CPUC Unlawfully Assessed MetroPCS Services, Court Rules

T-Mobile’s MetroPCS prevailed against the California Public Utilities Commission in a dispute about USF surcharges at the U.S. District Court for Northern California (case 3:17-cv-05959-JD).

The wireless company sued the CPUC in 2017 to challenge California's assessing USF payments for prepaid phone service. MetroPCS said the 2014 California Prepaid Act and related CPUC resolutions imposing USF surcharges on prepaid wireless are unlawful and preempted. MetroPCS claimed the CPUC unlawfully treated two-thirds of MetroPCS revenue as intrastate.

"The Court concludes that the CPUC’s 2017 and 2018 resolutions are preempted as applied to MetroPCS because they would impose surcharges on revenues from services that are not subject to surcharge, in violation of federal law,” wrote Judge James Donato in Friday's decision. "The CPUC may address an audit and related issues in an agency proceeding, as appropriate."

T-Mobile and the CPUC didn't immediately comment.