BellSouth v. NC Utilities

Cases vacated and remanded
by Supreme Court order
filed 5/28/02
 Filed: February 21, 2001

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

Nos. 99-1845(L)
(CA-98-170-3-MU, CA-99-5-3-MU, CA-99-97-3-MU)

BellSouth Telecommunications, Inc.,

Plaintiff - Appellee,

versus

North Carolina Utilities Commission,

Defendant - Appellant.

O R D E R

The court amends its opinion filed February 14, 2001, as

follows:

On page 7, first full paragraph, line 1 -- “Bell Atlantic” is

corrected to read “BellSouth.”

For the Court - By Direction

/s/ Patricia S. Connor
Clerk
PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

BELLSOUTH TELECOMMUNICATIONS,
INCORPORATED,
Plaintiff-Appellee,

UNITED STATES OF AMERICA; FEDERAL
COMMUNICATIONS COMMISSION,
Intervenors,

v.
No. 99-1845
NORTH CAROLINA UTILITIES
COMMISSION,
Defendant-Appellant,

and

US LECOF NORTH CAROLINA, LLC,
Defendant.

BELLSOUTH TELECOMMUNICATIONS,
INCORPORATED,
Plaintiff-Appellee,

UNITED STATES OF AMERICA; FEDERAL
COMMUNICATIONS COMMISSION,
Intervenors,

v.
No. 99-1846
NORTH CAROLINA UTILITIES
COMMISSION,
Defendant-Appellant,

and

INTERMEDIA COMMUNICATIONS,
Defendant.
BELLSOUTH TELECOMMUNICATIONS,
INCORPORATED,
Plaintiff-Appellee,

v.

NORTH CAROLINA UTILITIES
COMMISSION,
Defendant-Appellant, No. 99-1847

MCIMETRO ACCESS TRANSMISSION
SERVICES, INCORPORATED,
Defendant-Appellee,

UNITED STATES OF AMERICA; FEDERAL
COMMUNICATIONS COMMISSION,
Intervenors.

BELLSOUTH TELECOMMUNICATIONS,
INCORPORATED,
Plaintiff-Appellee,

UNITED STATES OF AMERICA; FEDERAL
COMMUNICATIONS COMMISSION,
Intervenors,

v.
No. 99-1970
US LECOF NORTH CAROLINA, LLC,
Defendant-Appellant,

and

NORTH CAROLINA UTILITIES
COMMISSION,
Defendant.

2
Appeals from the United States District Court
for the Western District of North Carolina, at Charlotte.
Graham C. Mullen, Chief District Judge.
(CA-98-170-3-MU, CA-99-5-3-MU, CA-99-97-3-MU)

Argued: May 1, 2000

Decided: February 14, 2001

Before WIDENER, NIEMEYER, and KING, Circuit Judges.

_________________________________________________________________

Vacated and remanded by published opinion. Judge Niemeyer wrote
the opinion, in which Judge Widener joined. Judge King wrote a dis-
senting opinion.

_________________________________________________________________

COUNSEL

ARGUED: James Carey Gulick, Special Deputy Attorney General,
NORTH CAROLINA DEPARTMENT OF JUSTICE, Raleigh, North
Carolina; Joseph W. Eason, Sr., MOORE & VAN ALLEN, P.L.L.C.,
Raleigh, North Carolina, for Appellants. Darryl Mark Bradford, JEN-
NER & BLOCK, Chicago, Illinois; Michael K. Kellogg, KELLOGG,
HUBER, HANSEN, TODD & EVANS, P.L.L.C., Washington, D.C.,
for Appellees. Mark Bernard Stern, Appellate Staff, Civil Division,
UNITED STATES DEPARTMENT OF JUSTICE, Washington,
D.C., for Intervenors. ON BRIEF: Michael F. Easley, North Carolina
Attorney General, NORTH CAROLINA DEPARTMENT OF JUS-
TICE, Raleigh, North Carolina, for Appellant Utilities Commission.
Martin H. Brinkley, MOORE & VAN ALLEN, P.L.L.C., Raleigh,
North Carolina; James P. McLoughlin, Jr., MOORE & VAN ALLEN,
P.L.L.C., Charlotte, North Carolina, for Appellant US LEC. Paul M.
Smith, John J. Hamill, John R. Harrington, JENNER & BLOCK, Chi-
cago, Illinois; Thomas F. O'Neil, III, Adam H. Charnes, Mark B. Ehr-
lich, MCI WORLDCOM, INC., Washington, D.C., for Appellee MCI
Metro. Sean A. Lev, KELLOGG, HUBER, HANSEN, TODD &
EVANS, P.L.L.C., Washington, D.C.; Edward L. Rankin, III, Andrew

3
Dean Shore, BELLSOUTH TELECOMMUNICATIONS, INC., for
Appellee BellSouth. William Schultz, Acting Assistant Attorney Gen-
eral, Mark T. Calloway, United States Attorney, Christopher J.
Wright, General Counsel, John E. Ingle, Deputy Associate General
Counsel, Susan L. Launer, Deputy Associate General Counsel,
Charles W. Scarborough, Appellate Staff, Civil Division, UNITED
STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Inter-
venors.

_________________________________________________________________

OPINION

NIEMEYER, Circuit Judge:

BellSouth Telecommunications, Inc., the incumbent local tele-
phone company in North Carolina, filed these three actions, seeking
to review decisions of the North Carolina Utilities Commission (the
"NCUC") that required BellSouth to pay competing carriers recipro-
cal compensation for telephone calls made by BellSouth's customers
to internet service providers served by the competing carriers. Bell-
South relied on the Telecommunications Act of 1996 as authority to
name the NCUC as a defendant in these federal court actions and for
subject matter jurisdiction. BellSouth also relied on 28 U.S.C.
§§ 1331 and 1332 for subject matter jurisdiction.

The district court determined that it had jurisdiction under the Tele-
communications Act to hear the cases, but, in light of an intervening
ruling by the Federal Communications Commission ("FCC"), it
remanded the cases to the NCUC "to give [it] an opportunity to reex-
amine its conclusions with the benefit of the recent FCC ruling." The
district court found it unnecessary "at this time" to reach NCUC's
assertion of immunity from suit in federal court under the Eleventh
Amendment.

The NCUC appeals, asserting that the district court erred both in
its refusal to respect NCUC's sovereign immunity and in its exercise
of federal jurisdiction over these disputes, which the NCUC contends
may be resolved only in North Carolina state courts. A competing car-
rier named as a defendant in one of the actions, US LEC of North

4
Carolina, L.L.C., also appeals, asserting that the district court did not
have subject matter jurisdiction. For the reasons that follow and those
given in our contemporaneous decision in Bell Atlantic Maryland,
Inc. v. MCI WorldCom, Inc., ___ F.3d ___, No. 99-2459 (4th Cir.
Feb. 14, 2001), we vacate the district court's orders in these cases and
remand with instructions to dismiss these actions.

I

Congress enacted the Telecommunications Act of 1996, Pub. L.
No. 104-104, 110 Stat. 56 (1996) (codified at 47 U.S.C. §§ 151-614)
(sometimes, the "1996 Act") with the purposes of reducing regulation
in the telecommunications industry and promoting competition. As
part of that effort, the 1996 Act enables local exchange carriers
("LECs") to use each other's networks by requiring LECs to enter into
interconnection agreements through either voluntary negotiation or
binding arbitration. See 47 U.S.C. § 252(a)(b). In particular, the 1996
Act requires, among other things, that each LEC, through such an
interconnection agreement, "afford access" to its facilities and local
network exchange, "provide interconnection" to that network to "any
requesting telecommunications carrier," and "establish reciprocal
compensation arrangements for the transport and termination of tele-
communications." 47 U.S.C. § 251(b)(4), (b)(5), (c)(2). Through such
reciprocal compensation arrangements, LECs pay each other for inter-
carrier calls. Thus, if a subscriber of carrier A calls a subscriber of
carrier B, carrier A must share with carrier B some of the revenues
collected from the calling-subscriber to compensate carrier B for use
of its facilities. Under regulatory authority conferred by the 1996 Act,
the FCC has construed the scope of the reciprocal compensation obli-
gation to apply to the "transport and termination of local telecommu-
nications traffic." 47 C.F.R. § 51.701(a) (emphasis added). The
interconnection agreements, whether reached through voluntary nego-
tiation or through arbitration, are subject to review by State public
service commissions and thereafter, in certain circumstances specified
by the 1996 Act, by federal courts, and in other circumstances, by
State courts.

BellSouth, the incumbent LEC in North Carolina, entered into
interconnection agreements with competing LECs, US LEC of North
Carolina, L.L.C. ("US LEC"), Intermedia Communications, Inc.

5
("Intermedia"), and MCImetro Access Transmission Services, Inc.
("MCImetro"). BellSouth negotiated its agreements with US LEC and
Intermedia, and although portions of its agreement with MCImetro
were arbitrated as provided by the 1996 Act, the reciprocal compensa-
tion provisions in that agreement were also negotiated. The NCUC
approved these agreements on January 29, 1997; October 10, 1996;
and May 12, 1997, respectively, and no judicial review of these
approvals was sought.

Shortly after these interconnection agreements were approved, the
parties found themselves in disputes over whether BellSouth was
required to pay reciprocal compensation for its subscribers' telephone
calls made to Internet Service Providers ("ISPs") that had local tele-
phone numbers but provided access to interstate destinations through
the Internet. BellSouth maintained that ISP-bound telephone calls
were not local traffic and therefore did not trigger reciprocal compen-
sation obligations under the parties' interconnection agreements. The
competing LECs, on the other hand, took the position that ISP-bound
calls were local traffic because the calls to the ISP numbers were
local. The parties agree that this issue involves substantial sums of
money.

To resolve the dispute, the LECs filed separate petitions against
BellSouth before the NCUC, alleging that BellSouth was in breach of
its interconnection agreements with them and requesting declaratory
judgments that ISP-bound telephone calls are local traffic and injunc-
tive relief directing BellSouth to pay reciprocal compensation due in
respect to those calls. In each case, the NCUC ruled in favor of the
competing LEC, declaring that "the reciprocal compensation provi-
sion contained in the [interconnection agreements] is fully applicable
to telephone exchange service calls that terminate to ISP customers
when the originating caller and the called number are associated with
the same local calling area." The NCUC also directed that BellSouth
pay reciprocal compensation for such calls, including "all sums cur-
rently due together with the required late payment charges" as well
as "all sums coming due in the future." In re Interconnection Agree-
ment Between BellSouth Telecomms., Inc., and US LEC of North Car-
olina, LLC, Docket No. P-55, SUB 1027 (N.C.U.C. Feb. 26, 1998);
see also In re Enforcement of Interconnection Agreement Between
Intermedia Communications, Inc., and BellSouth Telecomms., Inc.,

6
Docket No. P-55, SUB 1096 (N.C.U.C. Nov. 4, 1998); In re Com-
plaint of MCImetro Access Transmission Servs., Inc. against Bell-
South Telecomms., Inc., for Breach of Approved Interconnection
Agreement, Docket No. P-55, SUB 1094 (N.C.U.C. Feb. 10, 1999).

Seeking to review the decisions of the NCUC, BellSouth filed
separate actions in the district court against each of the competing
LECs, naming as defendants in each action the applicable LEC and
the NCUC. BellSouth alleged that under federal law, telephone calls
made to the ISPs are interstate in nature, and it sought declaratory
judgments and injunctive relief prohibiting enforcement of the
NCUC's orders. The NCUC filed a motion to dismiss in each action,
asserting that the action was barred by the Eleventh Amendment and
that the 1996 Act does not confer subject matter jurisdiction on fed-
eral district courts to review State commission determinations enforc-
ing or interpreting interconnection agreements. US LEC also filed a
motion to dismiss the action against it on the ground that the district
court lacked subject matter jurisdiction. The United States was per-
mitted to intervene to oppose the NCUC's motion to dismiss the suits.

While the motions to dismiss were pending before the district
court, the FCC issued a ruling (since vacated by the United States
Court of Appeals for the D.C. Circuit) that declared ISP-bound traffic
to be "non-local." See In re Implementation of the Local Competition
Provisions in the Telecomms. Act of 1996, Inter-Carrier Compensa-
tion for ISP-Bound Traffic, 14 FCC Rcd 3689, 3690 (¶ 1) (1999)
("FCC Ruling"), vacated, Bell Atl. Tel. Cos. v. FCC, 206 F.3d 1 (D.C.
Cir. 2000). The FCC noted, however, that the parties to interconnec-
tion agreements "may reasonably have agreed, for the purposes of
determining whether reciprocal compensation should apply to ISP-
bound traffic, that such traffic should be treated in the same manner
as local traffic." FCC Ruling, 14 FCC Rcd at 3703-04 (¶ 24). Indeed,
the FCC also concluded that "[w]here parties have agreed to include
this traffic within their . . . interconnection agreements, they are
bound by those agreements, as interpreted and enforced by the state
commissions." Id. at 3703 (¶ 22). In light of the FCC Ruling, the dis-
trict court requested additional briefing from the parties. In its supple-
mental brief, the NCUC maintained that its determinations in these
cases were consistent with the FCC Ruling but also suggested that the

7
district court "might decide that the case should be remanded to the
NCUC for reconsideration in light of the FCC's opinion."

The district court issued orders in two of the cases on May 20,
1999, and in the other, on May 24, 1999, finding in each case that it
had jurisdiction under the 1996 Act, pursuant to 47 U.S.C.
§ 252(e)(6), to review the NCUC's orders interpreting and enforcing
interconnection agreements. The court then "turn[ed] to the merits of
the case[s]" and concluded that in light of the intervening ruling of the
FCC, it would remand the cases to the NCUC to give the commission
the opportunity "to reexamine" its decisions in light of the FCC Rul-
ing. The court dismissed without prejudice BellSouth's claims for
declaratory judgment and injunctive relief and found"it unnecessary
to decide whether the Eleventh Amendment would bar suit against the
NCUC," therefore not ruling on the NCUC's immunity defense. From
these orders, the NCUC and US LEC filed appeals.

The NCUC contends that its sovereign immunity entitled it at the
outset to a ruling on its Eleventh Amendment immunity defense and
that in failing to rule on this defense, the district court "disregard[ed]
the important sovereignty concerns underlying the Eleventh Amend-
ment." The NCUC contends also, as does US LEC, that the district
court lacked subject matter jurisdiction. They maintain that the federal
review jurisdiction supplied by 47 U.S.C. § 252(e)(6) "is limited to
the review of decisions of State commissions approving agreements
or statements," not interpreting and enforcing them once approved.
US LEC also argues that the district court did not have subject matter
jurisdiction under 28 U.S.C. §§ 1331 and 1332.

By order dated July 9, 1999, we consolidated these cases for pur-
poses of briefing and oral argument.

II

For its principal argument, the NCUC contends that the district
court's exercise of Article III jurisdiction over it to remand this case
to the NCUC in effect vacated the NCUC's decision and ordered it
to reconsider its decision in light of the intervening FCC ruling. The
NCUC maintains that "[t]he district court's action in doing so utterly
disregards the important sovereignty concerns underlying the Elev-

8
enth Amendment." It relies on the Supreme Court's recent decision
in College Savings Bank v. Florida Prepaid Postsecondary Education
Expense Board, 119 S. Ct. 2219 (1999), which held that because Flor-
ida's sovereign immunity was not validly abrogated nor voluntarily
waived, "the federal courts are without jurisdiction to entertain this
suit against an arm of the State of Florida." Id. at 2233.

The appellees, as well as the United States as intervenor, contend
that the NCUC, "by accepting Congress's offer to wield federal regu-
latory authority over the interconnection process," waived its immu-
nity from suit in federal court. In Bell Atlantic v. MCI WorldCom, ___
F.3d ___, No. 99-2459, slip op. at 13-19 (4th Cir. Feb. 14, 2001), we
rejected this argument, and for the reasons given there, we reject it in
this case. The 1996 Act may fairly be construed to condition States'
participation in regulation under the 1996 Act on their consent to fed-
eral review of State commission determinations made under 47
U.S.C. § 252. But the 1996 Act makes no reference to any authoriza-
tion to sue the State itself in federal court and, more importantly, to
suggest that the States waive their Eleventh Amendment immunity.
As we more fully developed in Bell Atlantic v. MCI WorldCom, the
courts will not find an implied or constructive waiver of Eleventh
Amendment immunity; Congress's intent to condition participation in
a federal program on waiver of such immunity must be explicit and
unmistakably clear. See Bell Atlantic v. MCI WorldCom, ___ F.3d at
___, No. 99-2459, slip op. at 12-13.

The appellees argue that we need not reach the Eleventh Amend-
ment issue, taking the district court's position that such a decision
may be deferred. We do not agree. Without deciding whether North
Carolina was amenable to suit in federal court, the district court deter-
mined its authority under Article III and the federal jurisdictional stat-
ute, ruling that it had federal jurisdiction over the State entity. It then
"turn[ed] to the merits" and called for further briefing on the impact
of the FCC's ruling. Finally, it exercised its declared federal jurisdic-
tional power to remand the case to the NCUC to give it the first
opportunity to reach the correct answer, reserving its later right to
decide both Eleventh Amendment immunity and the merits. In this
same vein, it denied BellSouth's claims for declaratory judgment and
injunctive relief without prejudice to revisiting the claims. The court
stated that it "recognizes that the NCUC may well reach the same

9
decision, but nevertheless, the court wishes to give the NCUC an
opportunity to reexamine its conclusions with the benefit of the recent
FCC ruling." In deferring its decision on the Eleventh Amendment
immunity, the court explained that because it "has found that it has
subject matter jurisdiction and has determined that it will remand
th[e] matter to the NCUC for further consideration, the court finds it
was unnecessary to decide whether the Eleventh Amendment would
bar suit against the NCUC, and therefore declines to decide that issue
at this time" (emphasis added).

In taking these steps, the district court asserted federal subject mat-
ter jurisdiction over a State without recognizing its sovereign immu-
nity and, in the exercise of that jurisdiction, ordered further briefing,
a remand, and the deferral of the Eleventh Amendment immunity
issue until the case returned to the court. Its refusal to address the
Eleventh Amendment issue at the outset, however, interfered with
North Carolina's sovereignty as protected by the Constitutional struc-
ture. See Alden v. Maine, 119 S. Ct. 2240, 2254 (1999). This structure
excludes States, in the areas of their sovereignty, from the federal
exercise of Article III jurisdiction. See id. It therefore directly offends
State sovereignty to require the States to argue federal jurisdictional
issues emanating from Article III when their sovereignty entitles them
to protection from federal courts' exercise of Article III power. See
id. ("It is inherent in the nature of sovereignty not to be amenable to
the suit of an individual without its consent" (quoting Hans v. Louisi-
ana, 134 U.S. 1, 13 (1890)) (internal quotation marks omitted)); see
also id. at 2255 (pointing out that sovereignty immunity "pose[s] a
bar to federal jurisdiction over suits against nonconsenting States").
In short, the actions taken by the district court in this case violated the
essence of the Eleventh Amendment protection: "The very object and
purpose of the 11th Amendment were to prevent the indignity of sub-
jecting a State to the coercive process of judicial tribunals at the
instance of private parties." Puerto Rico Aqueduct & Sewer Auth. v.
Metcalf & Eddy, Inc., 506 U.S. 139, 146 (1993) (quotation marks and
citation omitted).

Accordingly, the NCUC, as an agency of the State of North Caro-
lina, is entitled to be dismissed by virtue of its sovereign immunity
as protected in federal court by the Eleventh Amendment.

10
III

Both US LEC and NCUC contend that the district court lacked
subject matter jurisdiction over enforcement decisions rendered by the
NCUC. They maintain that 47 U.S.C. § 252(e)(6), on which the dis-
trict court relied for its exercise of jurisdiction, limits the scope of
federal review to a special class of State commission determinations
made during the "initial approval process" to assure that interconnec-
tion agreements comport with the requirements of 47 U.S.C. §§ 251
and 252(d). They argue that Congress did not intend to convert every
contract dispute or issue of contract administration into a federal case.
They acknowledge that Congress undoubtedly wanted to ensure that
interconnection agreements be approved under uniform principles of
federal law that apply the traditional utility standards of public conve-
nience and necessity, public interest, and freedom from unjust dis-
crimination. NCUC asserts, however, that there is no reason to find
implied federal jurisdiction to ensure that the contracts themselves be
subject to uniform interpretation because the terms of interconnection
agreements, which are negotiated by the parties, vary.

As we pointed out in Bell Atlantic v. MCI WorldCom, § 252(e)(6)
confers jurisdiction on federal courts to review State commission "de-
terminations" made under § 252 "to determine whether the agreement
. . . meets the requirements of section 251 and this section [252]." 47
U.S.C. § 252(e)(6). We noted,

While this federal jurisdictional provision authorizes review
of § 252 arbitration determinations ultimately leading to the
formation of interconnection agreements, in the final analy-
sis, the State commission determinations under § 252
involve only approval or rejection of such [interconnection]
agreements. With respect to negotiated agreements in partic-
ular, the federal review is narrower. The only "determina-
tion" that can be made by the State commission under § 252
on a negotiated agreement is a determination to approve or
reject it, and when the agreement is approved by the State
commission, then there is a question whether there can be
any "party aggrieved" to seek review in federal court.

Bell Atlantic v. MCI WorldCom, ___ F.3d at ___, No. 99-2459, slip
op. at 34-35] (footnote omitted). We demonstrated that Congress

11
intended to reserve non-§ 252 determinations made by State commis-
sions for review in State courts as specified by State law. See id. at
35.

The interconnection agreements subject to these actions were sub-
mitted to the NCUC and approved by it, and no judicial review was
sought from these State commission determinations. The present dis-
putes involve contract administration and turn on the proper interpre-
tation of these agreements and their proper enforcement. But as we
explained fully in Bell Atlantic v. MCI WorldCom ,

While this dispute was properly brought before the Mary-
land commission and decided by it -- both because of the
commission's supervisory and regulatory authority over
public service companies operating in Maryland and
because of the 1934 Act's general assignment of responsi-
bility to State commissions -- the commission's decision
was not a § 252 determination and therefore was not review-
able in federal court by virtue of § 252(e)(6).

Id. at [52]. The same must be said in this case. The NCUC has juris-
diction over the administration of interconnection agreements entered
into by public utility companies under its jurisdiction. See N.C. Gen.
Stat. §§ 62-2, 62-30, 62-32, 62-60, 62-74, 62-110(f), 62-133.5. And
judicial review of such decisions by the North Carolina state courts
is provided by state law as preserved by the 1996 Act. See N.C. Gen.
Stat. §§ 62-90, 62-96. Accordingly, as to the private parties in this
case, the district court erred in asserting federal jurisdiction under 47
U.S.C. § 252(e)(6).

IV

BellSouth relied alternatively for subject matter jurisdiction on 28
U.S.C. §§ 1331 and 1332. Even though the district court did not reach
the issue of whether these general jurisdictional provisions authorized
federal jurisdiction, because we are reversing the district court's rul-
ing on 47 U.S.C. § 252(e)(6), we must also determine whether the dis-
trict court had federal jurisdiction under these general jurisdictional
statutes.

12
In Bell Atlantic v. MCI WorldCom, we noted that the carefully con-
sidered intent of Congress was to provide limited review of State
commission decisions in federal court and to leave all other review of
State commission decisions to the State courts. Because of this spe-
cific congressional intent manifested in the 1996 Act, we stated,

It would be nonsensical to conclude that even though Con-
gress carefully articulated jurisdictional responsibility in the
1996 Act, it nevertheless intended to have 28 U.S.C.§ 1331
override this effort.

Bell Atlantic v. MCI WorldCom, ___ F.3d at ___, No. 99-2459, slip
op. at 42.

For this reason and the other reasons given by us in Bell Atlantic
v. MCI WorldCom, id. at 42-44, we hold that the general jurisdictional
statutes do not backfill where Congress otherwise intended to allocate
jurisdiction between the States and the federal courts.

V

In sum, these federal actions by BellSouth against the NCUC are
barred by the Eleventh Amendment, and North Carolina did not
waive that immunity by participating in the regulation of interconnec-
tion agreements because Congress did not manifest an intent to condi-
tion participation in the federal regulatory scheme upon the States'
waiver of Eleventh Amendment immunity.

As to BellSouth's actions against US LEC, Intermedia, and MCI-
metro, the claims do not fall into the category of suits identified by
47 U.S.C. § 252(e)(6) for resolution in federal court. Such claims are
explicitly left by the 1996 Act for resolution by State commissions
and for review in State courts, and therefore federal courts have no
jurisdiction to decide them. In addition, 28 U.S.C. §§ 1331 and 1332
do not operate to confer jurisdiction over cases from which Congress
withheld federal jurisdiction in the 1996 Act.

For these reasons, we vacate the district court's judgment and
remand with instructions to dismiss these actions.

VACATED AND REMANDED WITH INSTRUCTIONS

13
KING, Circuit Judge, dissenting:

For the reasons more fully articulated in my opinion in the com-
panion case, Bell Atlantic Maryland, Inc. v. MCI WorldCom, Inc., No.
99-2459 (4th Cir. Feb. 14, 2001) (King, J., dissenting), I also must
dissent in this case. Once again, I heed -- and the majority dismisses
-- the clear admonition of Justice Scalia: "[T]here is no doubt . . . that
if the federal courts believe a state commission is not regulating in
accordance with federal policy they may bring it to heel." AT&T
Corp. v. Iowa Utils. Bd., 525 U.S. 366, 379 n.6 (1999). And, again,
I agree with the reasoned decisions of our sister circuits that have con-
sidered these issues, while the majority isolates itself from them.

In my view, the federal courts possess jurisdiction pursuant to the
Telecommunications Act ("Act"), specifically 47 U.S.C. § 252(e)(6),
to review the determinations made by State commissions in enforcing
interconnection agreements. See Bell Atlantic Md., No. 99-2459, slip
op. at 51-54 (King, J., dissenting); Southwestern Bell Tel. Co. v.
Brooks Fiber Communications of Okla., Inc., 235 F.3d 493, 496-97
(10th Cir. 2000); Southwestern Bell Tel. Co. v. Connect Communica-
tions Corp., 225 F.3d 942, 947 (8th Cir. 2000); MCI Telecomms.
Corp. v. Illinois Bell Tel. Co., 222 F.3d 323, 337-38 (7th Cir. 2000),
cert. denied sub nom. Public Serv. Comm'n v. Wisconsin Bell, Inc.,
121 S. Ct. 896 (2001), and cert. denied sub nom. Illinois Commerce
Comm'n v. MCI Telecomms. Corp., 121 S. Ct. 896 (2001); Southwest-
ern Bell Tel. Co. v. Public Util. Comm'n, 208 F.3d 475, 479-80 (5th
Cir. 2000).1
1 Moreover, I believe that a State commission waives sov-
ereign immunity by electing to participate in the regulation of local
telecommunications under the Act. See Bell Atlantic Md., No. 99-
2459, slip op. at 55-61 (King, J., dissenting); AT&T Communications
v. BellSouth Telecomms., Inc., No. 99-30421, 2001 WL 38281, at *10
(5th Cir. Jan. 16, 2001); Illinois Bell, 222 F.3d at 342; MCI Tele-
comms. Corp. v. Public Serv. Comm'n, 216 F.3d 929, 938-39 (10th
Cir. 2000).2
2 The majority concludes that the district court, by defer-
_________________________________________________________________

1 Because the Act confers jurisdiction on federal courts, it is unneces-
sary to consider whether general federal question jurisdiction also is pro-
vided under 28 U.S.C. § 1331.

2 Alternatively, the individual members of the State commission could
have been -- but were not -- sued in their official capacities for injunc-

14
ring consideration of the Eleventh Amendment issue,"interfered with
North Carolina's sovereignty as protected by the Constitutional struc-
ture." Ante, at 10. Although the district court should have addressed
the Eleventh Amendment issue prior to its remand to the State com-
mission, it did not, in my view, interfere with North Carolina's sover-
eignty.

Because the majority reaches contrary conclusions on these issues,
I respectfully dissent.
_________________________________________________________________

tive relief pursuant to Ex parte Young, 209 U.S. 123 (1908). See Bell
Atlantic Md., No. 99-2459, slip op. at 62-66 (King, J., dissenting); AT&T
Communications, 2001 WL 38281, at *11; Illinois Bell, 222 F.3d at 345;
Public Serv. Comm'n, 216 F.3d at 939; Michigan Bell Tel. Co. v. Climax
Tel. Co., 202 F.3d 862, 867 (6th Cir.), cert. denied sub nom. Strand v.
Michigan Bell Tel., 121 S. Ct. 54 (2000).

15