CTC COMMUNICATIONS CORP. v. BELL ATLANTIC CORP.

77 F. Supp.2d 124 (1999) | Cited 0 times | D. Maine | January 12, 1999

ORDER AFFIRMING THE RECOMMENDED DECISION OF THE MAGISTRATEJUDGE

The United States Magistrate Judge having filed with the Courton November 19, 1998, with copies to counsel, his RecommendedDecision on Defendant's Motion for Summary Judgment (Docket No.118); and Plaintiff having filed its objection thereto onDecember 7, 1998 (Docket No. 119), to which objection Defendantfiled its response on December 24, 1998 (Docket No. 129); andDefendant having filed its objection to the Recommended Decisionon December 7, 1998 (Docket No. 120), to which objectionPlaintiff filed its response on December 23, 1998 (Docket No.127); and this Court having reviewed and considered theMagistrate Judge's Recommended Decision, together with the entirerecord; and this Court having made a de novo determination ofall matters adjudicated by the Magistrate Judge's RecommendedDecision, and concurring with the recommendations of the UnitedStates Magistrate Judge for the reasons set forth in hisRecommended Decision, and having determined that no furtherproceeding is necessary; it is ORDERED as follows:

(1) Plaintiff's objection is hereby DENIED;

(2) Defendant's objection is hereby DENIED;

(3) The Recommended Decision of the Magistrate Judge is hereby AFFIRMED;

(4) Defendant's Motion for Summary Judgment is hereby GRANTED as to any claims in Count I arising out of the provision in the Agency Agreement for a separation payment in the event of elimination of the Defendant's third-party marketing channel, as set forth in paragraph 51 of the First Amended Complaint, and as to any antitrust claims arising out of paragraphs 41(c) and 56(e) in the First Amended Complaint, and is otherwise DENIED.

(5) Plaintiff's implied motion to dismiss claims raised in paragraphs 41(i), 56(m), and 86(j) of the First Amended Complaint is hereby GRANTED.

RECOMMENDED DECISION ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

The defendant, Bell Atlantic Corporation ("Bell"), has movedfor summary judgment on all remaining counts1 in the FirstAmended Complaint except Count V-2, which alleges breach ofcertain resale agreements. The counts at issue allege breach ofan agency agreement, violations of the applicable provisions ofantitrust law, and violations of the Telecommunications Act of1996.2 I recommend that the court grant the motion in partand deny it in part.

I. Summary Judgment Standard

Summary judgment is appropriate only if "the pleadings,depositions, answers to interrogatories, and admissions on file,together with the affidavits, if any, show that there is nogenuine issue as to any material fact and that the moving partyis entitled to a judgment as a matter of law." Fed.R.Civ.P.56(c). "In this regard, `material' means that a contested facthas the potential to change the outcome of the suit under thegoverning law if the dispute is resolved favorably to thenonmovant. By like token, `genuine' means that `the evidenceabout the fact is such that a reasonable jury could resolve thepoint in favor of the nonmoving party. . . .'" McCarthy v.Northwest Airlines, Inc., 56 F.3d 313, 315 (1st Cir. 1995)(citations omitted). The party moving for summary judgment mustdemonstrate an absence of evidence to support the nonmovingparty's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106S.Ct. 2548, 91 L.Ed.2d 265 (1986). In determining whether thisburden is met, the court must view the record in the light mostfavorable to the nonmoving party and give that party the benefitof all reasonable inferences in its favor. Cadle Co. v. Hayes,116 F.3d 957, 959 (1st Cir. 1997). Once the moving party has madea preliminary showing that no genuine issue of material factexists, "the nonmovant must contradict the showing by pointing tospecific facts demonstrating that there is, indeed, a trialworthyissue." National Amusements, Inc. v. Town of Dedham,43 F.3d 731, 735 (1st Cir. 1995) (citing Celotex, 477 U.S. at 324, 106S.Ct. 2548); Fed. R.Civ.P. 56(e). "This is especially true inrespect to claims or issues on which the nonmovant bears theburden of proof." International Ass'n of Machinists & AerospaceWorkers v. Winship Green Nursing Ctr., 103 F.3d 196, 200 (1stCir. 1996) (citations omitted).

II. Factual Background

The following undisputed material facts are appropriatelysupported in the summary judgment record.3 CTC is in thebusiness of selling telecommunications services to customers inNew York and New England. Affidavit of Robert Fabbricatore("Fabbricatore Aff."), Exh. B to CTC's Opposition, ¶¶ 5-6. Bellis a telecommunications carrier that sells telecommunicationservices in the mid-Atlantic states, New York and New England.Declaration of David Mahan ("Mahan Dec."), Exh. A to CTC'sOpposition, ¶ 4; SEC Filing, Bell Atlantic Corp., December 31,1996, Exh. J to CTC's Opposition, at 1. Bell is the corporatesuccessor to NYNEX. E-mail dated April 24, 1997, Exh. L to CTC'sOpposition. Bell provides local exchange telephone service withina specified geographic area. See United States v. American Tel.& Tel. Co., 552 F. Supp. 131, 139, 186 (D.D.C. 1982). TheTelecommunications Act of 1996, codified in part at47 U.S.C. § 251, imposes certain obligations on local exchange carriers tofoster the growth of competition for telecommunications servicesinvolving calls that originate and terminate within a localaccess and transport area ("LATA"). Such services are known as"intraLATA services."

Beginning in 1984, CTC sold intraLATA services pursuant to aseries of agency agreements with NYNEX; NYNEX also sold theseservices directly. Fabbricatore Aff. ¶ 6; Mahan Dec. ¶ 4. Themost recent agency agreement between CTC and NYNEX is datedFebruary 1, 1996 ("the Agency Agreement"). Fabbricatore Aff. ¶ 6.The Telecommunications Act of 1996 (sometimes "the Act") tookeffect on February 8, 1996. Act of February 8, 1996, Pub.L. No.104-104, 1996 U.S.C.C.A.N. (110 Stat.) 56, 161. After the Acttook effect, CTC decided to become a reseller of Bell intraLATAservices in competition with Bell. Fabbricatore Aff. ¶¶ 9-12. CTChas entered into written Resale Service Agreements with Bell forthe resale of Bell's intraLATA telecommunications services ("theResale Agreements"). Id. ¶ 15. In February 1997 NYNEX cut itscommission payments to its agents by 15%. Mahan Dec. ¶ 8.

The Telecommunications Act of 1996 requires, inter alia, thatregional Bell operating companies ("RBOCs") and "incumbent localexchange carriers" ("ILECs") sell at wholesale anytelecommunications service that they sell at retail,47 U.S.C. § 251(c)(4)(A); that ILECs offer elements of their networks for useby their competitors on an "unbundled" basis,47 U.S.C. § 251(c)(3); and that ILECs allow competitors to interconnect withtheir networks, 47 U.S.C. § 251(c)(2). Bell Atlantic is both anRBOC and an ILEC. Bell makes as great a profit on the localtelephone services it sells at wholesale as it does when it sellsthe same services at retail. Memorandum of Decision and Order("Decision on Motion to Dissolve TRO, etc.") (Docket No. 92) at16; Mahan Dec. ¶ 11.

In August 1997 Bell eliminated its Account Management Program("AMP"), in which CTC participated as an agent, for customersspending less than $40,000 annually for local telephone services.Mahan Dec. ¶ 12. Bell assumed direct account management for thesecustomers. Id. As an AMP agent, CTC sold Bell products toend-users and was paid a commission on each such sale. Decisionon Motion to Dissolve TRO, etc. at 4. Bell also paid fees to CTCto manage the relationship between Bell and its customers byproviding information and service to the customer at noadditional charge. Id.

The Agency Agreement, which was drafted exclusively by NYNEX,id. at 7, includes a covenant not to compete which providesthat

for a period of twelve (12) months after the expiration or termination of this Agreement Representative may not sell, represent, or promote any non-NYNEX IntraLATA services to any NYNEX Business Customer for whom Representative was responsible under the AMP Program, or to whom Representative sold any NYNEX Service, within 12 months prior to such expiration or termination.

Agreement for Sale of Services & Account Management ("AgencyAgreement"), Exh. J to Bell's SMF, at § D.1.s., p. 8. The AgencyAgreement also provides that the agent shall

[r]etain [accurate and complete books of account, documents and records] for a period of three (3) years from the date of final payment by NYNEX for services rendered under this Agreement. NYNEX and its authorized agents and representatives shall have access to such records for purposes of audit during normal business hours during the term of this Agreement and for three (3) years from the date of final payment. NYNEX shall notify Representative in writing at least seven (7) days before NYNEX intends to conduct such an audit.

Id., § D.1.p., p. 8. NYNEX's responsibilities under the AgencyAgreement include payment of commissions "not later than thirty(30) days following the end of the month during which a fullynegotiated and accurate order is issued by NYNEX" or "not laterthan thirty (30) days following the end of the month during whichthe installation of a Service sold by Representative is verifiedby NYNEX." Id. § F.1.d., at 12. In addition, NYNEX had theright under the Agency Agreement to "set off against any paymentdue by it hereunder any amounts owed to it by Representativeunder this Agreement or any other agreement between the parties."Id. § F.4., at 16. Finally, the Agency Agreement provides that

[i]n the event the NYNEX determines to eliminate its third party marketing sales channel, NYNEX, at its option, agrees to:

a. either terminate this Agreement only upon twelve (12) months prior written notice, except that, in the event of Representative's substantial lack of performance hereunder . . ., NYNEX may terminate this Agreement by providing Representative with notice pursuant to Section C. of this Agreement,

or

b. pay to Representative a separation payment based on 50% of the Representative's earned compensation during the twelve (12) months preceding termination.

Id. § F.5., at 16-17. The term "third party marketing saleschannel" is not defined in the Agency Agreement.

Since March 1997 the parties have disputed the amounts due toCTC under the Agency Agreement; CTC asserts that Bell owes itover $12 million. Declaration of John D. Pittenger, Exh. R toCTC's Opposition, ¶ 2 & Schedule A. In a letter dated December30, 1997 Bell notified CTC that "the sales agency agreement isterminated immediately due to CTC's material breach thereof."Letter from Jack H. White, Jr.to Robert Fabbricatore, Exh. AA to CTC's Opposition, at 1.

In October 1997 Bell informed CTC that it would not make voicemail services available to customers who purchased localtelephone lines from resellers, except in the state of New York.Mahan Dec. ¶ 19. In January 1998 Bell implemented a new policypursuant to which it would charge customers who had signedmulti-year contracts for particular local telecommunicationsproducts a fee if they chose to switch from Bell to a reseller asthe provider of that same product. Id. ¶ 23. This fee equalsthe present value of the remaining charges under the contract.Id. In February 1998 Bell notified CTC that it would no longerallow direct contact between CTC and Bell's technical andengineering personnel involved in the design and implementationof CTC's resale orders. Id. ¶ 26. This results in delay inCTC's provision of services to its customers. Id. In March 1998Bell implemented another new policy concerning its Business Linkservice, which provides deferred discounts called "BonusCredits." Id. ¶ 27; Declaration of Charlotte TerKeurst inOpposition to Bell Atlantic's Motion for Summary Judgment("TerKeurst Dec."), Exh. F to CTC's Opposition, ¶ 41. The newpolicy provides that the credits will be terminated when acustomer chooses to change from buying Business Link servicedirectly from Bell to buying it from a reseller. Mahan Dec. ¶ 27.

CTC has initiated proceedings concerning Bell's terminationfees before the public utility regulatory agencies in Maine, NewHampshire, Vermont, Massachusetts, New York and Rhode Island.Declaration of Kenneth Gordon in Support of Bell Atlantic'sMotion for Summary Judgment ("Gordon Dec.") (Docket No. 99), ¶20. Bell's Business Link program and termination charges aresubject to tariffs, which are detailed listings of rates andother terms and conditions for services that must be filed withpublic utility regulatory agencies in the states in which Belldoes business. Id. ¶¶ 10, 21. Bell "carrier access services"are subject to regulation by the Federal CommunicationsCommission ("FCC"), which approves tariffs for those services.Id. ¶¶ 22-23; Plaintiff's Response to Defendant's SecondInterrogatories to Plaintiff CTC Communications Corp., Exh. B toBell's SMF, Answer 8, at 14.

III. Discussion

A. Count I (Breach of Contract)

Count I of the First Amended Complaint alleges that Bellbreached the Agency Agreement by failing to pay CTC over $12million in commissions, failing to act "equitably" and "in goodfaith" "in light of the changes to the market engendered by theTelecommunications Act of 1996," eliminating commissions owed CTCfor AMP customers, and "actually and/or constructivelyeliminat[ing] CTC Communications as its `third party marketingsales channel' " but failing to pay the separation paymentprovided by the Agency Agreement. First Amended Complaint ¶¶50-51. Bell argues that CTC's claim for unpaid commissions isbarred by its refusal to permit Bell to perform an audit, so thatthe claim is both premature and blocked by CTC's own breach, andthat Bell has not eliminated its "third party marketing saleschannel," so CTC is not entitled to a separation payment underthe terms of the Agency Agreement. Motion for Summary Judgmentand Memorandum of Bell Atlantic in Support of Motion for SummaryJudgment ("Motion for Summary Judgment") (Docket No. 97) at37-39. Bell does not address the amended complaint's claimconcerning an alleged duty to act equitably and in good faith,and accordingly that claim will remain for trial in any event.

CTC responds that an audit is not a precondition for payment ofcommissions under the Agency Agreement and contends that it neverdenied Bell's demand for an audit and has supplied Bell with allavailable information concerning its claimfor commissions. CTC's Opposition at 37. CTC also contends thatthe Agency Agreement can only be interpreted so that the "thirdparty marketing sales channel" is CTC, and that it has beeneffectively eliminated by Bell's decision to serve customersincurring annual charges less than $40,000 directly rather thanthrough CTC. Id. at 38.

The parties agree that New York law applies to this claim.

With respect to the claim for commissions, CTC is correct. TheAgency Agreement does not require an audit before commissions arepayable. To the contrary, the agreement contemplates paymentwithin thirty days after the end of the month in which an orderfor the purchased service is issued by NYNEX or purchase of theservice is verified. In fact, the audit provision only requiresthat NYNEX (and hence Bell) have access "for purposes of audit"after "the date of final payment." Agency Agreement, § D.1.p.,at 8. If payments are due and unpaid, final payment by definitionhas not been made.4 If that is the case, CTC cannot be inbreach of the agreement for failing to allow an audit, a materialfactual allegation that in any event is hotly disputed. None ofthe New York case law cited by Bell supports a differentinterpretation of the contract language nor requires a differentoutcome here. Bell is not entitled to summary judgment on theclaim for payment of commissions.

The outcome is different for the claim to a separation paymentunder the Agency Agreement. In order to prevail on its claim, CTCwould have to prove that it was the only agent for Bell thatparticipated in the AMP program and that all of the AMP customersserved by CTC incurred annual charges less than $40,000. CTC hasprovided no evidence in the summary judgment record to supporteither conclusion. Even in the unlikely event that CTC's argumentthat the use of the singular form of the word "channel" in theagreement means that the single agent that is the party to theagreement is that channel were adopted by the court, CTC wouldstill have to show that it was "eliminated" by Bell's action.Without evidence in the summary judgment record that CTC servedno AMP customers with annual charges in excess of $40,000, CTChas failed to contradict Bell's showing that no genuine issue ofmaterial facts exists. Winship Green, 103 F.3d at 200. Bell isentitled to summary judgment on the claim raised in Paragraph 51of the First Amended Complaint.

B. Antitrust Claims (Counts II and IV)

Bell contends that it is entitled to summary judgment on all ofCTC's remaining antitrust claims5 on a variety of grounds,some of which it invokes only with respect to certain specificparagraphs in the amended complaint: the Noerr-Penningtondoctrine, the state action doctrine, the filed rate doctrine, thedoctrine of primary jurisdiction, lack of evidence ofmonopolization or attempted monopolization, absence ofanticompetitive effect, lack of evidence of antitrust injury, andabsence of aduty to deal under the circumstances set forth in the amendedcomplaint.

1. The Noerr-Pennington Doctrine.

Bell argues that this doctrine bars the claims raised inParagraphs 41(i), 56(b), 56(f) and 56(m) of the First AmendedComplaint. Motion for Summary Judgment at 3. This court hasalready dismissed any antitrust claims arising from Paragraph56(b). Affirming Order at 2. CTC has indicated its willingness todismiss any claims based on Paragraphs 41(i) and 56(m).6CTC's Opposition at 4 n. 1. The only paragraph remaining fordiscussion under the Noerr-Pennington doctrine therefore isParagraph 56(f), which alleges that Bell has "willfullymaintained" monopoly power "in the relevant market or markets ofIntraLATA telecommunication services for business customers inNew England and New York," First Amended Complaint ¶ 54, by

[r]efusing to sell IntraLATA telecommunications services at wholesale prices to Resellers, including CTC Communications, who seek to sell to customers with contracts with Bell Atlantic for the provision of these services, unless the customer agrees to pay unreasonable termination fees.

Id. ¶ 56(f).

The Noerr-Pennington doctrine, named for two Supreme Courtcases, provides that "[t]hose who petition government for redressare generally immune from antitrust liability." ProfessionalReal Estate Investors, Inc. v. Columbia Pictures Indus., Inc.,508 U.S. 49, 56, 113 S.Ct. 1920, 123 L.Ed.2d 611 (1993). Onlysham recourse to governmental agencies and the courts is notimmune. Id. at 58, 113 S.Ct. 1920. Evidence of anticompetitiveintent alone cannot transform otherwise legitimate activity intoa sham for this purpose. Id. at 59, 113 S.Ct. 1920. To qualifyas a sham, litigation "must be objectively baseless in the sensethat no reasonable litigant could realistically expect success onthe merits," and it must conceal an attempt to interfere directlywith the business relationships of a competitor through the useof the governmental process. Id. at 60-61, 113 S.Ct. 1920.

The doctrine immunizes only actions that are directed towardgovernmental agencies or officials. MCI Communications Corp. v.AT & T Co., 708 F.2d 1081, 1159 (7th Cir. 1983). The fact that aparty's act or decision "may eventually provoke agency action orreview does not alone call the Noerr-Pennington doctrine intoplay." Id. at 1160. Acts that are "reasonably and normallyattendant upon protected litigation" are entitled to immunity tothe same extent as the related litigation. Matsushita Elec.Corp. v. Loral Corp., 974 F. Supp. 345, 359 (S.D.N.Y. 1997).

Bell's argument is based on its assertion that Paragraph 56(f)charges it with "`threatening' to enforce the provisions fortermination charges in multi-year agreements signed by BellAtlantic's customers." Motion for Summary Judgment at 3. However,there is no allegation of a threat in that subparagraph of theFirst Amended Complaint. Bell argues that its position on theissue raised by Paragraph 56(f) has been upheld by the FCC andtwo state agencies and, therefore, could not have been a "sham."Id. at 5. If accurate, that argument is simply beside the pointfor purposes of application of the Noerr-Penningtondoctrine. No one is contending in this action that Bell'simposition of such penalties on customers who switch providers isa "sham." Perhaps in recognition of this fact, Bell argues in itsreply memorandum that the decision to enforce this provision inits contracts with its customers is "a necessary antecedent tothe filing of a suit." Bell's Reply at 2. In the absence of anyindication that Bell has filed suit to enforce its interpretationof this provision, or even that it intends to do so, itsexpressed intent to require such payment from its customers isnot an act "incidental to protected litigation" as that term isused in Matsushita, the authority upon which Bell relies.

Bell is not entitled to summary judgment on any antitrust claimarising out of Paragraph 56(f) of the First Amended Compliant onthe basis of the Noerr-Pennington doctrine.

2. The State Action Doctrine.

Bell's motion for summary judgment on the basis of the stateaction doctrine is directed to Paragraphs 41(d), 41(e), 56(f) and56(g) of the First Amended Complaint.7 Motion for SummaryJudgment at 7. The substance of Paragraph 56(f) has been setforth above. The remaining paragraphs identified by Bell provide:

Bell Atlantic has imposed the following unreasonable conditions and limitations, among others, on the resale of its telecommunications services:

d. It refuses to sell IntraLATA telecommunication services at wholesale prices to Resellers, including CTC, who seek to sell to customers who have what Bell Atlantic describes as "contracts" with Bell Atlantic for the provision of these services, unless the customer agrees to pay unreasonable termination fees. These contracts were signed by customers prior to the Telecommunications Act of 1996 when no choices were available to customers;

e. It refuses to permit customers to retain discounts under a program known as "Business Link", if customers continue to use Bell Atlantic service but switch to Resellers.

Bell Atlantic has willfully maintained [monopoly] power by:

g. Refusing to permit customers to retain discounts under a program known as "Business Link", if customers continue to use Bell Atlantic service but switch to Resellers.

First Amended Complaint, ¶¶ 41, 56.

The state action doctrine provides that "federal antitrust lawsare subject to supersession by state regulatory programs" undercertain conditions. FTC v. Ticor Title Ins. Co., 504 U.S. 621,632-33, 112 S.Ct. 2169, 119 L.Ed.2d 410 (1992). When a privateparty participating in a regime challenged under the Sherman Actclaims the protection of the doctrine, a two-prong test applies:"First, the challenged restraint must be one clearly articulatedand affirmatively expressed as state policy; second, the policymust be actively supervised by the State itself." CaliforniaRetail Liquor Dealers Ass'n v. Midcal Aluminum, Inc.,445 U.S. 97, 105, 100 S.Ct. 937, 63 L.Ed.2d 233 (1980) (internal quotationmarks and citation omitted).

A private party acting pursuant to an anticompetitive regulatory program need not point to a specific, detailed legislative authorization for its challenged conduct. As long as the State as sovereign clearly intends to displace competition in a particular field with a regulatory structure, the first prong of the Midcal test is satisfied.

Southern Motor Carriers Rate Conference, Inc. v. United States,471 U.S. 48, 64, 105 S.Ct. 1721, 85 L.Ed.2d 36 (1985) (internalquotation marks and citation omitted).

[W]hile a State may not confer antitrust immunity on private persons by fiat, it may displace competition with active state supervision if the displacement is both intended by the State and implemented in its specific details. Actual state involvement, not deference to private price-fixing arrangements under the general auspices of state law, is the precondition for immunity from federal law.

Ticor, 504 U.S. at 633, 112 S.Ct. 2169. The purpose of the"active supervision" inquiry "is to determine whether the Statehas exercised sufficient independent judgment and control so thatthe details of the rates or prices have been established as aproduct of deliberate state intervention, not simply by agreementamong private parties." Id. at 634-35, 112 S.Ct. 2169."[S]tate-action immunity is disfavored, much as are repeals byimplication." Id. at 636, 112 S.Ct. 2169.

Here, application of the doctrine is complicated by the factthat six states are involved, as well as the fact that stateregulation of the telephone industry predates theTelecommunications Act of 1996, which first established federalstatutory approval of competition in the provision of localtelecommunications services. This policy seems to befundamentally at odds with the state action doctrine, whichallows for protection of anticompetitive practices in thisindustry under certain circumstances. However, Ticor, whichalso predates the Act, remains the Supreme Court's most recentstatement on the matter. Bell argues that its new policy ofrequiring payment of termination fees when customers undercontract choose to switch to a reseller as the provider of Bellservices and its cancellation of credits earned under theBusiness Link program when a customer makes the same change areboth within the clearly articulated policy of each state andactively supervised by each state's utility regulatoryagency.8 Bell relies on the declaration of its expertwitness, Kenneth Gordon, as factual support for this argument.

Bell contends that the first prong of the Midcal test is metby the existence of state laws, collected at Exhibit A to theGordon Declaration, establishing regulatory commissions withauthority over local telecommunications services in each of theseven states at issue. While these statutes do not establish a"clearly articulated and affirmatively expressed state policy,"Midcal, 445 U.S. at 105, 100 S.Ct. 937, by specificallyauthorizing Bell's use of termination penalties and cancellationof Business Link credits under the circumstances set forth in theFirst Amended Complaint, see Southern Motor Carriers, 471 U.S.at 63, 105 S.Ct. 1721, it is possible that this prong of theMidcal test is met in each of these states by the respectivestatutes' providing each state agency with the authority anddiscretion to implement broad state policy that may include theseparticular actions, id. at 63-64, 105 S.Ct. 1721. CTC'sargument that the states are not authorized "to ignore theantitrust laws," CTC's Opposition at 9-10, is beside the pointhere. CTC also relies on AT & T v. IMR Capital Corp.,888 F. Supp. 221 (D.Mass. 1995), in which the court stated that thetheoretical power of the state regulatory agency to regulate thebehavior at issue is insufficient "to make such behavior thestate's own, and immunize itfrom federal law." Id. at 240. However, it appears that thecourt is discussing the second prong of the Midcal test at thatpoint in the IMR decision, not the first.

Assuming arguendo that the first prong of the Midcal stateaction test is met in this case by the existence of statestatutes establishing regulatory commissions in each of the sevenstates with the power to regulate Bell's Business Link programand its ability to charge termination penalties in connectionwith long-term service contracts, Bell fails to provideundisputed evidence that these states each actively supervise thechallenged actions. If the particular action at issue was neverauthorized by the state regulatory commissions, there can be noactive state supervision that immunizes the actions fromantitrust liability under the state action doctrine. IMR, 888F. Supp. at 240.

Bell's position is seriously undermined by the undisputed factsthat it did not charge the termination penalties at issue untilJanuary 1998, Mahan Dec. ¶ 23, and did not refuse to allowBusiness Link customers to retain their discounts if theyswitched to a reseller until May 1998, id. ¶ 27. None of thestate tariffs submitted by Bell appears to have changed inJanuary or May 1998. Gordon Dec. ¶¶ 17, 21 & Exhs. B & C.Accordingly, Bell's change in policy on these issues could nothave been actively supervised by the state regulatorycommissions, because it was not authorized by those commissions.In addition, the parties dispute whether the state tariffsaddress the ability of Bell to charge a termination fee tocustomers who seek to assign their contracts with Bell to CTC,compare TerKuerst Dec. ¶ 28 and Declaration of Jordan BradleyMichael in Opposition to Bell Atlantic's Motion for SummaryJudgment ("Michael Dec."), Exh. DD to CTC's Opposition, ¶ 7with Reply Declaration of Kenneth Gordon in Support of BellAtlantic's Motion for Summary Judgment ("Gordon Reply Dec.")(Docket No. 116) ¶¶ 3, 5 & Exhs. 1 & 2; and the ability of Bellto refuse to allow Business Link customers to retain theirdiscounts if they switch to a reseller as the provider of thoseBell services, compare Michael Dec. ¶ 9 with Gordon ReplyDec. ¶ 8 & Exh. 3. This is not merely a dispute concerning amaterial fact, however. Interpretation of a tariff is a questionof law. Rebel Motor Freight, Inc. v. ICC, 971 F.2d 1288, 1290(6th Cir. 1992). Accordingly, this court is in a position toresolve the parties' dispute on this point at this time.

After reviewing the specific tariff sections identified by Bellas providing evidence of active state regulatory agencysupervision of its policies of termination charges and loss ofBusiness Link discounts, I conclude that the tariffs do notspecifically authorize either policy. The portions of thosetariffs that refer to termination charges uniformly refer totermination of the service at issue. E.g., Gordon Reply Dec.Exh. 1 at [1], [9] (New York); [13] (Massachusetts); [21] (RhodeIsland); [24] (Vermont); [40] (New Hampshire); Gordon Reply Exh.2 at [2] (New York); [5] (Maine); [7] (Massachusetts); [9] (NewHampshire); [11] (Rhode Island); [13] (Vermont). What is at issuehere is not termination of the service provided to the customer,but only a change in the provider who is paid for the service bythe customer. The service remains the same, and the net income toBell remains approximately the same. Accordingly, the tariffs donot authorize Bell to charge termination fees under thecircumstances at issue.9 The same is true of the portions ofthe state tariffs concerning the Business Link program upon whichBell relies. Those tariffs allow forfeiture of earned creditsonly when the service agreement is terminated. E.g., GordonReply Dec. Exh. 3 at [2] (Massachusetts); [3] (Maine); [5] (NewHampshire); [8] (Rhode Island); [9] (New York). Under thescenario presented by CTC, the service agreement is notterminated but is merely assigned by the customer to CTC. Again,the service remains the same and the effective income to Bellremains the same. These tariffs do not authorize Bell to refuseto transfer the earned credits when the customer assigns itsBusiness Link contract to CTC.

Failure to meet the second prong of the Midcal test requiresthe court to deny Bell's motion for summary judgment on the basisof the state-action doctrine.

3. The Filed Rate Doctrine.

Bell asserts that it is entitled to summary judgment on anyclaims arising from the following paragraphs of the first amendedcomplaint under the filed rate immunity doctrine: 41(c), 41(d),41(e), 41(h), 56(e), 56(f), 56(g) and 56(j). Motion for SummaryJudgment at 10. Paragraphs 41(d), 41(e), 56(f) and 56(g) are setforth above. The text of the remaining paragraphs addressed byBell in this argument follows:

41. In addition, Bell Atlantic has imposed the following unreasonable conditions and limitations, among others, on the resale of its telecommunications services:

c. It refuses to sell at wholesale prices FCC-tariffed data services to Resellers, including CTC, who seek to sell these services to customers who have purchased or desire to purchase an FCC tariffed data service;

h. It has imposed unreasonable economic terms on the payment for Resellers [sic] for Bell Atlantic's IntraLATA telecommunications services.

56. Prior and subsequent to the passage of the Telecommunications Act of 1996, Bell Atlantic has willfully maintained [monopoly] power by:

e. Refusing to sell at wholesale prices FCC-tariffed data services to Resellers, including CTC Communications, who seek to sell these services to customers who have purchased or desire to purchase an FCC tariffed data service;

j. Imposing Resellers unreasonable economic terms on the payment of Bell Atlantic's IntraLATA telecommunication services. [Sic.]

Bell contends that each of the specified paragraphs deals withthe "prices and terms of Bell Atlantic's service offerings," andthat each of the practices challenged in these paragraphs is"fully consistent with Bell Atlantic's FCC and state approvedtariffs." Motion for Summary Judgment at 10.

The filed rate doctrine "forbids a regulated entity to chargerates for services other than those properly filed with theappropriate federal regulatory authority." Arkansas LouisianaGas Co. v. Hall, 453 U.S. 571, 577, 101 S.Ct. 2925, 69 L.Ed.2d856 (1981). At the heart of the doctrine is a policy ofnondiscriminatory rates which is violated when similarly situatedcustomers pay different rates for the same services. AT & T v.Central Office Tel., Inc., 524 U.S. 214, 118 S.Ct. 1956, 1963,141 L.Ed.2d 222 (1998). As all exemptions from the antitrust lawsare to be "strictly construed and strongly disfavored,"Square D Co. v. Niagara Frontier Tariff Bureau, Inc.,476 U.S. 409, 421, 106 S.Ct. 1922, 90 L.Ed.2d 413 (1986), this doctrinemust be applied with care. In support of its defensive use of thedoctrine, Bell relies on Fax Telecomm., Inc. v. AT & T,138 F.3d 479 (2d Cir. 1998), and Town of Concord v. Boston EdisonCo., 915 F.2d 17 (1st Cir. 1990).10 In Fax, the plaintiffsought to enforce its alleged agreement with AT & T to receivelong-distance service at rates lower than the rate on file withthe FCC for those services. 138 F.3d at 488. Realizing that thecourt could not directly enforce those rates, the plaintiff askedthe court to enforce AT & T's promise to file a tariff thatincluded those rates. Id. at 489. The Second Circuit held thatthis request also violated the filed rate doctrine, and that theplaintiff had failed to show that its claimed reliance on thepromise was reasonable. Id. at 490. In Concord, the filedrate doctrine was not at issue.

CTC argues in response that Bell's actions concerning thetermination charges, Business Link discounts, imposition of"unreasonable economic terms" for intraLATA services and sale ofFCC-tariffed services11 were anticompetitive non-rateactivity that might coincidentally implicate promulgated ratesbut would not be protected from antitrust liability, citing Inre Lower Lake Erie Iron Ore Antitrust Litig., 998 F.2d 1144,1159-60 (3d Cir. 1993).

The basic questions to be asked by the court in analyzingBell's argument here are whether the actions challenged by CTC"embody disagreement with rates or procedures embodied in a filedtariff," MCI Telecomms. Corp. v. Graphnet, Inc., 881 F. Supp. 126,132 (D.N.J. 1995), and whether allowing CTC to proceed withits claims will result in discrimination in favor of CTC againstother customers of Bell, Cooperative Communications, Inc. v. AT& T, 867 F. Supp. 1511, 1519 (D.Utah 1994).

The parties vigorously dispute the first point. I have alreadydetermined that Bell's actions with respect to terminationcharges and Business Link credits are not governed by the filedtariffs submitted by Bell. Allowing CTC to proceed with these twoclaims will not result in discrimination in favor of CTC againstother wholesale customers of Bell. Accordingly, Bell is notentitled to summary judgment on the basis of the filed ratedoctrine as to these two claims.

As for the claim concerning FCC-tariffed services, Bellcontends that the carrier access services at issue are governedby an FCC tariff and that a local competition order issued by theFCC concludes that such services are not subject to the resalerequirements added to 47 U.S.C. § 251(c)(4) by theTelecommunications Act of 1996. CTC responds only that the order"alone cannot support judgment against CTC based on the FiledRate Doctrine,"CTC's Opposition at 16, and that Bell's failure to refer to aspecific tariff means that it is not entitled to summary judgmenton this claim. Bell has provided a citation to a specific FCCtariff with its reply memorandum.

CTC does not explain why the FCC Order, First Report and Order,In the Matter of Implementation of the Local CompetitionProvisions in the Telecommunications Act of 1996, 11 F.C.C.R.15499, 1996 WL 452885 (Aug. 8, 1996), and specifically paragraphs873 and 874 of that order, cannot support judgment based on thefiled rate doctrine. Courts have routinely relied upon orders ofthe FCC as authority. E.g., Kessler v. Town of Niskayuna,774 F. Supp. 711, 714-17 (N.D.N.Y. 1991). The FCC's determination thatexchange access services are not subject to the resalerequirements of 47 U.S.C. § 251(c)(4) does not end the inquiryconcerning an antitrust violation, however, because thatconclusion only means that Bell is not required to sell suchservices at wholesale by the Act. The filed rate doctrine stillrequires that an existing tariff set a rate for sale of thespecific service at issue.

Bell has provided undisputed evidence that carrier accessservices are subject to a tariff entitled NYNEX TelephoneCompanies FCC # 1. Gordon Dec. ¶ 23. The brief excerpt from thattariff provided by Bell, Exhibit 4 to the Gordon ReplyDeclaration, is fairly cryptic. The unchallenged interpretationof that tariff by Bell's expert witness, however, is sufficientto establish that the tariff does cover the services at issue andrequires that the services be sold at retail. Gordon Reply Dec. ¶10. I therefore conclude that Bell's refusal to make suchservices available to CTC at wholesale rates is required by ratesor procedures embodied in a filed tariff and that allowing CTC toproceed with this claim could result in discrimination in favorof CTC against other customers of Bell, who would be required bythe tariff to purchase the services at retail prices. Bell isentitled to summary judgment on the antitrust claims raised inParagraphs 41(c) and 56(e) of the First Amended Complaint.

Bell's entire presentation in support of its motion for summaryjudgment on Paragraphs 41(h) and 56(j) of the First AmendedComplaint on the basis of the filed rate doctrine consists of aconclusory assertion that Bell's practice in this regard(imposing unreasonable economic terms on payment for intraLATAservices) "is fully consistent with Bell Atlantic's FCC and stateapproved tariffs," Motion for Summary Judgment at 10, and afootnote in its reply, in which it asserts that "in New York,Bell Atlantic may only sell its services in accordance with filedtariffs. In New England, the wholesale discounts (and other termsof resale) are either approved or, if necessary, prescribed bystate commissions," Bell's Reply at 6 n. 6. The fact that CTC haschosen not to reply to Bell's argument on this claim does notmean that summary judgment may enter for Bell without furtherconsideration by the court. Redman v. FDIC, 794 F. Supp. 20, 22(D.Me. 1992). While the information provided with Bell's replysupports its truncated presentation on this issue, Gordon ReplyDec. ¶ 11, it was only in Bell's reply memorandum that theevidentiary basis for it argument concerning this claim becameapparent. Under the circumstances, and in the absence of citationby Bell to the particular sections of particular tariffs that itcontends provide the basis for summary judgment under the filedrate doctrine, I conclude that it is not possible for the courtto determine whether the challenged action embodies disagreementwith rates or procedures included in a filed tariff, Graphnet,881 F. Supp. at 132, and accordingly, Bell is not entitled tosummary judgment on these claims.

4. Primary Jurisdiction

Bell seeks summary judgment on the following paragraphs of theFirst Amended Complaint under the primary jurisdiction doctrine:41(a)-(e), 41(g)-(i), 56(c)-(g),56(i) and 56(l). Motion for Summary Judgment at 15.12 CTChas indicated that it will not proceed with the claim based onParagraph 41(i). The text of the other paragraphs included inthis list13 not set forth earlier in this recommendeddecision follows:

41. In addition, Bell Atlantic has imposed the following unreasonable conditions and limitations, among others, on the resale of its telecommunications services:

a. It refuses to sell voice mail at wholesale or retail prices to Resellers, including CTC, in all of the New England states, although it provides these services to customers at retail and even offers these services at wholesale to Resellers in New York;

b. It refuses to sell or provide voice mail even at retail prices to customers who buy IntraLATA telecommunication services from Resellers;

g. It has refused to allow Resellers to communicate with technical design, engineering and support personnel to aid in the resale of Bell Atlantic's IntraLATA telecommunications services.

56. Prior and subsequent to the passage of the Telecommunications Act of 1996, Bell Atlantic has willfully maintained [monopoly] power by:

c. Refusing to sell voice mail at wholesale or retail prices to Resellers, including CTC Communications, in all of the New England states, although it provides these services to customers at retail and even offers these services at wholesale to Resellers in New York;

d. Refusing to sell or provide voice mail even at retail prices to customers who buy Bell Atlantic's IntraLATA telecommunications services through Resellers;

i. Refusing to allow Resellers to communicate with Bell Atlantic's technical design, engineering, and support personnel to aid in the resale of Bell Atlantic's IntraLATA telecommunication services;

l. Executing noncompetition covenants which unreasonably prevent or limit competition for the resale of IntraLATA services.

The primary jurisdiction doctrine is

specifically applicable to claims properly cognizable in court that contain some issue within the special competence of an administrative agency. It requires the court to enable a "referral" to the agency, staying further proceedings so as to give the parties reasonable opportunity to seek an administrative ruling.

Reiter v. Cooper, 507 U.S. 258, 268, 113 S.Ct. 1213, 122L.Ed.2d 604 (1993). The court may retain jurisdiction or, "if theparties would not be unfairly disadvantaged," dismiss the casewithout prejudice. Id. Bell apparently seeks the latteralternative, stating that the court "should grant summaryjudgment dismissing CTC's antitrust and TelecommunicationsAct14 claims in deference to the primary jurisdiction of theFCC and state commissions," Motion for Summary Judgment at 18,and later asserting that CTC "already has initiated proceedingson claims, repeated in this suit, in each of the six states atissue here." Bell's Reply at 7 n. 7 (emphasis in original).

Prior agency determination of certain issues in dispute betweenthe parties may aid the court in deciding whether an antitrustclaim is available to a plaintiff. Ricci v. Chicago MercantileExch., 409 U.S. 289, 305, 93 S.Ct. 573, 34 L.Ed.2d 525 (1973).The doctrine "comes into play whenever enforcement of the claimrequires the resolution of issues which, under a regulatoryscheme, have been placed within the special competence of anadministrative body." United States v. Western Pac. R. Co.,352 U.S. 59, 64, 77 S.Ct. 161, 1 L.Ed.2d 126 (1956). The FCC was"created by Congress specifically to enforce the provisions ofthe Communications Act of 1934," IMR Capital Corp., 888 F. Supp.at 244, of which 47 U.S.C. § 251 is by amendment a part. Thestate public utility commissions have jurisdiction overtelecommunications services within their borders. See LouisianaPub. Serv. Comm'n v. FCC, 476 U.S. 355, 359, 106 S.Ct. 1890, 90L.Ed.2d 369 (1986) (Communications Act "establishes . . . asystem of dual state and federal regulation over telephoneservice").

The First Circuit has stated that the doctrine of primaryjurisdiction is intended to serve "as a means of coordinatingadministrative and judicial machinery" and to "promote uniformityand take advantage of agencies' special expertise." MashpeeTribe v. New Seabury Corp., 592 F.2d 575, 580 (1st Cir. 1979).There are three factors that guide the decision whether to defera matter to an agency under the doctrine:

(1) whether the agency determination l[ies] at the heart of the task assigned the agency by Congress; (2) whether agency expertise [i]s required to unravel intricate, technical facts; and (3) whether, though perhaps not determinative, the agency determination would materially aid the court.

Massachusetts v. Blackstone Valley Elec. Co., 67 F.3d 981, 992(1st Cir. 1995), quoting Mashpee Tribe, 592 F.2d at 580-81.Also important in any consideration of possible deference is theavoidance of conflict and whether there is some urgency — whether"[o]ngoing business conduct is likely to be involved and harm,possibly irreparable, may be accruing." PHC, Inc. v. PioneerHealthcare, Inc., 75 F.3d 75, 80 (1st Cir. 1996).

I have already concluded that the doctrine of primaryjurisdiction is not applicable to CTC's claims insofar as the FCCis identified as the agency to which this court should defer,Rec.Dec. at 10, and that recommended decision was adopted by thecourt, Affirming Order at 2. This analysis accordingly will focuson the possibility of deferral to state agencies for the sevenclaims in the First Amended Complaint identified by Bell assubject to its motion on this basis. There are two basic problemswith Bell's position: it requires deferral to seven separatestate agencies and there is no evidence in the summary judgmentrecord that all seven issues have been placed before thoseagencies.

Bell argues that deferral to the state agencies is required inthis case. However, the First Circuit has used mandatory languageonly when the reasonableness of a tariff is at issue. E.g.,Delta Traffic Serv., Inc. v. Transtop, Inc., 902 F.2d 101, 103(1st Cir. 1990). Here, CTC has not challenged the reasonablenessof any state tariffs governing Bell's provision of services. Tothe contrary, CTC argues that Bell's tariffs do not extend to theactions it contends constituted violations of the Sherman Act. Ifthat is the case, the expertise of the seven state agenciesinvolved is not required to unravel intricate technical facts.The court can read the tariffs and determine whether they extendto the factual situations presented by the parties.

In addition, Bell relies on case law in which the courts haveapplied the doctrine of primary jurisdiction to defer to a singlestate agency on a given issue. Here, Bell asserts that"termination liability" is presently being contested before stateagencies in Massachusetts, Maine, New Hampshire, New York, RhodeIsland and Vermont, Gordon Dec. ¶ 20, and that Business Link "issubject to immediate administrative review at CTC's demand," anassertion that is not supported by the citation to the GordonDeclaration given by Bell, Bell's Reply at 7 n. 7. Even if thesewere the only two issues on which Bell sought deferral, and ifthe issues were also pending in Connecticut, there is noguarantee that all seven agencies would rule in the same manner,and certainly no guarantee that all would do so within arelatively short time. Deferral under these circumstances,particularly when there are other issues in dispute which, forall that is shown in the summary judgment record, have not beenbrought before the state agencies and possibly could notbe,15 could not possibly serve the purpose of uniformity thatis at the heart of the doctrine of primary jurisdiction as setforth in Mashpee Tribe, 592 F.2d at 580. Balancing theadvantages of applying the doctrine against the potential costsarising from complications and delay in the agency proceedings,National Communications Ass'n, Inc. v. AT & T, 46 F.3d 220, 223(2d Cir. 1995), I conclude that such costs outweigh any possibleadvantage inherent in application of the doctrine of primaryjurisdiction to seven of the specific claims raised in thisproceeding by CTC. See also Red Lake Band of Chippewa Indians v.Barlow, 846 F.2d 474, 476 (8th Cir. 1988) (doctrine is to beapplied sparingly). Bell is not entitled to summary judgment onthose claims on this basis.

5. Evidence of Monopolization or Attempted Monopolization

Bell next argues that there is no evidence to support CTC'sclaims concerning monopolization. Bell does not identify anyparagraphs or subparagraphs of the First Amended Complaint inwhich such claims are raised. It appears from a reading of theFirst Amended Complaint that such claims are raised only in CountII. To establish a claim of monopolization, a plaintiff must show

(1) the possession of monopoly power in the relevant market and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.

Eastman Kodak Co. v. Image Technical Servs., Inc.,504 U.S. 451, 481, 112 S.Ct.2072, 119 L.Ed.2d 265 (1992) (quoting United States v. GrinnellCorp., 384 U.S. 563, 570-71, 86 S.Ct. 1698, 16 L.Ed.2d 778(1966)). Specifically, Bell argues that CTC cannot provideevidence that Bell has sufficient market power in anappropriately defined market to allow a jury to decide whetherBell has an illegal monopoly or has attempted to obtain amonopoly. Motion for Summary Judgment at 18. Bell's expertwitnesses and CTC's expert witnesses differ on the question ofthe definition of the appropriate market. At first glance,therefore, this appears to be a classic situation in whichsummary judgment is not appropriate. See, e.g., Crist v. FocusHomes, Inc., 122 F.3d 1107, 1112 (8th Cir. 1997).

Market definition in the antitrust context is a question offact that may only be resolved on summary judgment if the recorddoes not present any dispute of material fact. Yeager's Fuel,Inc. v. Pennsylvania Power & Light Co., 953 F. Supp. 617, 645(E.D.Pa. 1997). See also Weiss v. York Hosp., 745 F.2d 786, 825(3d Cir. 1984). Bell argues that the definition of the relevantmarket provided by CTC's experts is erroneous as a matter of lawand internally inconsistent, and that for either reason Bell isentitled to summary judgment.

On the first point, Bell essentially argues that, because itsalleged anticompetitive conduct is "directly regulated by thegovernment," it is impossible, except under extraordinarycircumstances, for its conduct to violate the Sherman Act. Motionfor Summary Judgment at 19-21. Bell relies on Town of Concordas support for this argument. Of course, Town of Concord wasdecided well before the Telecommunications Act of 1996 wasenacted, and Bell's argument ignores the fact that the wholepoint of much of CTC's complaint is that the conduct alleged tobe anticompetitive is not regulated by any government agency. Theissue decided in Town of Concord was "whether a pricingpractice known as a price squeeze violates the antitrust lawswhen it takes place in a fully regulated industry." 915 F.2d at18. A firm can engage in a price squeeze only if it operates asboth a retailer and a wholesaler whose customers are also itscompetitors. Id. A price squeeze occurs when that firm's priceas a wholesaler is too high or as a retailer is too low for thecompetitor to stay in business. Id. The case only dealt with anindustry that was fully regulated — where prices are regulated atboth the retail and the wholesale levels. Id. at 19. The FirstCircuit held that effective price regulation at both levels madeit likely that a price squeeze would constitute an exclusionarypractice under the Sherman Act. Id.

Contrary to Bell's position, the facts in the summary judgmentrecord do not place the case at hand "comfortably within theTown of Concord paradigm." Motion for Summary Judgment at 21.Pricing is only one of the issues alleged in the First AmendedComplaint to be anticompetitive conduct, and Bell has made noshowing that its prices for wholesale products are fullyregulated. Town of Concord in fact provides little guidance tothis court for this case.

In Coastal Fuels of Puerto Rico, Inc. v. Caribbean PetroleumCorp., 79 F.3d 182 (1st Cir. 1996), the First Circuit noted:

Substantial market power that concerns antitrust law arises when the defendant (1) can profitably set prices well above its costs and (2) enjoys some protection against a rival's entry or expansion that would erode such supracompetitive prices and profits. Market power can be shown through two types of proof. A plaintiff can either show direct evidence of market power (perhaps by showing actual supracompetitive prices and restricted output) or circumstantial evidence of market power. Market power may be proved circumstantially by showing that the defendant has a dominant market share in a well-defined relevant market and that there are significant barriers to entry in that market and that existing competitors lack the capacity to increase their output in the short run.

Id. at 196-97 (internal punctuation and citations omitted).Here, CTC has offered evidence to make such a circumstantialcase, sufficient to avoid the entry of summary judgment on thisissue. See also United States v. E.I. du Pont de Nemours & Co.,351 U.S. 377, 395, 76 S.Ct. 994, 100 L.Ed. 1264 (1956) ("Inconsidering what is the relevant market for determining thecontrol of price and competition, no more definite rule can bedeclared than that commodities reasonably interchangeable byconsumers for the same purposes make up that part of the trade orcommerce, monopolization of which may be illegal." (Internalquotation marks omitted.))

Bell attacks this conclusion by arguing that the testimony ofCTC's experts16 on market power is economically unreasonable,making it insufficient to support a jury verdict, citing RebelOil Co. v. Atlantic Richfield Co., 51 F.3d 1421, 1436 (9th Cir.1995). The testimony is economically unreasonable, according toBell, because CTC's experts do not include PBX and Key systems,interLATA (long-distance) services, and wireless mobile servicesin their definition of the relevant market. Motion for SummaryJudgment at 23-25. CTC offers evidence that long distance serviceand cellular telephone service are not in the same relevantproduct market as local telephone service, which is the market inwhich CTC, by the terms of the First Amended Complaint, seeks tocompete with Bell. See, e.g., Declaration of Gregory L. Rosstonin Support of CTC Communications' Opposition to Bell Atlantic'sMotion for Summary Judgment, Exh. G to CTC's Opposition, ¶¶15-17, 20. Bell has established nothing beyond a battle of theexperts on this issue, and is accordingly not entitled to summaryjudgment. While the testimony concerning PBX and Key systems andwhether they should be included in the relevant market is lessclear than that concerning long distance and cellular service,compare id. ¶ 21 and Rule 30(b)(6) Deposition of CTCCommunications Corp. by David E. Mahan, excerpt attached as Exh.C to Bell's SMF, at 49, it is not the role of the court on amotion for summary judgment to assign weight to the evidence. Inaddition, Bell makes no showing that inclusion of PBX and Keysystems in the relevant market would necessarily result in theconclusion that Bell neither holds nor has attempted to hold amonopoly in that market. Similarly, if the testimony of CTC'sexperts is internally inconsistent, that fact goes to the weightof their testimony, not its admissibility. Bell is therefore notentitled to summary judgment on the basis of alleged deficienciesin CTC's expert testimony concerning the relevant market.17

6. Evidence of Anticompetitive Effect.

Bell's next argument for summary judgment on Count II of theFirst Amended Complaint is that CTC has produced no evidence thatany of Bell's challenged actions or inactions have foreclosed asubstantial amount of commerce in any relevant market and thatthe testimony of CTC's experts to the effect that Bell'schallenged actions or inactions are unreasonable andanticompetitive should be excluded due to a lack of basis ineconomic theory "or any other recognized discipline." Motion forSummary Judgment at 27. Bell specifically attacks CTC's claimsregarding voice mail, termination penalties and lack of directaccess to technical support, as well as the expert testimony ofDuncan Simester, in this regard.18 Again, Bell's expertsdisagree with CTC's experts on this issue.

In order to violate the Sherman Act, a restraint on competitionmust be "shown to have or [be] intended to have an effect uponprices in the market or otherwise to deprive purchasers orconsumers of the advantages which they derive from freecompetition." Apex Hosiery Co. v. Leader, 310 U.S. 469, 501, 60S.Ct. 982, 84 L.Ed. 1311 (1940). Because the antitrust laws weredesigned to protect competition, not competitors, Brown Shoe Co.v. United States, 370 U.S. 294, 320, 82 S.Ct. 1502, 8 L.Ed.2d510 (1962), a practice is "anticompetitive" only if it harms thecompetitive process, Data Gen. Corp. v. Grumman Sys. SupportCorp., 36 F.3d 1147, 1182 (1st Cir. 1994). The First Circuitalso uses the term "exclusionary conduct," which it defines as"conduct, other than competition on the merits or restraintsreasonably necessary to competition on the merits, thatreasonably appears capable of making a significant contributionto creating or maintaining monopoly power." Town of Concord,915 F.2d at 21 (internal quotation marks and citation omitted).Injury to competition may be measured by a reduction in outputand an increase in prices in the relevant market, and moregenerally by decreased efficiency in the market that has anegative impact on consumers. Sullivan v. National FootballLeague, 34 F.3d 1091, 1097 (1st Cir. 1994). "[O]therwiseinnocent or ambiguous behavior may violate the Sherman Act whenconsidered together with the remainder of the conduct." UnitedStates v. AT & T, 524 F. Supp. 1336, 1344 (D.D.C. 1981). Proof ofpredatory intent allows an inference of anticompetitive effect.Cornwell Quality Tools Co. v. C.T.S. Co., 446 F.2d 825, 831(9th Cir. 1971).

CTC resists Bell's attempt to focus the court's attention onindividual factual claims for analysis with respect to the issueof competitive injury. It relies on United States v. AT & T tosupport its contention that for purposes of summary judgment thecourt should examine only the pattern of alleged actions and noteach individual action alleged. 524 F. Supp. at 1343-44. BecauseCTC lists actions other than Bell's refusal to sell its voicemail at wholesale or to retail customers who purchase otherservices from resellers, Bell's imposition of terminationpenalties on customers who wish to assign their long-term servicecontracts with Bell to CTC, and Bell's refusal to allow CTCdirect access to its technical support personnel, the only claimsdiscussed by Bell in its motion on this point, CTC's position ispersuasive. I will nevertheless briefly address each of Bell'sarguments.

With respect to Bell's voice mail, Bell argues that its shareof the market forvoice mail is only 3%, Excerpt from Deposition of Jacob Goldberg,Exh. E to Bell's SMF, at 134,19 making it impossible,according to Bell, for its refusal to make its voice mailavailable to harm the competitive process. The basis for the 3%figure is not clear from Goldberg's testimony. CTC offersevidence that one-third of the Centrex customers in New Englandsubscribe to Bell's voice mail, and that Bell's policy prevents45% of these customers from switching to resellers as theirprimary providers of local telephone service. Rosston Dec. ¶ 51;Declaration of Dr. Duncan Simester ("Simester Dec."), Exh. II toCTC's Opposition, ¶ 5. Even if Bell's voice mail policy wereconsidered separately, CTC has provided sufficient evidence toavoid the entry of summary judgment on this claim on the groundasserted by Bell.

Bell next asserts that its imposition of termination penaltiesdoes not foreclose a substantial amount of commerce in therelevant market. Accepting CTC's definition of the relevantmarket for this claim and treating the contracts at issue asexclusive dealing arrangements, Bell argues that CTC must stillmake a "compelling showing of foreclosure of substantial amountsof trade in the relevant market" in order to avoid the entry ofsummary judgment on this claim, citing U.S. Healthcare, Inc. v.Healthsource, Inc., 986 F.2d 589, 595 (1st Cir. 1993). Motionfor Summary Judgment at 30. CTC cannot do so, Bell contends,because its experts, Rosston and Hall, testified at depositionthat they do not know what portion of the relevant market issubject to such contracts. Id. at 30-31. In U.S. Healthcare,a case that did not involve a former monopoly provider newlysubject to a federal statutory preference for competition, theFirst Circuit stated that under the circumstances assumed here byBell, "proof of substantial foreclosure and of probable immediateand future effects is the essential basis under Tampa [Elec.Co. v. Nashville Coal Co., 365 U.S. 320, 81 S.Ct. 623, 5 L.Ed.2d580 (1961),] for an attack on an exclusivity clause." 986 F.2d at597. Here, CTC has offered some evidence both of substantialforeclosure and of probable immediate and future effects.Simester Dec. ¶ 5 (72% of users of access lines would beprevented from switching to resellers by termination penalty);Rosston Dec. ¶¶ 58-59 (88% of business user contracts are for 3years or longer and many customers have multiple long-termcontracts that do not end in the same year, making access by acompetitor in face of the termination penalty "nearlyimpossible"). This is sufficient evidence on the point to avoidthe entry of summary judgment.

CTC's evidence concerning Bell's refusal to allow direct accessto its technical support personnel with respect to the impact ofthis policy on competition is minimal. CTC offers only thestatement of Mahan, its Vice President of Market Planning andDevelopment, that "[t]his lack of direct access impacts CTC'scustomer service, product quality and adds delay to CTC'sprovisioning of resold services to its customers." Mahan Dec. ¶¶2, 26. Standing alone, this assertion would not providesufficient evidence of injury to competition. However, it may beconsidered in combination with other actions and failures to actwhich CTC alleges constitute a pattern of anticompetitive actionin order to establish such an injury.

Finally, Bell argues that Simester's testimony must be excludedas "irrelevant and unreliable." Motion for Summary Judgment at32. While this appears to be a matter more suitable for a motionin limine than assertion as a ground for summary judgment, Iwill address it here because the testimony provides a partialbasis for CTC's opposition to the motion for summary judgment.Bell claims that Simester's methodology has "patently obviousflaws," id. at 33, apparently the asserted facts that Simesterinterviewed only 6%of the companies in his sample and that his sample included onlycustomers who formerly had agency agreements with CTC. Bell citesno authority for this argument. CTC responds that Simester'sactual response rate was 17%, well within the acceptable rangefor such studies, and that whether the customer previously had acontractual relationship with CTC has no effect on Simester'sconclusions. Simester Dec. ¶¶ 8-13. At most, Bell has presentedan issue of the weight to be accorded to Simester's testimony attrial. It has not established a basis for excluding the testimonyfrom the summary judgment record.

Bell is not entitled to summary judgment on the basis of lackof evidence of anticompetitive effect.20

7. Evidence of Antitrust Injury

Again presumably attacking Count II, Bell next argues that itis entitled to summary judgment because CTC has failed to produceevidence of antitrust injury. While it is certainly accurate tosay, as Bell does in beginning its argument on this basis, that aplaintiff seeking recovery under the antitrust laws "must provethe existence of antitrust injury, i.e., injury of the typethe antitrust laws were intended to prevent," Atlantic RichfieldCo. v. USA Petroleum Co., 495 U.S. 328, 334, 110 S.Ct. 1884, 109L.Ed.2d 333 (1990) (internal quotations marks and citationomitted; emphasis in original), Bell so limits its presentationof CTC's claim of antitrust injury that its ensuing argument haslittle or no merit. Bell contends that CTC claims antitrustinjury only to the extent that it was required to comply with atemporary restraining order issued by the court in the actionbrought by Bell in the Southern District of New York that has nowbeen consolidated with this action.21 Motion for SummaryJudgment at 34-35. CTC quite properly points out that it hasalleged antitrust injury caused not by the New York court's orderbut by Bell's imposition of the covenant not to compete containedin the Agency Agreement in a manner now rejected by this court,Decision on Motion to Dissolve TRO, etc. at 26. CTC's Oppositionat 35. Because CTC has not alleged antitrust injury in the onlymanner which Bell raises as the ground for its motion for summaryjudgment, Bell is not entitled to summary judgment on this basis.

8. Refusal to Deal.

Bell asserts that "most of CTC's antitrust claims fail becauseunder the antitrust laws, there is never a duty to offer acompetitor a product or service at a wholesale price, and thereis only seldom a duty to assist a competitor." Motion for SummaryJudgment at 35. Bell does not identify which of CTC's claims arenot subject to this argument, and it specifically mentions onlythe claims regarding Bell's voice mail, its refusal to allowdirect access to its support personnel, and its refusal to allowtransfer of Business Link credits as claims that must fail underthis theory. Id. at 36; Bell's Reply at 10. None of the caselaw cited by Bell arises from a factual situation in which apreviously regulated monopoly is required by statute toparticipate in the development of competition for its services.

It is true that as a general matter a firm can refuse to deal with its competitors. But such a right is not absolute; it exists only if there are legitimate competitive reasons for the refusal.

Eastman Kodak, 504 U.S. at 483 n. 32, 112 S.Ct. 2072. "[A]monopolist's unilateral refusal to deal with its competitors (aslong as the refusal harms the competitive process) may constituteprima facie evidence of exclusionary conduct in the context of a[Sherman Act] claim." Data Gen. Corp., 36 F.3d at 1183. Bellargues, quoting IIIA P. Areeda & H. Hovencamp, Antitrust Law §765b2 (1996) at 101, that "[i]n all cases where a rivalchallenges a unilateral refusal to deal under § 2 [of the ShermanAct], `essentiality' both must be the minimum condition underwhich the duty will be imposed and must define the scope of theduty." Bell's Reply at 11. From this platform, Bell moves to anassertion that CTC has "abandoned any claim that what it hassought is essential," id. at 12, and therefore that CTC cannotrecover on its antitrust claim, at least as to the threespecified claims.

The First Circuit, however, has not adopted Bell's premise. InData Gen. Corp., the First Circuit concluded that "[i]t is notentirely clear" whether the Supreme Court has created "a categoryof refusal-to-deal cases different from the essential facilitiescategory" or whether the Court has invited "the application ofmore general principles of antitrust analysis to unilateralrefusals to deal." 36 F.3d at 1183-84. The First Circuit in thatcase "assumed" the latter — that an antitrust plaintiff need nottailor its argument to an essential facilities category ofrefusal-to-deal antitrust claims. Id. at 1184. Given the FirstCircuit's current position on this issue, it appears that it isnot necessary that CTC either allege or prove that each of theservices involved in its specific claims is an essential facilitybefore it may proceed against Bell on its claims of refusal todeal.

Even if the First Circuit had concluded that in every case inwhich a plaintiff alleged refusal to deal as the basis for anallegation of antitrust violation the plaintiff must firstestablish that the monopolist defendant has refused to makeavailable an essential facility, Bell's assertion that CTC hasabandoned any claim that the services it denied to CTC wereessential is incorrect. No such abandonment is apparent in CTC'sOpposition, where CTC only argues that "[o]ne need not apply theessential facilities doctrine" under the circumstances. CTC'sOpposition at 34. Bell argues that its voice mail cannot be anessential facility because its "market share is in the singledigits;" that its Business Link credits cannot be an essentialfacility because they are available to resellers under certaincircumstances, although it provides no evidentiary support forthis assertion;22 and that CTC's complaint about access toBell's technical support personnel is "solely a complaint thatthey cannot call the personnel directly, but rather have to gothrough the Bell Atlantic wholesale account manager dedicated toCTC." Bell's Reply at 12 n. 13.

I have already addressed Bell's evidence concerning marketshare for its voice mail, and my conclusion regarding CTC'sevidence of the effect on the relevant market of Bell's practicein this regard is relevant here. Given the volume of businessusers found by CTC's expert witness that choose not to switch toresellers for any service when Bell's voice mail will beunavailable as a consequence of the switch, CTC can make asufficient showing that Bell voice mail is an essential facilityfor purposes of its antitrust claims to avoid the entry ofsummary judgment against it, if such a showing is necessary. Itis not necessary to discuss Bell's argument concerning BusinessLink credits in this context, given the lack of appropriateevidentiary support in the summary judgment record. Bell'sargument concerning the lack of direct access to supportpersonnel does not address the status of such personnel as anessential facility. Bell supports its argument on this claim witha citation to Ideal Dairy Farms, Inc. v. John Labatt, Ltd.,90 F.3d 737, 748 (3d Cir. 1996), and a district court case thatrelies on Ideal Dairy. I have previously noted that the ThirdCircuit in Ideal Dairy reached without discussion a conclusionthat I find to be inconsistent with Supreme Court precedent. Rec.Dec. at 22-23. I continue to find Ideal Dairy to beunpersuasive.

Accordingly, Bell is not entitled to summary judgment on anyportion of Count II on the basis of a lack of evidence of failureto deal.

C. Claims Under the Telecommunications Act (Count V-1)

Any claims raised in Count V-1 concerning Bell's voice mailhave been dismissed. Affirming Order at 2. As to the remainingclaims asserted by CTC under the Telecommunications Act, Bellargues in conclusory fashion that it is entitled to summaryjudgment under the filed rate and primary jurisdiction doctrines,for the same reasons set forth in its argument concerning CTC'santitrust claims, and that "CTC has failed to establish that anyof the practices of which it complains constitute unreasonable ordiscriminatory limitations on the resale of itstelecommunications services." Motion for Summary Judgment at 36.CTC, in similarly brief fashion, argues that it has establishedviolations of the Telecommunications Act "for the reasonsidentified above." CTC's Opposition at 36.

CTC's First Amended Complaint alleges violations of47 U.S.C. § 251, which is the portion of the Telecommunications Act of 1996that, inter alia, establishes the duties of local exchangecarriers and incumbent local exchange carriers with respect toresale of telecommunications services. Section 251 provides, inrelevant part:

(b) Obligations of all local exchange carriers

Each local exchange carrier has the following duties:

(1) Resale

The duty not to prohibit, and not to impose unreasonable or discriminatory conditions or limitations on, the resale of its telecommunications services.

(c) Additional obligations of incumbent local exchange carriers

(4) Resale

The duty —

(A) to offer for resale at wholesale rates any telecommunications service that the carrier provides at retail to subscribers who are not telecommunications carriers; and

(B) not to prohibit, and not to impose unreasonable or discriminatory conditions or limitations on, the resale of such telecommunications service. . . .

My research has located no reported decisions interpretingthese provisions of the Act in disputes between carriers, orbetween carriers and resellers. While the objectives andprovisions of the Act are quite different from those of theSherman Antitrust Act, I am therefore constrained by thepresentations of the parties to extend my conclusions concerningthe antitrust claims raised in this action to the claims raisedin Count V-1 as well. Accordingly, for the reasons set forthabove, Bell is not entitled to summary judgment on the remainingclaims set forth in Count V-1 of the First Amended Complaint.

IV. Conclusion

For the foregoing reasons, I recommend that the defendant'smotion for summary judgment be GRANTED as to any claims inCount I arising out of the provision in the Agency Agreement fora separation payment in the event of elimination of thedefendant's third-party marketing channel, as set forth inParagraph 51 of the First Amended Complaint, and as to anyantitrust claims arising out of Paragraphs 41(c) and 56(e) in theFirst Amended Complaint, and otherwise DENIED. I also recommendthat the plaintiff's implied motion to dismiss claims raised inParagraphs 41(i), 56(m) and 86(j) of the First Amended Complaintbe GRANTED.

NOTICE

A party may file objections to those specified portions of amagistrate judge's report or proposed findings or recommendeddecisions entered pursuant to 28 U.S.C. § 636(b)(1)(B) for whichde novo review by the district court is sought, together with asupporting memorandum, within ten (10) days after being servedwith a copy thereof. A responsive memorandum shall be filedwithin ten (10) days after the filing of the objection.

Failure to file a timely objection shall constitute a waiverof the right to de novo review by the district court and toappeal the district court's order.

Nov. 19, 1998.

1. Count III of the First Amended Complaint has beendismissed, as well as any claims asserted in Count II arising outof Paragraph 56(a), any antitrust claims arising out of Paragraph56(b), and any claims in Count V[-1] arising out of an allegedrefusal to sell voice mail services. Order Affirming theRecommended Decision of the Magistrate Judge ("Affirming Order")(Docket No. 111) at 2. The First Amended Complaint includes twocounts identified as Count V; the first will be referred toherein as Count V-1 and the second as Count V-2.

2. The plaintiff, CTC Communications Corp. ("CTC"),"voluntarily dismiss[es]" claims based on Paragraphs 41(i), 56(m)and 86(j) in its First Amended Complaint. CTC Communications'Memorandum of Law in Opposition to Bell Atlantic's Motion forSummary Judgment ("CTC's Opposition") (Docket No. 101) at 4 n. 1.CTC also contends that Bell has not challenged Paragraphs 50(b),51(a), 56(h), and 56(k) of the First Amended Complaint in itsmotion for summary judgment. Id. Bell specifically disputesthis characterization of its motion as to Paragraphs 56(h) and56(k) in its reply. Bell Atlantic's Reply Memorandum in Supportof its Motion for Summary Judgment ("Bell's Reply") (Docket No.108) at 1-2 & n. 2. There is no Paragraph 51(a) in the FirstAmended Complaint. CTC's characterization of Bell's argument asto its claim for breach of contract based on Paragraph 50(b) inCount I is correct.

3. CTC has moved to strike Bell Atlantic Corporation's LocalRule 56 Statement of Undisputed Material Facts ("Bell's SMF")(Docket No. 100), submitted in support of its motion for summaryjudgment as required by this court's Local Rule 56, on the groundthat it fails to comply with the local rule in that it iscomposed of "sweeping assertions liberally sprinkled with legalopinions, legal conclusions, and legal argument, all of which areabsolutely unsupported by any admissible evidence." CTC's Motionto Strike Bell Atlantic's Statement of Undisputed Material Facts(Docket No. 103) at 1. While there are many instances in whichparticular sentences or paragraphs among the unnumberedparagraphs in Bell's 19-page SMF do not meet the requirements ofthe local rule, striking the entire document is not theappropriate sanction. Where necessary, I will identify thoseportions of Bell's SMF upon which the court will not rely due tofailure to meet the requirements of the local rule. I note thatthe court's task is made more difficult by the fact that CTC doesnot respond directly to any of the factual assertions in Bell'sSMF, making it necessary for the court to compare every entry inCTC's 25-page Statement of Disputed Material Facts (Docket No.102) with every acceptable entry in Bell's SMF, a verytime-consuming exercise in a case of the magnitude and complexityof this action.

4. The offset provision of the agreement does not change thisresult. It does not create a condition precedent to payment ofcommissions; it simply gives Bell the right to set off amountsowed to it by CTC at the time Bell's payment is due to CTC. IfBell has not yet determined whether CTC owes it money from someprevious transaction at the time a payment to CTC comes due underthe agreement, it must wait to make a set-off at a later timewhen a payment to CTC is due and Bell has made the necessarydetermination concerning past overpayments, or that CTC owes itmoney for whatever other reason. The provision most certainlydoes not give Bell the right to delay paying commissions due toCTC indefinitely until Bell determines that CTC does or does notowe Bell money.

5. The antitrust law upon which CTC's claims in Counts II andIV of its First Amended Complaint are based is found at15 U.S.C. § 1 et seq. and will often be referred to in this recommendeddecision as the Sherman Act.

6. CTC states that it "will voluntarily dismiss" Count III.CTC's Opposition at 4 n. 1. That count has already been dismissedby the court. Affirming Order at 2. CTC also states that it "willalso voluntarily dismiss its claim concerning Bell Atlantic'sreduction of wholesale discounts" and "its claim of shamlitigation." CTC's Opposition at 4 n. 1. CTC may not simplyvoluntarily dismiss any of its claims at this stage of theaction. Fed. R.Civ.P. 41(a); D'Alto v. Dahon California, Inc.,100 F.3d 281, 283 (2d Cir. 1996). Taking CTC's statement as amotion to dismiss any claims raised in Paragraphs 41(i), 56(m),and 86(j) of its First Amended Complaint, see Bangor BaptistChurch v. State, 92 F.R.D. 123, 125 (D.Me. 1981), I recommendthat the court grant the motion.

7. In its reply memorandum, Bell expands this argument toinclude "imposition of `unreasonable economic terms' on the saleof wholesale services," without specifying any paragraphs in theFirst Amended Complaint. Bell's Reply at 3. Bell's failure toinclude this claim in its initial motion deprived CTC of theopportunity to respond to Bell's state-action argument on thisclaim. As a result, the court will not consider Bell's motion forsummary judgment on this claim on the basis of the state actiondoctrine. Grant v. News Group Boston, Inc., 55 F.3d 1, 7 (1stCir. 1995); In re One Bancorp Sec. Litig., 134 F.R.D. 4, 10 n.5 (D.Me. 1991).

8. The Business Link program is not available in Vermont.Gordon Dec. ¶ 21(b). Neither party appears to find thissignificant in connection with the state action issue.

9. While I do not rely on them, I note that my conclusion isin accordance with those of the three state regulatorycommissions that have ruled to date on this issue in proceedingsinitiated by CTC. Massachusetts Department of Public Utilities,D.T.E. 98-18, Ruling dated July 2, 1998, Exh. HH to CTC'sOpposition; New York Public Service Commission, Case 98-C-0426,Order Granting Petition effective September 14, 1998, enclosed inletter to the court from Rodger D. Young, Esq., dated October 23,1998 ("Young Letter"); New Hampshire Public Utilities Commission,DR 98-061, Order Permitting Assignment of Certain RetailCustomers, Order No. 23,040, dated October 7, 1998, enclosed inYoung Letter. Bell states, without evidentiary support, that theMassachusetts order has been stayed and Bell's petition forreconsideration by that agency granted. Bell's Reply at 7 n. 7.

10. Like the state action doctrine also invoked by Bell, thefiled rate doctrine

is plainly a creature of a different time. The Supreme Court has recognized that `although the filing requirement prevented price discrimination and unfair practices' when AT & T held a monopoly in long-distance telecommunications, strict application of the filed rate doctrine `frustrates those same goals' in today's era of deregulation and multiple competing carriers. MCI Telecomms. Corp. v. AT & T, 512 U.S. 218, 233, 114 S.Ct. 2223, 129 L.Ed.2d 182 (1994). . . . In practice, as this case illustrates, the filed rate doctrine may lead to results that are quite unjust. But . . . this court is not the proper forum in which to resolve the problem. Unless and until Congress or the Supreme Court reexamines the doctrine, we are bound to enforce it.

Fax, 138 F.3d at 491.

11. The "FCC-tariffed" services to which CTC refers areapparently "carrier access services." Plaintiff's Response toDefendant's Second Interrogatories to Plaintiff CTCCommunications Corp., Exh. B to Bell's SMF, Answer 8 at 14. TheintraLATA services listed in Paragraph 56(j) of the First AmendedComplaint are not further defined in the summary judgment recordand, unlike the services in all of the other paragraphs subjectto Bell's filed rate argument, are not separately addressed inBell's written submissions.

12. Bell's assertion that I recommended denial of its motionto dismiss on this ground "because the state commissions ratherthan the FCC were the primary regulators here," Motion forSummary Judgment at 15 n. 6, is incorrect. My analysis at thattime quite clearly and carefully raised but did not resolve thequestion whether application of the primary jurisdiction doctrineis appropriate when the regulatory agency involved is a stateagency rather than a federal one. Recommended Decision onDefendant's Motion to Dismiss ("Rec.Dec.") (Docket No. 46) at10-12.

13. In its reply memorandum, Bell appears to extend itsprimary jurisdiction argument to include "any remainingallegations of wrongful conduct under . . . the antitrust laws."Bell's Reply at 7. The only subparagraphs of paragraphs 41 and 56of the First Amended Complaint not addressed specifically in themotion for summary judgment or the court's order on Bell's motionto dismiss are Paragraphs 41(f) and 56(h) and (k). Bell arguesthat any allegations in Paragraph 56(k) should be "dismissed"because "CTC's experts point to no injury either to competitionor to CTC based on this conduct." Id. at 2 n. 2. This paragraphwill accordingly be discussed in section III(B)(7), infra, inthe context of Bell's more general argument to this effect. Myconclusions set forth in this section apply equally to Paragraphs41(f) and 56(h), which deal with Bell's alleged refusal to allowCTC to publish the fact that it has authority to market andresell Bell services.

14. Bell's motion for summary judgment on CTC's claims underthe Act will be discussed in section III(C), infra.

15. For example, one of the allegations in the First AmendedComplaint that Bell contends is subject to deferral under theprimary jurisdiction doctrine is that Bell has refused to allowresellers to communicate directly with its technical personnelconcerning the intraLATA communications services that theresellers have sold to end users. First Amended Complaint ¶¶41(g), 56(i). Bell has not suggested in any of its submissions inconnection with this motion that such communication is a mattersubject to filed tariffs or committed to administrative agencydetermination by statute.

16. Bell also argues in passing that the testimony of CTC'sexperts is inadmissible under Daubert v. Merrell Dow Pharm.Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993),because those experts fail "to take into account the central factof this case: Bell Atlantic's nature as a pervasively regulatedpublic utility." Motion for Summary Judgment at 23 n. 9. To thecontrary, the testimony of CTC's experts that is presented in thesummary judgment record meets the Daubert test foradmissibility: the experts appear qualified, their testimonyconcerns specialized knowledge, and their testimony would assistthe trier of fact. United States v. Shay, 57 F.3d 126, 132 (1stCir. 1995). If the testimony in fact fails to take into accountthe fact that Bell is subject to regulation and if that fact iscentral to this case, those facts go to the weight of theirtestimony, not its admissibility.

17. Bell's citation to authority for its argument that marketshare should be at most a point of departure in determining theexistence of monopoly power in a regulated industry, SouthernPac. Communications Co. v. AT & T, 740 F.2d 980, 1000 (D.C.Cir.1984), does not affect this conclusion. First, Bell suggests thatthe remaining factors to be considered are the power to controlprices or exclude competition. Bell's Reply at 10. CTC's expertsoffer testimony concerning their conclusions that Bell hasexcluded competition by engaging in the actions challenged byCTC. Second, Southern Pacific was decided twelve years beforethe Telecommunications Act of 1996 changed national policy tomake competition in the provision of local telephone service apossibility as well as a goal. The nature of monopoly power mustby definition be changed when the environment for the possibleexercise of that power has changed so fundamentally.

18. Bell also seeks summary judgment on this basis on CTC'sclaims alleging a tying arrangement involving voice mail andCentrex. Motion for Summary Judgment at 29. This claim, set forthin Count III of the First Amended Complaint, has already beendismissed. Affirming Order at 2.

19. Bell uses a figure of 3.4%, Motion for Summary Judgment at28, but only 3% is supported by the authority cited by Bell,Goldberg's deposition testimony.

20. One exception to this result might be the claim fordisparagement set forth in Paragraph 56(k) of the First AmendedComplaint, as to which Bell contends there is no evidence ofinjury either to competition or to CTC. Bells' Reply at 2 n. 2.However, Bell failed to raise this issue in its initial motion,and, as previously noted, it is not entitled to summary judgmenton the basis of an issue argued for the first time in its replymemorandum. Grant, 55 F.3d at 7.

21. Information concerning the New York action and the orderissued in that case is set forth in this court's order grantingCTC's motion to dissolve that order and denying Bell's motion fora permanent injunction. Decision on Motion to Dissolve TRO, etc.at 1-2, 16-17, 19-20, 25-26.

22. Bell's SMF includes a paragraph concerning Business Linkcustomers and the use and availability of credits under thisprogram, Bell's SMF at 13 [¶ 2], but it provides no citation tothe summary judgment record to support the factual assertions itcontains and thus may not be considered in support of its motionfor summary judgment. See Pew v. Scopino, 161 F.R.D. 1, 1(D.Me. 1995); Donnell v. United States, 834 F. Supp. 19, 21 n. 1(D.Me. 1993). prior to undertaking the search, to questionJennifer about the incident, to notify her of the object of thesearch, and to inform her that she was not required to consent tothe search. The failure of the administrators to take theseactions, however, does not, given the other factors in this case,make the search unjustified at its inception.

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