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METRO EAST CENTER v. QWEST COMMUNICATIONS INTERNATIONAL

January 28, 2002

METRO EAST CENTER FOR CONDITIONING AND HEALTH, INDIVIDUALLY AND BEHALF OF ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
V.
QWEST COMMUNICATIONS INTERNATIONAL, INC., DEFENDANT.



The opinion of the court was delivered by: David R. Herndon, United States District Judge.

MEMORANDUM AND ORDER

I. Introduction
On June 18, 2001, Metro East Center for Conditioning and Health filed suit against Qwest Communications, alleging that Qwest has been charging it a presubscribed interexchange carrier charge ("PICC") in violation of a Federal Communications Commission regulation, 47 C.F.R. § 69.153, and in excess of the appropriate rate as set forth in Qwest's FCC tariff (Doc. 1). On August 20, 2001, Qwest filed a motion to dismiss this action asserting that the FCC has primary jurisdiction over this case because Metro East seeks application and interpretation of a FCC regulation (Doc. 17). On September 13, 2001, Metro East voluntarily dismissed Count I of its Complaint which alleges a violation of a FCC regulation (Doc. 33). Therefore, Metro East now only alleges that the PICC charged is in excess of the rate set forth in Qwest's tariff. After Metro East voluntarily dismissed Count I of its Complaint, Qwest sent a letter to Metro East indicating its intent to invoke the "tariff provision requiring arbitration." Consequently, Metro East filed a "motion for the declaration of the inapplicability/unenforceability of arbitration clause" (Doc. 32) and Qwest filed a motion to compel arbitration (Doc. 34). On January 18, 2002, the Court held a hearing on these motions and took the matter under advisement. The Court now finds that Metro East's claim is not subject to arbitration and that Qwest's motion to dismiss must be denied.
II. Analysis
A. Arbitration

Qwest's tariff, filed with the FCC, contains an arbitration clause which requires that:

Any claim, controversy or dispute, whether sounding in contract, statute, tort, fraud, misrepresentation, or other legal theory, related directly or indirectly to the Services, whenever brought and whether between the Company and the Customer or between the Company or the Customer and its employees, agents or affiliated businesses of the other party, shall be resolved by arbitration as prescribed in this section. The Federal Arbitration Act, 9 U.S.C. § 1-15, not state law, shall govern the arbitrability of all claims.
(Doc. 37, Exh. A). Qwest, therefore, argues that Metro East's claim is subject to mandatory arbitration. In response, Metro East argues that the arbitration clause contained in Qwest's tariff is unenforceable because it is not a "written agreement to arbitrate" as required by the FAA.*fn1
Qwest's tariff provides that the Federal Arbitration Act "shall govern the arbitrability of all claims." (Doc. 37, Exh. A) (emphasis added). The Court must, therefore, turn to the FAA to determine whether Metro East's claim is arbitrable. Section 3 of the FAA provides:
If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in proceeding with such arbitration.
9 U.S.C. § 3. Therefore, in order to stay proceedings pursuant to section 3, the movant must satisfy two conditions: (1) the issue must be referable to arbitration under a written agreement to arbitrate and (2) the movant must not be in default in proceeding with arbitration. Merit Ins. Co. v. Leatherby Ins. Co., 581 F.2d 137, 142 (7th Cir. 1978). Although national policy encourages arbitration of disputes, submission to arbitration is consensual, not coercive. See Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 57, 62 (1995). Thus, a court cannot force a party to arbitrate unless that party has entered into a contractual agreement to do so. See First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943 (1995).
In this case, there was no contract between Qwest and Metro East. The arbitration clause at issue is contained in a tariff filed with the FCC. The unilateral and nonnegotiable nature of a tariff filed with the FCC negates any contention that a tariff constitutes an "agreement" between parties. Qwest has repeatedly and correctly asserted that a tariff is not a contract. MCI Telecommunications Corp. v. Graham, 7 F.3d 477, 479 (6th Cir. 1993). It cannot now argue that the arbitration clause contained in the tariff is part of a contract by which the parties agreed to arbitrate.*fn2
Qwest also argues that under the filed-rate doctrine, its valid tariff, filed with the FCC, "conclusively and exclusively controls the rights and liabilities between a carrier and its customer." Graham, 7 F.3d at 479. Therefore, Qwest argues, it does not matter that Metro East did not assent to the particular terms of the tariff. Even assuming that Qwest is correct in arguing that its tariff conclusively controls the rights and liabilities of the parties, Qwest's tariff requires that the FAA "govern the arbitrability of all claims," and the FAA requires a written agreement to arbitrate. Exalon Indus., 138 F.3d at 429. An "agreement" presupposes a mutual assent to the terms. Interstate Indus., 540 F.2d at 870-71. Under the analysis above, the arbitration clause in Qwest's tariff does not constitute a written agreement to arbitrate. The Court, therefore, finds that Qwest and Metro East clearly did not enter into a ...

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