Tenth Circuit Issues Decision in Qwest Phoenix Forbearance Appeal

Randy Sifers contributed to this blog post.

Yesterday, the U.S. Court of Appeals for the Tenth Circuit issued its long-awaited decision in Qwest v. FCC, Qwest’s appeal of the Federal Communication Commission’s (FCC’s) June 2010 decision denying Qwest’s petition for forbearance from unbundling obligations and dominant carrier regulations pertaining to Qwest’s provision of mass market services in the Phoenix, Arizona metropolitan statistical area (MSA). The Court denied Qwest’s petition for review of the FCC’s decision.

Qwest had attacked the FCC’s decision in two primary ways. First, Qwest claimed that the FCC had impermissibly changed the way it analyzed petitions for forbearance from UNE obligations mid-stream. Specifically, when Qwest first filed its petition seeking forbearance in Phoenix, the FCC was applying an arithmetic ​“two prong” test first established in granting Qwest’s prior request for UNE forbearance in Omaha. However, in the Phoenix decision, the Commission abandoned the Omaha test and substituted a market power analysis similar to that used by the Commission, the Federal Trade Commission and the Department of Justice in merger reviews. The Court ruled that the Commission was free to determine that its prior approach was flawed and to replace it with a market power analysis approach.

Click here to read the complete Kelley Drye Client Advisory for further information on the Phoenix Order.