WISCONSIN BELL , INC ., d/b/a Ameritech Wisconsin v. Ave M. Bie , et al., Commissioners of the Public Service Commission of Wisconsin, in…

In the
United States Court of Appeals
For the Seventh Circuit
____________
Nos. 02-3854, 02-3897
W ISCONSIN B ELL , I NC ., d/b/a Ameritech Wisconsin,
Plaintiff-Appellee,
v.
A VE M. B IE , et al., Commissioners of the Public Service
Commission of Wisconsin, in their official capacities,
Defendants-Appellants,
and
W ORLD C OM , I NC .,
Intervening Defendant-Appellant.
____________
Appeals from the United States District Court
for the Western District of Wisconsin.
No. 01-C-0690-C—Barbara B. Crabb, Chief Judge.
____________
A RGUED A PRIL 14, 2003—DECIDED A UGUST 12, 2003
____________
Before C UDAHY , P OSNER, and E ASTERBROOK, Circuit Judges.
P OSNER , Circuit Judge. Local telephone companies such as
Wisconsin Bell have a degree of monopoly power because
of the cost to a competitor of duplicating the grid of tele-
phone wires and switching equipment that constitutes a

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2 Nos. 02-3854, 02-3897
local telephone network. The competitor will find it difficult
to compete unless it is interconnected with the local net-
work. The Telecommunications Act of 1996 provides a
machinery for encouraging interconnection. The competitor
can require the local phone company to negotiate, in good
faith, an agreement authorizing interconnection on mutually
agreeable terms. If negotiations fail, the competitor can seek
arbitration by the state regulatory commission, and the
commission’s arbitral decision can be challenged in federal
district court on the ground that the decision fails to comply
with 47 U.S.C. §§ 251 or 252, sections that establish pricing
and other standards for interconnection. See Verizon Com-
munications, Inc. v. FCC, 535 U.S. 467, 492-97 (2002). But the
commission’s decision cannot be challenged in state court.
47 U.S.C. §§ 252(e)(4), (6).
The question presented by this appeal is whether a state
may create an alternative method by which a competitor can
obtain interconnection rights. Wisconsin’s public utility
commission simply ordered Wisconsin Bell to file tariffs
setting forth the price and other terms on which competitors
such as WorldCom shall be entitled to interconnect with
Wisconsin Bell’s local telephone network, rather than
arbitrating a disagreement between WorldCom and its
competitors concerning the terms on which those com-
petitors could interconnect with Wisconsin Bell’s local
network. Wisconsin Bell challenged the order in federal
district court. The judge held that the order is barred by the
federal act, and these appeals (by the commission itself, and
by WorldCom) followed.
Whether as the district judge ruled the state’s tariff-filing
order is preempted by the provisions of the federal act cre-
ating the contractual route to interconnection depends on
whether the state requirement interferes with the federal
procedure. The Federal Telecommunications Act is explicit

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Nos. 02-3854, 02-3897 3
that a state commission’s regulations concerning intercon-
nection are not preempted “if such regulations are not
inconsistent with the provisions of [the Federal Telecommu-
nications Act].” 47 U.S.C. § 261(b); Verizon North, Inc. v.
Strand, 309 F.3d 935, 937-44 (6th Cir. 2002). But if they are
inconsistent, they are preempted. A conflict between state
and federal law, even if it is not over goals but merely over
methods of achieving a common goal, is a clear case for
invoking the federal Constitution’s supremacy clause to
resolve the conflict in favor of federal law, see, e.g., Gade v.
National Solid Wastes Management Ass’n, 505 U.S. 88, 103-04
and n. 2 (1992)—and so WorldCom acknowledges in its
reply brief.
There is an initial question, however, whether the
state’s tariff order has any practical significance. Wisconsin
disclaims authority to fix the rates in the tariffs that it has
ordered Wisconsin Bell to file. If taken literally, the dis-
claimer implies that if Wisconsin Bell wants to prevent
WorldCom or other would-be competitors from bypassing
the contractual route, and thus to thwart utterly the state
commission’s alternative procedure, it has only to specify a
ridiculously high price in the tariffs that it files. But against
this the Wisconsin commission, while disclaiming authority
to fix the rates in Wisconsin Bell’s interconnection tariffs,
asserts a right to insist that the rates be “reasonable.” “[T]he
commission may not, and is not, specifying the tariff rates,
terms, and conditions . . . . However, compliance with this
order for tariffing does require good faith on the part of
Ameritech; it cannot post a price, or impose terms and
conditions, so totally unreasonable as to amount to a de
facto avoidance of compliance. An unreasonable price, term,
or condition is one that is patently obvious to any reason-
ably well-informed buyer as intended to discourage or
prevent the purchase of the service. Having said that,
however, the Commission recognizes that, in any challenge

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4 Nos. 02-3854, 02-3897
to a price, term or condition, the proponent would have
a heavy burden to prove Ameritech’s noncompliance with
this order.” Final Decision, Investigation into Ameritech
Wisconsin Operational Support Systems, Docket No. 6720-
TI-160, at 20, available at http://psc.wi.gov/pdffiles/
ord_notc/3823.pdf (Public Service Commission of Wiscon-
sin Sept. 25, 2001).
In the usual type of common carrier or public utility
regulation, the reasonableness of a rate is determined by ref-
erence to the cost of the tariffed service; the carrier or utility
is constrained to fix a rate no higher than necessary to cover
the cost of the service. The passage we just quoted from the
Commission’s decision suggests that only an outlandish
discrepancy between the tariffed rate and the cost of service
will trigger a finding of unreasonableness. This implies that
Wisconsin Bell’s pricing freedom is constrained only to the
extent that it may not fix a rate that exceeds the upper end
of the range of prices likely to emerge from a negotiation
with a would-be competitor in accordance with the proce-
dures set forth in the federal act. The tariffing requirement
would still be pretty empty because the would-be competi-
tor would expect to be able to do better in a negotiation
subject to arbitration than merely to bow to the telephone
company’s opening bid.
We were led by these ruminations to direct the parties to
file supplemental briefs explaining just what is at stake in
this case. We learn from these briefs that while indeed
disclaiming power to fix Wisconsin Bell’s rates, the Wiscon-
sin commission has ruled that the rates in the tariffs that it
has required Wisconsin Bell to file must be based on the
cost of the tariffed services as determined in accordance
with cost-accounting procedures prescribed by the com-
mission; specifically, the rates must be based on “the sum

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Nos. 02-3854, 02-3897 5
of the Total Element Long Run Incremental Cost (TELRIC)
and a reasonable allocation of forward-looking joint and
common costs.” Final Decision, Investigation into Ameritech
Wisconsin’s Unbundled Network Elements, Docket No.
6720-TI-161, at 22-23, available at http://psc.wi.gov/
pdffiles/ord_notc/4534.PDF (Public Service Commission of
Wisconsin Mar. 22, 2002). Rates so determined will prevent
Wisconsin Bell from setting a “take it or leave it” rate that
might deter all prospective entrants from taking the tariff
route. “As explained in the Final Decision, this order does
not establish [the tariff rates] themselves, but determines the
details of a methodology that can be used to determine cost-
based [tariffs] as required. For example, the Commission
made the determinations in its Final Decision for the appro-
priate cost of capital, depreciation rates, level of spare
capacity (fill), contract prices and joint and common mark-
up to comply with forward-looking TELRIC pricing stand-
ards to name a few such details.” UNE Compliance Order,
Investigation into Ameritech Wisconsin’s Unbundled Net-
work Elements, Docket No. 6720-TI-161, at 61, available
at http://psc.wi.gov/pdffiles/ord_notc/ 6145.PDF (Public
Service Commission of Wisconsin July 9, 2003). These
decisions make clear that it is the commission, not Wiscon-
sin Bell, that is making the tariff in a realistic sense. The
statement by our dissenting colleague that the decisions
from which we have quoted do not concern the tariffs that
the Commission has ordered Wisconsin Bell to file is
incorrect. The decisions expressly direct Wisconsin Bell to
file conforming tariffs on unbundled network elements
(UNE), March 22 order, supra, at 2, which are a component
of operational support systems (OSS), the general term for
the provision of access by a local phone company to a new
entrant. Sept. 25 order, supra, at 1 n. 1.
The district court was right to hold that the state’s tar-
iffing requirement is preempted. See Verizon North, Inc. v.

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6 Nos. 02-3854, 02-3897
Strand, supra, 309 F.3d at 941; MCI Telecommunications Corp.
v. GTE Northwest, Inc., 41 F. Supp. 2d 1157, 1178 (D. Ore.
1999); but cf. Michigan Bell Tel. Co. v. MCIMetro Access
Transmission Services, Inc., 323 F.3d 348, 358-60 (6th Cir.
2003). The requirement has to interfere with the procedures
established by the federal act. It places a thumb on the
negotiating scales by requiring one of the parties to the
negotiation, the local phone company, but not the other, the
would-be entrant, to state its reservation price, so that
bargaining begins from there. And it allows the other party
to challenge the reservation price, and try to get it lowered,
by challenging the tariff before the state regulatory commis-
sion, with further appeal possible to a state court—even
though Congress, in setting up the negotiation procedure,
explicitly excluded the state courts from getting involved in
it. At the very least, the tariff requirement complicates the
contractual route by authorizing a parallel proceeding.
It is true that the arbitral procedure prescribed by the
federal act is not completely freewheeling. The state com-
mission is required, in the event the parties cannot come to
an agreement, to establish terms of interconnection based on
the same TELRIC pricing standard that the commission
would apply to a tariff challenge. Verizon Communications,
Inc. v. FCC, supra, 535 U.S. at 493-97. But it does not follow
that the tariff route and the negotiation route are the
same or have the same effects. An appeal from the commis-
sion’s resolution of an entrant’s challenge to a tariff would
go to a state court, rather than a federal court, a difference
that cannot be assumed to be inconsequential. And given
the vagaries of the regulatory process, which requires
such stabs in the dark as making “reasonable projections” of
the use that a prospective entrant will make of access to the
local network if interconnection is ordered, id. at 496
n. 16, and the fact, as the Court noted in that case, that in

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Nos. 02-3854, 02-3897 7
setting rates the state commissions are subject to an “im-
portant limitation previously unknown to utility regula-
tion,” id. at 493, the results of a negotiation between the
local phone company and a prospective entrant are not
preordained—if it were, the federal law would not have
made recourse to the commission a last resort if negotiations
fail. The tariff procedure shortcircuits negotiations, making
hash of the statutory requirement that forbids requests for
arbitration until 135 days after the local phone company is
asked to negotiate an interconnection agreement. 47 U.S.C.
§ 253(b)(1).
The commission and WorldCom argue that by providing
an alternative means of obtaining interconnection, the
state’s tariff requirement promotes the procompetitive pol-
icy of the federal act. But to identify the policy underlying
a statute and then run with it is a dangerous method of
interpretation; it is likely to run roughshod over the com-
promise between interest groups that enabled the statute to
be passed in the first place. Rodriguez v. United States, 480
U.S. 522, 525-26 (1987) (per curiam); Hrubec v. National
Railroad Passenger Corp., 49 F.3d 1269, 1270 (7th Cir. 1995);
Bethlehem Steel Corp. v. EPA, 723 F.2d 1303, 1309 (7th Cir.
1983); Philip P. Frickey, “From the Big Sleep to the Big Heat:
The Revival of Theory in Statutory Interpretation,” 77 Minn.
L. Rev. 241, 251 (1992). The negotiation procedure estab-
lished by the federal act provides the local phone company
with a degree of protection that it would lack if the state
commission could, by requiring the company to file a tariff
that the commission might invalidate as unreasonable,
enable would-be entrants to bypass the federally ordained
procedure.
A FFIRMED .

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8 Nos. 02-3854, 02-3897
C UDAHY , Circuit Judge, dissenting. The starting point for
the present analysis must be the strong presumption against
preemption of state law, especially in the area of local
telephone service where, until the passage of the Telecom-
munications Act of 1996 (the Act or FTA), Pub. L. No. 104-
104, 110 Stat. 56, the states had historically exercised an
exclusive jurisdiction. See Medtronic, Inc. v. Lohr, 518 U.S. 470,
485-86 (1996); Louisiana Pub. Serv. Comm’n v. F.C.C., 476 U.S.
355 (1986). No doubt the FTA prescribes a specific, but I
believe non-exclusive, process for determination of prices to
be charged by incumbent carriers to aspiring competitors.
But the Act makes clear that state regulatory processes are
not to be voided unless they can be shown to conflict with
federal purposes. In fact, as the majority notes, the FTA
clearly addresses the issue of preemption as follows:
Nothing in this part shall be construed to prohibit any
State commission from enforcing regulations prescribed
prior to February 8, 1996, or from prescribing regula-
tions after February 8, 1996, in fulfilling the require-
ments of this part, if such regulations are not inconsis-
tent with the provisions of this part.
47 U.S.C. § 261(b). Plus, the Act has a more general savings
clause. “This Act and the amendments made by this Act
shall not be construed to modify, impair, or supersede
Federal, State, or local law unless expressly so provided in
such Act or amendments.” FTA § 601(c)(1). Not only did
Congress limit the general preemptive power of the Act, but
it further expressly delegated an important and integral role
to the state commissions in establishing prices under the act
as follows:
(1) Interconnection and network element charges.
Determinations by a State commission of the just and rea-
sonable rate for the interconnection of facilities and

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Nos. 02-3854, 02-3897 9
1 The F.C.C. has implemented these standards with regulations
outlining the TELRIC costing methodology. For example, 47
C.F.R. § 51.503(b) provides in pertinent part:
(b) An incumbent LEC’s rates for each element it offers shall
comply with the rate structure rules set forth in §§ 51.507 and
51.509, and shall be established, at the election of the state
commission—
(1) Pursuant to the forward-looking economic cost-
based pricing methodology set forth in §§ 51.505 and
51.511 . . . .
(emphasis added) and 47 C.F.R. § 51.505(a) provides in pertinent
part:
(a) In general. The forward-looking economic cost of an
element equals the sum of:
(1) The total element long-run incremental cost of the
element, as described in paragraph (b); and
(2) A reasonable allocation of forward-looking common
costs, as described in paragraph (c).
equipment for purposes of subsection (c)(2) of section
251 of this title, and the just and reasonable rate for
network elements for purposes of subsection (c)(3) of
such section—
(A) shall be—
(i) based on the cost (determined without ref-
erence to a rate-of-return or other rate-based
proceeding) of providing the interconnection or
network element (whichever is applicable), and
(ii) nondiscriminatory, and
(B) may include a reasonable profit.
47 U.S.C. § 252(d)(1) (emphasis added). 1

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10 Nos. 02-3854, 02-3897
The only question we must answer is whether a Wisconsin
order requiring an incumbent carrier to offer by tariff the
same network elements available by negotiated and arbi-
trated interconnection agreements is “inconsistent” with the
“provisions” of the Act. The majority says yes. I disagree.
There are several points to be made in response to the
majority. The majority, in essence, reduces the conflict to
one of an alternative procedure when it bemoans that, “at
the very least[,]” the tariff authorizes a “parallel procedure,”
and that tariffing is “making hash” of the 135 day waiting
period before the state can be summoned to arbitrate in a
manner similar to its function in the tariffing process. In this
discussion, the majority appears to echo the errors of the
Sixth Circuit, which has similarly justified preemption
based on interference with § 252’s procedure. The Sixth
Circuit found preemption by misinterpreting the Supreme
Court decision in Gade v. National Solid Wastes Management
Ass’n, 505 U.S. 88 (1992), involving the preemptive effect of
the Federal Occupational Safety and Health Act (OSHA) on
parallel state regulation. Verizon North, Inc. v. Strand, 309
F.3d 935, 940 (6th Cir. 2002); cf. Michigan Bell Tel. Co. v.
MCIMetro Access Transmission Servs., Inc., 323 F.3d 348, 360
(6th Cir. 2003) (finding no preemption because tariff did not
give entrant an “alternative route around the entire inter-
connection process”). These Sixth Circuit cases argue that,
because the negotiation method was prescribed by § 252,
any other method allowing one to foreshorten negotia-
tion/arbitration must be preempted.
This result is reached, however, by seizing upon a quo-
tation from Gade and using it out of context. Gade, 505 U.S.
at 103 (“A state law also is pre-empted if it interferes with
the methods by which the federal statute was designed to
reach th[at] goal.”) (alterations in original), quoting Int’l
Paper Co. v. Ouellette, 479 U.S. 481, 494 (1987). However,

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Nos. 02-3854, 02-3897 11
Gade was based on a finding that, with respect to occupa-
tional safety and health, Congress had intended to occupy
the whole field. The quotation cited by the Sixth Circuit, in
context, merely reinforces Gade’s conclusion that OSHA
preempted the entire field of parallel state regulation.
Therefore, of course, any state law that circumvented the
procedure outlined in OSHA would be preempted. By
contrast, with respect to competition for local telephone
service, no one has claimed that Congress intended to oc-
cupy the whole regulatory field. As the excerpt that I have
quoted from the Act shows, the state commissions occupy
a key role in the regulatory scheme. Hence, the whole idea
that the method of negotiation/arbitration is exclusive and
preemptive has no sound legal basis. While Gade showed a
clear intent to exclude parallel state regulation, the Act here
does not exclude, but rather specifically embraces, such
parallel regulation. So a finding of preemption here requires
much more than merely a parallel procedure. Something
about tariffing must interfere with the purpose and struc-
ture of the Act. See, e.g., In re Public Utility Commission of
Texas, 13 F.C.C.R. 3460, 3526 (1997) (finding that state
tariffing of telecommunications services for resale not
preempted because it did not prohibit entrants from de-
manding negotiation/arbitration under § 252).
The majority appears to be reaching for an argument that
the tariff interferes with more than a method when it la-
ments the economic “thumb on the negotiating scales” it
believes that tariffing imposes on Wisconsin Bell. But in
context this argument lacks substance—the § 252 mecha-
nism already contemplates a very similar “thumb” inherent
in its negotiation/arbitration method of interconnection.
What the Public Service Commission of Wisconsin (PSC or
commission) has told us is that it would use the federal

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12 Nos. 02-3854, 02-3897
2 TELRIC is Total Element Long-Run Incremental Cost, the cost-
based methodology for determining the price of network ele-
ments necessary to interconnection under the Act. It was pre-
scribed by the F.C.C. under the terms of the Act. See Verizon
Communications, Inc. v. F.C.C., 535 U.S. 467 (2002).
3 See 47 U.S.C. § 252(d); 47 C.F.R. §§ 51.501-505.
4 Historically, state commissions (although not necessarily
Wisconsin’s) generally favored the former Bell system companies
in their struggles with the F.C.C.’s preaching of competition.
TELRIC 2 methodology mandated by the F.C.C. and ap-
proved by the Supreme Court, if called upon to evaluate a
proposed tariff. Verizon, 535 U.S. 467. This is the methodol-
ogy the PSC must use whenever it is requested to arbitrate
interconnection negotiations under the Act, or to approve an
arbitrated interconnection agreement under the Act or to
approve the eerily tariff-like Statement of Generally Avail-
able Terms that Wisconsin Bell could choose to file under
§ 252(f). 3 So any negotiation of an interconnection agree-
ment is an option backed by the readiness of a state com-
mission to intervene at any time on the request of any party,
at which point the commission will set rates, and will use
the TELRIC methodology to do so. The state’s role as a
ratemaker, even under the regime of the Act, is still central.
See Verizon, 535 U.S. at 476-77, 489, 493 (explaining that the
FTA clearly contemplates a central role for state commis-
sions in setting interconnection lease rates under the
standards set by the F.C.C., i.e., TELRIC). In fact, the state’s
function and the appropriateness of TELRIC have been the
subjects of two lawsuits pursued to the Supreme Court by
incumbent companies. Id.; AT&T Corp. v. Iowa Utilities Bd.,
525 U.S. 366 (1999). 4
To ponder the majority opinion is to imagine that the tariff
requirement would somehow bludgeon Wisconsin Bell into

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Nos. 02-3854, 02-3897 13
revealing negotiating secrets, like its reservation price, that
it would otherwise be able to protect, or into otherwise
bargaining from an inferior position. The reality is that any
entrant that does not feel satisfied with Wisconsin Bell
during negotiations can summon the PSC to follow a
procedure virtually identical to what is going on unilaterally
during the tariffing process at issue. In fact, if anything, the
statutory role of the PSC as arbitrator is more intrusive than
the tariffing process at issue here. In tariffing, Wisconsin
Bell has the opportunity to propose the terms of the tariff,
which ordinarily are not disturbed. As arbitrator, however,
the PSC dictates the rate, in accordance with TELRIC. In
other words, the tariff procedure (a process employed since
time immemorial in the regulation of local telecommunica-
tions carriers) gives a very similar result through a process
just like the negotiation/arbitration method, lacking only
the initiating request by an entering competitor to negotiate.
And at the end of either process, negotiation/arbitration or
tariffing, an aggrieved Wisconsin Bell can challenge the
result in federal court. I believe the majority is incorrect
when it claims that a tariffing challenge would go to state
court. Insofar as the challenge would concern the state’s
application of the TELRIC standard in evaluating a tariff, it
is likely that the federal courts would have jurisdiction over
the matter, just as they would over a challenge to an
arbitrated interconnection agreement. See Verizon Maryland,
Inc. v. Public Service Comm’n of Maryland, 535 U.S. 635, 641-44
(2002).
But, says the majority, the method of § 252 represents
Congress’s careful compromise of interest group positions
and any regulation that influences or alters that process
risks undermining the “protection” afforded incumbents
like Wisconsin Bell. That is an interesting thought, but
unsupported by the statute. And even if one does believe
the method outlined in § 252 is designed to provide some

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14 Nos. 02-3854, 02-3897
5 This presumes, of course, that, as the TELRIC methodology
promises, the resulting tariff is not merely a one-size-fits-all menu
of prices and services, but is, instead, sensitive to the variations
in cost from entrant to entrant. See Verizon, 535 U.S. at 496 n.16
(“The actual TELRIC rate charged to an entrant leasing the ele-
ment would be a fraction of the TELRIC figure, based on a
‘reasonable projection’ of the entrant’s use of the element
(whether on a flat or per- usage basis) as divided by aggregate
total use of the element by the entrant, the incumbent, and any
other competitor that leases it.”). The majority makes much of
the fact that the PSC has asserted that Wisconsin Bell (and
everyone else) is bound by the TELRIC costing methodology. But
this is merely a restatement of what federal law, implemented
by a federal agency, has decreed. See note 1, supra.
measure of protection to incumbents, any postulated loss of
supposed protection through the tariffing method is
illusory. One need only examine two hypothetical negotia-
tions to see this. In one negotiation there exists a PSC-
approved tariff and in the other there is no tariff. In the
tariff negotiation, Wisconsin Bell will likely obtain no price
higher than its tariff offers since the entrant will either
accept the tariff or negotiate with Wisconsin Bell for a price
lower than the tariff. In the non-tariff negotiation Wisconsin
Bell can, as the majority believes proper, propose any price
it chooses. The entrant, however, knowing that it can always
look to the state to participate eventually, will not accept a
price greater than what it would eventually get from the
state—presumably an amount roughly equal to what the
tariff price would be (since the same methodology would be
used in both instances). 5 Either way, the applica-bility of the
ubiquitous TELRIC standard limits incumbents’ bargaining
power. Wisconsin Bell cannot avoid the fact that its “reser-
vation” price is, in this way, always quasi-public in all
interconnection environments.

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Nos. 02-3854, 02-3897 15
From all appearances, requiring a tariff is not inconsistent
with the negotiation of a price or with the ultimate prescrip-
tion of a price determined by the state commission as
arbitrator. This is especially so, given that the tariff does not
impede the right of an entrant to demand negotiation. It
may be that the majority, the district court and some other
courts that have viewed this problem have looked upon the
negotiation phase as providing a purely “free market”
solution as opposed to a regulatory solution. I think this
dichotomy simply does not exist here, where all parties are
bound to the TELRIC method of rate determination. In fact,
as the Supreme Court has recognized in rejecting the
challenges of incumbent companies, TELRIC controls
throughout. See Daniel F. Spulber & Christopher S. Yoo,
Access to Networks: Economic and Constitutional Connections,
88 Cornell L. Rev. 885, 969 (2003) (“TELRIC thus governs all
of the important pricing aspects of the access regime created
by the 1996 Act.”).
Finally, the majority includes a discussion of the hypothet-
ical process by which a tariff is proposed and then approved
by the PSC. But what is involved here is simply a facial
challenge to the PSC’s ability to require tariffing under any
circumstances. No price term or any other term for the tariff
has yet been proposed. Speculation about possible terms is,
therefore, beside the point in this facial challenge, and the
only issue is whether there is any set of facts under which
the PSC can require tariffing.
In fact, the majority’s hypothetical discussion goes seri-
ously astray by fortifying its arguments with quotations
from PSC decisions and orders that do not concern the
Operational Support Systems (OSS) tariffs at issue here,
but are, instead, orders and decisions with respect to the
establishment of TELRIC standards for the negotiation and

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16 Nos. 02-3854, 02-3897
6 The PSC was the first to bring the two UNE Orders into the
present case when, in its second supplemental brief, it used a
quotation from the UNE Final Decision to support its claim that
TELRIC is a methodological means, not a ratesetting end. How-
ever, the majority overreaches when it uses these documents to
demonstrate that the PSC exercises control over the final result of
the tariffing process.
7 In fact, when one continues to read onward, but a few pages
later, the PSC does finally have something to say about tariffs
(but not the OSS tariffs). These tariffs are required under the UNE
Final Decision as a temporary offering made available to entrants
who have requested interconnection and are to be used only
during the pendency of the negotiation/arbitration. UNE Final
Decision at 187 (“[Wisconsin Bell] is required to file UNE tariffs in
addition to the tariffs already required under the OSS order. . . .
(continued...)
arbitration mechanism of the Act. 6 See UNE Compliance Order,
Investigation into Ameritech Wisconsin’s Unbundled
Network Elements, Docket No. 6720-TI-161, available at
http://psc.wi.gov/pdffiles/ ord_notc/6145.PDF (Public
Service Commission of Wisconsin July 9, 2003); Final
Decision, Investigation into Ameritech Wisconsin’s Unbun-
dled Network Elements, Docket No. 6720-TI-161, avail-
able at http://psc.wi.gov/pdffiles/ord_notc/4534.PDF
(Public Service Commission Wisconsin Mar. 22, 2002)
(“UNE Final Decision”). I am tempted to dismiss these
decisions as simply inappropriate and irrelevant with
respect to the present case’s evaluation of OSS tariffs,
especially as used by the majority. Or I might point out that
the majority’s claim that “it is the commission, not Wiscon-
sin Bell, that is making the tariff in a realistic sense” does
not logically follow from the part of the decision quoted
because that refers to PSC actions on standards for arbitra-
tion and has nothing to say about the OSS tariffs. 7 Or, in the

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Nos. 02-3854, 02-3897 17
7 (...continued)
Those tariffs [the OSS tariffs] will meet the tariffing requirement
in this order, but are not time limited as are the other tariffs
ordered herein.”). The PSC notes, tellingly,
To implement this tariffing decision, the Commission
required [Wisconsin Bell] to file proposed tariffs in its
compliance filing. However, in Wisconsin, when tariffs are
placed on file, Commission approval is not required. Addition-
ally, [Wisconsin Bell] is allowed to revise tariffs without Commis-
sion approval. Accordingly, when issues arise about the terms
and conditions of offerings, it is expected that arbitration
panels will determine whether terms of offerings are non-
discriminatory and comply with federal and state require-
ments. The tariffs filed as a result of this proceeding do not
limit an arbitration panel’s ability to establish such compliant
terms and conditions.
UNE Compliance Order, at 65 (emphasis added). To the extent that
this Order is relevant to the present case, I do not believe it offers
support to the majority opinion.
alternative, I might note a certain irony in how the “realistic
sense” in which the PSC is allegedly “making the tariff” is
actually the PSC acting as arbitrator to the interconnection
process that the majority ostensibly seeks to protect. But
instead, I will only comment that the UNE decisions’
TELRIC discussions cited by the majority reinforce my basic
premise, which is that the tariffing is not markedly different
from the negotiating and arbitrating procedure. The differ-
ences are purely matters of form, not involving substance,
and are not inconsistent with the provisions of the Act.
When one strips away the tangential distractions, the
majority has ruled that Congress intended there to be only
one method to achieve interconnection and establish its
terms. The Act does not support this conclusion.

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18 Nos. 02-3854, 02-3897
I therefore respectfully dissent.
A true Copy:
Teste:
_____________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—8-12-03

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