United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 22, 2000 Decided August 8, 2000

No. 99-1220

Hi-Tech Furnace Systems, Inc. and

Robert E. Kornfeld,

Petitioners

v\.

Federal Communications Commission and

United States of America,

Respondents

Sprint Communications Company L.P.,

Intervenor

On Petition for Review of an Order of the

Federal Communications Commission

Michael C. Spencer argued the cause and filed the briefs for petitioner.
Steven G. Schulman entered an appearance.

Laurel R. Bergold, Counsel, Federal Communications Commission, argued
the cause for respondent. With her on the brief were Joel I. Klein,
Assistant Attorney General, U.S. Department of Justice, Robert B.
Nicholson and Robert J. Wiggers, Attorneys, Christopher J. Wright,
General Counsel, Federal Communications Commission, and John E. Ingle,
Deputy Associate General Counsel.

Leon M. Kestenbaum and Michael B. Fingerhut were on the brief for
intervenor Sprint Communications Company L.P.

Before: Edwards, Chief Judge, Tatel and Garland, Circuit Judges.

Opinion for the Court filed by Circuit Judge Garland.

Garland, Circuit Judge: Hi-Tech Furnace Systems, Inc. and its president,
Robert E. Kornfeld,[^1] filed a complaint with the Federal
Communications Commission (FCC) concerning revisions Sprint
Communications made in a long distance calling program known as
\"Fridays Free.\" Concluding that the revisions were lawful, the FCC
denied the complaint. We affirm.

I

Sprint, a common carrier regulated under the Communications Act of 1934,
provides long distance telephone service to the public. See 47 U.S.C. §§
153(h), 203. Hi-Tech is a small business located in the state of
Michigan. On December 14, 1995, Sprint filed tariff provisions proposing
to offer its new and existing \"Business Sense\" customers a promotion
under which they would be able to make free domestic and international
long distance calls on one day of the week for twelve months. Sprint
selected Friday as the day for free service and promoted its new
offering as \"Fridays Free.\" The Fridays Free tariff provisions went
into effect on January 1, 1996.[^2]

On February 29, 1996, Hi-Tech enrolled in the Fridays Free program by
signing Sprint\'s standard agreement form. The agreement committed
subscribers to a minimum enrollment term of two years and a minimum
monthly usage requirement of \$50. In compliance with the agreement,
Hi-Tech switched its long distance service to Sprint.

Shortly after initiating Fridays Free, Sprint began experiencing a
substantial increase in international call volume on Fridays. The growth
was so pronounced that it produced capacity problems at Sprint\'s
international gateway switch in New York.[^3] The volume of traffic
impaired the carrier\'s ability to complete calls to many international
locations and threatened to crash Sprint\'s international network. See
Hi-Tech Furnace Sys. v. Sprint Communications Co., 14 F.C.C.R. 8040,
8047-48 (1999) \[hereinafter Hi-Tech\]. Sprint tried to handle the
overload by installing a new, more powerful processor at the New York
gateway. Nonetheless, call volume on Fridays remained at dangerously
high levels and continued to increase. See id. at 8042, 8047.

On April 4, 1996, in an effort to ameliorate the overload problem,
Sprint filed a tariff revision to take effect on April 18. Under the
revision, Sprint removed 10 countries[^4] with high numbers of calls
from the list of approximately 220 foreign locations to which free
calling was permitted under the Fridays Free program. Sprint
subsequently restored one country, the Dominican Republic, to the list,
leaving a total of nine deletions. Sprint notified its subscribers of
the modifications by mailgram. In lieu of free Friday calling to the
deleted countries, Sprint offered subscribers a 25% discount on calls to
those countries every day of the week. Sprint also allowed Fridays Free
customers who did not want to continue in the program to terminate their
subscription without penalty\--although it did not advise subscribers of
this option unless they affirmatively communicated their lack of
continued interest.

The tariff revisions immediately remedied Sprint\'s system capacity
problems. The occupancy level of the New York gateway switch declined
from 109% on April 12, to 59% on April 19, the day after the program was
revised. The total number of calls made to those countries dropped from
3.69 million on April 12 to 1.43 million on April 19, 1996. See Hi-Tech,
14 F.C.C.R. at 8048.

On April 18, 1996, the day the tariff revisions became effective,
Hi-Tech filed a class action in Missouri state court, alleging that
Sprint had breached its contract with its Fridays Free subscribers.
Sprint removed the case to the United States District Court for the
Western District of Missouri. There, the district court concluded that
Hi-Tech\'s complaint required a determination of the reasonableness of
Sprint\'s revised tariff, and that such a determination was within the
primary jurisdiction of the FCC. See Hi-Tech Furnace Sys. v. Sprint
Communications Co., No. 96-0566-CV-W-3 (W.D. Mo. May 9, 1997). The court
permitted Hi-Tech to amend its complaint to add counts alleging
violations of the Communications Act, and thereafter referred the case
to the FCC \"for all further proceedings.\" Hi-Tech Furnace Sys. v.
Sprint Communications Co., No. 96-0566-CV-W-3 (W.D. Mo. Aug. 29, 1997).
At the same time, it dismissed Hi-Tech\'s contract claim without
prejudice and denied its motion for class certification as moot.

On April 17, 1998, Hi-Tech filed a complaint against Sprint with the
FCC, alleging that Sprint\'s curtailment of the Fridays Free program
violated section 201(b) of the Communications Act because it was unjust
and unreasonable,[^5] and section 203(c) because it was in breach of
Sprint\'s existing tariffs.[^6] On April 16, 1999, the Commission ruled
against Hi-Tech on both claims. See Hi-Tech, 14 F.C.C.R. at 8041.
Hi-Tech then petitioned for review in this court, limiting its petition
to the claim that Sprint violated section 201(b). See Hi-Tech Br. at 4
n.1. Petitioner challenges the FCC\'s decision on both procedural and
substantive grounds, and we consider those challenges in turn.

II

Hi-Tech levels two procedural attacks against the FCC\'s decision.
First, it contends that the Commission improperly assigned it the burden
of proof on the question of whether Sprint\'s tariff revisions were just
and reasonable. Second, it argues that the Commission improperly denied
its requests for discovery from Sprint.

A

The FCC assigned Hi-Tech the burden of proof, holding that \"\[i\]t is
well established that, in a formal complaint proceeding brought under
section 208 of the Act, the complainant has the burden of proof to
demonstrate that the carrier has violated the Act.\" Hi-Tech, 14
F.C.C.R. at 8044. Hi-Tech argues that this allocation was error. First,
it contends that it brought this proceeding not under Communications Act
section 208,[^7] but rather under section 204,[^8] which expressly
places the burden of proof on the carrier. See 47 U.S.C. § 204 (\"At any
hearing involving a new or revised charge, or a proposed new or revised
charge, the burden of proof to show that the new or revised charge, or
proposed charge, is just and reasonable shall be upon the
carrier\....\"). Second, even if the proceeding had been brought under
section 208, Hi-Tech contends it would be unlawful to allocate the
burden differently under that section.

We agree with the FCC that the complaint was brought, and properly so,
under section 208 rather than section 204.[^9] That Hi-Tech brought the
complaint under section 208 is apparent from its own pleadings, which
attached a form identifying section 208(a) as the statutory basis for
the claims. See Formal Complaint Intake Form (J.A. at 79). That section
208 was the proper avenue derives from an analysis of the purposes of
the two sections.

The FCC interprets section 204 as granting it a quasi-legislative
authority to evaluate a carrier\'s proposals for new or revised rates.
It understands section 208, by contrast, as granting it authority, upon
complaint by an injured party, to adjudicate the lawfulness of a
carrier\'s past and present rates and practices. See, e.g., National
Exchange Carrier Ass\'n, 2 F.C.C.R. 3679, 3679 (1987) (\"\[I\]ssues
\[that\] \... relate to currently effective tariff provisions \...
cannot be raised in a petition for a Section 204 investigation.
Objections to an existing tariff provision may be presented in a Section
208 complaint.\"). We have previously expressed the same
understanding,[^10] and the distinction is similar to that which courts
have made with respect to analogous provisions in both the Interstate
Commerce Act (ICA)[^11] and the Natural Gas Act (NGA).[^12] As the
FCC\'s construction constitutes a reasonable interpretation of the
statutory language,[^13] we are bound to defer to it. See Chevron U.S.A.
Inc. v. NRDC, 467 U.S. 837, 842-45 (1984).

Hi-Tech did not file a complaint with the Commission before the Fridays
Free revisions went into effect. Instead, it challenged them two years
after they had been in place. Accordingly, under the foregoing
interpretation of the two statutory provisions, Hi-Tech\'s complaint
falls within section 208.

Unlike section 204, section 208 is silent as to which party bears the
burden of proof. Hi-Tech argues that it is unlawful for the FCC to place
the burden on the complainant in section 208 proceedings, when the
statute places it on the carrier in proceedings under section 204. We
disagree.

Well-established FCC precedent imposes the burden of proof on the
complainant in section 208 proceedings.[^14] So does our own.[^15] Such
an allocation is consistent with the Administrative Procedure Act (APA),
which takes into account the distinction between statutory provisions
that do and do not mention the burden of proof, and which directs that:
\"Except as otherwise provided by statute, the proponent of a rule or
order has the burden of proof.\" 5 U.S.C. § 556(d). It is likewise
consistent with the Supreme Court\'s allocation of the burden of proof
under the analogous provisions in the ICA,[^16] and with our own
allocation of the burden under the analogous provisions in the NGA.[^17]
Accordingly, we find nothing unlawful about the FCC\'s decision to
impose upon Hi-Tech the burden of proof regarding the reasonableness of
the tariff revisions.

B

After filing its complaint with the FCC, Hi-Tech served Sprint with a
set of seven interrogatories. Sprint objected and, Hi-Tech contends, FCC
counsel declined to direct the carrier to respond.[^18] Instead, the
Commission undertook its own investigation, making its own demands for
information from the parties and following up with supplemental
inquiries. Hi-Tech contends that the agency acted unlawfully in failing
to allow petitioner to conduct its own discovery.

The FCC responds that this court has no jurisdiction to review its
decision not to permit discovery. It asserts that discovery is agency
action \"committed to agency discretion by law\" within the meaning of
the APA, 5 U.S.C. § 701(a)(2), and thus is not subject to judicial
review. See generally Heckler v. Chaney, 470 U.S. 821, 828-29 (1985).
For support, the FCC points to the broad language of Communications Act
§ 208(a), which states that \"it shall be the duty of the Commission to
investigate the matters complained of in such manner and by such means
as it shall deem proper.\" And it further cites our decision in Sprint
Communications Co. v. FCC, 76 F.3d 1221, 1231 (D.C. Cir. 1996), which it
reads as declaring, albeit in dictum, that the Commission\'s refusal to
permit discovery under section 208(a) is a matter within its
unreviewable discretion.

The United States, represented by the Department of Justice, is by law a
co-respondent with the FCC in this case. See 28 U.S.C. §§ 2344, 2348. In
contrast to the FCC, the United States believes that the agency\'s
decision regarding discovery is reviewable. See Resp\'ts Br. at 32 n.69.
We

agree. The FCC\'s position confuses the narrow category of agency action
wholly committed to agency discretion under APA § 701(a)(2), with the
primary category of agency action that is subject to review for \"abuse
of discretion\" under APA § 706(2)(A). See Heckler, 470 U.S. at 828-29.
We do not lightly place a matter within the former category, as the APA
embodies \"a \'basic presumption of judicial review.\' \" Lincoln v.
Vigil, 508 U.S. 182, 190 (1993) (quoting Abbott Labs. v. Gardner, 387
U.S. 136, 140 (1967)). The exception for agency action \"committed to
agency discretion by law\" is a \"very narrow\" one, reserved for
\"those rare instances where statutes are drawn in such broad terms that
in a given case there is no law to apply.\" Citizens to Preserve Overton
Park v. Volpe, 401 U.S. 402, 410 (1971) (internal quotation omitted);
see Lincoln, 508 U.S. at 191.

As the United States correctly points out, this court\'s dictum in
Sprint Communications does not support the FCC\'s claim to immunity from
judicial review. Sprint stated that \"it appears that the FCC\'s
decision whether to investigate a particular matter is an \'agency
action \... committed to agency discretion by law.\' \" 76 F.3d at 1231
(emphasis added).[^19] The court suggested, by its immediately-following
citation to Heckler v. Chaney, that an agency\'s decision not to
commence an investigation is analogous to an agency\'s decision not to
take enforcement action\--which the Supreme Court held unreviewable in
Heckler. See Heckler v. Chaney, 470 U.S. at 832. An agency\'s decision
not to permit discovery, however, is not analogous to a decision not to
take enforcement action. Unlike the latter, which the Court noted has
long been regarded as committed to an agency\'s absolute discretion, see
id. at 831 (citing precedent dating to 1869), this court and others have
long reviewed agency decisions regarding discovery.[^20] In fact, in
American Message Centers v. FCC, 50 F.3d 35, 40-41 (D.C. Cir. 1995), we
reviewed for abuse of discretion the FCC\'s refusal to compel discovery
in a section 208 proceeding. We follow that course here as well.

This court reviews such a determination, however, with \"extreme
deference.\" Lakeland Bus Lines v. ICC, 810 F.2d 280, 286 (D.C. Cir.
1987). \"\[T\]he conduct and extent of discovery in agency proceedings
is a matter ordinarily entrusted to the expert agency in the first
instance and will not, barring the most extraordinary circumstances,
warrant the Draconian sanction of overturning a reasoned agency
decision.\" Trailways Lines v. ICC, 766 F.2d 1537, 1546 (D.C. Cir.
1985). Although we have concluded that the Commission\'s actions are
reviewable for abuse of discretion, we agree with both the United States
and the Commission that there has been no such abuse here.

In this case, a body of evidence was generated by the formal written
submissions of the litigants. In addition, the FCC made its own
inquires, directing the parties to respond to detailed requests for
information. The Commission also had available Sprint\'s responses to
the discovery requests served by Hi-Tech during proceedings in the
district court. As our analysis in Part III below makes clear, the sum
of these measures created the record necessary to make the just and
reasonableness determination contemplated by 47 U.S.C. § 201(b).

Hi-Tech\'s real dispute is not with the discovery measures the FCC took,
but with additional measures it did not take. Specifically, petitioner
insists that the Commission should have permitted Hi-Tech itself to take
discovery from Sprint, in the form of its own interrogatories and
depositions, in order to test Sprint\'s responses \"through normal
adversarial proceedings.\" Hi-Tech Br. at 17. But Hi-Tech\'s demand
misapprehends the nature of the administrative process it entered into
when its complaint was ousted from the district court and referred to
the FCC. As we have pointed out before in affirming an FCC decision not
to compel discovery sought by a petitioner: Complaint proceedings under
the Communications Act, \"unlike court litigation or
administrative-trial type hearings, are often resolved solely on the
written pleadings,\" and the Commission has properly \"placed
limitations on the scope and methods of discovery in its formal
complaint proceedings that do not exist in trials governed by the
Federal Rules.\" American Message Ctrs., 50 F.3d at 41; see McClelland
v. Andrus, 606 F.2d 1278, 1285 (D.C. Cir. 1979) (\"The extent of
discovery that a party engaged in an administrative hearing is entitled
to is primarily determined by the particular agency: \... courts have
consistently held that agencies need not observe all the rules and
formalities applicable to courtroom proceedings.\").

Nothing in either the Communications Act or the APA entitles a party to
the specific procedures Hi-Tech demands. To the contrary, and as the FCC
properly emphasizes, section 208 of the Communications Act expressly
authorizes the Commission \"to investigate the matters complained of in
such manner and by such means as it shall deem proper.\" 47 U.S.C. §
208; cf. FCC v. Schreiber, 381 U.S. 279, 289 (1965). Moreover, the
Supreme Court has firmly instructed us that \"courts are not free to
impose upon agencies specific procedural requirements that have no basis
in the APA\" or statute. Pension Benefit Guar. Corp. v. LTV Corp., 496
U.S. 633, 654 (1990). Although \"\[a\]gencies are free to grant
additional procedural rights in the exercise of their discretion,\"[^21]
\"reviewing courts are generally not free to impose them if the agencies
have not chosen to grant them.\" Vermont Yankee Nuclear Power Corp. v.
NRDC, 435 U.S. 519, 524 (1978).

Cross-Sound Ferry Services, Inc. v. ICC, cited by petitioner, is not to
the contrary. 738 F.2d 481, 486-87 (D.C. Cir. 1984). In that case, a
ferry company challenged the ICC\'s decision to grant common carrier
authority to its competitor, the Bridgeport & Port Jefferson Steamboat
Company (B&PJ). On appeal from the agency, this court held that the ICC
had acted arbitrarily in failing to gather the information necessary to
make the statutory determination of whether the proposed service was \"
\'required by the present or future public convenience and necessity.\'
\" Id. at 482-84 (quoting 49 U.S.C. § 10922(a)). We did not, however,
say that the error was the ICC\'s failure to permit discovery by the
complainant. Rather, the error was the Commission\'s refusal to generate
an appropriate record\--\"by requiring greater specificity from B&PJ or
by permitting Cross-Sound to ferret out relevant evidence through
discovery\"\--which left the ICC without \"sufficient record evidence to
permit a reasoned application of statutory directives.\" Id. at 484
(emphasis added).

As we have noted above, the FCC did compile a record sufficient to make
the statutory determination at issue in this case. Hi-Tech does not
specify any additional information that should have been obtained, nor
does it point out any way in which conducting its own discovery would
have made a difference\--other than to emphasize its skepticism of the
\"self-serving\" nature of Sprint\'s responses and the need to test them
by the adversary process. Since the Supreme Court has made clear that we
are not permitted to impose any such testing procedure on an agency, we
have no basis for setting aside the FCC\'s decision.

III

With these preliminary matters attended to, we now reach the merits of
Hi-Tech\'s complaint. We review the FCC\'s denial only to determine
whether it was \"arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law.\" 5 U.S.C. § 706(2)(A); see
American Message Ctrs., 50 F.3d at 39.

The gravamen of Hi-Tech\'s complaint is that the changes Sprint made in
its Fridays Free program breached the requirement of section 201(b) that
\"charges, practices, classifications, and regulations \... be just and
reasonable.\" 47 U.S.C. § 201(b). To determine whether the revisions met
the statutory standard, Hi-Tech urged the Commission to employ its
so-called \"substantial cause\" test: that is, to determine whether
Sprint had \"substantial cause\" to amend the tariff. See Hi-Tech Br. at
21-23; see generally Showtime Networks Inc. v. FCC, 932 F.2d 1 (D.C.
Cir. 1991) (discussing \"substantial cause\" test for determining
whether tariff modifications are just and reasonable); RCA American
Communications, Inc., 86 F.C.C.2d 1197, 1201-02 (1981) (holding that a
carrier\'s decision \"to revise material provisions in the middle of a
term\" will be considered \"reasonable\" if the carrier can make a
showing of \"substantial cause\" for so doing). The FCC noted that it
had previously applied the substantial cause test only to revisions of
individually-negotiated contract tariffs and to revisions of generic,
long-term service tariffs filed by dominant carriers. See Hi-Tech, 14
F.C.C.R. at 8045-46. The Commission had not yet decided, however,
whether the test should be applied to \"a nondominant carrier\'s
generic, long-term service tariff, such as the Fridays Free promotion at
issue here.\" Id. at 8046. Nonetheless, the FCC agreed to apply the
standard, arguendo, to Sprint\'s tariff revisions. See id.

Under the substantial cause test, the FCC measures the reasonableness of
a tariff modification by weighing two principal considerations: the
\"carrier\'s explanation of the factors necessitating the desired
changes at that particular time,\" and the \"position of the relying
customer.\" RCA American, 86 F.C.C.2d at 1201; see Hi-Tech, 14 F.C.C.R.
at 8045. The FCC resolved the first factor in Sprint\'s favor,
concluding that \"Sprint has demonstrated that the tariff revisions were
necessary to prevent the overloading of Sprint\'s network, despite
reasonable efforts by Sprint to preserve the Fridays Free promotion in
its original form.\" Hi-Tech, 14 F.C.C.R. at 8046. The Commission found
that on each successive Friday after the promotion began, call volume
increased dramatically. See id. By late March, \"the extraordinarily
high call volumes on Fridays threatened to bring down Sprint\'s New York
international gateway switch \... which repeatedly reached over 100% of
designed traffic capacity.\" Id. at 8047. Moreover, \"because of this
international overload, the New York domestic switch \... also
approached overload levels.\" Id. Together, \"\[t\]hese system overloads
prevented the completion of many international calls from all over the
country.\" Id.

The FCC also found that Sprint had taken steps to try to resolve the
overload problem short of deleting countries from the Fridays Free
program. See id. Sprint purchased and installed a new processor, and it
changed the routing of calls so that the domestic New York switch would
receive less traffic. See id. Despite these efforts, \"\[t\]raffic loads
continued to increase dangerously\" and threatened to crash the gateway
switch. Id. at 8047-48. Sprint then filed its tariff revisions, and on
the first Friday after they took effect, call volume dramatically
decreased and the threat was eliminated. See id. at 8048.

These findings reasonably support the FCC\'s conclusion that Sprint
satisfied the first half of the substantial cause test, by establishing
its need for the revisions in the Fridays Free program. This was not a
case in which the carrier sought midterm changes based merely on a
\"generalized assertion of rising costs,\" RCA American, 86 F.C.C.2d at
1205, or on a claim \"that it will make less money\" without them, AT&T
Communications, 5 F.C.C.R. 6777, 6779 (1990)\--rationales the agency has
found unpersuasive in the past. Here, the FCC concluded that revisions
were necessary \"to protect the integrity of \[Sprint\'s\]
network\"\--to prevent the crash of key switches with consequent
disruption for all of Sprint\'s subscribers. Hi-Tech, 14 F.C.C.R. at
8050. Although Hi-Tech argues that Sprint could have expanded its
facilities rather than curtail the program, the FCC reasonably noted
that Sprint had already tried that to no avail, and that further
expansion of Sprint\'s international capacity would have required
negotiations with a foreign carrier, a process that could not have been
completed in time to resolve the capacity crisis. See id. at 8048.

Hi-Tech also argues that Sprint should have employed a \"less onerous\"
alternative than deletion of the nine countries. Hi-Tech Br. at 26. Of
course, deletion was itself a less drastic alternative than canceling
the entire program: Sprint continued to permit free Friday calling to
more than 200 foreign locations, as well as to all domestic locations.
Nonetheless, Hi-Tech argues that Sprint could have retained free calling
to the nine countries, but \"spread the program benefits over more days
of the week\" by \"designating different days of the week for different
segments of customers.\" Id. at 26-27 (quoting Compl. p 27). Sprint
should not be permitted to revise its tariff \"in a way that is
economically beneficial to the carrier,\" Hi-Tech insists, \"when better
and fairer alternatives are available.\" Id. at 27.

The FCC rejected this demand. The Commission noted Sprint\'s
representations that such a plan would have been impractical, and noted
that Hi-Tech had failed to offer any evidence to the contrary. See
Hi-Tech, 14 F.C.C.R. at 8049. It further pointed out that Hi-Tech had
failed to show why free calling on one day of the week was any more
reasonable than the alternative Sprint adopted: a 25% discount every
day. The FCC\'s statutory mandate is only to ensure that tariff
revisions are \"just and reasonable,\" 47 U.S.C. § 201(b), not that they
are the \"least onerous\" alternative available. See Showtime, 932 F.2d
at 4 (holding that substantial cause test is only an aid in ascertaining
whether newly filed modifications to long-term tariffs are \"within the
zone of reasonableness,\" and \"not an additional hurdle\" for carriers
to overcome). And our statutory mandate is only to ensure that the
agency\'s determinations are themselves reasonable, regardless of
whether there may be other \"better and fairer\" alternatives. Cf.
Serono Labs., Inc. v. Shalala, 158 F.3d 1313, 1321 (D.C. Cir. 1998). The
FCC\'s finding with respect to Sprint\'s need for the tariff revisions
meets that standard.

Turning to the second half of the substantial cause test, the FCC looked
for evidence of Hi-Tech\'s reliance on the provisions of the Fridays
Free plan\--and found it to be minimal. Hi-Tech\'s president conceded
that he had switched to Sprint not only because of the Fridays Free
promotion, but also because Sprint\'s \"rate was attractive in itself.\"
J.A. at 228 (Kornfeld Dep.). There was no evidence that, during the
month and a half in which it subscribed to the unrevised Fridays Free
program, Hi-Tech had made any calls to any of the nine deleted
countries\--with the exception of three calls its president made after
Sprint announced the revisions, calls he conceded making to take
advantage of the last free-calling opportunity under the program. See
Hi-Tech, 14 F.C.C.R. at 8049; J.A. at 237, 239, 241 (Kornfeld Dep.). Nor
did the company offer evidence to show that it had been any better off
under Fridays Free than it was under the new 25%-discount plan. And
while Hi-Tech contends that it should be able to support its case by
showing the detrimental reliance of Sprint customers other than
itself\--because it initially filed the case in court as a class
action[^22]\--there is no evidence of such reliance in the record. To
the contrary, the Commission concluded that because Sprint permitted
Fridays Free customers to terminate their contracts without penalty if
they were dissatisfied with the revisions, they were \"no worse off than
if they had never enrolled in Sprint\'s Fridays Free promotion.\"
Hi-Tech, 14 F.C.C.R. at 8050.[^23] In sum, we discern no abuse of
discretion in the agency\'s conclusion that the tariff revisions were
just and reasonable under both prongs of the substantial cause test.

IV

As a final argument, Hi-Tech contends that the FCC should have used
\"commercial contract law principles\" to resolve this case, and that if
it had, Hi-Tech would have prevailed. It further argues that because the
FCC did not employ such principles, we are obliged to vacate the
Commission\'s order. Without deciding what the result would be under
\"commercial contract law principles,\" it is clear that petitioner has
misperceived both the Commission\'s role in this dispute and our own.

Hi-Tech\'s breach-of-contract claims were dismissed by the district
court in Missouri, and we have no jurisdiction (and have not been asked)
to review that decision. Instead, under review here is the FCC\'s
determination of whether Sprint\'s tariff revisions were just and
reasonable\--which is, as we have noted above, the only authority the
Commission has under section 201(b) of the Communications Act. At
Hi-Tech\'s own request, the Commission agreed to evaluate reasonableness
under the \"substantial cause\" standard. That test requires an
evaluation of the carrier\'s need for tariff revisions and of the
subscriber\'s reliance on the tariff\'s original terms. Although these
factors may reflect familiar contract law principles, see, e.g.,
Restatement (Second) of Contracts § 261 (1979), they are not intended to
replicate contract law analysis, but only to assist the FCC in
determining whether the revisions were \"within the zone of
reasonableness\" required by the statute. Showtime, 932 F.2d at 4; see
Cahnmann v. Sprint Corp., 133 F.3d 484, 488 (7th Cir. 1998) (holding
that \"\[a\]ny rights that the plaintiff has to complain about a breach
of contract\" in a tariff revision case are evaluated \"by the principle
of reasonableness that the FCC uses to determine the validity of \... an
amendment to a tariff.\")

As we have also stressed above, our authority is limited to determining
whether the FCC\'s determination was itself reasonable\--that is,
whether the agency\'s decision was \"arbitrary, capricious, \[or\] an
abuse of discretion.\" 5 U.S.C. § 706(2)(A). Finding no violation of
that deferential standard, we deny the petition for review.

[^1]: For ease of reference, Hi-Tech and its president will be referred
    to collectively as \"Hi-Tech\" or \"petitioner.\"

[^2]: Section 203(a) of the Communications Act requires every
    communications common carrier to file with the FCC a schedule of its
    charges, and the \"classifications, practices, and regulations
    affecting such charges.\" 47 U.S.C. § 203(a). In this case, the
    Fridays Free promotion was a revision of Sprint\'s existing Business
    Sense tariff.

[^3]: During the period at issue in this case, an international call had
    to go through the \"gateway switch\" that connected with the
    international cable system serving the country to which the call was
    made. See Sprint Br. at 4 n.7.

[^4]: The deleted countries were Bolivia, China, the Dominican Republic,
    Ecuador, India, Iran, Israel, Myanmar, Pakistan, and Thailand.

[^5]: Section 201(b) requires that \"\[a\]ll charges, practices,
    classifications and regulations\" of communications common carriers
    \"shall be just and reasonable.\" 47 U.S.C. § 201(b).

[^6]: Section 203(c) provides that \"no carrier shall (1) charge,
    demand, collect, or receive a greater or less or different
    compensation \... for any service \... than the charges specified in
    the \[tariff\] then in effect.\" 47 U.S.C. § 203(c).

[^7]: Section 208, entitled \"Complaints to the Commission,\" states:

    \(a\) Any person \... complaining of anything done or omitted to be
    done by any common carrier subject to this chapter, in contravention
    of the provisions thereof, may apply to said Commission by
    petition\.... If such common carrier within the time specified shall
    make reparation for the injury alleged to have been caused, the
    common carrier shall be relieved of liability to the
    complainant\.... If such carrier \... shall not satisfy the
    complaint within the time specified or there shall appear to be any
    reasonable ground for investigating said complaint, it shall be the
    duty of the Commission to investigate the matters complained of in
    such manner and by such means as it shall deem proper.

    47 U.S.C. § 208.

[^8]: Section 204, entitled \"Hearings on new charges,\" states:

    (a)(1) Whenever there is filed with the Commission any new or
    revised charge \... or practice, the Commission may either upon
    complaint or upon its own initiative without complaint \... enter
    upon a hearing concerning the lawfulness thereof; and pending such
    hearing and the decision thereon \... may suspend the operation of
    such charge \... or practice, \... but not for a longer period than
    five months beyond the time when it would otherwise go into effect;
    and after full hearing the Commission may make such order with
    reference thereto as would be proper in a proceeding initiated after
    such charge \... or practice had become effective. If the proceeding
    has not been concluded and an order made within the period of the
    suspension, the proposed new or revised charge \... or practice
    shall go into effect at the end of such period\.... At any hearing
    involving a new or revised charge, or a proposed new or revised
    charge, the burden of proof to show that the new or revised charge,
    or proposed charge, is just and reasonable shall be upon the
    carrier\....

    \(b\) Notwithstanding the provisions of subsection (a) of this
    section, the Commission may allow part of a charge \... or practice
    to go into effect, based upon a written showing by the carrier or
    carriers affected \... that such partial authorization is just,
    fair, and reasonable. Additionally, or in combination with a partial
    authorization, the Commission, upon a similar showing, may allow
    \... a charge \... or practice to go into effect on a temporary
    basis pending further order of the Commission.

    47 U.S.C. § 204.

[^9]: At oral argument, petitioner verified that these are the only
    sections at issue. Hi-Tech did not, it conceded, endeavor to bring
    its complaint under another possibly relevant section, section 205,
    which permits the FCC (on its own initiative or upon complaint) to
    determine that an existing rate is unjust or unreasonable and to
    provide prospective relief. See 47 U.S.C. § 205; Illinois Bell Tel.
    Co. v. FCC, 966 F.2d 1478, 1482 (D.C. Cir. 1992).

[^10]: Compare Southwestern Bell Tel. Co. v. FCC, 168 F.3d 1344, 1350
    (D.C. Cir. 1999) (\"Section 204(a) gives the Commission the
    authority to approve or suspend a proposed charge\....\"), and
    Southwestern Bell Corp. v. FCC, 43 F.3d 1515, 1524 (D.C. Cir. 1995)
    (\"Upon complaint or on its own initiative, the Commission may hold
    hearings and declare unlawful proposed rate increases under section
    204.\"), with AT&T v. FCC, 978 F.2d 727, 732 (D.C. Cir. 1992)
    (describing § 208 proceeding as one in which the FCC\'s task was,
    \"as an adjudicator of private rights,\" to determine \"whether or
    not \[the carrier\] has been, and currently was, violating the
    law\"). See also Direct Mktg. Ass\'n v. FCC, 772 F.2d 966, 969 (D.C.
    Cir. 1985).

[^11]: 11 49 U.S.C. §§ 10101 et seq. See Southern Ry. v. Seaboard Allied
    Milling Corp., 442 U.S. 444, 446, 450, 454 (1979) (noting
    distinction between proceedings under ICA § 15(8)(a) to challenge
    proposed rate increases, and \"posteffective proceedings\" to
    protect \"aggrieved\" parties under ICA § 13(1)); Baer Bros.
    Mercantile Co. v. Denver & Rio Grande R.R., 233 U.S. 479, 486 (1914)
    (\"\[A\]warding reparation for the past and fixing rates for the
    future involve the determination of matters essentially different.
    One is in its nature private and the other public. One is made by
    the Commission in its quasi-judicial capacity to measure past
    injures sustained by a private shipper; the other, in its
    quasi-legislative capacity, to prevent future injury to the
    public.\"); see also MCI Tel. Corp. v. FCC, 59 F.3d 1407, 1418 (D.C.
    Cir. 1995) (\"Because the Congress borrowed heavily from the
    Interstate Commerce Act when it drafted the Communications Act of
    1934 \... both this court and the \[FCC\] often turn to decisions
    under the ICA for guidance in interpreting the Communications
    Act.\"). The Interstate Commerce Commission was abolished in 1996,
    and its remaining functions were transferred to the Surface
    Transportation Board. See ICC Termination Act of 1995, Pub. L. No.
    104-88, 109 Stat. 803 (1995).

[^12]: 15 U.S.C. §§ 717 et seq. See Public Serv. Comm\'n v. FERC, 866
    F.2d 487, 488 (D.C. Cir. 1989) (noting distinction between
    proceedings concerning \"proposed rates\" under NGA § 4, and
    proceedings concerning existing rates under § 5); see also Las
    Cruces TV Cable v. FCC, 645 F.2d 1041, 1047 (D.C. Cir. 1981)
    (stating that ratesetting provisions of Communications Act are
    analogous to provisions of NGA and \"trace their lineage\" to ICA).

[^13]: Section 204 contains repeated indications of its intended
    application to charges not yet in effect. It applies to \"any new or
    revised\" charge or practice; it permits suspension of such charge
    or practice for not longer than five months \"beyond the time when
    it would otherwise go into effect\"; if an order has not been issued
    within the period of the suspension, it provides that \"the proposed
    new or revised\" charge or practice \"shall go into effect\"; and it
    authorizes the Commission to allow a charge or practice \"to go into
    effect on a temporary basis\" pending further order. Section 208, by
    contrast, contains repeated indications of its intended application
    to past actions. For example, it permits any person complaining of
    anything \"done or omitted to be done\" by any common carrier to
    petition the FCC, and it relieves the carrier of liability if it
    makes reparations \"for the injury alleged to have been caused.\"
    See 47 U.S.C. § 204, set out at supra note 8; 47 U.S.C. § 208, set
    out at supra note 7.

[^14]: See Beehive Tel., Inc., 12 F.C.C.R. 17950, 17961-62 (1995)
    (\"Although carriers who file new or revised rates bear the burden
    of proof in Section 204 proceedings, it is well settled that
    complainants in Section 208 formal complaint proceedings bear the
    burden of proof.\"), aff\'d on other grounds, 179 F.3d 941 (D.C.
    Cir. 1999); see also Ascom Communications, Inc. v. Sprint
    Communications Co., 15 F.C.C.R. 3223, 3230 n.41 (2000); AT&T v. Bell
    Atlantic, 14 F.C.C.R. 556, 570 (1998); Directel, Inc. v. AT&T, 11
    F.C.C.R. 7554, 7560 (1996); Connecticut Office of Consumer Counsel,
    4 F.C.C.R. 8130, 8133 (1989), aff\'d on other grounds, 915 F.2d 75
    (2d Cir. 1990). The petitioner\'s references to FCC opinions in
    agency proceedings initiated under sections other than § 208 are
    inapposite.

[^15]: See American Message Ctrs. v. FCC, 50 F.3d 35, 41 (D.C. Cir.
    1995) (stating, regarding a case brought under § 208, that \"\[t\]he
    rules place the burden of pleading and documenting a violation of
    the Act on \[the complainant\]. They do not require \[the carrier\]
    to prove it has not violated the Act.\"); Aeronautical Radio, Inc.
    v. FCC, 642 F.2d 1221, 1235 n.34 (D.C. Cir. 1980) (noting that the
    complaint procedure of §§ 206-209 \"shifts the burden of proof onto
    the aggrieved party\"). See generally Copley Press, Inc. v. FCC, 444
    F.2d 985, 988 (D.C. Cir. 1971) (holding § 204 burden-allocation
    provision may not be relied upon to assess burden in non-204
    proceeding).

[^16]: See Southern Ry., 442 U.S. at 446, 450, 454 (noting that burden
    of proof is on carrier in § 15(8)(a) proceeding, while burden is on
    shipper (customer) in § 13(1) proceeding); Aeronautical Radio, 642
    F.2d at 1235 n.34 (relying on Southern Railway for conclusion that
    §§ 206-209 of Communications Act \"shift\[ \] the burden of proof
    onto the aggrieved party\"). See generally supra note 11.

[^17]: In Public Service, we held that \"\[u\]nder § 4 \[of the NGA\]
    the company has the burden of showing that \[its\] proposed rates
    are just and reasonable, while under § 5 the Commission must show
    that the \[filed\] rates it would alter are not just and
    reasonable\.... The unifying principle is that the proponent of
    change bears the burden.\" 866 F.2d at 488. Section 4 of the NGA, 15
    U.S.C. § 717c(e), like section 204 of the Communications Act,
    expressly provides that \"\[a\]t any hearing involving a rate or
    charge sought to be increased, the burden of proof to show that the
    increased rate or charge is just and reasonable shall be upon the
    natural-gas company.\" Section 5 of the NGA, like section 208 of the
    Communications Act, is silent as to the burden of proof. See ANR
    Pipeline v. FERC, 771 F.2d 507, 513 (D.C. Cir. 1985) (discussing
    different burdens of proof under NGA). See generally supra note 12.

[^18]: The FCC contends that Hi-Tech never filed a motion to compel a
    response.

[^19]: Although the Sprint opinion noted the petitioner\'s objection
    \"to the FCC\'s failure to permit discovery or to conduct an
    evidentiary proceeding in order to investigate the alleged
    fraudulent concealment,\" the court\'s comment on reviewability
    mentioned only the \"decision whether to investigate a particular
    matter.\" Sprint Communications, 76 F.3d at 1231 (emphasis added).
    Moreover, notwithstanding its comment, the court went on to review
    the FCC\'s failure and found no abuse of discretion. See id.

[^20]: See Lakeland Bus Lines v. ICC, 810 F.2d 280, 287-88 (D.C. Cir.
    1987) (reversing in part ICC denial of petitioner\'s discovery
    request on ground that denial relied on inaccurate factual premise);
    Trailways Lines v. ICC, 766 F.2d 1537, 1546 (D.C. Cir. 1985)
    (reviewing, but upholding as reasonable, ICC\'s rejection of
    petitioners\' discovery request); Cross-Sound Ferry Svcs., Inc. v.
    ICC, 738 F.2d 481, 486-87 (D.C. Cir. 1984) (holding that ICC\'s
    failure to gather sufficient evidence from applicant for common
    carrier authority was arbitrary and capricious); McClelland v.
    Andrus, 606 F.2d 1278, 1286 (D.C. Cir. 1979) (reviewing agency
    discovery decision and remanding for further consideration);
    Virginia Petroleum Jobbers Ass\'n v. FPC, 293 F.2d 527, 529 (D.C.
    Cir. 1961); see also, e.g., Pacific Gas and Elec. Co. v. FERC, 746
    F.2d 1383, 1387-88 (9th Cir. 1984); Armstrong, Jones & Co. v. SEC,
    421 F.2d 359, 364 (6th Cir. 1970); NLRB v. Gala-Mo Arts, Inc., 232
    F.2d 102, 106 (8th Cir. 1956).

[^21]: FCC regulations permit complainants to file requests for
    interrogatories, but leave it to Commission staff to \"determine the
    interrogatories, if any, to which parties shall respond.\" 47 C.F.R.
    § 1.729(d). The regulations also authorize the Commission, in its
    discretion, to allow additional discovery, including depositions.
    See 47 C.F.R. § 1.729(h).

[^22]: But see Krauss, 14 F.C.C.R. 2770, 2774 (1999) (finding it
    inappropriate to determine carrier\'s liability for injuries to
    other subscribers, as that \"would, in effect, transform this
    section 208 complaint proceeding into a class action suit, a result
    neither contemplated by, nor consistent with, the private remedies
    created under sections 206 through 209 of the Act\"); Certified
    Collateral Corp., 2 F.C.C.R. 2171, 2173 (1987) (noting that FCC
    rules \"do not contemplate class action complaints\").

[^23]: The FCC also noted that the standard order form signed by Hi-Tech
    stated that the promotion was \"governed by the applicable Sprint
    tariffs, as they may be amended from time to time.\" Hi-Tech, 14
    F.C.C.R. at 8050. The Commission did not rest on this point in
    stating its ultimate conclusion, see id. at 8050, and we would not
    regard it as sufficient to establish lack of justified reliance on
    the part of Hi-Tech. Although Sprint was free to amend its tariff,
    it could not do so\--regardless of the boilerplate language\--unless
    the amendment was \"just and reasonable\" under § 201. See RCA
    American, 86 F.C.C.2d at 1202 (\"\[T\]he mere presence of some
    sweeping reservation to unilaterally change any and all terms and
    conditions will not serve to lessen our original concerns.\").