alleging breach of contract and fraud, respectively. The Court
dismisses Counts I and III without prejudice so that Plaintiff may
seek the determination of the Federal Communications Commission
with respect to the issues identified above. The Court GRANTS
Defendant’s Motion to Dismiss Count II of Plaintiff’s Complaint,
alleging breach of the covenant of good faith and fair dealing, and
Count IV, claiming unjust enrichment. The Court dismisses Counts
II and IV with prejudice.

Iv IS SO ORDERED.

Dated: August 9, 2002

Hon, WILL J. HIBBLER
U.S. DISTRICT COURT JUDGE

13


Cingular’s rates, and those cases involving the “entry of or the
rates charged by any commercial service or any private mobile
service are the province of federal regulators and courts.” Id;
see also Bastien v. AT&T Wireless Serv., Inc., 205 F.3d 983, 987
(7* Cir. 2000) and Gilmore v. Southwestern Bell Mobile Sys., Inc.,
156 F.Supp.2d 916, 920-24 (N.D. Ill. 2001) (“Gilmore I”).

The Court now considers Cingular's Motion to Dismiss.
Cingular asks the Court to dismiss Fedor’s Complaint for lack of
subject matter jurisdiction, or, in the alternative, to dismiss
Fedor’s claims because they are within the primary jurisdiction of
the Federal Communications Commission. Cingular further moves to
dismiss all counts for failure to state a claim upon which relief
can be granted. Because Counts I and III are within the primary
jurisdiction of the FCC, these counts are dismissed without
prejudice and should be brought before the FCC for resolution. In
addition, because this contractual relationship provides no context
within which the covenant of good faith and fair dealing or the
doctrine of unjust enrichment are applicable, Counts II and IV are
dismissed with prejudice.

Analysis
I, Breach of Contract
Under 47 U.S.C. § 207, any person claiming to be damaged by a

common carrier (such as'a cellular/wireless phone company) may


Cingular’s interstate market entry. These issues are within the
FCC’s expertise, and the need for uniformity and the establishment
of national policy requires the exercise of the Commission’s
discretion. See Digital Communications Network, Inc, v, AT&T
Wireless Servs., 63 F.Supp.2d 1194, 1199 (C.D. Cal. 1999)
(citations omitted), The FCC summarized its authority under the
FCA: “Under {47 U.S.C. § 201{a)] the Commission has the authority,
after hearing, to order the establishment of physical connection
between common carriers, and to establish through routes and
charges applicable thereto and the division of such charges.” Re
CPI Microwave, Inc., 49 F.C.C.2d 779 (1974); see also 47 U.S.C. $§
201 (a),(b); re. Medical-Dental Bureau, fInc., 22 F.C.C.2d 53
(1970).

Although Fedor characterizes his claim as a mere challenge to
accounting practices, the delayed billing process at issue is the
result of equipment arrangements that enable Cingular to enter new
markets. Cingular explained it does not own towers in all parts of
the country. (Def’s Opp’n to Mot. to Remand at 10.) It instead
enters into agreements with other carriers so Cingular customers
can receive cellular service when they are outside of their local
calling areas. These arrangements enable Cingular to provide
service in markets outside of a given state or local area.

Cingular maintains these arrangements cause a delay in processing


allowing the Court to “refer a matter extending beyond the
‘conventional experience of judges’ or ‘falling within the realm of
administrative discretion’ to an administrative agency with more
specialized experience, expertise, and insight.” Gilmore II, 2001
WL 1539157, at *6@ (quoting Arsberry v. Illinois, 244 F.3d 558, 563
(7*" Cir. 2001) (quoting Nat’1l Communications Ass’n v. AT&T Co., 46
F.3d 220, 222-23 (27 Cir. 1995) (quoting Far Eastern Conference v.
United States, 342 U.S. 570, 574 (1952)))). A court has discretion
to “either retain jurisdiction or, if the parties would not be
unfairly disadvantaged, to dismiss the case without prejudice.”
Lee v. Contel Cellular of the South, Inc., No. CV-95-1057-JH, 1996
U.S, Dist. LEXIS 19636, at *15 (S.D. Ala. Nov. 21, 1996) (quoting
Reiter v. Cooper, 507 U.S. 258, 268 (1993)).

In determining whether to apply the primary jurisdiction
doctrine, courts consider a number of factors, including: (a)
whether the issue is within the conventional experience of the
judiciary; (b) the presence of technical or policy issues within
the agency's particular field of expertise; (c) whether the
agency's discretion would be involved in making a determination on
the issue; (d) the need for a consistent and uniform rule; (e) the
likelihood of inconsistent rulings if the issue is not referred to
the agency; (f) whether the issue has already been before the

agency; (g) whether it would be judicially economical to refer the


bring a complaint before the FCC or sue for damages in a federal
district court, but not both. 47 U.S.C. § 207 (2002); Gilmore v.
Southwestern Bell Mobile Sys., L.L.C., No. O1 C 2900, 2001 WL
1539157, at *6 (N.D. Ill. Nov. 30, 2001) (“Gilmore II”); see
Cahnmann v. Sprint Corp., 133 F.3d 484, 487 (7 Cir. 1998), cert.
denied 524 U.S. 952 (1998); Digitel, Inc. v. MCI Worldcom, Inc.,
239 F.3d 187, 190 (2% Cir. 2001). However, even when the
plaintiff prefers judicial disposition, the court may still apply
the primary jurisdiction doctrine to require the parties to obtain
an FCC determination of issues within the Commission’s special
competence. Gilmore II, 2001 WL 1539157, at *6; Alinet
Communication Serv., Inc., v. Nat’l Exch. Carrier Ass'n, Inc., 965
F.2d 1118, 1122 (D.C. Cir, 1992); Miranda v. Mich., 141 F.Supp.2d
747, 760 (E.D. Mich. 2001); Telecom Int’l America, Ltd. v. AT&T
Co., 67 F.Supp.2d 189, 219 (S,.D.N.Y. 1999); Unimat, Inc. v. MCI
Telecomm. Corp., No. 92 C 5941, 1992 WL 391421, at *2-3 (E.D. Pa.
Dec. 16, 1992); see also Cahnmann, 133 F.3d at 487; Access
Telecomm. v. Southwestern Bell Tel. Co., 137 F.3d 605, 607-609 (8TM"
Cir. 1998), cert. denied, 525 U.S. 962 (1998); Richman Bros.
Records, Inc. v. U.S. Sprint Communications Co., 953 F.2d 1431
1435 (3% Cir. 1991), cert. denied 505 U.S. 1230 (1992).

The primary jurisdiction doctrine in the present context is

not jurisdictional in nature, but a form of judicial abstention,


of primary jurisdiction should be invoked and the plaintiff should
seek FCC resolution. See Cahnmann, 133 F,3d at 491. Case law has
characterized claims regarding billing for long distance calls that
were never completed and the failure to disclose billing practices
to customers as those requiring a “reasonableness” determination by
the FCC. In re Long Distance Telecomm. Litig., 647 F.Supp. 78
(E.D. Mich. 1986). As has already been resolved, Count I also
challenges the reasonableness of Cingular’s rates, despite Fedor’s
characterization to the contrary. Fedor I. The artful pleading
doctrine allows a court to look beyond the face of the complaint to
determine whether “a plaintiff has artfully pleaded his suit so as
to couch a federal claim in terms of state law.” Burda v. M. Ecker
Co., 954 F.2d 434, 438 (7 Cir. 1992). Fedor’s claim would require
the trier of fact to focus on the appropriateness of the fees
charged by Cingular from January through April 2001 and to
determine if the fees were unjust. Fedor I. Accordingly, Fedor’s
breach of contract claim challenges the reasonableness of
Cingular's rates under the Federal Communications Act. 47 U.S.C.
§ 201 (b) (2002) (“All charges, practices, classifications, and
regulations for and in connection with such communication service,
shall be just and reasonable, and any such charge... that is
unjust or unreasonable is hereby declared to be unlawful.”).

Fedor’s breach of contract claim also challenges aspects of


Minute Orgor Form (06/97) y-

United States District Court, Northern District of Hlinois

Name of Assigned Judge illi i Sitting Judge if Other
or Magistrate Judge William J. Hibbler than Assigned Judge
CASE NUMBER 01 C 6849 DATE 08/09/2002
CASE TITLE Fedor, v, Cingular Wireless Corp.
[ln the following box (a) indicate the party filing the motion, e.g. plaintiff, defendant, 3rd party plaintiff, and (b) state bricily the
MOTION: nature of the motion being presented.)
Defendants’ Motion to Dismiss (#4-1)

DOCKET ENTRY:

(00) is] Filed motion of [ use listing in “Motion” box abave.]

(2) is) Brief in support of motion due

(3) a Answer brief to motion due . Reply to answer brief due

(4) Qo Ruling/Hearing on set for at

(5) oO Status hearing [held/continued to) [set for/re-set for] on set for at

(6) o Pretrial conference [held/continued to] [set for/re-set for] on set for al

a) oO Trial [set for/re-set for] on at

(8) o {Bench/Jury trial) [Hearing] held/continued to at

@Q) Oo This case is dismissed [with/without] prejudice and without costs [by/agreement/pursuant to]

OFRCP4(m) OGeneral Rule 21 © FRCP41(a)(1) O FRCP41(a)(2).

(10) m [Other docket entry] For the attached reasons, the Court GRANTS Defendant’s Motion to Dismiss
Counts I and III of Plaintiff’s Complaint, and dismisses Counts I and III without prejudice. Plaintiff
should seek the determination of the Federal Communications Commission with respect to the issues
identified in these counts. The Court GRANTS Defendant’s Motion to Dismiss Counts II and IV of
Plaintiffs Complaint, and dismisses these counts with prejudice. All pending motions and dates are
terminated as moot. Enter Memorandum Opinion and Order.

(il) [For further detail see order on the reverse side of the original minute order.)

Qs

No notices required, advised in open court,
No notices required.

Notices mailed by judge's staff.

Notified counsel by telephone.

Docketing to mail notices,

Mail AO 450 form.

Copy to judge/magistrate judge,

umber af notices

AuG 1 2 7002

date docketed

JHC

courtroom dave maited noice

deputy’s
initials

Date/time reccived in

central Clerk’s Office muiting deputy initials



III. Covenant of Good Faith and Fair Dealing

In Count II of the Complaint, Fedor alleges Cingular breached
the covenant of good faith and fair dealing. Illinois courts infer
a duty of good faith and fair dealing in all contracts. Beraha v.
Baxter Health Care Corp., 956 F.2d 1436, 1443 (7 Cir. 1992)
(citations omitted). However, the covenant of good faith and fair
dealing is not an independent source of duties for the parties;
rather, it exists to guide the construction of explicit terms in an
agreement. Id. The covenant of good faith and fair dealing does
not, therefore, impose additional obligations beyond the bargained-
for exchange between the parties. See Baxter Healthcare Corp. v.
O.R. Concepts, Inc., 69 F.3d 785, 792 (7 Cir. 1995).

Fedor alleges a breach of an express contract between himself
and Cingular. Fedor does not ask the Court to use the duty of good
faith and fair dealing to “guide the construction” of the express
agreement, but to impose a distinct and separate obligation upon
Cingular. The covenant requires a party with broad contractual
discretion “to exercise that discretion reasonably and with proper
motive, not arbitrarily, capriciously, or in a manner inconsistent
with the reasonable expectations of the parties.” Davis v.
McDonald’s Corp., 44 F.Supp.2d 1251, 1259 (N.D. Pla. 1998) (quoting
Resolution Trust Corp. v. Holtzman, 618 N,.E.2d 418, 424 (Ill.

1993)). Fedor, however, merely alleges Cingular breached the

ll


billing information, because it must interact with the equipment
owners to retrieve all roaming data for its customers. (Def’s
Opp’n to Mot. to Remand at 6.) By challenging the customer billing
process, Fedor challenges the impact of this delay, and therefore
the manner by which Cingular enters and operates in new markets.
Accordingly, Count I, alleging breach of contract, is dismissed
without prejudice, and Fedor should seek a determination by the FCC
regarding the above issues.
Iz. Fraud

In Count III of the Complaint, Fedor alleges, “Defendant
misrepresented, concealed and/or omitted to inform Plaintiff. .
regarding Cingular’s practice of accumulating and failing to timely
bill for calls which result in improper charges.” Compl. 1 27.
This allegation is inextricably intertwined with Fedor’s breach of
contract allegation. Fedor demands the timely billing of roaming
charges under both the breach of contract and fraud counts. When
the relief sought by both counts is the same, as was the case in
Cahnmann, “’ fraud’ is just another name for ‘breach of contract.’”
Cahnmann, 133 F.3d at 490. Count III therefore mirrors Count I's
challenge to the reasonableness of Cingular’s rates and its market
entry strategy. Accordingly, Count III, alleging fraud, is
dismissed without prejudice, and should also be brought before the

FCC for resolution.

10


issue for agency resolution; and (h) whether agency referral will
result in substantial delay and added expense. Gilmore II, 2001 WL
1539157, at *6; see Ryan v. Chemlawn Corp., 935 F.2d 129, 131 (7TM
Cir. 1991); Nat’l Communications Ass’n, 46 F.3d at 222-23; Access
Telecomm., 137 F.3d at 608; Sprint Spectrum L.P. v. AT&T Co., 168
F, Supp. 2d 1095, 1097 (W.D, Mo. 2001); Madison County Mass Transit
v, Hanfelder, No. 00-CV-0179-DRH, 2001 WL 775977, at *2 (S.D. Ill.
Feb. 7, 2001); AT&T Corp. v. Ameritech Corp., No. 98 C 2993, 1998
WL 325242, at *4, *5 (N.D. Ill. June 10, 1998); MCI Telecomm. Corp.
v. Ameri-Tel, Inc., 852 F. Supp. 659, 663 (N.D. Ill. 1994). Courts
do not rely on any fixed formula in the consideration of these
factors, but should instead determine “whether the reasons for the
existence of the doctrine are present and whether the purposes it
serves will be aided by its application in the particular
litigation.” Gilmore II, 2001 WL 1539157, at *6@ (quoting United
States v. Western Pacific Railroad Co., 352 U.S. 59, 64 (1956)).
Fedor’s breach of contract claim involves issues that should
be resolved through the primary jurisdiction of the FCC, Questions
regarding the reasonableness of rates “are generally within the
particular expertise of the FCC and the regulation of such involves
exercising agency discretion.” Gilmore II, 2001 WL 1539157, at *7.
If a plaintiff’s claim for breach of contract can be more properly

characterized as a challenge to a rate agreement, then the doctrine


said calls and the time and related charges thereto would have been
{sic] without extra charge.” (Compl. 6.)

Fedor alleges he was charged from January through April of
2001 for calls which should have been billed during the month in
which they were made, but instead were shifted to subsequent months
due to Cingular’s billing practice. He maintains this practice
resulted in Cingular billing monies it would not normally be
entitled to if the airtime minutes were accounted for and billed in
a timely manner. This complaint pleaded both individual and class
action claims for breach of contract, breach of the covenant of
good faith and fair dealing, consumer fraud, and unjust enrichment.

II. Procedural History

Cingular removed the state court claim to federal court
pursuant to U.S.C. § 1441 (b). Fedor moved to remand the claim
back to state court and maintained he presented only a state law
claim based on alleged “contract violative accounting principles”
(Pl‘s Mot. to Remand ¥ 6.). This Court denied Fedor’s Motion to
Remand and subsequent Motion for Reconsideration after determining
Fedor’s Complaint was a challenge to the reasonableness of
Cingular’s rates. Fedor I. Such a challenge is completely
preempted by the Federal Communications Act, 47 U.S.C. § 332
(c) (3) (A) (2002) (“the FCA”). The Court held Fedor’s Complaint was

a mere attempt to use state law as a cloak for an attack on


Plaintiff should seek the determination of the Federal
Communications Commission with respect to the issues identified
below. The Court GRANTS Defendant’s Motion to Dismiss Counts II
and IV of Plaintiff's Complaint, and dismisses these counts with
prejudice for the reasons described below.
Background
I. Factual History
Plaintiff James J. Fedor, Jr. (“Fedor”) contracted with
Defendant Cingular Wireless (“Cingular”) for a cellular telephone
service plan. This plan provided a fixed rate for a certain amount
of airtime minute usage each month. Minutes used in excess of this
plan allowance were to be charged to Fedor’s account.?

In July 2001, Fedor filed a complaint against Cingular in
state court. The Complaint alleged Cingular improperly billed
Fedor by accumulating, holding, and charging roaming calls to later
billing periods. Fedor claims this practice enabled Cingular to
assess charges which should “not have been incurred based on the

service package plans purchased by said customers and under which

1 It is not clear whether any roaming minutes were to be included within the
fixed rate allowance, or if these minutes were to trigger an extra charge
regardless of the total number of minutes used within a given billing period.
For the purposes of the present analysis, this is not directly relevant;
however, the structure of the roaming charges will be relevant in the
determination of any damages incurred by Fedor, if applicable. If, for
instance, a fixed roaming charge applied regardless of total minutes incurred,
the result of the billing lag would be a mere timing difference reconciled
between billing periods. On the other hand, if roaming minutes were fully or
partially included in total minutes and charged only when total minutes used
exceeded the fixed allowance, then Fedor could incur permanent additional
charges as a result of the billing lag.

2


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION ‘

JAMES J. FEPOR, JR. and
on behalf of others
similarly situated
Plaintiffs,

NO. O01 C 6849 ial

ne

JUDGE WILLIAM J. HIBBLER

v.

CINGULAR WIRELESS CORPORATION
Defendant.

MEMORANDUM OPINION AND ORDER

The Court has before it Defendant’s Motion to Dismiss
Plaintiff’s Complaint for breach of contract, breach of the
covenant of good faith and fair dealing, fraud, and unjust
enrichment. In the interest of federalism, see Allen v. Ferguson,
791 F.2d 611, 616 (7% Cir. 1986), the Court previously held
determination of this motion in abeyance pending disposition of
Plaintiff’s Motion to Remand the case to state court. The Court
denied Plaintiff's Motion to Remand, finding Plaintiff’s complaint
a challenge to the appropriateness of Defendant’s rates, thereby
preempted by the Federal Communications Act. Fedor v. Cingular
Wireless Corp., No. 01 C 6849 (N.D, Ill. Nov. 9, 2001) (Motion to
Remand) ("Fedor I”). The Court has now considered the submissions
of both parties relating to this motion. The Court GRANTS
Defendant’s Motion to Dismiss Counts I and III of Plaintiff’s

Complaint, and dismisses Counts I and III without prejudice.

JO


covenant of good faith and fair dealing when it breached the
express contract. Accordingly, Count II of Fedor’s Complaint is
dismissed with prejudice.
IV. Unjust Enrichment

Count IV of Fedor’s Complaint is a claim for unjust
enrichment, Fedor alleges “Cingular has been and is being unjustly
enriched by the improper charges for calls which were accumulated,
held and billed to later billing periods.” This Count does not set
forth a proper cause for action. The theory of unjust enrichment
applies only in the context of contracts implied in law. People ex
rel, Hartigan v. E&E Hauling, Inc., 153 N.E.2d 165, 177 (1982)
“Because unjust enrichment is based on an implied contract, ‘where
there is a specific contract which governs the relationship of the
parties, the doctrine of unjust enrichment has no application.’”
Id. (quoting La Throp v. Bell Fed. Savs & Loan Ass'n, 68 Ill, 2d
375, 391 (1977) (quoting Brooks v. Valley Nat’l Bank, 113 Ariz
169, 174 (1976))). Again, Fedor alleges in the present case a
breach of an express contract. Therefore, unjust enrichment is not
an applicable cause of action, and the Court dismisses Count IV of
the Complaint with prejudice.

Conclusion
For the reasons set forth above, the Court GRANTS Defendant’s

Motion to Dismiss Counts I and III of Plaintiff’s Complaint,