The United States Court of Appeals for the 11th Circuit held yesterday that a federal district court had no jurisdiction to review an action of the Federal Communications Commission. Only the court of appeals has exclusive jurisdiction to enjoin, set aside, suspend, or determine the validity of all final orders of the FCC. District courts cannot determine the validity of FCC orders.
The ruling came on appeal of a federal district court decision that the court had no jurisdiction to rule on a decision by the FCC to apply, on a prospective basis, an order that required universal service funds be calculated based on a carrier’s interstate and international revenues. Prior to the FCC’s order on recalculating universal service contributions, the FCC had calculated universal service support for rural healthcare providers, and schools and libraries based partially on a carrier’s intrastate revenues.
A 1998 ruling from the United States Court of Appeals-Fifth Circuit had determined that federal universal service support could not be based on intrastate rates. To implement the court’s holding, the FCC issued an order that starting November 1, 1999, universal service support would not be based on intrastate revenues.
Citing the ruling in the Fifth Circuit, an individual plaintiff brought an action in federal district court seeking refunds retroactively of pass through charges she had been assessed for universal service support. The district court found that pursuant to the Communications Act it had no jurisdiction to rule on the validity of the FCC’s prospective order on universal service support. The court of appeals concurred with the district court’s ruling.
Investors should be mindful that neither the 5th or 11th circuits addressed the issue of refunds of universal service contributions made between January 1, 1998 and October 31, 1999. The total amount of contributions made during this period was $1.6 billion. An action could still be brought to recover this amount in refunds. I do not believe that the FCC or the industry would endorse initiatives to identify who these refunds would go to because of the administrative burden that would be imposed. The cost to the FCC and the industry to identify potential recipients and distribute these funds may well exceed $1.6 billion.
Martha Self v. BellSouth Mobility, No. 11-13998, United States Court of Appeals, 11th Circuit