DC Circuit Questions Aureon/AT&T Tariff Pact

U.S. Court of Appeals for District of Columbia Circuit judges questioned a settlement in principle (in Pacer) that Aureon and AT&T agreed to for a tariff dispute, during oral argument (see 2103190067). Whether a settlement had been reached or if the court had standing to hear the case were issues Friday.

Judge Sri Srinivasan was “surprised by the fact that parties would have filed a document in our court representing that there’s been an agreement reached in principle and then the parties’ representatives before us are not in a position to tell us whether there’s been an agreement reached." Aureon made it sound as if there's no agreement, Srinivasan said.

Aureon attorney James Troup said he learned about the settlement negotiations Thursday and wasn't part of them. Troup said some terms were agreed on, but Aureon’s board hadn't reviewed them. “There has been no written agreement,” said Troup, of Fletcher Heald.

Judges asked whether an agreement would end the case. AT&T attorney Michael Hunseder, of Sidley Austin, responded yes. Hunseder said he became aware of the settlement negotiations earlier in the week and reviewed emails on Thursday between an AT&T representative who was part of the negotiations and Aureon’s CEO confirming an agreement in principle. Attorneys for Aureon and AT&T didn’t respond to requests for comment on details.

Judge Cornelia Pillard asked whether Aureon will seek to dismiss its petition for review if there's a pact. Troup said it would be in a position to do so for only the district court case if Aureon settled with AT&T and not the FCC.

Srinivasan questioned standing, saying “we don’t know yet whether the governing rate is the benchmark rate or the cost-based rate because it’s only the lower of the two that’s operative.” If Aureon were challenging only the benchmark rate, “then we don’t know yet whether any of those challenges even matter,” Srinivasan said.

Asked by Pillard whether the cost-based or benchmark rate applies to Aureon, FCC attorney William Scher said the commission didn’t identify a lawful rate and instead directed Aureon to revise its tariff and provide more support for its cost-based rate. The FCC declined comment afterwards.

Srinivasan questioned how it's clear the benchmark rate is below the cost-based rate if “there needed to be more information to figure out what the cost-based rate is, so we don’t know which is the lower one.” Pillard asked whether additional data could either validate or define another rate. “We don’t know until we know,” Pillard said.

Judges asked why AT&T isn't subject to the same objection it raised about Aureon’s standing due to uncertainty on the benchmark rate. Hunseder said AT&T has standing because its tariff rate is higher than the benchmark. Pillard asked whether the case would affect how the “appropriate rate would be calculated in the nature of refunds.” Had the FCC for AT&T, Hunseder said, there would have been a determination on the benchmark and that’s “injuring us right now.”

Judge Neomi Rao didn’t ask questions. The docket is 18-1258.