ. Thus, as we
noted in BellSouth I, "the differential treatment of the BOCs
and non-BOCs, is neither suggestive of punitive purpose nor
particularly suspicious." 144 F.3d at 67. Accordingly, we
find that s 271 furthers nonpunitive purposes.
3.Legislative Intent To Punish
Finally, we briefly address the final prong of the punish-
ment test: whether the legislative record indicates a legisla-
tive intent to punish. As we noted in BellSouth I, BellSouth
must show " 'unmistakable evidence of punitive intent.' " 144
F.3d at 67 (quoting Selective Service, 468 U.S. at 856 n.15).
"[S]everal isolated statements" are not sufficient to evince
punitive intent. See Selective Service, 468 U.S. at 856 n.15.
BellSouth again cites here, as it did in BellSouth I, the
remarks of members of Congress that refer to the history of
the BOCs and the breakup of AT&T. See Brief for Appel-
lants at 28-29; Reply Brief for Appellants at 13-14 n.7. But,
as we said in BellSouth I, the "few scattered remarks refer-
ring to anticompetitive abuses allegedly committed by the
BOCs in the past" do not provide the kind of " 'smoking gun'
evidence of congressional vindictiveness." 144 F.3d at 67.
Furthermore, as we explained above, Congress was justified
in considering the MFJ when drafting the 1996 Act. Thus,
we find that BellSouth has failed to show the "unmistakable
evidence of punitive intent" that is required under Selective
Service.
In sum, we find that s 271's restrictions do not fall within
the historical meaning of legislative punishment, that they
further nonpunitive purposes, and that there is no unmistak-
able evidence of legislative intent to punish. Thus, we find
that s 271 does not constitute punishment according to the
test articulated in Selective Service.
4.The Beneficial Effects of s 271
The result that we are constrained to reach in this case
makes sense in light of the history of the BOCs in the
telecommunications industry. As the FCC points out, s 271
actually "benefits the BOCs by relieving them of certain
burdens." Brief for Appellee at 19; see Brief of Intervenors
in Support of the FCC at 17 ("Section 271 cannot qualify as
punishment unless it deprives BOCs of a right 'previously
enjoyed.' ") (quoting United States v. Brown, 381 U.S. 437,
448 (1965)). Indeed, in BellSouth I, we commented that
"BellSouth's claim of punitive purpose is somewhat under-
mined by s 274's placement in an Act that as a whole relieves
the BOCs of several of the burdens imposed by the MFJ,
particularly by prescribing in s 271 a method whereby the
BOCs can achieve a long-sought-after presence in the long-
distance market." 144 F.3d at 66.
BellSouth, however, argues that we should not compare the
status of the BOCs under the MFJ in determining whether
s 271 imposes punishment. Instead, BellSouth contends that
"whether section 271 punishes the BOCs must be tested by
comparing how it treats the BOCs as compared to other [local
exchange carriers]--not by comparing the MFJ to the 1996
Act." Brief for Appellants at 20-21. In response, the FCC
and the intervenors are quick to point out that counsel for
BellSouth readily embraced a comparison between the re-
strictions of the 1996 Act and the MFJ when he testified
before Congress:
[I]nsofar as MFJ restrictions are left in place pursuant to
the decision of the D.C. Circuit [in United States v.
Western Electric Co., 900 F.2d 283 (D.C. Cir. 1990)],
Congress has authority to lift such restrictions in whole
or in part, replacing them with equivalent or less restric-
tive regulatory alternatives that single out the parties to
the AT&T litigation, as an exercise of its authority under
the Necessary and Proper Clause, Art. I, section 8, cl. 18,
to "carr(y) into Execution" the powers of the Article III
judiciary. Because such parties have already been sin-
gled out through enforcement activity of the executive
branch, in litigation supervised by the judicial branch,
Congress may likewise address its legislative substitute
for the MFJ to those parties in particular, again provided
that it avoids imposing more burdensome restrictions, or
restrictions that violate the first amendment.
Telecommunications Policy Act (Pt. 1): Hearings Before the
Subcomm. on Communications and Finance of the House
Comm. on Energy and Commerce, 101st Cong. 416 (1990)
(testimony of Professor Laurence H. Tribe, Tyler Professor
of Constitutional Law, Harvard Law School). Such a com-
parison appears reasonable, given that a common definition
for "punish" is "to inflict injury or loss upon." Webster's
Third International Dictionary 1843 (1993). And it is hard
to imagine how s 271 inflicts injury on BellSouth when it was
already prevented under the MFJ from entering the in-region
long distance service market.
Although we acknowledge that it may at times be difficult
to compare a party's status before and after the enactment of
regulatory legislation to determine whether the legislation
inflicts punishment, we nonetheless believe that such a com-
parison is relevant to our analysis. In this case, it is clear
that s 271's restrictions are not more burdensome than those
of the MFJ. BellSouth argues that under the MFJ, a BOC
could petition for the removal of a line-of-business restriction
if it could show that "there is no substantial possibility that
[it] could use its monopoly power to impede competition in the
relevant market." MFJ, 552 F. Supp. at 195. It then points
out that, if the parties to the MFJ consented, a line-of-
business restriction could be removed if the BOC could show
that the change was in the public interest. See United States
v. Western Elec. Co., 900 F.2d 283, 306 (D.C. Cir. 1990). But
now, argues BellSouth, the process is more burdensome,
because s 271 subjects it to "an indefinite procedure of FCC
and Department of Justice review." Brief for Appellants at
21. Our view of the situation is quite different.
Section 271, at worst, provides the BOCs with the possibili-
ty of immediate entrance into the in-region long distance
services market, by following a clearer path than that provid-
ed under the MFJ. As the Fifth Circuit pointed out, "the
Special Provisions gave the BOCs a clear delineation of what
they needed to do to achieve a lifting of all the old MFJ
restrictions in the future--certainly a step up, from the
BOCs' perspective, from being under [the District Court's]
perpetual supervision. It is perhaps for this reason that the
BOCs have apparently consistently represented, outside of
litigation, that they were pleased with the Act." SBC Com-
munications (5th), 154 F.3d at 244; see, e.g., BellSouth
Reaction to President Clinton's Signing of the Telecommuni-
cations Act of 1996, PR Newswire, Feb. 8, 1996, available in
WESTLAW, PRWIREPLUS database (reporting that Bell-
South's Chairman applauded the Act and noted "bipartisan
and industry wide support" for it). In short, as a qualitative
matter, the BOCs are no worse off under s 271 than they
were under the MFJ; and there are many who think their
position has vastly improved. In any event, we are confident
that s 271 does not constitute "punishment," either as a
matter of constitutional law under the bill of attainder clause
or as a matter of common sense.
B.Equal Protection
BellSouth also argues that the application of s 271 denies it
equal protection under the Fifth Amendment. We disagree.
As the Court stated in FCC v. Beach Communications,
Inc., 508 U.S. 307, 313 (1993), "a statutory classification that
neither proceeds along suspect lines nor infringes fundamen-
tal constitutional rights must be upheld against equal protec-
tion challenge if there is any reasonably conceivable state of
facts that could provide a rational basis for the classification."
As we found in BellSouth I, "the differential treatment of the
BOCs and non-BOCs is neither suggestive of punitive pur-
pose nor particularly suspicious." 144 F.3d at 67. Nor does
s 271 infringe a fundamental constitutional right. According-
ly, we need only subject s 271 to rational basis scrutiny.
As explained above, Congress clearly had a rational basis
for singling out the BOCs, i.e., the unique nature of their
control over their local exchange areas. See supra Part
II.A.2. Thus, it was undoubtedly rational for Congress to
restrict the BOCs' entry into the long distance services
market. By no stretch of the imagination can it be found that
s 271 violates equal protection. See Beach Communications,
508 U.S. at 315-16 ("[A] legislative choice is not subject to
courtroom factfinding and may be based on rational specula-
tion unsupported by evidence or empirical data.... Defining
the class of persons subject to a regulatory requirement--
much like classifying governmental beneficiaries--'inevitably
requires that some persons who have an almost equally
strong claim to favored treatment be placed on different sides
of the line, and the fact [that] the line might have been drawn
differently at some points is a matter for legislative, rather
than judicial, consideration.' ") (quoting United States R.R.
Retirement Bd. v. Fritz, 449 U.S. 166, 179 (1980)). And, as
we noted in BellSouth I, the bill of attainder inquiry is "more
exacting than a rational basis test." 144 F.3d at 67. There-
fore, in light of our decision that s 271 does not violate the
bill of attainder clause, we must conclude a fortiori that it
does not violate the equal protection clause.
C.Separation of Powers Challenge
BellSouth next argues that s 271 is contrary to the princi-
ple of separation of powers. It concedes that "Congress may
modify generally applicable rules and thereby supersede a
prior consent decree arising from those underlying rules."
Reply Brief for Appellants at 4. However, the problem,
according to BellSouth, is that s 271 "pinpoint[s]" the BOCs,
and replaces the restrictions imposed on them by the MFJ
with what Congress "deem[ed] ... a more appropriate sanc-
tion." Id. BellSouth contends that, in so doing, Congress
interfered with the prerogative of the judicial branch. Al-
though we agree with BellSouth that Congress may not
reopen "the last word of the judicial department," Plaut v.
Spendthrift Farm, Inc., 514 U.S. 211, 227 (1995), we do not
agree that s 271 implicates this concern.
In Pennsylvania v. Wheeling and Belmont Bridge Co., 59
U.S. (18 How.) 421 (1855), the Court had entered a final
judgment in 1851, ordering the private owner of a bridge
across the Ohio River to either remove or raise a bridge
because it obstructed traffic along the river. See id. at 429.
After that decision, Congress passed legislation that made the
bridge in question a post-road, which meant that the bridge
could remain in place with no interference from navigation
along the river. See id. The bridge was then destroyed by a
storm. See id. at 422. When the owner began to rebuild the
bridge, the state of Pennsylvania filed suit to prevent its
reconstruction based on the Supreme Court's original finding
that the bridge was a nuisance. See id. Faced with this
dilemma, the Court held that the legislation was not unconsti-
tutional, because the injunctive remedy awarded in 1851 was
"a continuing decree," see id. at 431, and, thus, could be
modified by Congress. As a result, the statute passed by
Congress prevented the Court from enjoining the construc-
tion of the bridge. See id. at 431-32. Therefore, as the Fifth
Circuit pointed out, "under [Wheeling], it has long been clear
that Congress may change the law underlying ongoing equi-
table relief, even if, as in Wheeling itself, the change is
specifically targeted at and limited in applicability to a partic-
ular injunction, and even if the change results in the neces-
sary lifting of that injunction." SBC Communications (5th),
154 F.3d at 245.
The Supreme Court recently revisited the separation of
powers doctrine in Plaut. There, Congress had passed a
statute that would have allowed cases alleging claims under
the Securities Exchange Act s 10(b) that had been dismissed
as time-barred to be reinstated. See Plaut, 514 U.S. at 214-
15. The Court held that the statute violated separation of
powers principles, because it reopened final judgments of the
judiciary. See id. at 240. The Court was careful, however,
not to overrule Wheeling, "implicitly [drawing] a ... distinc-
tion between two kinds of final judgments for separation of
powers purposes--final judgments without prospective ef-
fects, which could not be constitutionally revised through
legislation, and final judgments with prospective effects,
whose effects could constitutionally be so revised." Benjamin
v. Jacobson, 124 F.3d 162, 171 (2d Cir. 1997); see Plaut, 514
U.S. at 232 (stating that "nothing in our holding today calls
[Wheeling] into question").
The 1996 Act did not reopen a final judgment, but rather
eliminated the prospective effects of the MFJ, and provided
new restrictions to govern the future acts of the BOCs in its
place, such as those found in s 271. Our analysis is not
altered by the fact that Congress targeted the BOCs for
different treatment, because the Court upheld precisely this
type of specificity in Wheeling.
Moreover, BellSouth's argument appears to be the same
argument that SBC made to the Fifth Circuit regarding
separation of powers, i.e., "a not-too-well-defined argument
that all of the problematic aspects of the Special Provisions--
including particularly their specificity, their interference with
the MFJ, and the near-punitive nature of the liability they
impose--when added together somehow amount to a separa-
tion-of-powers violation that is greater than the sum of its
parts." SBC Communications (5th), 154 F.3d at 246. But in
Plaut, the Court made clear that "[i]t makes no difference
whatever to [the] separation-of-powers violation ... that it is
not accompanied by an 'almost' violation of the Bill of Attain-
der Clause." 514 U.S. at 239; see SBC Communications
(5th), 154 F.3d at 246. Thus, although BellSouth is troubled
by the particularity with which s 271 operates, and the fact
that it believes s 271 is at least near-punitive, this combina-
tion does not change the result of our analysis of the separa-
tion of powers claim. We agree with the Fifth Circuit that
s 271 does not violate separation of powers principles.
D.The Proceedings Under s 271(c)(1)(B)
BellSouth also argues that the FCC erred in finding that it
was foreclosed from proceeding under s 271(c)(1)(B), Track
B, which would allow it to provide long distance services in-
region. Under Track B, as discussed above, a BOC may
apply to provide long distance services if it can show that "no
potential facilities-based provider of the type of telephone
exchange service described in s 271(c)(1)(A) requested access
and interconnection to BellSouth's network." Order p 65.
BellSouth argues that in order to foreclose Track B, a
"competing provider must be taking reasonable steps toward
implementation" of a request. Reply Brief for Appellants at
15; see Brief for Appellants at 33. This interpretation of
Track B, contends BellSouth, is based on the statute as well
as the Oklahoma Order. See Brief for Appellants at 33;
Reply Brief for Appellants at 15-18. The FCC counters that
there is no "reasonable steps" requirement under Track B;
instead, the "reasonable steps" language in the Oklahoma
Order was only used in a discussion of what might be
considered when making a decision regarding subsequent, not
initial, applications. See Brief for Appellee at 31-32; Okla-
homa Order p 58.
In SBC Communications, this court had the opportunity to
determine what type of request foreclosed Track B. See SBC
Communications, 138 F.3d at 417-21. In that case, the FCC
found that "Track B was foreclosed the moment a provider
requested interconnection so long as [the FCC] could predict
that the carrier would, after implementing the agreement,
provide competitive service to both residential and business
customers, at least predominantly over its own facilities." Id.
at 417. This court enforced the agency's interpretation of the
Track B statute because "under [Chevron, U.S.A., Inc. v.
Natural Resources Defense Council, Inc., 467 U.S. 837 (1984)]
we must give deference to the Commission's interpretation if
it is a permissible reading," and the court had "no doubt that
[the FCC's interpretation] passes that test; indeed it may ...
be the only reasonable interpretation." Id. at 421. Notably,
there is no mention of reasonable steps in this definition.
Accordingly, the FCC need not find that a requesting provid-
er has taken reasonable steps before Track B is foreclosed to
a BOC; it must only be able to predict that a provider who
requests interconnection would be able to provide competitive
services "to both residential and business customers, at least
predominantly over its own facilities." Id. at 417.
BellSouth objects to what it sees as the "gaming" aspect of
Track B. It argues that if there is no reasonable-steps
requirement, "the FCC all but ensures that some carriers
(particularly incumbent long distance carriers) will block
Track B for months or years." Reply Brief for Appellants at
17. As the FCC explained in its Order, however, the statute
prevents this type of gaming: if the state commission certifies
that a requesting provider has failed to negotiate in good
faith or has failed to comply with the implementation sched-
ule in an agreement, a qualifying request by that provider
would be ignored. See Order p 64. Thus, if either of these
two situations occurred, Track B would be available to the
BOC. Accordingly, there is no need for a "reasonable steps"
requirement.
BellSouth counters that this answer is illusory, because the
agreements often lack implementation schedules. See Brief
for Appellants at 36-37. But, as the FCC points out, "BOCs
are not precluded from insisting that implementation sched-
ules be included in interconnection agreements." Brief for
Appellee at 34-35; see SBC Communications, 138 F.3d at
420. Moreover, "[i]n any event, this argument does not really
go to congressional purpose ... but rather to the adequacy of
the remedy Congress provided." SBC Communications, 138
F.3d at 420.
BellSouth never offered any evidence that it did not receive
any qualifying requests; instead, it rested solely on evidence
that no carrier had taken the reasonable steps it thought
were necessary to constitute a qualifying request. See Order
pp 65-67 (noting that BellSouth received requests from twen-
ty-six carriers with signed interconnection agreements, only
three of which BellSouth discussed in its application). Thus,
we deny BellSouth's petition to review the FCC's decision,
because it is clear that BellSouth failed to demonstrate that it
is eligible to proceed under Track B.
E.Satisfaction of Certain Competitive Checklist Items Un-
der s 271(c)(2)(B)
BellSouth also argues that the FCC erred in its application
of the competitive checklist of s 271(c)(2)(B). This argument
concerns whether the FCC attempted to "dictate how ...
interconnection, unbundled access, [or] resale ... should be
priced" in violation of the Eighth Circuit's mandamus order in
Iowa Utilities Board v. FCC, 135 F.3d 535 (8th Cir. 1998),
petition for cert. filed, 66 U.S.L.W. 3623 (U.S. Mar. 13, 1998)
(No. 97-1519). Reply Brief for Appellants at 18 (internal
quotation marks omitted). The mandamus order in the sec-
ond Iowa Utilities case is based on the Eighth Circuit's
decision in Iowa Utilities Board v. FCC, 120 F.3d 753 (8th
Cir. 1997), which the Supreme Court has agreed to review.
See 118 S. Ct. 879 (1998).
Because the FCC relied on BellSouth's failure to comply
with the competitive checklist items only as an alternative
ground for its denial of BellSouth's application, see Order
p 76, we see no reason to offer any opinion on the FCC's
findings with respect to this issue.
III. Conclusion
For the reasons set forth above, we deny BellSouth's
petition for review of the FCC's decision.
So ordered.
Sentelle, Circuit Judge, concurring in the result: As the
majority opinion exhaustively sets forth, in the present appeal
BellSouth mounts the same sort of constitutional attack on 47
U.S.C. s 271 that it previously pursued unsuccessfully against
47 U.S.C. s 274 in BellSouth Corp. v. FCC, 144 F.3d 58 (D.C.
Cir. 1998) ("BellSouth I"). In the prior case BellSouth and
the other Bell operating companies ("BOCs") argued that
Congress had punished their prior anti-competitive conduct
by singling them out by name for legislative debarment from
participation in the lucrative line of business constituting
electronic publishing. In the present case they assert the
unconstitutionality of s 271 on the same basis, as it singles
them out by name for disqualification from immediate entry
into the business of providing in-region long distance tele-
phone service until they comply with burdens not imposed on
any other entity no matter how similarly situated. I found
their arguments persuasive in BellSouth I. See 144 F.3d at
71-74 (Sentelle, J., dissenting). I find them equally persua-
sive today.
As the majority today sets forth, Article I, section 9, clause
3 of the Constitution prohibits Congress from passing any
"Bill of Attainder or ex post facto Law." See Maj. op. at 9.
As the majority further recognizes, that clause prohibits any
statute that "(1) applies with specificity, and (2) imposes
punishment." Maj. op. at 10. Specificity is not at issue here.
Section 271, like s 274, specifies its applications solely to the
BOCs by their names. It does not apply to any other of the
"over 1,300 local exchange carriers," BellSouth I, 144 F.3d at
71, no matter how large or market dominant they are or
become. Thus, under the two-part test correctly set forth by
the majority, if s 271 imposes punishment it is an unconstitu-
tional bill of attainder. It does, and it is.
The Supreme Court has previously "announced a three-
part test to determine whether a statute imposes 'punish-
ment' for purposes of the Bill of Attainder Clause":
(1) whether the challenged statute falls within the histor-
ical meaning of legislative punishment; (2) whether the
statute, viewed in terms of the type and severity of
burdens imposed, reasonably can be said to further
nonpunitive legislative purposes; and (3) whether the
legislative record evinces a congressional intent to pun-
ish.
Id. at 72 (quoting Selective Serv. Sys. v. Minnesota Public
Interest Research Group, 468 U.S. 841, 852 (1984)). The
limitations on the BOCs constitute punishment under that
three-part test.
First, this line of business limitation embodied in s 271 is a
restriction of a sort falling within the historic meaning of
legislative punishment. "[L]egislative bars to participation
by individuals or groups in specific employments or profes-
sions" unquestionably fall within the category of punishments
forbidden by the Bill of Attainder Clause. Selective Serv.
Sys., 468 U.S. at 852; United States v. Brown, 381 U.S. 437
(1965) (invalidating statute barring communist party mem-
bers from labor union offices); United States v. Lovett, 328
U.S. 303 (1946) (striking down law cutting off salaries to three
named government employees); Cummings v. Missouri, 71
U.S. (4 Wall.) 277 (1867); Ex Parte Garland, 71 (4 Wall.) 333
(1867) (barring former confederate rebels from entry into
professions). I find unpersuasive the majority's attempt to
distinguish these prior cases on the basis that the "line of
business" restrictions before us leave open the possibility that
they may one day be overcome. I find nothing in the history
of bill of attainder jurisprudence that suggests that the fact
that debarment from business will or may someday end
prevents the temporary or potentially temporary bar from
constituting punishment.
I find even less persuasive the majority's paralleling the
line of business restrictions with regulatory restrictions appli-
cable to entire industries. While it may be true as the
majority argues that environmental laws specific to an indus-
try do not constitute punishment, I do not see how this
lessens or even affects the punitive nature of a restriction
applicable not to a specific industry but rather to specific
named individuals or corporations within an industry inappli-
cable to others in the same industry, whether or not similarly
situated. Both punitive effect and specificity are necessary
to render a legislative enactment an unconstitutional bill of
attainder. Supreme Court precedent upholding regulatory
restrictions (whether punitive or not) where specificity is
lacking is inapposite. See, e.g., FCC v. National Citizens
Comm. for Broad., 436 U.S. 775 (1978); Board of Governors
of Fed. Reserve Sys. v. Agnew, 329 U.S. 441 (1947). In short,
in my view, the first prong of the three-part test of bill of
attainder status is plainly met.
Second, as to whether the statute furthers nonpunitive
legislative purposes, the laudable goal of opening the telecom-
munications industry to competition by deregulating the long
distance market is not served by forbidding specific persons,
whether natural or corporate, from competing on the same
terms as others. If the BOCs possess characteristics that
require that they be more stringently regulated than other
entities, then Congress could further its nonpunitive goals by
imposing limitations on local exchange carriers of a certain
size or market dominance. I do not see how this provision
specifying the individual Bell operating companies furthers
the nonpunitive goals of the new statutory regime; rather, it
furthers the punitive goal of penalizing their past anti-
competitive conduct. Pursuit of this punitive goal strikes at
the heart of the prohibition against "Bills of Attainder" and
"ex post facto Laws" which constitute an essential part of the
Constitution's structural separation of powers among the
branches of government: the redress of past conduct is the
province of the Judiciary, not of the Legislature. As we
recognized in BellSouth I, Article I, section 9, clause 3 of the
Constitution was designed to prevent punishment "without
the benefit of a judicial trial." BellSouth I, 144 F.3d at 62.
As to the third element of the Selective Service System
test, that is, whether the legislative record evinces a congres-
sional intent to punish, as I stated in my dissent in BellSouth
I, while I think this "the least important" of the three factors,
id. at 73, I think it amply met. The timing of the enactment
along with its effect in undoing the termination of the prior
judicial redress of the BOCs' past conduct really leaves no
doubt as to Congress's motive. Congress clearly had avail-
able to it "less burdensome alternatives" under which it could
have addressed its "legitimate nonpunitive objectives" while
refraining from singling out the BOCs for punitive legislative
treatment. See Nixon v. Administrator of General Services,
433 U.S. 425, 482 (1977).
For these reasons, were we writing on a clean slate I would
vote to hold 47 U.S.C. s 271 unconstitutional as a violation of
the Bill of Attainder Clause. But I recognize that we do not
write upon a clean slate. BellSouth I announces the law of
the Circuit. The prior opinions of other panels of this court
bind us. Melcher v. Federal Open Market Comm., 836 F.2d
561, 565 n.4 (D.C. Cir. 1987); National Treasury Employees
Union v. United States, 990 F.2d 1271, 1286 n.7 (D.C. Cir.
1993) (Sentelle, J., dissenting) ("The law of this Circuit,
whether in error or not, is binding absent correction by a
higher court."), aff'd in part and rev'd in part, 513 U.S. 454
(1995). While the BOCs have labored to find distinctions
between s 274 which we struck down in BellSouth I and
s 271 which is before us today, they have produced none of
constitutional significance. I therefore concur in my col-
leagues' decision that we must uphold s 271 as we upheld
s 274.
I do not find that the BOCs' other arguments concerning
the equal protection component of the Fifth Amendment or
the statute's inconsistency with the constitutional separation
of powers change the result. The equal protection argument
is simply the bill of attainder argument dressed in different
clothes. The separation of powers argument is to me a
powerful one, but one which cannot carry the day. While I
would agree that by undoing the judicial decision on this same
subject matter, s 271--and for that matter s 274--falls afoul
of the Supreme Court's reasoning in Plaut v. Spendthrift
Farm, Inc., 514 U.S. 211 (1995), I do not think we could enter
such a holding consistent with our precedent in BellSouth I.
The characteristics which make these statutory sections in-
consistent with constitutional separation of powers are the
same ones which in my view make them inconsistent with the
protections of Article I, section 9, clause 3. See Brown, 381
U.S. at 442 ("The best available evidence, the writings of the
architects of our constitutional system, indicates that the Bill
of Attainder Clause was intended not as a narrow, technical
(and therefore soon to be outmoded) prohibition, but rather
as an implementation of the separation of powers, a general
safeguard against legislative exercise of the judicial function,
or more simply--trial by legislature."). This Circuit having
decided those issues adversely to the BOCs under the more
specific rationale cannot consistently decide in their favor
under the more general. Therefore, again, I join the majori-
ty's result, but only for reasons of stare decisis and binding
precedent, not because I believe it correct.