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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 20, 2004 Decided April 30, 2004

No. 02-1364

COMMUNICATIONS VENDING CORPORATION OF ARIZONA, INC., ET AL.,

PETITIONERS

v.

FEDERAL COMMUNICATIONS COMMISSION AND

UNITED STATES OF AMERICA,

RESPONDENTS

ABTEL COMMUNICATIONS, INC., ET AL.,

INTERVENORS

Consolidated with

03–1010, 03–1012

On Petitions for Review of an Order of the

Federal Communications Commission

Katherine J. Henry argued the cause for IPP petitioners.

With her on the briefs was Albert H. Kramer.

 Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.
2

Aaron M. Panner argued the cause for LEC petitioners.

With him on the briefs were Michael E. Glover, Edward H.

Shakin, John M. Goodman, and Gary L. Phillips.

Michael J. Thompson was on the brief for intervenors

ABTEL Communications, Inc., et al. in support of PSP

petitioners.

Richard K. Welch, Counsel, Federal Communications Commission, argued the cause for respondents. On the brief were

Robert H. Pate III, Assistant Attorney General; Robert B.

Nicholson and Robert J. Wiggers, Attorneys; John A. Rogovin, General Counsel, Federal Communications Commission;

John E. Ingle, Deputy Associate General Counsel; and Laurel R. Bergold, Counsel.

Albert H. Kramer argued the cause for IPP intervenors in

support of respondents. With him on the brief was Katherine J. Henry.

Aaron M. Panner argued the cause for LEC intervenors in

support of respondents. With him on the brief were Michael

E. Glover, Edward Shakin, John M. Goodman, and Gary L.

Phillips.

Before: SENTELLE, RANDOLPH, and TATEL, Circuit Judges.

Opinion for the Court filed by Circuit Judge TATEL.

TATEL, Circuit Judge: In these consolidated cases, we

consider challenges to the Federal Communications Commission’s ruling that local telephone companies unreasonably

imposed certain end-user charges on independent payphone

providers from 1986 to 1997. One set of petitioners, local

telephone companies, argues that the Commission had no

basis for finding them liable. Another set of petitioners,

independent payphone providers, challenges the Commission’s application of the Communications Act’s statute of

limitations to limit their recovery to charges paid during the

two years prior to the filing of their complaints. Concluding

that both decisions are consistent with law and neither arbi-
3

trary nor capricious, we affirm the Commission in all respects.

I.

This dispute between local telephone companies (known as

local exchange carriers or LECs) and independent payphone

providers (IPPs) has a long pedigree in this court. Two prior

opinions describe the background in detail. See Verizon Tel.

Cos. v. FCC, 269 F.3d 1098 (D.C. Cir. 2001); C.F. Communications Corp v. FCC, 128 F.3d 735 (D.C. Cir. 1997).

The history begins in 1983, when the Commission issued

access charge rules authorizing LECs to recover certain nontraffic sensitive costs (such as the cost of installing phone

lines) through flat monthly charges called End User Common

Line (EUCL) charges. In re MTS and WATS Market

Structure, Third Report and Order, 93 F.C.C.2d 241, 242–43

(1983), modified on recons., 97 F.C.C.2d 682 (1983) (Access

Charge Recons.), modified on further recons., 97 F.C.C.2d 834

(1984), aff’d in part and remanded in part sub nom. Nat’l

Ass’n of Regulatory Util. Comm’rs v. FCC, 737 F.2d 1095

(D.C. Cir. 1984). Under those rules, LECs could assess

EUCL charges only on ‘‘end users,’’ defined by the Commission’s rules as ‘‘any customer of TTT telecommunications

service TTT [or] a person or entity that offers telecommunications services exclusively as a reseller TTT if all resale transmissions TTT originate on the premises of such reseller.’’ 47

C.F.R. § 69.2(m) (2003).

Of particular significance to the issue we face here, the

access charge rules applied differently to public and semipublic payphone service. The Commission explained: ‘‘A pay

telephone is used to provide public telephone service when a

public need exists, such as at an airport lobby, at the option of

the telephone company and with the agreement of the owner

of the property on which the phone is placed.’’ Access

Charge Recons., 97 F.C.C.2d at 704 n.41 (emphasis added).

By contrast, ‘‘[a] pay telephone is used to provide semipublic

telephone service when there is a combination of general

public and specific customer need for the service, such as at a
4

gasoline station or pizza parlor.’’ Id. at 704 n.40 (emphasis

added). Because end users of public payphones are the

transient general public, rather than identifiable subscribers,

the Commission’s rules exempted public payphone service

from EUCL charges and instead allowed LECs to recover

public payphone costs from long distance carriers. See id. at

705, ¶ 58. Semi-public payphone service, however, was subject to EUCL charges because the LECs’ ‘‘fixed costs [could]

be recovered from an identifiable business end user through

flat charges.’’ Id. at 706, ¶ 60.

At the time the Commission issued its access charge rules,

all payphones were owned and operated by LECs. In 1984,

the Commission allowed IPPs to enter the market and compete with LEC payphones. Because the access charge rules

were established at a time when only LECs provided payphone service, the rules said nothing about how EUCL

charges would apply to IPP-owned payphones. Acting entirely on their own, however, the LECs began assessing

EUCL charges on all IPP payphones, both public and semipublic, as soon as IPPs entered the market. The IPPs

objected, and in 1989 their trade association filed a petition

with the Commission challenging the lawfulness of the

charges. Also in 1989, one IPP, C.F. Communications Corporation (CFC), filed a complaint with the Commission, arguing

that its payphones should be exempt from EUCL charges

because it was not an ‘‘end user’’ and because it provided

public payphone service.

Denying CFC’s complaint, the Commission ruled that the

LECs had properly assessed EUCL charges under the access

charge rules. CFC, the Commission explained, met the

regulatory definition of ‘‘end user’’ because it was a ‘‘reseller’’

whose resale transmissions ‘‘originate[d] on [its] premises.’’

In re C.F. Communications Corp. v. Century Tel. of Wisc.,

Inc., 10 F.C.C.R. 9775, 9778–79, ¶¶ 12–17 (1995) (quoting 47

C.F.R. § 69.2(m)) (internal quotation marks omitted). The

Commission also found that CFC’s payphones were not ‘‘public telephones’’ but rather semi-public payphones subject to

EUCL charges. See id. at 9779–80, ¶¶ 20–21. Relying on
5

that order, the Commission denied complaints filed by several

other IPPs challenging the imposition of EUCL charges.

In C.F. Communications v. FCC, however, we reversed the

Commission’s CFC decision, concluding that the Commission

‘‘erred in determining that CFC was an ‘end user’ ’’ within the

meaning of its rules. 128 F.3d at 740. We found ‘‘the

Commission’s interpretation of the word ‘premises,’ ’’ a ‘‘real

property’’ term, to encompass IPP payphones, items of ‘‘personal property,’’ to be ‘‘so far removed from any established

definition of that word’’ that it was ‘‘plainly erroneous.’’ Id.

at 739. We also found the Commission’s decision ‘‘not reasoned’’ because by permitting EUCL charges on IPP-owned

but not LEC-owned public payphones even though both

provided indistinguishable telephone service, the Commission

‘‘improperly discriminated between similarly situated phone

services without a rational basis.’’ Id. at 740.

Following our lead, the Commission reversed itself on

remand, concluding that the LECs had imposed an unreasonable charge in violation of agency regulations and 47 U.S.C.

§ 201(b) (2000), which requires that charges for communications services be ‘‘just and reasonable.’’ See In re C.F.

Communications Corp. v. Century Tel. of Wisc., Inc., 15

F.C.C.R. 8759, 8768, ¶ 24 (2000) (CFC Remand Order). According to the Commission, ‘‘CFC and the other IPPs [could

not] be considered ‘end users’ ’’ under the definition of that

term because they owned the payphones but not the ‘‘premises’’ from which payphone calls were made. Id. The Commission went on to state, however, that ‘‘irrespective of

whether CFC was an ‘end user,’ TTT the primary determination the Commission should have made was whether CFC’s

payphones were ‘public’ or ‘semi-public.’ ’’ Id. at 8768, ¶ 25.

Viewing the rules this way, the Commission concluded that

LECs had unreasonably imposed EUCL charges on IPP

public payphones. See id. at 8766, ¶ 20.

The LECs then petitioned for review, arguing that liability

was unfounded because they had acted in reliance on the

Commission’s prior ruling approving the charges. Observing

that the Commission’s decision was ‘‘under unceasing chal-
6

lenge before progressively higher legal authorities’’ until ultimately being overturned in C.F. Communications, we upheld

the Commission. Verizon, 269 F.3d at 1110.

In the meantime, following C.F. Communications, IPPs

that had not participated in those proceedings filed some 3000

informal complaints with the Commission seeking damages

for the LECs’ imposition of EUCL charges from the time

IPPs entered the payphone market until 1997, when the

Commission revised its access charge rules to require ‘‘the

prospective application of EUCL charges to both independent

payphones and to LEC-owned payphones.’’ C.F. Communications, 128 F.3d at 738 (emphasis omitted). Thirteen of

those complaints, filed in late 1997 and early 1998, are the

subject of this case. In their complaints, the IPPs alleged

that the LECs’ imposition of EUCL charges violated section

201(b) because the IPPs were not end users, irrespective of

whether their payphones were public or semi-public. After

bifurcating the proceedings and deferring the calculation of

damages to a later phase, the Commission issued the liability

order now on review, granting the IPPs’ complaints in part.

See Communications Vending Corp. of Ariz. v. Citizens

Communications Co., 17 F.C.C.R. 24,201 (2002) (Order). For

reasons explained further in each section below, the Commission concluded that (1) because the IPPs were not end users

under Commission regulations, they were not subject to

EUCL charges for either their public or their semi-public

payphones, and (2) because the IPPs’ cause of action accrued

when they incurred EUCL charges, the Communications

Act’s statute of limitations barred them from recovering

charges paid more than two years before they filed their

complaints. See id. at 24,208, ¶ 15.

Both the LECs and the IPPs now challenge the Commission’s order. The LEC petitioners dispute the finding of

liability, while the IPP petitioners argue that the statute of

limitations does not limit their recovery. Each group of

petitioners has intervened on behalf of the Commission to

oppose the other group’s petition, and additional IPPs, whose

complaints before the Commission were stayed pending resolution of this proceeding, see id. at 24,206, ¶ 11, have inter-
7

vened in support of the IPP petitioners. We address the

LECs’ arguments in part II and the IPPs’ in part III.

II.

The Commission found that ‘‘because [the IPPs] were not

‘end users’ within the meaning of [its regulations], they were

not within the scope of the EUCL rule, and charges levied

against them—regardless of whether the payphones were

public or semi-public—were unlawful.’’ Id. at 24,209, ¶ 19.

In so ruling, the Commission rejected the LECs’ argument

that because the IPPs were acting as agents of the owners of

the premises on which their payphones were located, EUCL

charges were reasonable. See id. at 24,211, ¶ 24. The Commission explained that as to public payphones, whether the

IPPs were acting as agents was irrelevant because under the

access charge rules public premises owners were exempt

from EUCL charges. See id. at 24,211–12, ¶ 25. In any

event, as to both public and semi-public payphones, the

Commission concluded that the LECs ‘‘ha[d] established no

basis for imputing any liability of the premises owner’’ to the

IPPs. Id. at 24,212, ¶ 26. According to the Commission,

neither the written agreements nor the circumstances of the

payphone service arrangements detailed in the record subjected the IPPs to the premises owners’ control. To the

contrary, the Commission found that the IPPs paid the

owners for the use of their space and, although the IPPs

needed authorization to install the payphones, they maintained the phones at their own discretion and in their own

interests.

In reviewing the LECs’ challenges to the Commission’s

order, we follow familiar principles of administrative law,

affirming the Commission’s conclusions of law unless they are

‘‘arbitrary, capricious, an abuse of discretion, or otherwise not

in accordance with law,’’ 5 U.S.C. § 706(2)(A) (2000), and

accepting its findings of fact so long as they are supported by

substantial evidence on the record as a whole, see, e.g., AT&T

Corp. v. FCC, 86 F.3d 242, 247 (D.C. Cir. 1996). We give

‘‘controlling weight’’ to the Commission’s interpretation of its

own regulations ‘‘unless it is plainly erroneous or inconsistent
8

with the regulation.’’ Capital Network Sys., Inc. v. FCC, 28

F.3d 201, 206 (D.C. Cir. 1994).

The LECs challenge the Commission’s liability determination on two grounds. First, they argue that the Commission

erred in holding that because IPPs were not end users they

were exempt from EUCL charges on their semi-public payphones. During the period at issue the FCC regulation

establishing EUCL charges stated that ‘‘[a] charge TTT shall

be assessed upon end users that subscribe to local exchange

service TTT or semi-public coin telephone service.’’ 47 C.F.R.

§ 69.104(a) (1996). Thus, as the Commission explained,

‘‘[u]nder the plain language of the rule’’ only end users were

subject to EUCL charges. Order, 17 F.C.C.R. at 24,209–10,

¶ 20. As mentioned above, section 69.2(m) defined ‘‘end user’’

as:

[A]ny customer of an interstate or foreign telecommunications service that is not a carrier except that

a carrier other than a telephone company shall be

deemed to be an ‘end user’ when such carrier uses a

telecommunications service for administrative purposes and a person or entity that offers telecommunications services exclusively as a reseller shall be

deemed to be an ‘end user’ if all resale transmissions offered by such reseller originate on the premises of such reseller.

47 C.F.R. § 69.2(m) (emphasis added). Expressly following

C.F. Communications’s reasoning, which it had adopted in

the CFC Remand Order, the Commission again found that

the IPPs here, like CFC, were not end users under that

definition because, although they were resellers of telecommunications services, they did not own the premises from

which the payphone transmissions originated. See Order, 17

F.C.C.R. at 24,210–11, ¶¶ 21–22.

We see nothing unreasonable in the Commission’s analysis.

Indeed, largely ignoring the regulations’ language and the

well-established precedent on which the Commission relied,

the LECs essentially contend that the Commission got it

right in the CFC Remand Order, which concluded that LECs
9

were liable only for EUCL charges assessed on IPP public

payphones. Citing C.F. Communications, they argue first

that the Commission erred by applying section 69.2(m)’s

definition of end user to the assessment of EUCL charges on

IPP payphones, claiming it was ‘‘adopted in a different context.’’ LEC Pet’rs’ Br. at 19. In C.F. Communications,

however, we did not find the end-user definition inapplicable

to the IPP payphone context, but rather remanded the case

so that the Commission could correct its erroneous interpretation of section 69.2(m)’s definition with respect to IPP

payphones. Indeed, throughout the history of these proceedings, the petitioners, the Commission, and this court have

looked to that end-user definition to evaluate the assessment

of EUCL charges on IPPs, and the LECs offer no reason

why it was unreasonable for the Commission to continue to do

so here.

The LECs next charge that the Commission inadequately

explained its change in position from the CFC Remand Order.

We disagree. Recognizing that making LEC liability turn on

IPP end-user status deviated from its prior decision, the

Commission provided a ‘‘thorough review of the relevant rules

and precedents’’ before ‘‘conclud[ing] that [its] prior focus on

the public/semi-public distinction, rather than the threshold

end user determination, was incorrect.’’ Order, 17 F.C.C.R.

at 24,212, ¶ 22. The Commission explained that because of its

focus on that distinction, it had previously determined that

IPPs were not end users but that it had never before

addressed the IPPs’ argument about the consequences of that

determination in view of the fact that section 64.104 made

clear that EUCL charges could be assessed on end users

only. See id. at 24,212, ¶ 23 (explaining that ‘‘a charge that

may be levied only on ‘end users’ may [not] be assessed upon

entities that explicitly have been found not to be end

‘users’ ’’). This is more than sufficient to provide the ‘‘reasoned explanation’’ we require of an agency that changes its

position. See Amax Land Co. v. Quarterman, 181 F.3d 1356,

1365 (D.C. Cir. 1999).

The LECs’ other arguments on this score rest on a misreading of the Commission’s order. They claim that by
10

holding that a premises owner ‘‘that ordered semi-public

payphone service from [a LEC] was liable for the EUCL

charge’’ while a premises owner ordering the same service

from an IPP ‘‘enjoyed an access charge exemption,’’ the

Commission ignored the access charge policy of ‘‘recovery of

costs from an identifiable subscriber’’ and ‘‘create[d] precisely

the type of unreasonable discrimination that prompted this

court to grant the petition for review in C.F. Communications.’’ LEC Pet’rs’ Br. at 16–17. But as the Commission

points out, its order ‘‘states only that the IPPs were not

subject to the EUCL charges,’’ and does not consider ‘‘whether the identifiable end users (i.e., premises owners) of IPPowned semi public payphones TTT would have been liable for

EUCL charges.’’ Resp’ts’ Br. at 32 (emphasis omitted).

Thus, the Commission’s determination that IPPs were not

end users with respect to their semi-public payphones does

not run counter to the access charge rules that authorized

LECs to collect EUCL charges from identifiable subscribers

who qualified as end users of IPPs’ semi-public payphones.

Indeed, given that LECs paid no EUCL charges on their own

semi-public payphones, but rather imposed them on premises

owners receiving their semi-public payphone service, the

Commission’s order treats competing IPPs in precisely the

same way. Therefore, unlike in C.F. Communications, the

Commission’s revised interpretation of its rules does not treat

similar payphone services differently. It was the LECs who

chose to assess EUCL charges on their IPP competitors

rather than on those premises owners who may have qualified

as identifiable end users. Thus, any disparate treatment of

semi-public payphone services stems from the LECs’ actions,

not from the Commission’s ruling.

For their second line of attack, the LECs contend that even

if end-user status is determinative, they properly assessed

EUCL charges on both public and semi-public payphone

service because the IPPs were serving as agents of the

premises owners who, according to the LECs, were end users

subject to EUCL charges under the Commission’s regulations, i.e., premises owners were ‘‘customer[s] of TTT telecommunications service,’’ 47 C.F.R. § 69.2(m), that ‘‘subscribe[d]
11

to local exchange telephone service.’’ 47 C.F.R. § 69.104(a).

Like the Commission, however, we fail to see how the existence of any such agency relationship could matter for public

payphone service. The Commission’s determination that the

LECs ‘‘cannot use an agency theory to avoid liability for

EUCL charges assessed on public payphones,’’ Order, 17

F.C.C.R. at 24,211, ¶ 25 (emphasis omitted), follows directly

from its regulations and controlling precedent. As the Commission explained, its access charge rules, C.F. Communications, and the CFC Remand Order all clearly established that

‘‘ ‘end users’ of public payphones are exempt from the EUCL

charges,’’ id.—an exemption that applies with equal force to

IPP- and LEC-owned payphones. Under those rules and

precedents, premises owners having IPPs’ public payphones

were not subject to EUCL charges because the owners were

not ‘‘end users’’ who ‘‘subscribe[d]’’ to local telephone service.

For public payphones, the transient general public, not the

public premises owner, was the end-user, and although IPPs

providing public payphones may have subscribed to local

exchange service, public premises owners did not. In other

words, as the Commission reasonably concluded, because ‘‘the

premises owners [of IPPs’ public payphones] would not have

been subject to EUCL charges,’’ whether IPPs were agents

of the public premises owners is irrelevant. Id.

The agency issue may well have relevance with respect to

semi-public payphone service, which was subject to EUCL

charges, but the Commission found that the LECs had ‘‘established no basis for imputing any liability of the premises

owner’’ to the IPPs. Id. at 24,212, ¶ 26. Challenging that

finding, the LECs contend that the Commission ignored

record evidence showing that the IPPs acted—or at least led

the LECs to believe they were acting—as the premises

owners’ agents in ordering local telephone service. We disagree. Reviewing the written agreements between the IPPs

and the premises owners, the parties’ roles under those

agreements, and other record evidence, the Commission

found that the IPPs were acting as licensees of the premises

owners, not as agents allegedly liable for EUCL charges.

Although recognizing that the IPPs needed the premises
12

owners’ consent before ordering service, the Commission

determined that this did not establish an agency relationship

given that, in each case, the IPPs compensated the premises

owners for that authorization and had sole discretion over the

number of lines to install. See id. at 24,212–13, ¶¶ 28–29.

Thus, the Commission found that the IPPs were acting in

their own interests free from the premises owners’ control.

The LECs insist that the agency relationship is ‘‘particularly clear in the case of semi-public payphones,’’ where the

‘‘premises owner itself has a ‘specific TTT need’ for the

payphone’’ and the IPP orders ‘‘service on the premises

owner’s behalf so that the premises owner would have continuing access to semi-public payphone service.’’ LEC Pet’rs’

Br. at 24–25. It is true that the Commission’s rules suggest

that the relationship between IPPs and premises owners

would likely have differed in the semi-public context:

Semi-public payphones tend to be payphones placed

in locations, at the request of the premises owner,

that do not generate significant amounts of traffic.

The [company] providing the semi-public payphone

typically receives the coin revenues from the payphone, as well as a monthly fee discounted from the

rate for a business line.

In re Implementation of the Pay Tel. Reclassification &

Compensation Provisions of the Telecomms. Act of 1996, 11

F.C.C.R. 20,541, 20,680 n.912 (1996) (citation omitted). Even

if such a relationship were sufficient to establish agency,

however, the LECs point to nothing in the record demonstrating that any of the IPP petitioners actually had such a

relationship with premises owners. Although we understand

that the Commission deferred the question of whether the

IPPs’ payphones were public or semi-public to the damages

phase, see Order, 17 F.C.C.R. at 24,211 n.73, we think the

Commission correctly put the burden of proving an agency

relationship on the LECs, for it was they who asserted

agency as a defense in the liability phase, see id. at 24,212,

¶ 27; see also Karl Rove & Co. v. Thornburgh, 39 F.3d 1273,

1296 (5th Cir. 1994); 12 Williston on Contracts § 35:2 (4th
13

ed. 2003) (‘‘As a general rule, the party asserting the agency

relationship has the burden of proving both the existence of

the relationship and the authority of the agent.’’). On this

record, the Commission correctly concluded that the LECs

failed to carry that burden because they had offered insufficient evidence of an agency relationship between the IPPs

and the premises owners that could have supported their

claim of imputed liability. Moreover, nothing in the record

supports the LECs’ argument that the IPPs somehow misled

them; indeed, given that the LECs were themselves involved

in similar transactions, we find it difficult to accept the notion

that they could have been confused about the nature of the

IPP-premises owner relationship.

III.

This brings us to the IPPs’ challenge to the Commission’s

application of the statute of limitations to limit their recovery

of damages. Section 415 of the Communications Act provides: ‘‘All complaints against carriers for the recovery of

damages not based on overcharges shall be filed with the

Commission within two years from the time the cause of

action accrues, and not afterTTTT’’ 47 U.S.C. § 415(b) (2000).

Citing judicial and Commission precedent, the Commission

explained that a cause of action under section 415 accrues on

the date of injury, or if the injury is not readily discoverable,

at the time the complainant should have discovered it. Order,

17 F.C.C.R. at 24,222, ¶ 51. Based on the IPPs’ representation that they were aware of the charges when assessed,

believed them to be unlawful, and knew that other IPPs had

challenged them, the Commission held that the injury occurred and the cause of action accrued when the IPPs ‘‘received their first bill containing the EUCL assessment.’’ Id.

at 24,223, ¶ 51. The Commission rejected the IPPs’ theory

that their cause of action did not accrue until the unlawfulness of the charges was clearly established. See id. at 24,223,

¶ 52. The Commission also declined to toll the statute of

limitations, finding that the IPPs had failed to act with due

diligence. See id. at 24,226–27, ¶¶ 58–63. Applying the twoyear limitation period, the Commission concluded that the
14

IPPs could recover damages for only the two-year period

preceding the filing of their complaints. See id. at 24,227,

¶ 64.

We review the Commission’s interpretation of section 415

in accordance with the familiar principles of Chevron USA

Inc. v. Natural Resources Defense Council, 467 U.S. 837

(1984). See Cellco P’ship v. FCC, 357 F.3d 88, 94 (D.C. Cir.

2004). Because Congress did not define the term ‘‘accrues,’’

we must determine whether the agency’s interpretation is

‘‘based on a permissible construction of the statute.’’ Chevron, 467 U.S. at 843. In construing section 415, the Commission relied on its long held view that ‘‘a cause of action

accrues at the time the carrier does the unlawful act.’’ In re

MCI Telecomms. Corp. v. US West Communications, Inc., 15

F.C.C.R. 9328, 9330, ¶ 5 (2000). Thus, ‘‘[i]n cases involving

allegations that a carrier has failed to charge a just and

reasonable rate TTT , the general rule is that the two-year

limitations period begins to run when the customer receives a

bill from the carrier assessing the disputed rate.’’ Id.

The IPPs insist that ‘‘[e]xisting law does not support the

Commission’s accrual ruling’’ because ‘‘a cause of action

cannot accrue when the controlling law does not recognize

its validity.’’ IPP Pet’rs’ Br. at 13, 15. In making this argument, however, they point to nothing in section 415’s

language or legislative history either to support their interpretation or to suggest that the Commission’s reading is

unreasonable. Instead, the IPPs rely on a line of cases

unrelated to section 415 that originates with the Fifth Circuit’s decision in United States v. One 1961 Red Chevrolet

Impala Sedan, 457 F.2d 1353 (5th Cir. 1972). In that

case, a taxpayer sued to recover property forfeited as a

result of gambling and tax violations. Rejecting the argument that the claim was barred by the six-year statute of

limitations, the Fifth Circuit held that the taxpayer’s cause

of action did not accrue until the date of an intervening

Supreme Court ruling, which established a new defense to

such forfeiture proceedings and expressly endorsed the retroactive application of that new rule. In delaying the accrual of the taxpayer’s cause of action, the Fifth Circuit
15

explained that the taxpayer had ‘‘no reasonable probability

of successfully prosecuting his claim against the government prior to the enunciation of the new TTT rule.’’ Id. at

1358. Applying Red Chevrolet to the circumstances here,

the IPPs argue that they had no cause of action until our

1997 decision in C.F. Communications because, until then,

they had no reasonable probability of success.

While the IPP’s theory is certainly interesting, Red Chevrolet arose under a different statute entirely—the Tucker Act—

and therefore has nothing to do with the question before us:

whether the FCC’s interpretation of section 415 is reasonable.

Not only do we see nothing in the statute that suggests

otherwise, but the FCC’s view is consistent with prevailing

caselaw. To determine when a cause of action accrues under

section 415, this circuit, as well as every other circuit to have

addressed the issue, has applied the ‘‘discovery of injury’’

rule—the general accrual rule for remedial civil actions. See

MCI Telecomms. Corp. v. FCC, 59 F.3d 1407, 1417 (D.C. Cir.

1995); see also MCI Telecomms. Corp. v. Teleconcepts, 71

F.3d 1086, 1100 (3d Cir. 1995); Pavlak v. Church, 727 F.2d

1425, 1428 (9th Cir. 1984). Under that rule, a cause of action

accrues either when a readily discoverable injury occurs or, if

an injury is not readily discoverable, when the plaintiff should

have discovered it. MCI Telecomms. Corp., 59 F.3d at 1417.

In other contexts, moreover, we have rejected Red Chevrolet’s reasoning and the IPPs’ argument that a cause of action

does not accrue until uncertain law becomes settled. In

Atchinson, Topeka & Santa Fe Ry. Co. v. ICC, 851 F.2d 1432

(D.C. Cir. 1988), we reversed an Interstate Commerce Commission ruling that a shipper’s cause of action seeking refunds

of unlawfully paid delivery fees did not accrue at the time of

the delivery (as required by the statute at issue), but rather

years later when the ICC resolved unsettled law about such

refund claims. Calling the ICC’s action ‘‘as extraordinary as

it was unwarranted,’’ we rejected that agency’s delayed accrual approach in favor of traditional equitable tolling analysis.

Id. at 1437; see also Aluminum Co. of Am. v. United States,

867 F.2d 1448, 1453 (D.C. Cir. 1989) (rejecting the argument
16

that a cause of action did not accrue until our precedent

resolved the question of available remedies).

Given the foregoing, we have no doubt that the Commission’s construction of section 415 is permissible. Moreover,

because the IPPs concede that they were aware of the EUCL

charges and believed them to be unlawful when they were

assessed, the Commission reasonably found that their cause

of action accrued under section 415 when the LECs billed

them for the EUCL charges.

Nothing in Hartford Life Insurance Co. v. Title Guarantee

Co., 520 F.2d 1170 (D.C. Cir. 1975), requires a different

result. There, we held that the three-year statute of limitations on contract claims did not bar Hartford Life, the

assignee of a promissory note, from bringing suit against the

assignor twelve years after the assignment. The delay occurred because Hartford Life had spent many years suing the

trustee of the debtor who defaulted on the note—litigation

that ended when this court decided that the note was unlawful and unenforceable against the debtor’s trustee. Because

Hartford Life’s cause of action against the assignor ‘‘depended upon a prior adjudication of the rights of the trustee’’ and

because it had chosen to pursue its ‘‘substantial legal claim’’

against the trustee rather than suing the assignor immediately, we declined to hold that the ‘‘cause of action arose prior to

our decision’’ about the note’s validity. Id. at 1173–74. Although in Hartford Life we cited Red Chevrolet for the basic

proposition that the ‘‘right to sue did not accrue until the

plaintiff had a cause of action,’’ id. at 1173, our prior ruling

that the note was invalid was not mere precedent for Hartford Life’s suit against the assignor; instead it established for

the first time a predicate fact of injury central to that action.

In contrast, although our decision in C.F. Communications

clarified uncertain precedent, it changed no facts relating to

the IPPs’ injuries. Moreover, unlike Hartford Life, which

had diligently pursued its claim (albeit against the wrong

party), the IPPs took no action even though they believed

that the LECs were unlawfully assessing EUCL charges.
17

Finally, the Commission reasonably rejected the IPPs’

assertion that it would have been futile to pursue their claims

when the injury occurred. As the Commission noted, other

IPPs had continuously challenged its approval of EUCL

charges, and ‘‘pending legal challenges to that [approval]

made the legality of the [LECs’] behavior uncertain.’’ Order,

17 F.C.C.R. at 24,224, ¶ 53. Although the IPPs contend that

they had ‘‘no reasonable probability’’ of successfully challenging the Commission, their probability was exactly the same as

those IPPs that did so and succeeded. As the Second Circuit

has explained:

The only sure way to determine whether a suit can

be maintained is to try it. The application of the

statute of limitations cannot be made to depend upon

the constantly shifting state of the law, and a suitor

cannot toll or suspend the running of the statute by

relying upon the uncertainties of controlling law. It

is incumbent upon him to test his right and remedy

in the available forums. These suits were not commenced until through the labor of others the way

was made clear.

Fiesel v. Bd. of Educ., 675 F.2d 522, 524–25 (2d Cir. 1982)

(quoting Versluis v. Town of Haskell, 154 F.2d 935, 943 (10th

Cir. 1946)) (internal quotation marks omitted).

Alternatively, the IPPs argue that even if their claims

accrued when the LECs assessed the EUCL charges, the

Commission erred in declining to toll the statute of limitations. While recognizing that section 415 may be equitably

tolled, the Commission has construed that provision strictly,

even when doing so produces hardship. See In re Valenti v.

AT&T Co., 12 F.C.C.R. 2611, 2621–22, ¶ 24 (1997). We too

have set a high hurdle for equitable tolling, allowing a statute

to be tolled ‘‘only in extraordinary and carefully circumscribed instances.’’ Smith-Haynie v. District of Columbia,

155 F.3d 575, 580 (D.C. Cir. 1998) (internal quotation marks

omitted). As the Supreme Court has explained:

Federal courts have typically extended equitable

relief only sparingly. We have allowed equitable
18

tolling in situations where the claimant has actively

pursued his judicial remedies by filing a defective

pleading during the statutory period, or where the

complainant has been induced or tricked by his

adversary’s misconduct into allowing the filing deadline to pass.

Irwin v. Dep’t of Veterans Affairs, 498 U.S. 89, 96 (1990)

(footnote omitted). Meant to ‘‘ensure[ ] that the plaintiff is

not, by dint of circumstances beyond his control, deprived of a

reasonable time in which to file suit,’’ Chung v. DOJ, 333 F.3d

273, 279 (D.C. Cir. 2003) (internal quotation marks omitted),

equitable tolling is unwarranted where a litigant has ‘‘failed to

exercise due diligence in preserving his legal rights,’’ Irwin,

498 U.S. at 96; see also Smith–Haynie, 155 F.3d at 580. In

light of this stringent test, we have little difficulty sustaining

the Commission’s refusal to toll the statute of limitations,

particularly given our highly deferential standard of review.

See Sprint Communications Co. v. FCC, 76 F.3d 1221, 1226

(D.C. Cir. 1996) (explaining that we reverse a Commission

ruling that a claim is time barred ‘‘only if the agency’s

decision is not supported by substantial evidence or the

agency has made a clear error in judgment’’).

According to the Commission, the IPPs ‘‘did not act with

anything approaching due diligence.’’ Order, 17 F.C.C.R. at

24,226, ¶ 59. As the Commission explained, even though

some IPPs filed complaints early on, they failed to pursue

them. Insisting they did act diligently, the IPPs point out

that their industry trade association filed a petition in 1989

challenging the EUCL charges on their behalf. See supra at

4. But that petition sought only a declaratory ruling that the

LECs’ imposition of EUCL charges was unlawful, so it could

neither have tolled the statute nor otherwise excused the

IPPs’ failure to pursue complaints for damages, especially

when other IPPs did so and thereby preserved their claims in

full.

We have reviewed the IPPs’ remaining equitable tolling

arguments and found them to be without merit. While it is

certainly true that the Commission’s decision ‘‘allows the

LECs to keep money that TTT they collected unlawfully,’’ IPP
19

Pet’rs’ Br. at 29, that is both the nature of a statute of

limitations and the consequence of the IPPs’ failure to file

and pursue their complaints in a timely manner.

IV.

Weary of this long and drawn-out dispute, counsel for the

Commission asked at oral argument that we affirm the Commission and put it ‘‘out of [its] misery.’’ We are pleased to

oblige. As General Douglas MacArthur proclaimed from the

deck of the U.S.S. Missouri, ‘‘[t]hese proceedings are now

closed.’’

So ordered.