No. 00-878 

In the Supreme Court of the United States 

RICHARD L. MATHIAS, ET AL., PETITIONERS 

v. 

WORLDCOM TECHNOLOGIES, INC., ET AL. 

ON WRIT OF CERTIORARI 
TO THE UNITED STATES COURT OF APPEALS 
FOR THE SEVENTH CIRCUIT 

BRIEF FOR THE UNITED STATES 

JOHN A. ROGOVIN 

Deputy General Counsel 
Federal Communications 

Commission 
Washington, D.C. 20554 
THEODORE B. OLSON 
Solicitor General 

Counsel of Record 

GREGORY G. KATSAS 

Acting Assistant Attorney 

General 

LAWRENCE G. WALLACE 

Deputy Solicitor General 

BARBARA MCDOWELL 

Assistant to the Solicitor 

General 

MARK B. STERN 
CHARLES W. SCARBOROUGH 

Attorneys 

Department of Justice 
Washington, D.C. 20530-0001 
(202) 514–2217 

QUESTIONS PRESENTED 

1. Whether a state commission’s action relating to 
the enforcement of a previously approved Section 252 
interconnection agreement entered into pursuant to the 
Telecommunications Act of 1996 is a “determination 
under [Section 252]” and thus is reviewable in federal 
court under 47 U.S.C. 252(e)(6) (Supp. IV 1998). 

2. Whether a state commission’s acceptance of Con- 
gress’s invitation to participate in implementing a 
federal regulatory scheme that provides that state 
commission determinations are reviewable in federal 
court constitutes a waiver of Eleventh Amendment 
immunity. 

3. Whether an official capacity action seeking pro- 
spective relief against state public utility commis- 
sioners for alleged ongoing violations of federal law in 
performing federal regulatory functions under the 
Telecommunications Act of 1996 can be maintained 
under the Ex parte Young doctrine. 

(I) 

TABLE OF CONTENTS 

Page 

Opinions below ............................................................................... 
1 

Jurisdiction ...................................................................................... 1 

Constitutional and statutory provisions involved ................... 
2 

Statement ........................................................................................ 2 

Summary of argument .................................................................. 
10 

Argument: 

I. Federal courts have jurisdiction to review deci- 
sions by state commissions interpreting or enfor- 
cing previously approved interconnection agree- 
ments ................................................................................... 16 

II. The Eleventh Amendment does not bar suits 

against state commissions or their commis- 
sioners seeking prospective relief from their 

determinations under the 1996 Act ............................... 
29 

A. Congress conditioned the states’ participation 

in the new regulatory scheme created by the 

1996 Act on the states’ waiver of immunity 

from suits challenging their determinations 

under the Act ............................................................. 

31 

B. State commissioners are subject to suit in 

their official capacities under the doctrine of 

Ex Parte Young to secure their prospective 

compliance with the 1996 Act ................................. 

42 

Conclusion ....................................................................................... 50 

TABLE OF AUTHORITIES 

Cases: 

Arkansas v. Oklahoma, 503 U.S. 91 (1992) ...................... 

21 

AT&T Communications of S. States, Inc. v. Bell- 
SouthTelecomms., Inc., 229 F.3d 457 (4th Cir. 2000) ..... 

18 

AT&T Communications v. BellSouth Telecomms., 

Ind., 238 F.3d 636 (5th Cir. 2001) ........................ 28, 33, 34, 43 

(III) 

IV 

Cases—Continued: Page 

AT&T Corp. v. Iowa Utils. Bd., 525 U.S. 366 

(1999) ................................................ 

2, 10, 11, 14, 33, 37, 38-39 

Alden v. Maine, 527 U.S. 706 (1999) .................................. 

42 

Bell Atlantic Md., Inc. v. MCI WorldCom, Inc., 

240 F.3d 279 (4th Cir.), cert. granted, 121 S. Ct. 

2548 (2001) ............................................. 

10, 21-22, 23, 34, 44, 48 

Board of Trs. v. Garrett, 121 S. Ct. 955 (2001) ........ 

42, 45, 49 

Brown v. GSA, 425 U.S. 820 (1976) .................................... 

47 

Chevron U.S.A. Inc. v. NRDC, Inc., 467 U.S. 837 

(1984) .................................................................................... 

13, 23 

City of Chicago v. Chicago Rapid Transit Co., 

284 U.S. 577 (1931) ................................................................ 

48 

City of New York v. FCC, 486 U.S. 57 (1988) ................... 

45 

College Sav. Bank v. Florida Prepaid Postsecon- 
dary Educ. Expense Bd., 527 U.S. 666 (1999) ................. 

14, 

31, 32, 37 
Edelman v. Jordan, 415 U.S. 651 (1974) ........................... 

45 

Federal Energy Regulatory Comm’n v. Mississippi, 

456 U.S. 742 (1982) ................................................................ 

38 

Green v. Mansour, 474 U.S. 64 (1985) ................................ 

45 

Hodel v. Virginia Surface Mining & Reclamation 

Ass’n, 452 U.S. 264 (1981) ................................................... 

38 

Idaho v. Coeur d’Alene Tribe, 521 U.S. 261 (1997) .......... 

16, 

42, 43, 48 

Illinois Bell Tel. Co. v. Worldcom Technologies, Inc., 
No. 98-C-1925, 1998 WL 419493 (N.D. Ill. July 23, 

1998) ......................................................................................... 9 

Kimel v. Florida Bd. of Regents, 528 U.S. 62 (2000) ....... 

34 

Larson v. Domestic & Foreign Commerce Corp., 

337 U.S. 682 (1949) ................................................................ 

45 

MCI Telecomms. Corp. v. Illinois Bell Tel. Co., 222 

F.3d 323 (7th Cir. 2000), cert. denied, 121 S. Ct. 

896 (2001) .................................................................. 21, 34, 38, 43 

V 

Cases—Continued: Page 

MCI Telecomms. Corp. v. Illinois Commerce 

Comm’n, 168 F.3d 315 (1999), modified on reh’g 

222 F.3d 323 (7th Cir. 2000), cert. denied, 121 S. Ct. 

896 (2001) ................................................................................. 

9, 10 

MCI Telecomms. Corp. v. Public Serv. Comm’n, 

216 F.3d 929 (10th Cir. 2000), cert. denied, 121 

S. Ct. 1167 (2001) .................................................... 

28, 34, 43-44 

Michigan Bell Tel. Co. v. Climax Tel. Co., 202 

F.3d 862 (6th Cir.), cert. denied, 531 U.S. 816 

(2000) .................................................................................... 

40, 43 

Natural Gas Pipeline Co. of Am. v. Slattery, 302 

U.S. 300 (1937) ........................................................................ 

48 

Papasan v. Allain, 478 U.S. 265 (1986) ............................. 

45 

Parden v. Terminal Ry., 377 U.S. 184 (1964) ................... 

32 

Pennhurst State Sch. & Hosp. v. Halderman, 465 

U.S. 89 (1984) .......................................................................... 

42 

Petition of Cox Virginia Telecomms., Inc. for Pre- 
emption of Jurisdiction of the Virginia State 

Corp. Commission Pursuant to Section 252(e)(5) 

of the Telecommunications Act of 1996 and for 

Arbitration of Interconnection Disputes with 

Verizon-Virginia, Inc., In re, 16 F.C.C.R. 2321 

(2001) ........................................................................................ 40 

Petty v. Tennessee-Missouri Bridge Comm’n, 359 

U.S. 275 (1959) ................................................... 

14, 31, 32, 34-35 

Printz v. United States, 521 U.S. 898 (1997) .................... 

40 

Procedures for Arbitrations Conducted Pursuant to 

Section 252(e)(5) of the Communications Act of 1934, 

as amended, In re, 16 F.C.C.R. 6231 (2001) .................... 

36 

Ray v. Atlantic Richfield Co., 435 U.S. 151 

(1978) ........................................................................................ 45 

Russello v. United States, 464 U.S. 16 (1983) .................... 

24 

Seminole Tribe of Florida v. Florida, 517 U.S. 44 

(1996) ....................................................................... 

16, 46, 47, 48 

Smith v. Illinois Bell Tel. Co., 270 U.S. 587 (1926) ......... 

48 

South Dakota v. Dole, 483 U.S. 203 (1987) ........................ 32 

VI 

Cases—Continued: Page 

Southwestern Bell Tel. Co. v. Brooks Fiber Com- 
munications of Okla., Inc., 235 F.3d 493 (10th 

Cir. 2000) ....................................................................... 

21, 23, 27 

Southwestern Bell Tel. Co. v. Connect Communi- 
cations Corp., 225 F.3d 942 (8th Cir. 2000) .................. 

21, 23 

Southwestern Bell Tel. Co. v. Public Util. Comm’n, 

208 F.3d 475 (5th Cir. 2000) ................................................. 

21 

Starpower Communications, LLC Petition for 

Preemption of Jurisdiction of the Virginia State 

Corp. Comm’n Pursuant to Section 252(e)(5) of 

the Telecommunications Act of 1996, In re, 15 

F.C.C.R. 11, 277 (2000) .................................... 

12-13, 22, 23, 40 

United States v. AT&T Co., 552 F. Supp. 131 (D.D.C. 

1982), aff ’d, 460 U.S. 1001 (1983) ........................................ 

3 

United States v. Mead Corp., 121 S. Ct. 2164 

(2001) ........................................................................................ 23 

Young, Ex parte, 209 U.S. 123 (1908) ......................... 

16, 42, 44 

Constitution, statutes and rule: 

U.S. Const.: 

Art. III ..................................................................................... 

30 

Art. VI, cl. 2 (Supremacy Clause) ............................ 

45, 46, 48 

Amend. X ................................................................................ 

40 

Amend. XI ...................................................................... 

passim 

Americans with Disabilities Act of 1990, Pub. L. 

No. 101-336, Title I, 104 Stat. 330 (42 U.S.C. 12111 

et seq. ........................................................................................ 

49 

42 U.S.C. 12112(b)(5)(A) .................................................. 

49 

Communications Act of 1934, 47 U.S.C. 402(a) ................... 

36 

Hobbs Administrative Orders Review Act, 28 U.S.C. 

2341 et seq. ....................................................................... 

7, 17, 36 

28 U.S.C. 2342(1) ............................................................... 

36 

28 U.S.C. 2344 ................................................................ 

15, 36 

Indian Gaming Regulatory Act, Pub. L. No. 100-497, 

102 Stat. 2467 .......................................................................... 

46 

Sherman Act, 15 U.S.C. 1 et seq. ............................................ 3 

VII 

Statutes and rule—Continued: 

Page 

Telecommunications Act of 1996, Pub. L. No. 104-104, 

110 Stat. 56 (47 U.S.C. 251 et seq.) ...................................... 

2 

Title I, 110 Stat. 61: 

47 U.S.C. 251 (Supp. V 1999) ......................... 

4, 6, 7, 11, 

18, 20, 26, 33, 38 
47 U.S.C. 251(b) (Supp. V 1999) ............................... 

17 

47 U.S.C. 251(b)(5) (Supp. V 1999) ........................... 

4 

47 U.S.C. 251(c) (Supp. V 1999) .............................. 

5, 17 

47 U.S.C. 251(c)(1) (Supp. V 1999) ........................... 

17 

47 U.S.C. 251(c)(2) (Supp. V 1999) ........................... 

4 

47 U.S.C. 251(c)(3) (Supp. V 1999) ........................... 

4 

47 U.S.C. 251(c)(4) (Supp. V 1999) ........................... 

4 

47 U.S.C. 251(d)(1) (Supp. V 1999) ......................... 

6, 23 

47 U.S.C. 251(d)(2) (Supp. V 1999) ........................... 

18 

47 U.S.C. 251(d)(3) (Supp. V 1999) ........................... 

39 

47 U.S.C. 252 (Supp. V 1999) .............................. 

passim 

47 U.S.C. 252(a) (Supp. V 1999) ................................ 

48 

47 U.S.C. 252(a)(1) (Supp. V 1999) ........................... 

18 

47 U.S.C. 252(b) (Supp. V 1999) ....................... 

5, 17, 48 

47 U.S.C. 252(b)(1) (Supp. V 1999) ........................... 

18 

47 U.S.C. 252(c) (Supp. V 1999) ................................ 

6 

47 U.S.C. 252(d) (Supp. V 1999) ............................... 

18 

47 U.S.C. 252(e)(1) (Supp. V 1999) ................. 

5, 6, 7, 35 

47 U.S.C. 252(e)(1)-(2) (Supp. V 1999) ..................... 

48 

47 U.S.C. 252(e)(2) (Supp. V 1999) ....................... 

20, 35 

47 U.S.C. 252(e)(2)(A) (Supp. V 1999) ................... 

6, 22 

47 U.S.C. 252(e)(2)(A)(ii) (Supp. V 1999) ................ 

35 

47 U.S.C. 252(e)(2)(B) (Supp. V 1999) ................... 

6, 22 

47 U.S.C. 252(e)(3) (Supp. V 1999) ....................... 

25, 39 

47 U.S.C. 252(e)(4) (Supp. V 1999) ......................... 

7, 12, 

23, 24, 26 

47 U.S.C. 252(e)(5) (Supp. V 1999) ................. 
5, 12, 17, 

22, 23, 33, 41, 49 
47 U.S.C. 252(e)(6) (Supp. V 1999) ..................... 

passim 

47 U.S.C. 252(f)(2) (Supp. V 1999) ............................ 

36 

47 U.S.C. 252(i) (Supp. V 1999) ................................. 18 

VIII 

Statutes and rule—Continued: 

Page 

47 U.S.C. 253(b) (Supp. V 1999) ............................... 

39 

47 U.S.C. 261(b) (Supp. V 1999) ............................... 

39 

47 U.S.C. 261(c) (Supp. V 1999) ................................ 

39 

28 U.S.C. 1331 ............................................................... 

8, 10, 28, 29 

28 U.S.C. 1441 ........................................................................ 

25, 27 

Fed. R. App. P. 15(a) ............................................................ 

15, 36 

Miscellaneous: 

H.R. Conf. Rep. No. 458, 104th Cong., 2d Sess. 
(1996) ........................................................................................ 

2, 3 
H.R. Rep. No. 204, 104th Cong., 1st Sess. Pt. 1 
(1995) ........................................................................................ 3 

In the Supreme Court of the United States 

No. 00-878 

RICHARD L. MATHIAS, ET AL., PETITIONERS 

v. 

WORLDCOM TECHNOLOGIES, INC., ET AL. 

ON WRIT OF CERTIORARI 
TO THE UNITED STATES COURT OF APPEALS 
FOR THE SEVENTH CIRCUIT 

BRIEF FOR THE UNITED STATES 

OPINIONS BELOW 

The opinion of the court of appeals as initially issued 
(Pet. App. 6a-22a) is reported at 179 F.3d 566. The 
opinion was amended by a subsequent order (Pet. App. 
3a-5a) that is not reported. The opinion of the district 
court (Pet. App. 23a-35a) is not reported. 

JURISDICTION 

The judgment of the court of appeals was entered on 
June 18, 1999, and amended on August 9, 1999. A 
petition for rehearing was denied on August 9, 2000. 
On November 3, 2000, Justice Stevens extended the 
time within which to file a petition for a writ of certio- 
rari to and including November 28, 2000. The petition 
for a writ of certiorari was filed on November 28, 2000, 
and was granted on March 5, 2001. The jurisdiction of 

(1) 

2 

this Court rests on 28 U.S.C. 1254(1). On August 8, 
2001, the Court granted the motion of the United States 
to intervene in the case pursuant to 28 U.S.C. 2403. 

CONSTITUTIONAL AND STATUTORY 
PROVISIONS INVOLVED 

The Eleventh Amendment to the United States Con- 
stitution is set forth in the appendix to the petition at 
36a. Sections 251 and 252 of the Telecommunications 
Act of 1996 are set forth in the appendix to petitioners’ 
brief at 1a-22a. Citations of that Act are of the 1999 
Supplement to the United States Code. 

STATEMENT 

The Telecommunications Act of 1996 (1996 Act or 
Act), Pub. L. No. 104-104, 110 Stat. 56, effected a com- 
prehensive overhaul of telecommunications regulation 
designed to “open[] all telecommunications markets to 
competition.” H.R. Conf. Rep. No. 458, 104th Cong., 2d 
Sess. 113 (1996); see generally AT&T Corp. v. Iowa 
Utils. Bd., 525 U.S. 366 (1999). The 1996 Act estab- 
lishes procedures to encourage competition in local 
telecommunications markets, including the requirement 
that incumbent carriers enter into agreements with 
competitors concerning interconnection with, and 
access to elements of, the incumbent’s network. The 
Act authorizes state public utility commissions to 
assume certain regulatory authority respecting those 
agreements (commonly referred to as interconnection 
agreements) and provides that such exercises of 
authority are subject to review in federal district court. 
47 U.S.C. 252(e)(6). This case concerns whether federal 
judicial review extends to decisions of state commis- 
sions interpreting and enforcing interconnection agree- 
ments and, if so, whether state commissions or state 
commissioners, in their official capacities, may be made 

3 

parties to those proceedings consistent with the 
Eleventh Amendment. 

1. For many years, most telephone service in the 
United States was provided by AT&T and its local- 
exchange affiliates, collectively known as the Bell 
System. In 1974, the United States sued AT&T under 
the Sherman Act, 15 U.S.C. 1 et seq., alleging, among 
other things, that the Bell System had improperly used 
its monopoly power in local markets to impede competi- 
tion in the long-distance market. See United States v. 
AT&T Co., 552 F. Supp. 131 (D.D.C. 1982), aff ’d, 460 
U.S. 1001 (1983). In 1982, AT&T entered into a consent 
decree in settlement of that suit that required AT&T to 
divest its local exchange operations. The newly inde- 
pendent Bell Operating Companies, together with 
approximately 1,500 non-Bell carriers, continued to pro- 
vide monopoly local exchange service in their respec- 
tive service areas. What remained of AT&T continued 
to provide nationwide long-distance service, increas- 
ingly in competition with other long-distance carriers, 
such as MCI and Sprint. See H.R. Rep. No. 204, 104th 
Cong., 1st Sess. Pt. 1, at 48-50 (1995). 

a. In considering how to facilitate the entry of com- 
petitors into local telephone markets, Congress recog- 
nized that the economic barriers to entry into those 
markets would remain formidable even if the regula- 
tory restrictions on competition were removed. H.R. 
Conf. Rep. No. 458, supra, at 113. It would be economi- 
cally impracticable, at least with the current tech- 
nology, for even the largest prospective competitor to 
duplicate an incumbent carrier’s entire local network— 

i.e., to create a new network of switches and a new 
infrastructure of loops connecting every house and 
business in a calling area to those switches and thus to 
one another. Moreover, without rights of access to the 

4 

existing network, a prospective competitor could not 
gradually enter the market through partial duplication 
of local exchange facilities; the competitor would win 
few customers if, for example, those customers could 
call only one another and not customers of the incum- 
bent’s separate (and already established) network. 

Congress addressed those concerns in Sections 251 
and 252 of the 1996 Act. It imposed various obligations 
on all local exchange carriers, incumbents and new en- 
trants alike, including the obligations to provide num- 
ber portability (so that a consumer may change carriers 
without changing telephone numbers), to allow com- 
petitors to have access to certain services (e.g., direc- 
tory assistance) and facilities (e.g., poles, ducts, con- 
duits, and rights-of-way), and “to establish reciprocal 
compensation arrangements for the transport and ter- 
mination of telecommunications.” 47 U.S.C. 251(b)(5). 
The underlying dispute in this case concerns an 
arrangement to pay reciprocal compensation, which is a 
payment made by the carrier whose customer origi- 
nates a call to the carrier whose facilities are used to 
complete the call. 

Congress also imposed on incumbent carriers the 
obligation to open their networks to new entrants in 
three distinct but complementary ways. First, new 
entrants are entitled to “interconnect” their networks 
with the incumbent’s existing network, and to do so at 
rates and on terms and conditions that are “just, rea- 
sonable, and nondiscriminatory.” 47 U.S.C. 251(c)(2). 
Second, new entrants are entitled to gain access to 
elements of an incumbent’s network “on an unbundled 
basis”—i.e., to lease individual network elements (loops, 
switching capability, etc.) at rates and on terms and 
conditions that are “just, reasonable, and nondiscrimi- 
natory.” 47 U.S.C. 251(c)(3). Third, new entrants are 

5 

entitled to buy an incumbent’s retail services “at whole- 
sale rates” and to resell those services to end users. 
47 U.S.C. 251(c)(4).1 

The 1996 Act requires incumbents to negotiate in 
good faith with new entrants on agreements regarding 
reciprocal compensation, interconnection, access to 
network elements, resale of services, and the other 
arrangements contemplated by the Act. 47 U.S.C. 
251(c), 252. The Act provides for binding arbitration if 
the parties cannot conclude an agreement through 
negotiation. 47 U.S.C. 252(b). 

The 1996 Act permits, but does not require, state 
public utility commissions to assume regulatory author- 
ity over interconnection agreements, set the terms and 
conditions for those agreements (subject to the stan- 
dards set forth in the Act and in regulations promul- 
gated by the Federal Communications Commission 
(FCC) pursuant to the Act), arbitrate disputes that 
arise in the negotiation of the agreements, and exercise 
review and enforcement authority. If a state commis- 
sion elects not to assume such authority, the FCC will 
perform that role. 47 U.S.C. 252(e)(5). 

b. All interconnection agreements, whether arrived 
at through negotiation or arbitration, are subject to 
approval by the state commission or, if it declines that 
role, the FCC. 47 U.S.C. 252(e)(1) and (5). A negoti- 
ated agreement may be approved by the state com- 
mission (or the FCC) only if it does not “discriminate[] 

1 The Court is currently considering a challenge to the meth- 
odology developed by the Federal Communications Commission 
(FCC) for establishing the rates that incumbents may charge new 
entrants for interconnection and access to network elements. See 
Verizon Communications, Inc. v. FCC, Nos. 00-511 et al. (to be 
argued Oct. 10, 2001). 

6 

against a telecommunications carrier not a party to the 
agreement” and is “consistent with the public interest, 
convenience, and necessity.” 47 U.S.C. 252(e)(2)(A). 

If the parties are unable to conclude an agreement 
through negotiations and proceed to arbitration, the 
state commission (or, if it declines that role, the FCC) 
will resolve any open issue. Such issues may concern 
the rates, terms, and conditions under which competi- 
tors will interconnect with or lease network elements 
from incumbents, as well as the charges that the 
incumbent and the new entrant will pay each other for 
transport and termination of calls. The 1996 Act sets 
forth standards for state commissions to follow in 
setting such rates; the state commissions are also 
required to follow FCC regulations issued pursuant to 
Section 251(d)(1). 47 U.S.C. 252(c). Once an agreement 
has been concluded through arbitration, the parties 
must submit it to the state commission (or, if it declines 
that role, the FCC) for approval. An arbitrated agree- 
ment may be approved only if it complies with Sections 
251 and 252 of the Act and applicable FCC regulations. 
47 U.S.C. 252(e)(1) and (2)(B). 

The 1996 Act provides for federal court “[r]eview of 
State commission actions” with respect to interconnec- 
tion agreements. 47 U.S.C. 252(e)(6) (title). The Act 
states, in relevant part: 

In any case in which a State commission makes a 
determination under this section [i.e., Section 252], 
any party aggrieved by such determination may 
bring an action in an appropriate Federal district 
court to determine whether the agreement or state- 
ment meets the requirements of section 251 of this 
title and this section. 

7 

47 U.S.C. 252(e)(6). The Act divests state courts of 
“jurisdiction to review the action of a State commission 
in approving or rejecting an agreement under this 
section.” 47 U.S.C. 252(e)(4). 

Where a state commission has elected not to assume 
regulatory authority under the 1996 Act and the FCC 
has acted in its place, the Act provides that the FCC 
proceeding and “any judicial review of the [FCC’s] 
actions shall be the exclusive remedies for a State 
commission’s failure to act.” 47 U.S.C. 252(e)(6). The 
FCC’s final orders with respect to interconnection 
agreements are reviewable, as are other final orders of 
the FCC, in the federal courts of appeals pursuant 
to the Hobbs Administrative Orders Review Act, 
28 U.S.C. 2341 et seq. 

2. Pursuant to Sections 251 and 252 of the 1996 Act, 
respondent Ameritech, the incumbent local exchange 
carrier in Illinois, negotiated interconnection agree- 
ments with several carriers seeking to enter that 
market. Each of those agreements provided for the 
payment of reciprocal compensation “[a]s [d]escribed in 
the Act.” J.A. 8a, 13a, 19a, 30a, 38a. 

The parties submitted the interconnection agree- 
ments to the Illinois Commerce Commission (ICC) for 
approval as specified in 47 U.S.C. 252(e)(1). The ICC 
assumed regulatory authority and approved the agree- 
ments. Soon after the ICC approved the agreements, a 
dispute arose between Ameritech and the competing 
carriers concerning whether the obligation to pay 
reciprocal compensation under the agreements applied 
to calls made to Internet service providers (ISPs) to 
obtain access to the Internet. Ameritech took the posi- 
tion that its obligation to pay reciprocal compensation 
“[a]s [d]escribed in the Act” did not extend to such 
Internet-bound calls. 

8 

The competing carriers petitioned the ICC for relief, 
seeking orders directing Ameritech to pay reciprocal 
compensation under the terms of its interconnection 
agreements. The ICC assumed regulatory authority to 
resolve the dispute, invoking its “jurisdiction under the 
[state] Public Utilities Act and Section 252 of the 
Telecommunications Act of 1996.” J.A. 112a. The ICC 
concluded that Ameritech was required to pay 
reciprocal compensation for Internet-bound calls. 

3. Ameritech sought review of the ICC’s decision in 
the United States District Court of the Northern Dis- 
trict of Illinois, asserting that the ICC’s decision was 
contrary to federal law and invoking the court’s juris- 
diction under 47 U.S.C. 252(e)(6) and 28 U.S.C. 1331. 
J.A. 127a, 140a-141a (claim that ICC’s order is inconsis- 
tent with FCC’s declaratory ruling that ISP-bound calls 
are not “local” for purposes of reciprocal compensation 
under 1996 Act and FCC’s implementing regulations); 
see also U.S. Br. 19 note 3, Verizon Maryland Inc. v. 
Public Serv. Comm’n of Md., Nos. 00-1531 et al. (dis- 
cussing FCC’s declaratory ruling). Ameritech named 
as defendants the competing carriers and the ICC 
commissioners in their official capacities. 

The ICC commissioners moved to dismiss. They 
argued that the district court lacked subject-matter 
jurisdiction and, in any event, that they were immune 
from suit under the Eleventh Amendment. 

The district court denied the motion. The court held 
that 47 U.S.C. 252(e)(6) gives district courts jurisdiction 
to review state commission decisions interpreting and 
enforcing previously approved interconnection agree- 
ments. Pet. App. 28a-29a. The court therefore did not 
consider whether jurisdiction also existed under 28 
U.S.C. 1331. Pet. App. 29a & n.3. In addition, the court 
held that the commissioners were not entitled to 

9 

Eleventh Amendment immunity from Ameritech’s 
action for two reasons: first, the court held that a state 
commission waives its Eleventh Amendment immunity 
by voluntarily participating in the federal regulatory 
scheme created by the 1996 Act; and, second, the court 
held that the doctrine of Ex parte Young permits offi- 
cial capacity actions against state commissioners seek- 
ing prospective relief from ongoing violations of the 
1996 Act. Id. at 30a. 

The district court upheld the ICC’s decision on the 
merits in a separate opinion. Illinois Bell Tel. Co. v. 
WorldCom Technologies, Inc., No. 98-C-1925, 1998 WL 
419493 (N.D. Ill. July 23, 1998). 

4. The United States Court of Appeals for the 
Seventh Circuit affirmed. Pet. App. 6a-22a.2 
First, the court of appeals held that the ICC com- 
missioners were not immune under the Eleventh 
Amendment from Ameritech’s suit. The court reasoned 
that state commissions waive their Eleventh Amend- 
ment immunity by electing to exercise regulatory 
authority under the 1996 Act. Pet. App. 12a-13a (citing 
MCI Telecomms. Corp. v. Illinois Commerce Comm’n, 
168 F.3d 315 (1999), modified on reh’g, 222 F.3d 323 (7th 
Cir. 2000), cert. denied, 121 S. Ct. 896 (2001)). 

Second, the court of appeals held that the district 
court had jurisdiction under 47 U.S.C. 252(e)(6) to 
review the ICC’s decision construing and enforcing the 
interconnection agreements between Ameritech and its 
competitors. The court reasoned that Section 252(e)(6) 

2 While noting that its jurisdiction over the ICC’s appeal was 
“somewhat problematic” because the district court decided the 
merits before reaching the ICC’s jurisdictional defense, the Sev- 
enth Circuit concluded that those “formal defects” did not preclude 
appellate jurisdiction. Pet. App. 11a-12a. 

10 

“provides for judicial review of ‘state commission 
actions,’ not simply review of ‘interconnection agree- 
ments.’ ” Pet. App. 13a-14a (citing MCI, 168 F.3d at 
320). The court nonetheless noted that Section 
252(e)(6) authorizes judicial review of commission 
actions only for compliance with federal law. Id. at 15a. 

Finally, the court of appeals held that the ICC’s 
underlying decision with respect to reciprocal com- 
pensation for ISP calls “does not violate the [1996] Act 
or the FCC’s interpretation of the Act.” Pet. App. 20a.3 

SUMMARY OF ARGUMENT 

This Court has recognized that, “[w]ith regard to the 
matters addressed by the 1996 Act,” Congress “unques- 
tionably” has “taken the regulation of local telecom- 
munications competition away from the States.” AT&T 
Corp. v. Iowa Utils. Bd., 525 U.S. 366, 379 n.6 (1999). 
Congress allowed the States, through their public 
utility commissions, to elect to play a role in that 
regulation, but only as a part of a regime that explicitly 
provided for federal judicial review of their actions to 
ensure compliance with the new federal standards. 
With respect to the core local competition obligations 

3 Because the court of appeals affirmed the ICC’s underlying 
ruling on the merits, there is a question as to petitioners’ standing 
to seek review of the court’s jurisdictional and Eleventh Amend- 
ment holdings. See U.S. Pet. 14, United States v. Public Service 
Comm’n of Md., No. 00-1711 (identifying that standing concern in 
petition seeking review of the Fourth Circuit’s decision in Bell 
Atlantic MD, Inc. v. MCI WorldCom, Inc., 240 F.3d 279 (2001)). 
The petitions for certiorari filed by the United States and Verizon 
Maryland Inc. in the Fourth Circuit case present the three ques- 
tions that are presented in this case, as well as an additional ques- 
tion of jurisdiction under 28 U.S.C. 1331. The Court granted those 
petitions limited to the Section 1331 question. 121 S. Ct. 2448 
(2001). No standing concerns exist in the Fourth Circuit case. 

11 

imposed by Sections 251 and 252, the 1996 Act does not 
allow the state commissions to exercise federal regula- 
tory authority without federal judicial oversight. Thus, 
whether a state commission is approving or rejecting a 
new interconnection agreement, or is interpreting or 
enforcing an agreement already in effect, this Court’s 
observation in Iowa Utilities Board holds true: “[I]f 
the federal courts believe a state commission is not 
regulating in accordance with federal policy they may 
bring it to heel.” 525 U.S. at 379 n.6. 

I. Petitioners do not dispute that Congress vested 
the federal district courts with jurisdiction—indeed, 
exclusive jurisdiction—to review state commissions’ 
decisions approving or rejecting interconnection agree- 
ments for compliance with the 1996 Act. Petitioners 
contend, however, that Congress did not also intend the 
district courts to exercise jurisdiction to ensure that, 
when state commissions subsequently construe and 
enforce such interconnection agreements, they do so 
consistently with the Act. Petitioners’ position, which 
has been rejected by four of the five courts of appeals 
that have considered it, should be rejected by this 
Court as well. 

Congress made clear in Section 252(e)(6) of the 1996 
Act that “any case in which a State commission makes a 
determination under this section [i.e., Section 252]” is 
reviewable in district court for compliance with the Act. 
47 U.S.C. 252(e)(6). A state commission “makes a 
determination under” Section 252 not only when it 
approves or rejects a new interconnection agreement, 
but also when it construes or enforces an existing 
agreement, because a state commission’s authority to 
regulate such agreements under the new federal 
regulatory regime established by the Act derives from 
Section 252. 

12 

A contrary conclusion is not suggested by the fact 
that Section 252 expressly prescribes standards to gov- 
ern the state commissions’ review of interconnection 
agreements only at the initial approval stage. Congress 
would have understood that a state commission’s 
authority to approve an interconnection agreement 
necessarily includes the authority to construe and 
enforce the agreement, both at the time that the 
agreement is submitted for the commission’s approval 
and at subsequent times when disputes arise between 
the parties concerning the application of the agreement 
in a particular context. Indeed, a state commission’s 
authority to assess whether an agreement meets the 
requirements of the 1996 Act would be illusory if the 
commission could not assure that the agreement con- 
tinued to meet those requirements in its performance. 
Moreover, in a companion provision of the Act, Con- 
gress expressly precluded state court review of state 
commission decisions “approving or rejecting an agree- 
ment.” 47 U.S.C. 252(e)(4). Presumably, Congress 
would have used the same language in Section 252(e)(6) 
had it intended to authorize federal judicial review only 
of those decisions, and not of decisions construing or 
enforcing agreements. 

The FCC, too, has concluded that a state commis- 
sion’s authority under Section 252 is not limited to the 
initial approval or rejection of interconnection agree- 
ments. In construing a provision of the 1996 Act that 
authorizes the FCC to assume jurisdiction when a state 
commission declines to “carry out its responsibility 
under [Section 252],” 47 U.S.C. 252(e)(5), the FCC de- 
termined that a state commission exercises “responsi- 
bility under” Section 252 when it construes and en- 
forces an existing interconnection agreement. In re: 
Starpower Communications, LLC Petition for Preemp- 

13 

tion of Jurisdiction of the Virginia State Corp. Comm’n 
Pursuant to Section 252(e)(5) of the Telecommuni- 
cations Act of 1996, 15 F.C.C.R. 11,277 (2000). The 
FCC’s understanding of the scope of Section 252 is 
entitled to deference under Chevron U.S.A. Inc. v. 
NRDC, Inc., 467 U.S. 837 (1984). 

Petitioners’ contrary interpretation of the 1996 Act 
would produce a curious, confusing, and easily manipu- 
latable regulatory regime, under which identical issues 
of federal law could be resolved only in federal court, or 
only in state court, based solely on the fortuity of when 
the issue arose. Such an approach would inject 
additional uncertainty into dealings between competing 
carriers and, in some instances, could encourage carri- 
ers to defer raising issues of interpretation until after 
an agreement was approved. Nothing in the text of 
Section 252(e)(6), or any other provision of the Act, sug- 
gests, much less compels, such an inherently problem- 
atic result. 

II. State public utility commissions and their com- 
missioners are not immune under the Eleventh Amend- 
ment from suits, such as this one, challenging their 
determinations with respect to interconnection agree- 
ments under the 1996 Act. That is the case for two 
independently sufficient reasons—one or both of which 
have been accepted by four of the five courts of appeals 
that have considered the question. 

A. Congress conditioned the States’ exercise of regu- 
latory authority under the 1996 Act—authority that 
Congress was under no obligation to grant and the 
States are under no obligation to accept—on the States’ 
waiver of their Eleventh Amendment immunity from 
suits in federal court to review their exercise of that 
authority. This Court recently confirmed that Con- 
gress may condition a federal “gratuity”—i.e., some 

14 

economic or other benefit that Congress is free to 
withhold—on the recipient State’s waiver of its sover- 
eign immunity from suits involving that gratuity. See 
College Sav. Bank v. Florida Prepaid Postsecondary 
Educ. Expense Bd., 527 U.S. 666, 686-687 (1999); Petty 

v. Tennessee-Missouri Bridge Comm’n, 359 U.S. 275 
(1959). Congress took an analogous approach here by 
giving the States the opportunity voluntarily to partici- 
pate in an integrated regulatory regime involving both 
authority and reviewability in federal court of exercises 
of such authority. 

As this Court has recognized, the 1996 Act trans- 
formed the regulation of local telecommunications com- 
petition, imposing a new federal regulatory regime in 
an area that previously was regulated by the individual 
States. See Iowa Utils. Bd., 525 U.S. at 379 n.6. 
Congress allowed the States, through their state com- 
missions, to play a role in the new regime, but only as 
part of a scheme that explicitly contemplates review of 
their actions to ensure compliance with federal stan- 
dards. Congress left the States free to decline that 
regulatory role—as one State has done—and to leave 
the role to be performed by the FCC instead. Accord- 
ingly, by voluntarily exercising regulatory authority 
under the 1996 Act to approve, reject, interpret, or 
enforce interconnection agreements, a State impliedly 
waives its sovereign immunity from suits challenging 
the manner in which it exercises that authority. 

Contrary to petitioners’ contention, the 1996 Act suf- 
ficiently put the States on notice of the condition 
attached to Congress’s offer of federal regulatory 
authority. Section 252(e)(6), which authorizes federal 
court “[r]eview of State commission actions” under the 
Act, is most naturally read as providing for such review 
in actions against state commissions. Section 252(e)(6) 

15 

declares that, “[i]n any case in which a State commis- 
sion makes a determination under [Section 252),” 
review is available in federal district court to “any 
party aggrieved by such determination.” 47 U.S.C. 
252(e)(6) (emphasis added). In order to assure that 
judicial review is available to “any [aggrieved] party” in 
“any case,” Section 252(e)(6) must be understood as 
authorizing proceedings against state commissions, 
because in some categories of cases there may be no 
party to defend the challenged determination in federal 
court other than the state commission. Moreover, 
Congress would have understood that, in a proceeding 
to review the FCC’s exercise of regulatory authority 
under the Act, the FCC and the United States neces- 
sarily would be parties. 

See 28 U.S.C. 2344; Fed. R. 
App. P. 15(a). Congress surely intended that, in an 
analogous proceeding to review state commissions’ 
exercise of regulatory authority under the Act, state 
commissions would be parties. 

Petitioners also suggest that Congress’s grant of 
federal regulatory authority to the States in the 1996 
Act is not properly characterized as a “gift” under 
College Savings Bank, because the States, rather than 
the United States, previously had regulated most as- 
pects of local telecommunications. But such arguments 
ignore the fundamental change in local telecommuni- 
ations regulation wrought by the 1996 Act. Congress, 
acting within its constitutional authority to regulate 
commerce, could have preempted all state regulation in 
areas encompassed by the Act. Consequently, Con- 
gress also could give States the choice whether to 
exercise new federal regulatory power that they would 
not otherwise possess and could condition that choice on 
compliance with the requirements of the Act, including 
a waiver of sovereign immunity. 

16 

B. In any event, because this is a suit against the 
individual ICC commissioners in their official capacities 
to enjoin their enforcement of an order that assertedly 
violates the 1996 Act, the suit is not barred by the 
Eleventh Amendment for an additional reason. Under 
the exception to the States’ Eleventh Amendment 
immunity recognized in Ex parte Young, 209 U.S. 123 
(1908), the federal courts may adjudicate suits against 
state officers in their official capacities to secure their 
prospective compliance with federal law. This Court 
has repeatedly reaffirmed “the continuing validity of 
the Ex parte Young doctrine.” Idaho v. Coeur d’Alene 
Tribe, 521 U.S. 261, 269 (1997). 

There is no merit to petitioners’ contention that the 
Ex parte Young exception is unavailable in this case 
under the rationale of Seminole Tribe of Florida v. 
Florida, 517 U.S. 44 (1996). This case is unlike Semi- 
nole Tribe in all relevant respects. The 1996 Act does 
not create its own “carefully crafted and intricate reme- 
dial scheme,” id. at 73-74, under which parties may 
challenge the determinations of state commissions with 
regard to interconnection agreements. There is conse- 
quently no reason in this case, as there was in Seminole 
Tribe, to foreclose the use of a judicially crafted 
remedial scheme under Ex parte Young. 

ARGUMENT 

I. FEDERAL COURTS HAVE JURISDICTION TO 
REVIEW DECISIONS BY STATE COMMISSIONS 
INTERPRETING OR ENFORCING PREVIOUSLY 
APPROVED INTERCONNECTION AGREEMENTS 

A. Section 252(e)(6), titled “Review of State com- 
mission actions,” authorizes federal district courts to 
exercise jurisdiction over “any case in which a State 
commission makes a determination under this section,” 

17 

i.e., Section 252. 7 U.S.C. 252(e)(6). Section 252(e)(6) 
further provides that “any party aggrieved by such de- 
termination may bring an action in an appropriate Fed- 
eral district court to determine whether the agreement 
or statement meets the requirements of section 251 of 
this title and this section.” Ibid.4 Section 252(e)(6) does 
not, by its terms, confine federal judicial review to state 
commission actions approving or rejecting intercon- 
nection agreements as an initial matter. It instead 
authorizes federal judicial review of all state commis- 
sion “determination[s]” with respect to interconnection 
agreements for compliance with the local competition 
provisions of the 1996 Act—not only determinations 
concerning the approval or rejection of new agree- 
ments, but also determinations concerning the interpre- 
tation or enforcement of existing agreements. 

It should be emphasized at the outset that inter- 
connection agreements are, to a significant extent, crea- 
tures of federal law. Congress required incumbent local 
exchange carriers and potential competitors to negoti- 
ate interconnection agreements in good faith. See 
47 U.S.C. 251(c)(1). Congress also provided for compul- 
sory arbitration if the negotiations fail, see 47 U.S.C. 
252(b); prescribed the subjects to be addressed by 
interconnection agreements, see, e.g., 47 U.S.C. 251(b) 
and (c); and established standards—and directed the 
FCC to establish standards—with regard to the 

4 If the state commission has declined to act, and the FCC has 
assumed regulatory responsibility pursuant to Section 252(e)(5), 
federal court review of the FCC’s orders is available under the 
Hobbs Administrative Orders Review Act, 28 U.S.C. 2341 et seq., 
and the FCC proceeding and “judicial review of the [FCC]’s 
actions shall be the exclusive remedies for a State commission’s 
failure to act.” 47 U.S.C. 252(e)(6). 

18 

content of those agreements, see, e.g., 47 U.S.C. 
251(d)(2), 252(d).5 

Congress would thus have known that issues of 
federal law (i.e., compliance with Sections 251 and 252 
and the FCC’s regulations promulgated thereunder) 
would arise not only at the time that an interconnection 
agreement was negotiated or arbitrated, but also 
during the term of the agreement as the parties dis- 
agreed about the meaning of a given provision and the 
state commission was called upon to resolve the dis- 
agreement. Indeed, state commission determinations 
that interpret and give effect to existing agreements 
are often the principal mechanism for establishing the 
substance of the parties’ obligations under the 1996 Act. 
Congress could not have intended to foreclose federal 
court review of claims by an aggrieved carrier that a 
state commission has interpreted or enforced an 

5 The 1996 Act provides that carriers may enter into a negoti- 
ated interconnection agreement “without regard to” the require- 
ments of Sections 251 and 252(d). 47 U.S.C. 252(a)(1). As a practi- 
cal matter, however, negotiated agreements ordinarily incorporate 
those requirements to the same extent as arbitrated agreements 
because, if one party does not agree to such a requirement in 
negotiations, the other party can demand arbitration by the state 
commission to impose the requirement. 47 U.S.C. 252(b)(1). More- 
over, an incumbent has an incentive not to agree in negotiations to 
terms more favorable than those required by Sections 251 and 
252(d), because non-party carriers then are entitled to demand the 
same terms from the incumbent. 47 U.S.C. 252(i). See AT&T 
Communications of Southern States, Inc. v. BellSouth Telecom- 
munications, Inc., 229 F.3d 457, 465 (4th Cir. 2000) (noting that 
“many so-called ‘negotiated’ provisions represent nothing more 
than an attempt to comply with the requirements of the 1996 
Act”). 

19 

existing agreement in a manner inconsistent with 
federal law.6 

Petitioners’ contrary approach would produce a 
curious, confusing, and easily manipulatable regulatory 
regime in which two different judicial systems were 
assigned interrelated but mutually exclusive tasks of 
reviewing state commission decisions on identical 
issues. Such issues could be resolved only in federal 
court, or only in state court, based solely on the fortuity 
of when the issue arose—in federal court if the issue 
arose at the formation of the agreement, but in state 
court if the issue arose during the term of the agree- 
ment. A party could evade federal court review (except 
potentially by this Court) simply by waiting to raise an 
issue until after an agreement was approved. There is 
no indication in the language of Section 252(e)(6), or any 
other provision of the 1996 Act, that federal court 
review depends upon the timing of a claim rather than 
its substance, or that Congress would have intended 
such a manifestly irrational system. 

B. Petitioners principally contend (Br. 16-20) that 
state commission decisions interpreting or enforcing 
interconnection agreements are not reviewable in 

6 Petitioners acknowledge (Br. 24) that, because different 
issues of interpretation may arise at different times over the term 
of an interconnection agreement, “interpretation cases will likely 
represent the great bulk of litigation regarding interconnection 
agreements.” It is particularly understandable, given the rapidity 
of technological change within the telecommunications industry, 
that important interpretive issues may not arise until an agree- 
ment has been in place for some time. For example, the underlying 
issue in this proceeding—whether federal law requires that recip- 
rocal compensation be paid on calls to ISPs—has become increas- 
ingly important to carriers over the years as more of their 
customers have sought access to the Internet. 

20 

federal district court because they are not “determina- 
tion[s] under this section” within the meaning of 
Section 252(e)(6). Petitioners are mistaken. 

Petitioners concede, as they must, that a state com- 
mission acts “under” Section 252 when it approves or 
rejects an interconnection agreement as an initial 
matter. The authority to approve or reject an intercon- 
nection agreement necessarily includes the authority to 
determine what the agreement is. That authority may 
be exercised not only when an agreement is initially 
presented to a state commission for its approval, but 
also when disputes subsequently arise between the 
parties about the application of the agreement in a 
particular context. 

An implicit condition of a state commission’s approval 
of any interconnection agreement is that the parties 
will carry out the agreement in accordance with the 
commission’s understanding of its terms. Otherwise, 
the commission’s determination that an agreement does 
not discriminate against non-party carriers, serves the 
public interest, convenience, and necessity, and com- 
plies with Sections 251 and 252, see 47 U.S.C. 252(e)(2), 
could become meaningless. That condition contem- 
plates that the commission may later be called upon to 
clarify what the agreement provides. Such determina- 
tions, although separate in time from the commission’s 
initial approval of the agreement, are nonetheless 
incident to that approval and may be indistinguishable 
in substance from determinations made at the initial 
approval stage. Indeed, they are precisely the same 
determinations that the commission could have made at 
that earlier stage if the parties and the commission had 
foreseen the dispute that would arise as to the meaning 

21 

of the agreement.7 Accordingly, whether or not an 
interconnection agreement has already taken effect, a 
state commission makes a “determination” under Sec- 
tion 252 when it declares what the agreement is.8 

It is for such reasons that every court of appeals that 
has addressed the question, with the exception of the 
Fourth Circuit, has held that, when a state commission 
interprets or enforces an existing interconnection 
agreement, the commission makes a “determination 
under [Section 252].” See, e.g., MCI Telecomms. Corp. 

v. Illinois Bell Tel. Co., 222 F.3d 323, 338 (7th Cir. 2000) 
(“A state commission’s authority to approve or reject 
interconnection agreements under the Act necessarily 
includes the authority to interpret and enforce, to the 
same extent, the terms of those agreements once they 
have been approved by that commission.”), cert. denied, 
121 S. Ct. 896 (2001); accord Southwestern Bell Tel. Co. 

v. Brooks Fiber Communications of Okla., Inc., 235 
F.3d 493, 496-497 (10th Cir. 2000); Southwestern Bell 
Tel. Co. v. Connect Communications Corp., 225 F.3d 
942, 946 (8th Cir. 2000); Southwestern Bell Tel. Co. v. 
Public Util. Comm’n, 208 F.3d 475, 479-480 (5th Cir. 
2000); but see Bell Atlantic MD, Inc. v. MCI 

7 Cf. Arkansas v. Oklahoma, 503 U.S. 91 (1992) (deferring to 
EPA’s understanding of the meaning of EPA-approved state 
water quality requirements in the context of resolution of an 
interstate compliance dispute). 

8 The ICC itself acknowledged in this proceeding that Section 
252 is a source—although, in the ICC’s view, not the only source — 
of its authority to interpret and enforce interconnection agree- 
ments. See J.A. 112a (asserting jurisdiction under Section 252 and 
state law). 

22 

WorldCom, Inc., 240 F.3d 279, 301-307 (4th Cir.), cert. 
granted, 121 S. Ct. 2448 (2001) (Nos. 00-1531, 00-1711).9 

The FCC has also concluded that state commissions 
act under Section 252 when they interpret or enforce 
existing interconnection agreements. See In re: Star- 
power Communications, LLC Petition for Preemption 
of Jurisdiction of the Virginia State Corp. Comm’n 
Pursuant to Section 252(e)(5) of the Telecommunica- 
tions Act of 1996, 15 F.C.C.R. 11,277 (2000). There, a 
state commission (unlike the ICC in this case) declined 
to exercise regulatory authority to construe a provision 
of an existing interconnection agreement concerning 
reciprocal compensation. The FCC assumed regulatory 
authority over the dispute, pursuant to Section 
252(e)(5), on the ground that the state commission had 

9 The Fourth Circuit suggested that a state commission does 
not act under Section 252 when it construes an existing inter- 
connection agreement that was negotiated between the parties (as 
was the agreement in this case), because Section 252 authorizes 
state commission to review such agreements as an initial matter 
only to assure that they are consistent with the public interest, 
convenience, and necessity and do not discriminate against non- 
party carriers. See Bell Atlantic, 240 F.3d at 302-303. But 
whether a state commission is evaluating a negotiated agreement 
under the standards of Section 252(e)(2)(A) or an arbitrated 
agreement under the standards of Section 252(e)(2)(B), the state 
commission first has to decide what the agreement is. The state 
commission’s resolution of antecedent questions concerning the 
meaning of the agreement is thus a necessary component of its 
“determination under [Section 252].” And, where the state com- 
mission clarifies the meaning of an agreement previously approved 
under the standards of Section 252(e)(2)(A) or (B), the commission 
is likewise acting under Section 252. The mere fact that the 
commission announces its interpretation after, rather than at the 
same time as, its initial approval of the agreement does not detract 
from the status of that interpretation as a “determination under 
[Section 252].” 

23 

declined to “ ‘carry out its responsibility’ under section 
252.” Id. (para. 6). The FCC thus determined that a 
state commission’s “ ‘responsibility’ under section 252” 
includes “interpret[ing] and enforc[ing] existing inter- 
connection agreements.” Ibid. 

10 Because the FCC’s 
interpretation of the 1996 Act is eminently reasonable, 
it is entitled to deference under Chevron U.S.A. Inc. v. 
NRDC, Inc., 467 U.S. 837 (1984). See Brooks Fiber 
Communications, 235 F.3d at 497; Connect Communi- 
cations, 225 F.3d at 946. 

11 

C. Petitioners next contend (Br. 19) that Section 
252(e)(4), which declares that “[n]o State court shall 

10 The Fourth Circuit attempted to distinguish Starpower on the 
ground that Section 252(e)(5) refers to a state commission’s “re- 
sponsibility under this section [i.e., Section 252]” whereas Section 
252(e)(6) refers to a state commission’s “determination under this 
section [i.e., Section 252].” See Bell Atlantic MD, Inc. v. MCI 
WorldCom, Inc., 240 F.3d at 303 n.6. The difference in terminol- 
ogy, to the extent it has any significance at all, is a consequence of 
the fact that Section 252(e)(5) is concerned with the activities of 
state commissions, whereas Section 252(e)(6) is concerned with the 
end products of those activities. But that difference in terminology 
does not detract from the relevance of Starpower to the question 
here. Starpower makes clear that a state commission exercises 
“responsibility under” Section 252 when it construes or enforces an 
existing interconnection agreement. It thus follows that the state 
commission’s resulting determination with respect to how the 
agreement is to be construed or enforced is a “determination 
under” Section 252. 

11 The FCC’s conclusions in Starpower concerning the source of 
state commissions’ authority to interpret and enforce existing 
interconnection agreements qualify for deference under Chevron, 
because Congress delegated authority to the FCC to make rules 
carrying the force of law in this area, see 47 U.S.C. 251(d)(1), and 
the interpretation at issue was promulgated in a preemption 
proceeding mandated by Congress, see 47 U.S.C. 252(e)(5). Cf. 
United States v. Mead Corp., 121 S. Ct. 2164 (2001). 

24 

have jurisdiction to review the action of a State com- 
mission in approving or rejecting an agreement under 
this section,” implies that Congress contemplated that 
state courts would have jurisdiction to review state 
commissions’ orders with respect to existing agree- 
ments. It does not follow, simply because Congress did 
not expressly foreclose state court review of state 
commission decisions interpreting or enforcing agree- 
ments that were previously approved, that Congress 
intended to confine federal court review to state com- 
mission decisions approving or rejecting agreements as 
an initial matter. Nothing in the text of Section 
252(e)(4), Section 252(e)(6), or any other provision of the 
1996 Act hints at such an intent. 

To the contrary, Section 252(e)(4) manifestly under- 
mines petitioners’ position here. Section 252(e)(4) 
demonstrates that, when Congress intended to refer 
only to decisions of state commissions “approving or 
rejecting an agreement,” Congress did so in those 
unequivocal terms. Congress did not use those same 
terms in describing the scope of federal court review 
under Section 252(e)(6). Instead, Congress chose more 
expansive language—providing for federal court review 
in “any case in which a State commission makes a 
determination under this section”—and its choice 
should be given significance. See Russello v. United 
States, 464 U.S. 16, 23 (1983) (“[W]here Congress 
includes particular language in one section of a statute 
but omits it in another section of the same Act, it is 
generally presumed that Congress acts intentionally 
and purposely in the disparate inclusion or exclusion.”). 
Thus, although Congress did not expressly preclude 
state court review of state commission orders inter- 
preting or enforcing interconnection agreements, Con- 
gress also did not confine federal court review under 

25 

Section 252(e)(6) to state commission orders approving 
or rejecting agreements as an initial matter. Rather, 
Congress used language that encompasses decisions 
interpreting or enforcing agreements already in exis- 
tence. 

Congress may have concluded that state court review 
of state commission orders interpreting or enforcing 
interconnection agreements should not be entirely 
foreclosed because, in some cases, the order might turn 
on issues of state statutory or common law. Cf. 
47 U.S.C. 252(e)(3) (state commission may enforce cer- 
tain state-law requirements in review of interconnec- 
tion agreements). Congress may have sought to give 
carriers the option of seeking review of such orders in 
either federal court or state court, depending upon 
whether, among other things, the order implicates 
predominantly federal-law or state-law claims. Of 
course, if a case presenting both federal-law claims and 
state-law claims were to be brought in state court, a 
defendant would ordinarily have the option to remove 
the case to federal court, at least for the adjudication of 
any federal-law claims. See 28 U.S.C. 1441. 

In any event, the question here is not, as petitioners 
suggest (Br. 19), whether Congress “intend[ed] to pre- 
clude customary state court review of * * * deter- 
minations made by state commissions * * * inter- 
preting and enforcing agreements.” Rather, the ques- 
tion is whether Congress intended to preclude federal 
court review of such determinations for compliance 
with federal law. Congress evinced no such intent. The 
Court is not required to decide in this case whether, or 
to what extent, state courts may exercise concurrent 
jurisdiction to review orders of the sort at issue here. 

D. Petitioners note (Br. 19) that federal judicial 
review under Section 252(e)(6) is addressed “to deter- 

26 

min[ing] whether the agreement * * * meets the 
requirements of section 251 of this title and this section 
[i.e., Section 252],” and argue that a district court is not 
engaging in that inquiry when it reviews a state com- 
mission’s order interpreting or enforcing an existing 
agreement. Again, petitioners are mistaken. 

Although, as petitioners observe (ibid.), federal judi- 
cial review for compliance with Sections 251 and 252 
“should occur at the time the agreement is approved,” 
subsequent disputes concerning the interpretation and 
enforcement of the agreement also must be resolved in 
compliance with Sections 251 and 252. Thus, when a 
state commission construes a provision of an existing 
agreement, and an aggrieved party seeks judicial 
review under Section 252(e)(6) on the ground that the 
construction is inconsistent with the 1996 Act (as 
Ameritech did in this case), the district court is being 
asked to “determine whether the agreement,” as so 
construed and applied, “meets the requirements of ” 
Sections 251 and 252. 

12 

E. Petitioners argue (Br. 24) that Congress would 
not have seen any need for state commissions’ orders 
interpreting and enforcing interconnection agreements 
to be reviewed in federal court for consistency with 
federal law. To the contrary, Congress surely under- 
stood that federal court review serves an important 

12 Alternatively, when a state commission construes a disputed 
provision of an existing interconnection agreement, the commis- 
sion might be viewed as “approving” a new agreement between 
the parties (i.e., the existing agreement as it is newly understood 
and clarified), thereby making federal review available even under 
petitioners’ restrictive understanding of Section 252(e)(6). That 
understanding would not necessarily require a construction of 
Section 252(e)(4) that ousts the state courts of jurisdiction to 
review state commission decisions construing existing agreements. 

27 

purpose: to promote the development and application 
of a more consistent body of federal law to govern the 
rights and obligations of parties under interconnection 
agreements. After all, Congress assigned the federal 
courts exclusive responsibility for reviewing state com- 
mission decisions approving or rejecting interconnec- 
tion agreements in the first instance. And the same 
issues of federal law that arise at the approval/rejection 
stage also arise at the interpretation/enforcement 
stage. Congress could not have intended to leave the 
federal courts powerless to review the determinations 
of state commissions, in the course of interpreting or 
enforcing interconnection agreements, to assure that 
those decisions do not conflict with federal law or 
significantly alter the terms of agreements approved in 
the federal courts’ initial review. See Brooks Fiber 
Communications, 235 F.3d at 497 (observing that 
Congress would not have created a regime under which 
“certain state commission decisions would escape fed- 
eral review simply because the dispute arose after the 
agreement had been approved”). 

As a practical matter, inconsistent decisions from the 
federal and state courts on the same, or similar, issues 
of federal law—or even the possibility of such incon- 
sistent decisions—could significantly impede the inter- 
connection process envisioned by the 1996 Act. 

13 State 

13 To be sure, if the state courts possess concurrent jurisdiction 
with the federal courts to review state commission orders inter- 
preting or enforcing interconnection agreements (a question not 
presented here), some potential exists for inconsistent decisions. 
But state courts ordinarily would decide cases challenging such 
state commission orders on federal-law grounds only when the 
plaintiffs chose to file the case in state court and the defendants 
chose not to remove the case to federal court under 28 U.S.C. 1441. 

28 

regulators could be torn between conflicting decisions 
of the state and federal courts on the same issue of fed- 
eral law in attempting to carry out their responsibilities 
under the 1996 Act. And telecommunication carriers 
could face greater uncertainty, and thus potentially 
greater cost, in entering into interconnection agree- 
ments. Parties to such agreements could be tempted, 
for example, to engage in regulatory gamesmanship by 
waiting to raise critical issues until after an agreement 
has been approved. Accordingly, federal court review 
of state commission determinations interpreting and 
enforcing interconnection agreements for compliance 
with federal law not only comports with the statutory 
text but also advances Congress’s overriding purpose 
to facilitate the expeditious development of competition 
in local telecommunications markets. 

14 

F. Finally, whether or not Section 252(e)(6) vests 
the district courts with jurisdiction to review state 
commission orders interpreting and enforcing existing 
interconnection agreements for compliance with federal 

14 As a last resort, petitioners contend (Br. 27-28) that Section 
252(e)(6) “should be read to confine federal court review to arbitra- 
tion and approval decisions to avoid the difficult Eleventh Amend- 
ment questions raised by this case.” As explained below, the canon 
of constitutional avoidance has no application in this case because 
construing Section 252(e)(6) to authorize suits against state com- 
missions or their commissioners does not present serious Eleventh 
Amendment problems. In any event, the Court could not long 
avoid the Eleventh Amendment question, which also arises with 
respect to federal court challenges to state commission decisions 
approving or rejecting interconnection agreements, which petition- 
ers concede are within the scope of Section 252(e)(6). See, e.g., 
AT&T Communications v. BellSouth Telecomms., 238 F.3d 636 
(5th Cir. 2001); MCI Telecomms. Corp. v. Public Serv. Comm’n, 
216 F.3d 929 (10th Cir. 2000), cert. denied, 121 S. Ct. 1167 (2001). 

29 

law, the district courts possess such jurisdiction under 
28 U.S.C. 1331. As noted above, Ameritech invoked the 
district court’s jurisdiction pursuant to both provisions. 
Although neither the district court nor the Seventh 
Circuit found it necessary to address the question (see 
Pet App. 24a, 29a n.3), Section 1331 remains available 
as an alternate basis for federal jurisdiction in this 
context. Because the Court did not grant certiorari on 
that question in this case, we have addressed the ques- 
tion in our brief in Verizon v. Public Service Comm’n of 
Maryland, No. 00-1531 (consolidated with United 
States v. Public Service Comm’n of Maryland, No 00- 
1711). 

II. THE ELEVENTH AMENDMENT DOES NOT BAR 
SUITS AGAINST STATE COMMISSIONS OR 
THEIR COMMISSIONERS SEEKING PROSPEC- 
TIVE RELIEF FROM THEIR DETERMINATIONS 
UNDER THE 1996 ACT 

State public utility commissions and their commis- 
sioners are not entitled to Eleventh Amendment immu- 
nity from suits, such as this one, seeking review of their 
orders approving, rejecting, construing, or enforcing 
interconnection agreements under the 1996 Act. That 
is so for two independent reasons. First, a State waives 
its immunity from suit in federal court under the 1996 
Act by electing to participate in the regulatory scheme 
established by the Act. Second, the doctrine of Ex 
parte Young permits suits against state commissioners 
in their official capacities to secure their prospective 
compliance with the 1996 Act. 

It should be emphasized that the only remedy avail- 
able in federal court to a party aggrieved by a state 
commission order under Section 252 is a judicial 

30 

determination that the order is contrary to federal law 
and therefore is unenforceable. The same remedy is 
available to a party aggrieved by an order issued by the 
FCC under Section 252 in circumstances where the 
State has elected not to exercise regulatory authority 
under the 1996 Act. The aggrieved party cannot, in 
either instance, obtain monetary relief against the State 
or the United States. A state commission’s obligation 
to appear in federal court to defend a Section 252 deter- 
mination—the same obligation that is imposed on the 
FCC—does not constitute a significant intrusion into 
state sovereignty, especially given that the States can 
avoid that obligation altogether by electing to leave the 
exercise of regulatory authority under the 1996 Act to 
the FCC. 

15 

15 Even if the Eleventh Amendment were a bar to suits under 
the 1996 Act against state commissions or their commissioners, 
state commissions’ decisions approving, rejecting, construing, or 
enforcing interconnection agreements would be reviewable in 
federal court for compliance with federal law, so long as sufficient 
adversariness existed between the private parties to create an 
Article III case or controversy. Cf. pp. 35-36, infra (describing 
instances in which such adversariness between private parties may 
not exist). Those private parties would be required by principles 
of claim and issue preclusion to give effect to the federal court’s 
decision in the case. A state commission could be expected to give 
effect to the decision as well. If a state commission nonetheless 
refused to do so, the question whether an injunction could issue 
against the commissioners in an action under Ex parte Young is 
distinct from the Ex parte Young question presented in this case. 

31 

A. Congress Conditioned The States’ Participation In The 

New Regulatory Scheme Created By The 1996 Act On 

The States’ Waiver Of Immunity From Suits 

Challenging Their Determinations Under The Act 

1. This Court has recognized that, as a condition for 
a grant of federal authority to a State, Congress may 
require the State to waive its immunity from suit with 
respect to its exercise of that authority. See Petty v. 
Tennessee-Missouri Bridge Comm’n, 359 U.S. 275 
(1959); see also College Savings Bank v. Florida Pre- 
paid Postsecondary Educ. Expense Bd., 527 U.S. 666, 
686-687 (1999) (discussing Petty). That is what Con- 
gress did in the 1996 Act. Congress invited the States 
to participate, if they chose to do so, in the federal 
regulatory scheme established by the Act. Congress 
conditioned such participation, however, on the States’ 
acceptance of a reguatory regime that specifically made 
their determinations under the Act subject to review in 
federal court. Accordingly, when Illinois accepted 
Congress’s invitation to regulate under the Act—which 
Illinois was free to decline—Illinois waived the ICC’s 
immunity from suits such as this one. 

In Petty, Congress consented to a compact between 
two States to engage in the construction of bridges and 
the operation of ferries across navigable waters of the 
United States. Congress, in the Act approving the 
compact, attached a condition that “nothing herein con- 
tained shall be construed to affect, impair, or diminish 
any right, power, or jurisdiction of * * * any court 

* * * of the United States over or in regard to any 
navigable waters or any commerce between the 
States.” 359 U.S. at 281. The Court construed that 
provision, read in light of a “sue-and-be-sued” provision 
in the compact itself, as “reserv[ing] the jurisdiction of 

32 

the federal courts to act in any matter arising under the 
compact,” including tort suits against an agency of the 
two States that was formed pursuant to the compact. 
Ibid. The Court explained that “[t]he States who are 
parties to the compact by accepting it and acting under 
it assume the conditions that Congress under the 
Constitution attached.” Id. at 281-282. 

Three Terms ago, the Court reaffirmed its holding in 
Petty that the compacting States “had consented to suit 
by reason of a suability provision attached to the con- 
gressional approval of the compact.” College Savings 
Bank, 527 U.S. at 686. The Court described Petty as 
involving Congress’s attachment of a condition to a 
grant of authority that the States would not otherwise 
have possessed, because the Constitution prohibits 
States from entering into compacts with one another 
without congressional approval. Ibid. Thus, the Court 
explained, Congress’s approval of the grant of authority 
contained in the compact in Petty was a “gratuity” in 
the same sense as a grant of federal funds—a context in 
which it is well-established that Congress may condi- 
tion a State’s acceptance of the gratuity on a waiver of 
immunity. Id. at 686-687 (citing South Dakota v. Dole, 
483 U.S. 203 (1987) (holding that Congress could condi- 
tion a grant of federal funds to the States upon the 
States’ taking certain actions that Congress could not 
require them to take)). 

16 

16 College Savings Bank confirms that a voluntary waiver, 
based on a State’s acceptance of a federal gratuity that is condi- 
tioned on the State’s consent to suit in federal court, is wholly 
distinct from a forced waiver under the now-overruled doctrine of 
Parden v. Terminal Railway, 377 U.S. 184 (1964). See College 
Savings Bank, 527 U.S. at 675-687. 

33 

This case involves a condition attached to Congress’s 
provision of a “gratuity”—a grant of authority that a 
State may choose to accept or reject—analogous to the 
condition attached to Congress’s approval of the inter- 
state compact in Petty. As this Court observed in Iowa 
Utilities Board, the 1996 Act transformed the regula- 
tion of local telecommunications, because “[w]ith regard 
to the matters addressed by the 1996 Act,” Congress 
“unquestionably” has “taken the regulation of local tele- 
communications competition away from the States.” 
525 U.S. at 379 n.6; see AT&T Communications v. 
BellSouth Telecommunications, Inc., 238 F.3d 636, 646 
(5th Cir. 2001) (“After passage of the 1996 Act, regula- 
tion of competition among providers of local phone ser- 
vice is no longer within the province of states’ inherent 
authority.”). Congress allowed the States, through 
their public utility commissions, to play a role in that 
regulation, but only pursuant to a regulatory regime 
that explicitly provides that exercises of that authority 
are subject to review in federal court to ensure that 
they comply with the new federal standards. Congress 
left the States free to decline that regulatory role, in 
which case the role would be performed by the FCC. 
See 47 U.S.C. 252(e)(5). Thus, with respect to the core 
local competition obligations imposed by Sections 251 
and 252, the 1996 Act does not allow the States simply 
“to do their own thing,” and, “if the federal courts 
believe a state commission is not regulating in accor- 
dance with federal policy they may bring it to heel.” 
Iowa Utils. Bd., 525 U.S. at 379 n.6. 

Three courts of appeals, applying the implied waiver 
doctrine recognized in Petty and College Savings Bank, 
have held that States, by electing to exercise regu- 
latory authority under the 1996 Act, waive their immu- 
nity from suits in federal court challenging their 

34 

exercise of that authority. See AT&T Communications 

v. BellSouth Telecomms., Inc., 238 F.3d at 646-647; 
MCI Telecomms. Corp. v. Illinois Bell Tel. Co., 222 
F.3d at 341; MCI Telecomms. Corp. v. Public Serv. 
Comm’n, 216 F.3d 929, 938 (10th Cir. 2000), cert. 
denied, 121 S. Ct. 1167 (2001); but see Bell Atlantic 
Maryland, Inc. v. MCI WorldCom, Inc., 240 F.3d at 
290-294 (rejecting implied waiver argument). 

2. Petitioners contend (Br. 30-33) that the 1996 Act 
does not contain a sufficiently clear statement that 
state commissions will be subject to suit in federal court 
if they choose to exercise regulatory authority under 
the Act. Petitioners are mistaken. Section 252(e)(6), 
read in context with other provisions of Section 252, 
puts state commissions on abundant notice that they, 
like the FCC, may be named as defendants in suits in 
federal court seeking review of their determinations 
under the Act. Cf. Kimel v. Florida Bd. of Regents, 528 
U.S. 62, 74 (2000) (analysis of whether Congress 
intended to abrogate States’ sovereign immunity is to 
be based on the statutory text “[r]ead as a whole”). 

As noted above, Section 252(e)(6) is titled “[r]eview 
of State commission actions,” and provides, in pertinent 
part, that “[i]n any case in which a State commission 
makes a determination under this section, any party 
aggrieved by such determination may bring an action in 
an appropriate Federal district court.” 47 U.S.C. 
252(e)(6). Section 252(e)(6) does not state, in so many 
words, that such an action may be brought against the 
state commission. But that is the unmistakable impli- 
cation of the statutory text. In Petty, the proviso that 
Congress attached to its approval of the interstate 
compact likewise did not expressly refer to suits 
against the bistate commission or to a waiver of the 
commission’s sovereign immunity, see 359 U.S. at 277- 

35 

278, but the Court understood the proviso as address- 
ing such a waiver, see id. at 281-282. 

Indeed, Section 252(e)(6) must be read to authorize 
suits against state commissions in order to assure, as 
the statute provides, that federal judicial review is 
available to “any party aggrieved” and “[i]n any case in 
which a State commission makes a determination under 
this section.” 47 U.S.C. 252(e)(6) (emphases added). 
There are some categories of cases seeking review of 
state commission determinations under Section 252 in 
which the only potential defendant is the state com- 
mission itself. For example, Section 252(e)(1) requires 
that “[a]ny interconnection agreement adopted by 
negotiation or arbitration shall be submitted for ap- 
proval to the State commission,” which “shall approve 
or reject the agreement, with written findings as to any 
deficiencies.” 47 U.S.C. 252(e)(1); see also 47 U.S.C. 
252(e)(2) (providing separate standards for state com- 
missions’ review of negotiated agreements and arbi- 
trated agreements). Congress surely contemplated 
situations in which a state commission rejects a negoti- 
ated agreement—an agreement that is satisfactory in 
all respects to the parties—on the ground, for example, 
that the agreement “is not consistent with the public 
interest, convenience, and necessity.” 47 U.S.C. 
252(e)(2)(A)(ii). In such situations, both parties to the 
agreement would be “aggrieved by [the state com- 
mission’s] determination,” within the meaning of 
Section 252(e)(6), and thus would be entitled to seek 
review as plaintiffs in federal district court. The only 
possible defendant to that suit could be the state 
commission (especially if no other party had appeared 
in the state commission proceedings to urge rejection of 
the agreement). Similarly, where a state commission 
has rejected a Bell operating company’s statement of 

36 

generally available terms under Section 252(f )(2), the 
only possible defendant in a suit by the Bell operating 
company under Section 252(e)(6) seeking review of that 
determination might well be the state commission. 

17 

Moreover, Section 252(e)(6) contemplates “judicial 
review of the Commission’s [i.e., the FCC’s] actions,” 
acting in the place of a state commission, in a proceed- 
ing in federal court against the FCC and the United 
States. All final orders of the FCC are reviewable, 
unless otherwise specifically provided, in the federal 
courts of appeals under the Hobbs Administrative 
Orders Review Act, 28 U.S.C. 2341 et seq. See 28 
U.S.C. 2342(1); 47 U.S.C. 402(a); see also In re Proce- 
dures for Arbitrations Conducted Pursuant to Section 
252(e)(5) of the Communications Act of 1934, as 
Amended, 16 F.C.C.R. 6231 (2001) (para. 15). The 
Hobbs Act states that any proceeding thereunder to 
review an agency order “shall be against the United 
States.” 28 U.S.C. 2344; see also Fed. R. App. P. 15(a) 
(requiring petitions for review of federal agency orders 
to “name the agency as a respondent,” and noting that 
the United States, whether or not named, is a respon- 
dent if required by statute). It would have been 
anomalous for Congress to provide that, although an 
order issued by the FCC under Section 252 is review- 
able in a proceeding against the FCC itself, an order 
issued by a state commission under Section 252 is 
reviewable in federal court only in a proceeding against 

17 Petitioners acknowledge (Br. 18) that state commission deci- 
sions approving or rejecting interconnection agreements are 
reviewable in district court under Section 252(e)(6). But peti- 
tioners suggest no means by which such review could occur in 
cases, such as those identified in the text, where there is no party 
other than the state commission to defend the decision in district 
court. 

37 

private parties, if any exist, and not against the state 
commission. Thus, Section 252(e)(6) should be under- 
stood as providing for federal court review in a pro- 
ceeding against whatever entity—the FCC or the state 
commission—issued the order approving, rejecting, 
construing, or enforcing an interconnection agreement. 

3. Petitioners further contend (Br. 32-40) that the 
States cannot be deemed to have waived their Eleventh 
Amendment immunity with respect to judicial review 
proceedings under Section 252(e)(6) because the author- 
ity to regulate interconnection agreements is not a 
“gratuity” under this Court’s decisions. Petitioners 
rely on the distinction that the Court drew in College 
Savings Bank between a requirement that a State 
waive its immunity in order to obtain a federal “gift or 
gratuity,” such as the highway funds in Dole or the 
interstate compact in Petty, and a requirement that a 
State waive its immunity in order to engage in “other- 
wise permissible activity” in which private parties are 
free to engage, such as the interstate commercial activ- 
ity in that case. 527 U.S. at 687. Petitioners suggest 
that, because the States exercised comprehensive regu- 
latory authority over local telecommunications before 
the enactment of the 1996 Act, the regulation of inter- 
connection agreement is such an “otherwise permissible 
activity,” and thus that the States’ participation in that 
activity cannot be conditioned on a waiver of immunity. 
Petitioners overlook not only that Congress may 
preempt state regulatory authority over commercial 
activities that are within the federal commerce power 
but also that Congress did preempt such state regu- 
latory authority here. As this Court made quite clear in 
Iowa Utilities Board, Congress has taken over signifi- 
cant aspects of local telecommunications regulation. 
See 525 U.S. at 379 n.6 (“With regard to the matters 

38 

addressed by the 1996 Act,” Congress “unquestionably” 
has “taken the regulation of local telecommunications 
competition away from the States.”); accord MCI 
Telecomms. Corp. v. Illinois Bell Tel. Co., 222 F.3d at 
342. The Act imposed a new federal regulatory scheme 
on local telecommunications markets; the States were 
permitted to continue to regulate in areas encompassed 
by the Act only to the extent consistent with the Act 
and the implementing FCC regulations, and only by 
accepting a regulatory regime in which state commis- 
sion decisions were made reviewable in federal court. 
The Act thus reflects the general principle that Con- 
gress may preempt the States from regulating in an 
area of federal concern and may condition the States’ 
continued regulation in that area on adherence to 
federal standards. See Federal Energy Regulatory 
Comm’n v. Mississippi, 456 U.S. 742, 767 (1982); Hodel 

v. Virginia Surface Mining & Reclamation Ass’n, 452 
U.S. 264, 290 (1981). 

Petitioners’ contention (Br. 37-40) that they had no 
meaningful choice whether to accept Congress’s invita- 
tion to exercise federal regulatory authority rests on a 
similarly flawed conception of the preemptive scope of 
the 1996 Act. Suggesting that a State would lose all 
ability to regulate local telecommunications if it de- 
clined to regulate under the Act, petitioners argue (Br. 

39) that Illinois “should not have to choose between 
giving up the ‘vital public service’ performed by the 
ICC and ‘consenting’ to federal suit.” Congress did not, 
however, put States to that choice. A State’s decision 
not to exercise regulatory authority under Sections 251 
and 252 does not divest the State of all regulatory 
authority over local telecommunications. Although 
Congress supplanted state regulation with respect to 
“matters addressed by the 1996 Act,” Iowa Utilities 

39 

Board, 525 U.S. at 379 n.6, Congress did not supplant 
state regulation of all aspects of local telecommuni- 
cations. The local competition provisions of the 1996 
Act are concerned principally with dealings between 
telecommunications carriers, rather than with relations 
between each carrier and its own customers, which has 
been a traditional focus of state regulation. Moreover, 
Congress expressly preserved the ability of States to 
supplement federal requirements with requirements of 
their own, so long as they are consistent with the Act 
and any rules promulgated thereunder by the FCC. 
See 47 U.S.C. 251(d)(3), 252(e)(3), 253(b), 261(b) and (c). 
The States thus retain considerable regulatory author- 
ity with respect to local telecommunications, whether 
or not they choose to participate in the federal scheme 
established by the 1996 Act. 

18 

Nor is it relevant, as petitioners suggest (Br. 37), 
that a state commission may have been required by 
state law to accept Congress’s invitation to regulate 
interconnection agreements. The relevant point is that 
Congress left it to the States to choose whether to 
exercise regulatory authority under the 1996 Act. It 
makes no difference for Eleventh Amendment purposes 
whether that choice was made by the state legislature 
or the state commission. In either circumstance, it is 
not “the unilateral action of Congress” (Br. 38) that has 
brought the state commission or its commissioners to 
federal court, but rather the unilateral decision by the 

18 The fact that Congress did not supplant state regulation of 
local telecommunications in every possible respect does not under- 
mine the waiver analysis. Under that analysis, the States are 
deemed to have waived their sovereign immunity only with 
respect to those matters as to which Congress has supplanted 
state regulation with federal regulation. 

40 

State to accept the full regulatory authority offered by 
Congress. 

19 

Indeed, one State—the Commonwealth of Virginia— 
has declined to exercise authority under the 1996 Act. 
See In re Petition of Cox Virginia Telecommuni- 
cations, Inc. for Preemption of Jurisdiction of the 
Virginia State Corporation Commission Pursuant to 
Section 252(e)(5) of the Telecommunications Act of 
1996 and for Arbitration of Interconnection Disputes 
with Verizon-Virginia, Inc., 16 F.C.C.R. 2321, 2322 
(para. 4) (Jan. 26, 2001) (noting Virginia State Corpora- 
tion Commission’s refusal to exercise authority under 
the 1996 Act on grounds that doing so may be deemed a 
waiver of sovereign immunity); see also Starpower, 15 
F.C.C.R. at 11,277 (FCC exercises regulatory authority 
under 1996 Act in the default of the Virginia Com- 
mission). Such action confirms that Congress left the 
States free to choose whether to participate in the new 
federal regulatory scheme, and that a State choosing to 
participate would know that it is waiving its Eleventh 
Amendment immunity from federal judicial review of 
state commission orders under the Act. Petitioners and 
other state commissioners may not like the choice that 
Congress offered under the Act, because they would 
prefer instead a return to the era when virtually all 
local telecommunications regulation was the sole 

19 Petitioners do not assert that Congress “coerced” them to 
regulate interconnection agreements in violation of the Tenth 
Amendment. See Printz v. United States, 521 U.S. 898 (1997). The 
lone court of appeals that has addressed that issue rejected a 
Tenth Amendment challenge to the 1996 Act, emphasizing that the 
state commission in that case “could have chosen not to par- 
ticipate,” but instead arbitrated and reviewed the interconnection 
agreement at issue. See Michigan Bell Tel. Co. v. Climax Tel. Co., 
202 F.3d 862, 868 (6th Cir.), cert. denied, 531 U.S. 816 (2000). 

41 

domain of the States. See Pet. Br. 39 (“[u]tilities regu- 
lation is a long-standing function of state government in 
Illinois”). There can be no doubt, however, that Con- 
gress has offered the States a real choice, albeit a choice 
that carries with it burdens as well as benefits, and that 
the FCC will exercise regulatory authority under the 
1996 Act if the States decline to do so. See 
47 U.S.C. 252(e)(5). 

In sum, it is the 1996 Act, not state law, that provides 
new entrants with the core rights to interconnect with 
an incumbent carrier’s network, to lease elements of 
the incumbent’s network, and to purchase services of 
the incumbent’s network for resale. It is the 1996 Act, 
not state law, that provides for competing carriers to 
enter into agreements implementing those rights, 
either through negotiation between themselves or 
through arbitration under the auspices of a regulatory 
body. It is the 1996 Act, and the regulations promul- 
gated by the FCC under that Act, that contain the basic 
principles governing the rates, terms, and conditions to 
be incorporated into such agreements. Thus, to the 
extent that Congress has preempted state regulation of 
interconnection agreements, such state regulation is 
not “otherwise permissible activity” under College 
Savings Bank. Instead, the invitation to participate in 
such regulation is a form of “gratuity” that Congress 
may offer with conditions attached. States remain free 
to accept or reject the regulatory role that Congress 
has offered to them under the Act. But States cannot 
choose to participate in the regulatory scheme estab- 
lished under the Act while rejecting the federal judicial 
review that is a critical part of the regulatory scheme. 

42 

B. State Commissioners Are Subject To Suit In Their 

Official Capacities Under The Doctrine Of Ex Parte 

Young To Secure Their Prospective Compliance With 

The 1996 Act 

There is a second, independent reason why this 
action may, consistent with the Eleventh Amendment, 
proceed against petitioners in federal court. This is a 
suit against state officials, in their official capacities, to 
secure their prospective compliance with the 1996 Act. 
It thus comes within the Ex parte Young exception to 
the Eleventh Amendment. 

1. This Court has recognized that the doctrine of 
sovereign immunity reflected in the Eleventh Amend- 
ment does not apply to suits that seek to enjoin 
individual state officials in their official capacities from 
enforcing state law that is contrary to federal law or 
otherwise from engaging in conduct that federal law 
prohibits. Ex parte Young, 209 U.S. 123 (1908); see 
Board of Trustees v. Garrett, 121 S. Ct. 955, 968 n.9 
(2001) (noting that the Americans With Disabilities Act 
is enforceable against States “by private individuals in 
actions for injunctive relief under Ex parte Young”); 
Idaho v. Coeur d’Alene Tribe, 521 U.S. 261, 269 (1997) 
(acknowledging “the continuing validity of the Ex parte 
Young doctrine”); Pennhurst State Sch. & Hosp. v. 
Halderman, 465 U.S. 89, 102 (1984). As the Court has 
observed, the Ex parte Young exception is “necessary 
to permit the federal courts to vindicate federal rights 
and hold state officials responsible to the supreme 
authority of the United States.” Pennhurst 465 U.S. at 
105 (internal quotation marks omitted); accord Alden v. 
Maine, 527 U.S. 706, 747-748 (1999). 

As the Seventh Circuit has observed, suits such as 
this one, which seek to enjoin state commissioners from 
enforcing orders asserted to be contrary to the 1996 

43 

Act, “fit squarely within the traditional framework of 
Ex parte Young.” 

MCI Telecomms. Corp. v. Illinois 
Bell Tel. Co., 222 F.3d at 345. In naming petitioners, all 
of the commissioners of the ICC, in their official capaci- 
ties as parties in a suit seeking review of the ICC’s 
determinations under the 1996 Act, Ameritech was 
seeking “to have the commissioners conform their 
future actions, including their continuing enforcement 
of the challenged determinations, with federal law.” 
Ibid. That is the precise circumstance in which the Ex 
parte Young exception is appropriately employed. See 
Coeur d’Alene Tribe, 521 U.S. at 276-277 (opinion of 
Kennedy, J.) (Ex parte Young and its progeny teach 
“that where prospective relief is sought against individ- 
ual state officers in a federal forum based on a federal 
right, the Eleventh Amendment, in most cases, is not a 
bar”). 

20 Thus, every court of appeals that has ad- 
dressed the question, with the exception of the Fourth 
Circuit, has held that Ex parte Young permits federal 
court review of state commission determinations for 
consistency with the 1996 Act. See, e.g., Michigan Bell 
Tel. Co. v. Climax Tel. Co., 202 F.3d 862, 867 (6th Cir.) 
(characterizing such a suit as “a straightforward Ex 
parte Young case”), cert. denied, 531 U.S. 816 (2000); 
see also AT&T Communications v. BellSouth Tele- 
comms., Inc., 238 F.3d at 647-649; MCI Telecomms. 
Corp. v. Illinois Bell Tel. Co., 222 F.3d at 345; MCI 
Telecomms. Corp. v. Public Serv. Comm’n, 216 F.3d at 

20 Seven of the nine Justices in Coeur d’Alene Tribe reaffirmed 
that the inquiry governing whether an action may proceed against 
state officials under the Ex parte Young exception is “whether a 
complaint alleges an ongoing violation of federal law and seeks 
relief properly characterized as prospective.” 521 U.S. at 296 
(O’Connor, J., concurring); id. at 298 (Souter, J., dissenting). 

44 

939-940; but see Bell Atlantic MD, Inc. v. MCI 
WorldCom, Inc., 240 F.3d at 294-298 (rejecting Ex 
parte Young argument). 

21 

2. Petitioners initially contend (Br. 42) that state 
commissioners “cannot be said to violate federal law,” 
for purposes of the Ex parte Young exception, when 
they construe or enforce an interconnection agreement 
in a manner contrary to the 1996 Act. According to 
petitioners, so long as state officials act “within their 
jurisdiction” (ibid.) under state law, they cannot be 
subject to suit in federal court under Ex parte Young. 
The rule suggested by petitioners would turn Ex 
parte Young on its head. Indeed, the Ex parte Young 
exception applies only to suits challenging acts by state 
officials in their “official capacities,” and thus ordinarily 
to acts ostensibly within the scope of their authority 
under state law. Ex parte Young proceeds, however, 
on the principle (or legal fiction) that state officials act 
outside their authority under state law, and thus are 
not the State for Eleventh Amendment purposes, when 
they exercise that authority contrary to federal law. 
See Ex parte Young, 209 U.S. at 159-160 (a state officer 
is “stripped of his official or representative character” 

21 In holding that the Ex parte Young exception does not apply 
to suits contending that a state commission’s determination with 
respect to an interconnection agreement violates the 1996 Act, the 
Fourth Circuit undertook an extensive inquiry into the merits of 
the plaintiff ’s challenge and ultimately concluded that the plaintiff 
could not “allege an ongoing violation of federal law.” Bell Atlantic 
MD, Inc. v. MCI WorldCom, Inc., 240 F.3d at 297. The Fourth 
Circuit erred in conflating the threshold inquiry into the applicabil- 
ity of the Ex parte Young exception with the inquiry on the merits. 
The applicability of Ex parte Young does not depend on whether 
the challenge to the state officials’ action will ultimately be 
successful. 

45 

when he acts contrary to “the supreme authority of the 
United States”); see also Papasan v. Allain, 478 U.S. 
265, 276 (1986) (Ex parte Young is “based on a deter- 
mination that an unconstitutional state enactment is 
void and that any action by a state official that is 
purportedly authorized by that enactment cannot be 
taken in an official capacity since the state authorization 
for such action is a nullity”). 

22 

Nothing in this Court’s decision in Larson v. Domes- 
tic & Foreign Commerce Corp., 337 U.S. 682 (1949), on 
which petitioners rely, casts doubt on the availability of 
an Ex parte Young action in the circumstances here. 
Larson involved a suit against an officer of the United 
States, in his official capacity, to challenge an allegedly 
tortious act of his agency. The Court declined to hold 
that the United States’ sovereign immunity does not 
bar such suits on a theory that federal officers necessar- 
ily act outside the scope of their federal authority when 
they commit common-law torts. See id. at 692-695. But 
the Court nonetheless acknowledged the principle of 
Ex parte Young that treats state officials as acting 
outside their state authority when they violate supreme 
federal law. See id. at 690-691. That principle derives 
from the Supremacy Clause of the Constitution. See, 

e.g., Green v. Mansour, 474 U.S. 64, 68 (1985) (“[T]he 
availability of prospective relief of the sort awarded in 
Ex parte Young gives life to the Supremacy Clause. 
Remedies designed to end a continuing violation of 

22 The Ex parte Young exception applies where a state official’s 
conduct is alleged to violate either the Constitution or a federal 
statute or regulation. See Ray v. Atlantic Richfield Co., 435 U.S. 
151, 156-157 n.6 (1978); accord Garrett, 121 S. Ct. at 968 n.9; Edel- 
man v. Jordan, 415 U.S. 651, 665-671 (1974); cf. City of New York 

v. FCC, 486 U.S. 57, 63-64 (1988) (federal regulation may preempt 
state regulation). 

46 

federal law are necessary to vindicate the federal inter- 
est in assuring the supremacy of that law.”). Neither 
the Supremacy Clause nor any other federal constitu- 
tional or statutory restraint on the federal officer’s 
conduct was implicated in Larson. 

3. Petitioners next contend (Br. 45-48) that the Ex 
parte Young exception is unavailable in this case under 
the rationale of Seminole Tribe of Florida v. Florida, 
517 U.S. 44 (1996). This case is unlike Seminole Tribe in 
all relevant respects. The 1996 Act does not create its 
own “carefully crafted and intricate remedial scheme,” 
id. at 73-74, under which parties may challenge the 
determinations of state commissions with regard to 
interconnection agreements. There is consequently no 
reason in this case, as there was in Seminole Tribe, to 
foreclose the use of a judicially crafted remedial scheme 
under Ex parte Young. 

In Seminole Tribe, the Court reviewed provisions of 
the Indian Gaming Regulatory Act (IGRA), Pub. L. No. 
100-497, 102 Stat. 2467, that established a framework 
for Tribes to negotiate gaming compacts with States. 
Under IGRA, the only judicial remedy for a State’s 
failure to negotiate in good faith with a Tribe was an 
order directing the State and the Tribe to conclude a 
compact within 60 days; the only judicial remedy for a 
State’s failure to conclude a compact within 60 days was 
an order requiring each party to submit its own 
proposed compact to a mediator; and the only judicial 
remedy for a State’s refusal to accept the compact 
selected by the mediator was a notice to the Secretary 
of the Interior, who would then promulgate regulations 
governing gaming on the Indian lands at issue. 
Seminole Tribe, 517 U.S. at 74. The Court reasoned 
that, “[b]y contrast with this quite modest set of sanc- 
tions” that Congress in IGRA had authorized federal 

47 

courts to provide against States, “an action brought 
against a state official under Ex parte Young would 
expose that official to the full remedial powers of a 
federal court, including, presumably, contempt sanc- 
tions.” Id. at 75. The Court therefore held that Tribes 
could not seek to enforce their IGRA rights in suits 
against state officials under Ex parte Young, because 
such suits would enable the Tribes to obtain more 
expansive sanctions than the limited statutory reme- 
dies that Congress provided as part and parcel of the 
limited statutory rights conferred in IGRA. Id. at 74- 
76; cf. Brown v. GSA, 425 U.S. 820, 829-835 (1976) (Title 
VII’s “careful blend” of remedies for discrimination in 
federal employment precludes more general federal 
statutory remedies). 

There is no reason similarly to conclude that the 
availability of judicial review of state commission 
orders under Ex parte Young is at all inconsistent with 
the 1996 Act. Congress, while making clear that such 
orders are reviewable in federal court, see 47 U.S.C. 
252(e)(6), did not prescribe any particular mechanisms 
to govern such review. Nor did Congress circumscribe 
the remedies available in a federal court proceeding 
challenging a state commission order under the Act. 
Congress thereby indicated that all of the remedies 
ordinarily available in federal court when state officials 
act in a manner contrary to federal law are available 
when state commissions issue orders contrary to the 
Act and the FCC’s implementing regulations. There is 
no statutory basis whatsoever for precluding the 
normal operation of the Ex parte Young doctrine in this 
case. 

23 

23 It is instructive to contrast the specificity with which Con- 
gress addressed the administrative stage of proceedings under the 

48 

4. Finally, petitioners assert (Br. 47-48) that allow- 
ing Ex parte Young review of state commissioners’ 
decisions with respect to interconnection agreements is 
“an affront to the sovereignty of the State.” Br. 47-48 
(quoting the Fourth Circuit’s decision in Bell Atlantic 
MD, Inc. v. MCI WorldCom, Inc., 240 F.3d at 298). The 
mere fact that state interests are implicated by an Ex 
parte Young action—which necessarily challenges the 
official acts of a State through its officials—is not the 
sort of “affront” that is sufficient to preclude such 
actions. See Coeur d’Alene Tribe, 521 U.S. at 269-270 
(observing that Ex parte Young itself, like subsequent 
cases applying its “fictional distinction between the 
official and the State,” “implicated substantial state 
interests”); id. at 278 (opinion of Kennedy, J.) (“Of 
course, the State’s interests are almost always impli- 
cated to a certain extent in Young actions.”). It is no 
more an “affront” than is the Supremacy Clause itself. 

24 

1996 Act with the generality with which Congress addressed the 
judicial review stage. Compare 47 U.S.C. 252(a), (b), and (e)(1)-(2) 
with 47 U.S.C. 252(e)(6). It is irrelevant to the Seminole Tribe 
analysis whether the administrative scheme that precedes judicial 
review under the 1996 Act might be characterized as “carefully 
crafted and intricate,” 517 U.S. at 73-74. The Seminole Tribe 
analysis is concerned with whether Congress has prescribed a 
scheme for judicial review that is so “intricate,” and its remedies 
so circumscribed, as to compel the conclusion that Congress would 
not have intended judicial review also to be available under Ex 
parte Young. No such conclusion can be drawn from the 1996 Act. 

24 The commissioners of the ICC have long been accustomed to 
Ex parte Young-type suits challenging their actions as contrary to 
federal law. See, e.g., Natural Gas Pipeline Co. of Am. v. Slattery, 
302 U.S. 300 (1937); City of Chicago v. Chicago Rapid Transit Co., 
284 U.S. 577 (1931); Smith v. Illinois Bell Tel. Co., 270 U.S. 587 
(1926). 

49 

Nor do petitioners offer any reason to conclude that 
this case, as opposed to the many other cases in which 
review of state officials’ acts under Ex parte Young has 
been recognized to be available, presents any distinct 
“affront” to state sovereignty. 

25 Indeed, given that 
Congress expressly gave States the option not to regu- 
late interconnection agreements under the 1996 Act, 
and to leave such regulation to the FCC instead, see 
47 U.S.C. 252(e)(5), the States may readily avoid any 
“affront” occasioned by Ex parte Young review of state 
commission orders of the sort at issue here. 

25 Last Term, for example, the Court acknowledged that a 
private party may sue under Ex parte Young to enjoin state offi- 
cials from violating the requirements of Title I of the Americans 
With Disabilities Act of 1990, 104 Stat. 330, 42 U.S.C. 12111 et seq., 
which, among other things, requires employers to “mak[e] reason- 
able accommodations to the known physical or mental limitations 
of an otherwise qualified individual with a disability who is 
an applicant [for employment] or an employee,” 42 U.S.C. 
12112(b)(5)(A). See Garrett, 121 S. Ct. at 968 n.9. An injunction 
mandating compliance with that requirement by state officials 
could have a significantly greater impact on the State’s conduct of 
its affairs than an injunction barring state commissioners from 
enforcing an order construing an interconnection agreement in a 
manner inconsistent with the 1996 Act. 

50 

CONCLUSION 

The judgment of the court of appeals should be 
affirmed. 

Respectfully submitted. 

JOHN A. ROGOVIN 

Deputy General Counsel 
Federal Communications 

Commission 
THEODORE B. OLSON 
Solicitor General 

GREGORY G. KATSAS 

Acting Assistant Attorney 

General 

LAWRENCE G. WALLACE 

Deputy Solicitor General 

BARBARA MCDOWELL 

Assistant to the Solicitor 

General 

MARK B. STERN 
CHARLES W. SCARBOROUGH 

Attorneys 

SEPTEMBER 2001