MCI v. State Corp Comm

UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

MCI TELECOMMUNICATIONS
CORPORATION, A DELAWARE
CORPORATION; MCI
TELECOMMUNICATIONS CORPORATION OF
VIRGINIA,
Plaintiffs-Appellees,

v.
No. 98-2026
STATE CORPORATION COMMISSION OF THE
COMMONWEALTH OF VIRGINIA; HULLIHEN
W. MOORE; I. CLINTON MILLER;
THEODORE V. MORRISON, JR., in their
official capacities as Commissioners of
the Commonwealth of Virginia State
Corporation Commission,
Defendants-Appellants.

Appeal from the United States District Court
for the Eastern District of Virginia, at Richmond.
Richard L. Williams, Senior District Judge.
(CA-98-284-3)

Argued: April 8, 1999

Decided: May 10, 1999

Before WIDENER and TRAXLER, Circuit Judges, and
BUTZNER, Senior Circuit Judge.

_________________________________________________________________

Vacated and remanded by unpublished opinion. Senior Judge Butzner
wrote the opinion, in which Judge Widener and Judge Traxler joined.

_________________________________________________________________
COUNSEL

ARGUED: Robert A. Dybing, SHUFORD, RUBIN & GIBNEY,
Richmond, Virginia, for Appellants. Adam Howard Charnes, MCI
COMMUNICATIONS CORP., Washington, D.C., for Appellees. ON
BRIEF: James C. Dimitri, William H. Chambliss, Robert M. Gilles-
pie, Allison Leigh Held, STATE CORPORATION COMMISSION
OF VIRGINIA, Richmond, Virginia, for Appellants. Thomas F.
O'Neil, III, MCI COMMUNICATIONS CORP., Washington, D.C.;
David G. Shuford, LECLAIR RYAN, Richmond, Virginia; Donald B.
Verrilli, Jr., JENNER & BLOCK, Washington, D.C., for Appellees.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

BUTZNER, Senior Circuit Judge:

After the Virginia State Corporation Commission (SCC) issued an
order barring MCI Telecommunications Corporation of Virginia
(MCIV) from collecting certain charges from customers making intra-
state telephone calls, the district court enjoined the SCC from enforc-
ing its order. The SCC appealed. Because all parties now agree that
MCIV neither imposed nor collected the charges, we vacate the order
of the district court and remand with instructions to dismiss this case
as moot.

I

Telecommunication companies doing business in Virginia are reg-
ulated under a bipartite structure. The Federal Communications Com-
mission (FCC) regulates interstate telephone service, while the
Virginia State Corporation Commission (SCC) oversees intrastate ser-
vice. See 47 U.S.C. § 152 (1994); Va. Const. art. IX, § 2. Pursuant to
this regime, MCI Telecommunications Corporation (MCIT), a Dela-

2
ware corporation, provides interstate telephone service to customers
in Virginia and other states in accordance with a schedule, or tariff,
filed with the FCC. MCIT provides intrastate service through a Vir-
ginia subsidiary, MCI Telecommunications Corporation of Virginia
(MCIV), which operates under a tariff filed with the SCC.

In 1997 and 1998, MCIT amended its FCC tariff to add certain
charges, the Federal Universal Service Fee and the National Access
Fee, to business customers. This amendment applied to customers in
Virginia. The SCC believed that MCIV had imposed the charges on
intrastate calls within Virginia, a position that MCIV did not deny
until proceedings before the district court. The SCC issued an order
enjoining MCIV from collecting the charges, and directing MCIV to
return monies already collected. MCIT and MCIV filed suit in federal
court seeking an injunction against the SCC order. The district court
found upon agreement of the parties that MCIT, not MCIV, had
issued and collected the charges, and enjoined enforcement of the
SCC order. The SCC filed this appeal.

II

The only question before this court is whether the district court
properly enjoined the SCC from enforcing its order. The SCC has ini-
tiated a proceeding before the FCC challenging MCIT's imposition of
the charges under MCIT's federal tariff. We express no opinion on
the merits of that case. Likewise, the Supreme Court of Virginia is
holding in abeyance a proceeding initiated by MCIT and MCIV
appealing the SCC order.

Federal courts sit only to decide cases or controversies. U.S. Const.
art. III, § 2; see Preiser v. Newkirk, 422 U.S. 395, 401 (1975). "[A]
federal court has neither the power to render advisory opinions nor to
decide questions that cannot affect the rights of litigants in the case
before them." Id. (internal quotation and citation omitted). Mootness
can arise at any stage of litigation. See Calderon v. Moore, 518 U.S.
149, 150 (1996).

The SCC initially found that MCIV had collected the charges at
issue. The SCC now agrees that MCIT had imposed and collected the
charges, and concedes that its order rests upon a mistake of fact, albeit

3
a justifiable mistake under the circumstances. Since there is no con-
troversy concerning this key fact, there is no jurisdictional ground
upon which this court may adjudicate the rights of the litigants.
Preiser, 422 U.S. at 401. This case has "lost its character as a present,
live controversy" and is moot. Maryland Highways Contractors Ass'n
v. State of Maryland, 933 F.2d 1246, 1249 (4th Cir. 1991).

III

Because the SCC order is based upon a mistake of fact, we vacate
the order of the district court and remand with instructions to dismiss
as moot. See U.S. Bancorp Mortgage Co. v. Bonner Mall Partnership,
513 U.S. 18, 25 (1994) (vacatur is appropriate where mootness occurs
in a nonsettlement context); see also Arizonans for Official English
v. Arizona, 520 U.S. 43, 71-72 (1997).

VACATED AND REMANDED

4