*The Honorable John Feikens, United States District Judge for theEastern District of Michigan, sitting by designation.1RECOMMENDED FOR FULL-TEXT PUBLICATIONPursuant to Sixth Circuit Rule 206ELECTRONIC CITATION: 2000 FED App. 0141P (6th Cir.)File Name: 00a0141p.06UNITED STATES COURT OF APPEALSFOR THE SIXTH CIRCUIT_________________GTENORTH,INC.,Plaintiff-Appellant,v.JOHNG.STRAND, et al.,Defendants-Appellees.;>1No. 98-1851Appeal from the United States District Courtfor the Western District of Michigan at Lansing.No. 98-00038—Robert Holmes Bell, District Judge.Argued: December 13, 1999Decided and Filed: April 20, 2000Before: BOGGS and NORRIS, Circuit Judges; andFEIKENS, District Judge.*_________________COUNSELARGUED:Patrick F. Philbin, KIRKLAND & ELLIS,Washington, D.C., for Appellant. David A. Voges, OFFICEOF THE ATTORNEY GENERAL, PUBLIC SERVICE2GTE North, Inc. v. Strand, et al.No. 98-1851DIVISION, Lansing, Michigan, for Appellees. Charles W.Scarborough, UNITED STATES DEPARTMENT OFJUSTICE, CIVIL DIVISION, Washington, D.C., forIntervenors.ON BRIEF:Patrick F. Philbin, KIRKLAND &ELLIS, Washington, D.C., for Appellant. David A. Voges,Henry J. Boynton, OFFICE OF THE ATTORNEYGENERAL, PUBLIC SERVICE DIVISION, Lansing,Michigan, for Appellees. Charles W. Scarborough, UNITEDSTATES DEPARTMENT OF JUSTICE, CIVIL DIVISION,Washington, D.C., for Intervenors. Stephen F. Smith, DavidL. Lawson, Peter D. Keisler, SIDLEY & AUSTIN,Washington, D.C., for Amici Curiae._________________OPINION_________________BOGGS, Circuit Judge. GTE North, Inc. (GTE), anincumbent local telecommunications carrier in Michigan,sued the defendants, members of the Michigan Public ServiceCommission (MPSC or the Commission), under the FederalTelecommunications Act of 1996 (FTA or the Act) after theCommission issued an opinion and order directing GTE to (1)publish tariffs in which GTE would offer to sell elements ofits telecommunications network at rates predetermined by theCommission, and (2) allow competitors to purchase preassembled platforms of GTE network elements. In itscomplaint, GTE alleged that the MPSC’s order conflictedwith, and was preempted by, the FTA, and that enforcementof the order infringed GTE’s statutory rights in violation of 42U.S.C. § 1983.GTE moved for summary judgment, and the defendantsfiled a cross-motion to dismiss for lack of subject matterjurisdiction. The district court granted the defendants’ motionand dismissed the case without prejudice, holding that it didnot have jurisdiction to review the MPSC’s order under42 U.S.C. § 252(e)(6), the FTA provision limiting federaljudicial review of state commission orders approving orrejecting final interconnection agreements, because theNo. 98-1851GTE North, Inc. v. Strand, et al.23where the agency rule or action giving rise to the controversy is final andnot contingent upon future uncertainties or intervening agency action.Ibid. The hardship prong concerns the extent of the burden imposed onthe petitioner who would be compelled to act under threat of enforcementof the challenged law.See id. at 153.In this case, the district court must decide whether the ripenessinquiry demands that one of GTE’s competitors actually request access atthe tariff rate before deciding the case, or whether the order itself givesrise to a justiciable claim because it imposes an immediate obligation onGTE to sell network elements at predetermined rates.by affirming state commissions’ statutory role and rejectingan unduly expansive interpretation of § 252(e)(6) that wouldpermit state regulatory authorities to insulate from federalreview orders alleged to be contrary to, or preempted by,federal law.22GTE North, Inc. v. Strand, et al.No. 98-18517To determine whether a claim is ripe for decision, the reviewingcourt must consider both the “fitness of the issues for judicial decisionand the hardship to the parties of withholding court consideration.”Abbott Laboratories v. Gardner, 387 U.S. 136, 149 (1967),overruled onother grounds byCalifano v. Sanders, 430 U.S. 99 (1977). A case is “fitfor judicial decision” where the issues raised are purely legal ones andestablished in the February 25 order against GTE. Thechallenged order was the productnotof § 252 proceedings,but of proceedings initiated by the MPSC under Michiganlaw, and as such may be independently enforced by theMichigan courts. The district court therefore erred inconcluding that § 252(e)(6) provides an adequate opportunityfor deferred review under eitherCalifanoorThunder Basin.It is presumably because § 252(e)(6) does not provide GTEwith an adequate assurance of federal review that the MPSCdoes not seriously defend on appeal the district court’sconclusion that §252(e)(6) satisfiesThunder Basinbecause itdefers, but does not preclude, federal review. Rather, theMPSC argues that “there is neither a need nor a requirementfor the federal District Court to review [the February 25order]” because that order is fully reviewable in Michiganstate court. Although this argument may be relevant to thequestion whether the district court should abstain fromdeciding GTE’s claims at this time,seeRomine v.CompuServe Corp., 160 F.3d 337, 340–41 (6th Cir. 1998), itis wholly irrelevant to the question whether the court hasjurisdiction to hear GTE’s federal preemption challenges to astate commission order entered in a non-FTA proceeding.In upholding jurisdiction over GTE’s claims under § 1331,we emphasize that it is precisely because state utilitycommissions play such a critical role in administering theFTA’s regulatory framework that they must operate strictlywithin the confines of the statute. We therefore REVERSEthe district court’s ruling, uphold its jurisdiction under§ 1331, and remand the case for determination on the meritsif and when the district court finds GTE’s claims ripe forreview.7In so doing, we hope to further the goals of the FTANo. 98-1851GTE North, Inc. v. Strand, et al.3challenged directive was merely an interlocutory order.See42 U.S.C. § 252(e)(6) (1996). GTE timely appealed thedistrict court’s decision to this court.Based on the language and legislative history of§ 252(e)(6), we conclude that the limitations on federalreview set forth in that provision do not apply in this case, andthat the district court has general federal question jurisdictionunder 28 U.S.C. § 1331 to hear GTE’s challenge to theFebruary order.IBefore addressing the basis for the district court’sjurisdiction over GTE’s claims, it is necessary briefly todescribe the administrative context in which the MPSC issuedthe challenged order. In the spring of 1996, AT&T and Sprintattempted to negotiate an interconnection agreement withGTE pursuant to § 251 of the FTA. Congress passed the Actin 1996 in an effort to promote competition in local telephonemarkets by ending regulated monopolies previously enjoyedby incumbent local exchange carriers (LECs) such as GTE.Before Congress enacted the FTA, state public utilitycommissions regulated local telecommunications markets bygranting companies that incurred the expense of establishinglocal networks the exclusive right to provide service in theareas covered by their systems. In exchange for this privilege,LECs allowed the state commissions to regulate local servicerates. The FTA altered this practice and addressed theunderlying problem of anti-competitive localtelecommunications markets in two ways: it preempted statecommissions’ authority to grant service monopolies, andobligated incumbent LECs to provide competitors withnetwork access.Although the FTA circumscribes state commissions’ powerto regulate local markets, it does not exclude statecommissions from the FTA approval process. To thecontrary, it invests them with authority to approve or rejectinterconnection agreements negotiated in accordance with theAct, which requires LECs to permit rival carriers to: (1)4GTE North, Inc. v. Strand, et al.No. 98-1851utilize the LEC’s network and facilities; (2) purchaseunbundled network elements from the LEC; and (3) purchaseat wholesale rates any telecommunications service that theLEC provides at retail to subscribers who are nottelecommunications carriers.See47 U.S.C. §251(c)(2)-(4)(1996);see also id. § 252 (establishing procedures fornegotiation, arbitration, and approval of interconnectionagreements). To facilitate new competitors’ entry into localmarkets, the FTA outlines specific procedures that LECs andnew market entrants must follow in negotiating, arbitrating,and approving interconnection agreements.See generallyid.§252 (1996). LECs and their competitors may negotiateinterconnection agreements voluntarily, through mediation, orthrough compulsory arbitration before a state utilitycommission.Seeid.§ 252(a)-(b) (1996). When a finalagreement is reached, the telecommunications orpublic utilitycommission for the state in which the LEC is located mustapprove or reject the agreement.Seeid.§ 252(e) (1996).Once a state commission rules on a proposed agreement,Section 252(e)(6), the FTA provision at issue in this case,authorizes any aggrieved party to “bring an action in anappropriate Federal district court to determine whether theagreement . . . meets the requirements of section 251.”Id.§ 252(e)(6) (1996). If a state commission fails to approve orreject a proposed agreement within a certain time – 30 daysfrom the date of submission if the agreement resulted fromcompulsory arbitration, or 90 days from the date submitted ifthe agreement resulted from voluntary negotiation ormediation – the Federal Communications Commission (FCC)may preempt the state commission’s jurisdiction and rule onthe validity of the agreement.Seeid.§ 252(e)(4) - (5) (1996).In this case, AT&T and Sprint petitioned the MPSC forcompulsory arbitration under § 252 when the negotiationsthey began with GTE in 1996 did not produce an agreement.In March 1997, before a final agreement was reached, GTEfiled a complaint in federal district court alleging that an orderissued by the MPSC on January 15, 1997, concerning GTE’sinterconnection obligations to Sprint and AT&T violated theNo. 98-1851GTE North, Inc. v. Strand, et al.216GTE was prudent to sue the Michigan commissioners underEx parte Youngbecause it is virtually certain that a state utilitycommission’s decision to accept regulatory authority under the FTAcannot legitimately be construed as a valid waiver of sovereign immunity.The Supreme Court’s recent decisions inCollege Savings Bank v. FloridaPrepaid Postsecondary Education Expense Bd., 119 S. Ct. 2199, andFlorida Prepaid Postsecondary Education Expense Bd. v. CollegeSavings Bank, 119 S. Ct. 2219 (1999),undermine earlier circuit courtdecisions holding that the Eleventh Amendment does not bar suits againststate utility commissions because such commissions constructively waivetheir immunity from suit by participating in the regulatory schemeestablished by the FTA.See, e.g.,MCI Telecommunications Corp. v.Illinois Commerce Comm’n, 183 F.3d 567,567-68 (7th Cir.1999)(granting a petition for rehearing and directing the parties to filesupplemental briefs on the impact that the Supreme Court’s decisions inAlden v. Maine, 119 S. Ct. 2240 (1999), and theCollege Savings Bankcases had on the court’s earlier decision).It is precisely because the waiver doctrine no longer provides areliable basis for seeking relief against state commissions that wedisagreed inMichigan Bell Telephone Co. v. Climax Telephone Co., 202F.3d 862 (6th Cir. 2000), with the Seventh Circuit’s decision inMCIandpremised our conclusion that the plaintiff could proceed with its suitagainst the MPSC solely onEx parte Young, rather than waiver, grounds.to prospective injunctive relief, waiting to decide this caseuntil the Commission approves a final agreementincorporating the challenged terms may well deny GTE atimely and adequate remedy by precluding recovery for harmsustained while the order was in effect.6For the foregoing reasons, abstention is not warranted inthis case.IVIn holding that GTE’s claims fell within the purview of§ 252(e)(6), the district court effectively denied GTE anyassurance of federal review because under § 252(e)(6), federalreview is wholly contingent on a state commission’s decisionto approve or reject a final interconnection agreementincorporating the terms of any challenged order, an event thatneed not occur for a competitor to enforce the tariffs20GTE North, Inc. v. Strand, et al.No. 98-1851the rule that only exceptional circumstances justify[abstention]”). Because the MPSC’s February order cannotbe described as “judicial” in nature,Youngerdoes not requirethis court to abstain from ruling on the merits of GTE’sclaims.See id. at 371 (holding that a “judicial inquiryinvestigates, declares and enforces liabilities as they stand onpresent or past facts and under laws supposed already toexist,” and concluding that the “establishment of a rate is themaking of a rule for the future, and therefore is an actlegislative and not judicial in kind”). Indeed,Youngerabstention would be especially inappropriate in this casebecause the Michigan Court of Appeals has alreadyconsidered and rejected the merits of GTE’s challenge to theMPSC’s 1997 orders.SeeGTE North, Inc. v. MPSC, No.198324 (unpublished opinion, December 30, 1997) (affirmingover GTE’s objection the rates established in the MPSC’sorder in case U-10860 and affirming the MPSC’s directive toconduct the cost study proceedings that gave rise to thedispute in this case).Finally, the district court is not required to abstain fromdeciding this case under the Johnson Act, which prohibitsfederal courts from enjoining compliance with state ordersaffecting rates charged by a public utility only when, amongother things, “[j]urisdiction is based solely on diversity ofcitizenship or repugnance of the order to the FederalConstitution.” 28 U.S.C. § 1342 (1994). The Johnson Actdoes not require abstention in this case because jurisdictionover GTE’s claims is based on alleged violations of its rightsunder the FTA.In addition to the fact that the requirements for abstentionestablished by the Supreme Court are not satisfied in thiscase, abstention is not warranted here because waiting toreview the propriety of the February 25 order until it isincorporated into a final arbitration agreement will deny GTEa timely and adequate remedy at law. GTE, whose suitagainst the MPSC is based onEx parte Young, 209 U.S. 123(1908), cannot recover damages for injuries sustained underthe challenged order. BecauseYounglimits GTE’s recoveryNo. 98-1851GTE North, Inc. v. Strand, et al.5FTA. The district court dismissed GTE’s complaint, holdingthat it did not have subject matter jurisdiction to review thechallenged order because it was not an order approving orrejecting a final interconnection agreement.SeeGTE Northv. Strand, No. 5:97-CV-20 (W.D. Mich. June 2, 1997) (citing47 U.S.C. § 252(e)(6)).Then, while arbitration proceedings between GTE, Sprint,and AT&T were still pending, the MPSC initiated unrelatedstate law proceedings against GTE and other incumbent LECsin order to establish terms of interconnection to Michiganlocal exchange networks generally. These proceedingsconcerned GTE as an LEC, but not specifically as a party tothe AT&T and Sprint arbitration. In connection with thesegeneral interconnection proceedings, the MPSC required GTEand Ameritech, as Michigan LECs, to file with theCommission “Total Service Long Run Incremental Cost”(TSLRIC) studies for both regulated and non-regulatedtelecommunications services. In addition, the MPSC directedGTE to publish tariffs in which GTE would offer to sell itsnetwork elements and wholesale services to any interestedparty at rates predetermined by the Commission. GTEresponded to the Commission’s order by filing a petition forrehearing in which GTE challenged the MPSC’s rates forunbundled loops as confiscatory in violation of the FTA. TheMPSC denied GTE’s petition for rehearing, and GTEappealed the MPSC’s order to the Michigan Court ofAppeals. On December 30, 1997, the court affirmed theMSPC’s order, and the MPSC proceeded to use GTE’s andAmeritech’s TSLRIC studies to determine prices for newentrants’ access to bundled and unbundled network elementsand basic local exchange services throughout Michigan.On February 25, 1998, in the course of the stateproceedings against GTE and Ameritech, the MPSC issuedthe order contested in this appeal. In the February 25 order,the MPSC used GTE’s TSLRIC studies to establish the ratesat which GTE would be compelled to sell unbundled networkelements to its competitors. In addition, the order stated thatthe FTA requirement that GTE allow competitors to access6GTE North, Inc. v. Strand, et al.No. 98-1851pieces, or unbundled elements, of GTE’s local network didnot preclude GTE’s competitors from requesting access topre-assembled, fully operational local service platforms.Upon receiving the order, GTE sued the MPSC in the districtcourt, alleging that the Commission, acting pursuant toMichigan law, violated the FTA when it issued the February25 order: (1) directing GTE to provide competitors withaccess to pre-assembled, fully operational service platforms;and (2) requiring GTE to publish tariffs offering to sellelements of its network at rates predetermined by theCommission.In its motion for summary judgment, GTE argued that theCommission’s mandate directing GTE to provide competitorswith access to pre-assembled network platforms violated§ 251(c)(3) of the FTA because that provision requires LECsto provide competitors with access only to “unbundlednetwork elements.” 47 U.S.C. § 251(c)(3) (1996) (emphasisadded). According to GTE, Congress deliberately limitedincumbent LECs’ obligation to grant competitors networkaccess by requiring LECs to provide competitors only with“unbundled,” or separated, network elements that the newcarrier would have to assemble before it could provideservice.Ibid. In addition, GTE argued that the portion of theFebruary order directing it to offer pre-assembled platformsto all potential competitors violated the FTA because the Actspecifically states that only competitors whorequestunbundled access (“requesting carriers”) are entitled tonetwork access under § 251(c)(3), and then only afternegotiating individual interconnection agreements.Seeibid.GTE made a similar argument in challenging the MPSC’ssecond directive, which, according to GTE, violates the FTAbecause it requires LECs to publish tariffs offering to sellnetwork elements toallinterested competitors atpredetermined rates even though §§ 251 and 252 of the ActNo. 98-1851GTE North, Inc. v. Strand, et al.19Pullmanabstention is similarly inappropriate becausePullmanabstention is warranted only when a state law ischallenged and resolution by the state of certain questions ofstate law may obviate the federal claims, or when thechallenged law is susceptible of a construction by state courtsthat would eliminate the need to reach the federal question.See, e.g.,Babbit v. United Farm Workers National Union,442 U.S. 289, 306 (1979) (interpretingPullman). In this case,to abstain pending state review of GTE’s claims would beinappropriate because the dictates of the MichiganTelecommunications Act (pursuant to which the MPSCissued the challenged order) are clear and the MPSC hasalready considered GTE’s objections to the February 25 order,denied them, and denied GTE’s request for rehearing.Youngerabstention is also inappropriate. InYounger, theSupreme Court held that federal courts should abstain fromdeciding cases within their jurisdiction only when: (1) thereare ongoing state court proceedings; (2) those proceedingsinvolve important state interests; and (3) the parties have anadequate opportunity to raise constitutional issues in the stateproceedings.SeeGTE MobileNet of Ohio v. Johnson, 111F.3d 469, 481 (6th Cir. 1997). The MPSC contends that allthree conditions forYoungerabstention are met, andemphasizes that state proceedingsarecurrently ongoingdespite the Michigan courts’ rejection of GTE’s claimsbecause GTE has a right pursuant to Mich. Comp. Laws§ 462.26 to seek review of the Commission’s February 25order (and the Commission’s May 11, 1998, order denyingrehearing) in the Michigan Court of Appeals.That GTE has a right to appeal does not, however, satisfythe requirement that a federal court may abstain underYoungeronly if the parties are involved in ongoing stateproceedings. The Supreme Court held inNOPSIthat theavailability, or even the pendency, of state court review of a“legislative or executive action” does not justifyYoungerabstention.NOPSI, 491 U.S. at 368 (noting that requiringabstention in deference to state judicial proceedings reviewing“legislative or executive action” would “make a mockery of18GTE North, Inc. v. Strand, et al.No. 98-1851express an opinion on the merits of GTE’s claims, but not onthe grounds urged by the defendants. Although the Michigancourts have concurrent jurisdiction over GTE’s § 1983 andpreemption claims, we should decline to decide this case onlyif the requirements for abstention established inBurford v.Sun Oil Co., 319 U.S. 315 (1943),Younger v. Harris, 401U.S. 37 (1971), orRailroad Comm’n of Texas v. Pullman Co.,312 U.S. 496 (1941), are met, or if abstention is warrantedunder the Johnson Act, 28 U.S.C. § 1342 (1994).Burfordabstention is appropriate where “timely andadequate state-court review is available” and:(1) when there are difficult questions of state law bearingon policy problems of substantial public import whoseimportance transcends the result in the case then at bar;or(2) where the exercise of federal review of the questionin a case and in similar cases would be disruptive of stateefforts to establish a coherent policy with respect to amatter of substantial public concern.New Orleans Public Service, Inc. v. Council of the City ofNew Orleans, 491 U.S. 350, 361 (1989) (NOPSI). Althoughthe MPSC was arguably trying to establish a “coherentpolicy” concerning local interconnection rates, Michigan statelaw clearly authorizes the dictates in the Commission’sFebruary 25 order. Because Congress has invested the federalcourts with primary responsibility for adjudicating FTAchallenges to state telecommunications regulations, andbecause this case does not concern a disputed issue of statelaw, but rather a potential conflict between state and federaltelecommunications laws,Burfordabstention is inappropriate.See, e.g.,NOPSI, 491 U.S. at 361 (holdingBurfordabstentioninappropriate because the plaintiffs’ case did not “involve astate-law claim, nor even an assertion that the federal claimsare in any way entangled in a skein of state law that must beuntangled before the federal case can proceed”) (internalquotation marks and citation omitted).No. 98-1851GTE North, Inc. v. Strand, et al.71Although GTE claims that it will be disadvantaged if its competitorsare not required to negotiate individual terms of network access, any harmGTE may suffer on this score will arguably be temporary becauseuniversal subsidies are due to be phased out under the FTA.Cf.AT&TCorp. v. Iowa Utilities Bd., 119 S. Ct. 721, 737 (1999) (upholding an FCCrule that the plaintiffs said would “eviscerate the distinction betweenresale and unbundled access” and amount to “government-sanctionedarbitrage” on the grounds that the rule was consistent with the FTA, andnoting that, because “§ 254 requires that universal service subsidies bephased out, . . . whatever possibility of arbitrage remains will be onlytemporary”).The counter-argument is, of course, that even if the tariffingrequirement established in the February 25 order were struck down oncethe Commission approved an agreement incorporating the terms set forthin the tariffs, GTE could not recover damages for harm suffered in theinterim, nor could it “turn back the clock and recreate the atmosphere ofnegotiations that would have prevailed if [its competitors] had not beenoperating for months under tariffing arrangements.” Appellant’s Br. at24-25.specifically require competitors to negotiate individual termsof access with LECs.1See47 U.S.C. § 252(c)(2)-(3) (1996).Although GTE’s claims raise interesting questions aboutthe scope and applicability of certain provisions of the FTA,the district court did not address these arguments on themerits because it determined that it lacked jurisdiction under§ 252(e)(6) to review the MPSC’s February 25 order. In itsJuly 1998 ruling, the court dismissed GTE’s claims fordeclaratory and injunctive relief on the basis that § 252(e)(6)precludes federal review where a state commission has not yetissued a final order approving or rejecting an interconnectionagreement. GTE argues on appeal that the district court erredin dismissing the case for lack of subject matter jurisdictionbecause the district court had general jurisdiction under 28U.S.C. § 1331 to hear GTE’s claims. In deciding this appeal,we express no opinion on the merits of GTE’s claims anddetermine only whether the district court has jurisdiction toentertain GTE’s challenge to the February 25 order.8GTE North, Inc. v. Strand, et al.No. 98-1851IIThis court reviewsde novothe district court’s denial ofGTE’s motion for summary judgment.SeeGreene v. Reeves,80 F.3d 1101, 1104 (6th Cir. 1996). We also reviewde novothe district court’s decision to dismiss GTE’s complaint forlack of subject matter jurisdiction.SeeAnderson v. LibertyLobby Inc., 477 U.S. 242, 249, 252 (1986);MussonTheatrical, Inc. v. Federal Express Corp., 89 F.3d 1244, 1248(6th Cir. 1996). Lack of subject matter jurisdiction is anaffirmative defense that a defendant may assert in a motion todismiss.SeeFed. R. Civ. P. 12(b)(1);In re DeLorean MotorCo., 991 F.2d 1236, 1240 (6th Cir. 1993) (emphasizing thatto survive a motion to dismiss, a complaint must contain“either direct or indirect allegations respecting all materialelements to sustain a recovery under some viable legaltheory”).The party opposing dismissal has the burden of provingsubject matter jurisdiction.SeeMoir v. Greater ClevelandReg’l Transit Auth., 895 F.2d 266, 269 (6th Cir. 1990).Specifically, the non-moving party must show that thecomplaint “alleges a claim under federal law, and that theclaim is ‘substantial.’”Musson Theatrical, Inc. v. FederalExpress Corp., 89 F.3d 1244, 1248 (6th Cir. 1996) (holdingthat a complaint is “substantial” unless “prior decisionsinescapably render [it] frivolous”). That is to say, the nonmoving party will survive the motion to dismiss by showing“any arguable basis in law” for the claims set forth in thecomplaint.Ibid. In conducting our review, we “construe thecomplaint in a light most favorable to the plaintiff, accept astrue all of plaintiff’s well-pleaded factual allegations, anddetermine whether the plaintiff can prove no set of factssupporting [his] claims that would entitle him to relief.”Ludwig v. Board of Trustees of Ferris State Univ., 123 F.3d404, 408 (6th Cir. 1997). We review for clear error anyfactual findings the district court made in deciding the motionto dismiss.SeeGafford v. General Elec. Co., 997 F.2d 150,161 (6th Cir. 1993).No. 98-1851GTE North, Inc. v. Strand, et al.175InIowa, the Supreme Court reversed the Eighth Circuit’s decisionvacating, as inconsistent with the private negotiation provisions of theFTA, the FCC’s “pick-and-choose” rule, which required incumbents tooffer network access to any potential competitor on the same termsenjoyed by earlier competitors who negotiated individual agreements withthe incumbent. The Eighth Circuit vacated the rule on the basis that itallowed late market entrants to obtain the benefits of previouscompetitors’ agreements without having to accept the trade-offs that theinitial competitors had to make in order to obtain favorable terms ofaccess.See id.at 738. In reversing the Eighth Circuit and upholding therule, the Supreme Court rejected the argument that the rule undercutincumbents’ bargaining power and contravened the purpose of thenegotiation provisions of the FTA, and affirmed the FCC’s authority topromulgate the rule on the basis that it tracked the language of a particularFTA provision (§ 252(i)) “almost exactly.”In the same opinion, the Supreme Court also reversed the EighthCircuit’s decision vacating FCC Rule 315(b), which prohibits incumbentLECs from separating already combined network elements before leasingthem to competitors under the “unbundled access” provisions of the FTA.The Eighth Circuit determined that the rule should be vacated because itrequired leased access to “bundled” elements, in violation of the FTA.The Supreme Court disagreed, finding that, although § 251(c)(3) directsincumbents to grant competitors access to “unbundled” elements that thecompetitors may then “combine” and thus “forbid[s] incumbents tosabotage network elements that are provided in discrete pieces,”§ 251(c)(3) “does not say, or even remotely imply, that elements must beprovided only in this fashion and never in combined form.”Iowa, 119 S.Ct. at 737. Noting that “§ 251(c)(3) is ambiguous on whether leasednetwork elements may or must be separated,” the Court concluded that theFCC’s rule, which effectively requires incumbents to lease “bundled”elements to competitors under certain circumstances, “is entirely rational”even though the rule “could allow entrants access to an entirepreassembled network.”Id. at 737–38.Court inAT&T Corp. v. Iowa Utilities Bd., 119 S. Ct. 721(1999).5IIIThe MPSC argues that, even if we have jurisdiction overGTE’s claims, it would be prudent for us to abstain fromruling on the merits of the case until the rates specified in theFebruary 25 order are incorporated into an interconnectionagreement approved by the Commission. We decline to16GTE North, Inc. v. Strand, et al.No. 98-1851preemption challenges to state commission orders issued innon-FTA proceedings.Indeed, to hold to the contrary would have enormousnegative implications: if only certain actions (final ordersapproving interconnection agreements) by state commissionsare reviewable in federal court, and if, as the district courtheld, § 252(e)(6) is the exclusive basis for judicial review ofstate commission actions that in any way relate tointerconnection agreements, state commissions may insulateregulatory requirements that violate the FTA from federal,and possibly even state, court review. This interpretation of§ 252(e)(6) conflicts with Congress’s decision to establishfederal procedures for negotiating interconnection rights andto concentrate judicial review of interconnection agreementsin the federal courts. It is also antithetical to the principle thatparties injured by a governmental entity’s failure to adhere tothe law may seek redress in the courts. Finally, denyingreview and forcing GTE either to violate the February 25order, or to comply with the general and immediateobligations imposed by the order in the hope that the orderwould one day be incorporated into a reviewable finalagreement, would undermine both the letter and spirit of theFTA.Section 252(e)(6) circumscribes federal review only ofcases born of § 252 proceedings. Because the MPSC’sFebruary 25 order was not the product of § 252 arbitration,but of an independent state law proceeding, § 252(e)(6) doesnot preclude jurisdiction over GTE’s claims. We thereforehold that federal review is available under § 1331 todetermine whether state commission orders violate federallaw except in cases in which the challenged regulatory actionis clearly an interlocutory order arising out of § 252proceedings. We confine our holding to the jurisdictionalquestion because it is for the district court to determine onremand whether the directives in the February 25 order violate§ 252 of the FTA as recently interpreted by the SupremeNo. 98-1851GTE North, Inc. v. Strand, et al.92Section 261 of the FTA provides that state commissions can imposetheir own rules “in fulfilling requirements of this part, if such regulationsare not inconsistent with the provisions of [the FTA].” 47 U.S.C. § 261(1996). State commissions may also impose additional requirements onLECs if such requirements “are necessary to further competition in theprovision of telephone exchange access, so long as the State’srequirements are not inconsistent with the [Federal Communication]Commission’s regulations to implement this part.”Id.§ 261 (b)-(c).3See47 U.S.C. §§ 251(a)(1),251(c)(1) (requiring incumbents andtheir competitors to negotiate in good faith the specific terms andconditions of interconnection agreements).Jurisdiction Over the Challenged OrderBased on the scope of the applicable statutory provisionsand the nature of the challenged order, we conclude that thedistrict court has general jurisdiction pursuant to 28 U.S.C.§ 1331 to hear GTE’s claims. Section 252(e)(6), whichprohibits federal review of interlocutory orders entered in thecourse of FTA proceedings, plainly does not preclude reviewof the February 25 order, which was entered in anindependent state law proceeding unrelated to theAT&T–Sprint arbitration. Moreover, even if one couldinterpret § 252(e)(6) to encompass GTE’s claims, to do sowould frustrate Congress’s intent by allowing statecommissions to insulate from federal review decisionsallegedly preempted by, or otherwise contrary to, federaltelecommunications law. We therefore reverse the districtcourt’s order dismissing GTE’s complaint, but express noopinion on whether the order directing GTE to sell preassembled platforms and other network elements atpredetermined rates is preempted by the FTA.2We similarlyexpress no opinion on whether the portion of the February 25order directing GTE to sell network elements to any interestedcompetitor at rates predetermined by the Commission ispreempted by the FTA requirement that competitors obtainaccess to local networks by negotiating individualinterconnection agreements.310GTE North, Inc. v. Strand, et al.No. 98-1851To survive a motion to dismiss based on lack of federalquestion jurisdiction, the non-moving party must show firstthat its claims arise under federal law and, second, that § 1331jurisdiction is not “preempted by a more specific statutoryprovision conferring exclusive jurisdiction elsewhere.”Connors v. Amax Coal Co., 858 F.2d 1226, 1229-30 (7th Cir.1988). GTE asserts that the district court has subject matterjurisdiction over its 42 U.S.C. § 1983 and federal preemptionclaims because: (1) such claims arise under the Constitutionand laws of the United States; and (2) the MPSC’sFebruary 25 order, which the parties agree was issuedpursuant to Michigan law, deprives GTE of its rights underthe FTA, thereby creating a cause of action for prospectiveinjunctive relief against the commissioners under 42 U.S.C.§ 1983 andEx parte Young, 209 U.S. 123 (1908). We agree.Because GTE’s claims arise under federal law, the districtcourt has jurisdiction under § 1331 to decide the case unlessGTE’s claims are subject to the limitations on federal reviewset forth in § 252(e)(6), which we conclude they are not.See47 U.S.C. § 252(e)(6) (1996);Shaw v. Delta Air Lines, Inc.,463 U.S. 85, 96 n.14 (1983) (holding that a plaintiff who“seeks injunctive relief from a state [or local] regulation onthe ground that such regulation is preempted by federal law. . . presents a federal question which the federal courts havejurisdiction under 28 U.S.C. § 1331 to resolve”). Federalquestion jurisdiction over GTE’s claims is not preempted bythe FTA because § 252(e)(6) only circumscribes federaljudicial review of interlocutory orders issued in FTA, not statelaw, proceedings.SeeConnors, 858 F.2d at 1229–30.The text and legislative history of the FTA make clear that§ 252(e)(6) is the exclusive basis for federal judicial reviewonly of orders entered in negotiation or arbitrationproceedings under § 252 of the Act. Section 252(e)(6)provides that, “[i]n any case in which a State commissionmakes a determinationunder this section, any party aggrievedby such determination may bring an action in an appropriatefederal district court to determine whether the agreement orstatement meets the requirements of section 251 of this titleNo. 98-1851GTE North, Inc. v. Strand, et al.15state courts to defer to the MPSC].”Id.at 654. Because aninterested buyer need not incorporate the terms of theFebruary 25 order into a final arbitration agreement to enforceGTE’s obligations under the order, § 252(e)(6) does notprovide an “adequate procedure” by which GTE may obtainreview of the MPSC’s directives. That GTE could contest thevalidity of the February 25 order in the course of defending astate court enforcement proceeding does not solve theproblem, because leaving resolution of GTE’s claims to thestate courts would clearly frustrate Congress’s goals under theFTA.See, e.g.,MFS Intelenet, 16 F. Supp. 2d. at 823–34(concluding that review of § 252 “as a whole” demonstratesthat “Congress has created a unique framework which, whileinviting state commissions to arbitrate and approveinterconnection agreements, retains exclusive jurisdictionwithin the federal courts to ensure that those agreements meetfederal requirements”).The district court has subject matter jurisdiction under§ 1331 to review federal preemption claims.SeeBibbo v.Dean Witter Reynolds, Inc.,151 F.3d 559 (6th Cir. 1998).The question in this case is simply whether § 252(e)(6)diveststhe district court of its jurisdiction over GTE’spreemption claims because the February 25 order, thoughitself a product of state law proceedings, establishes rates thatmight one day be incorporated into final arbitrationagreements approved by the MPSC. There is no evidence thatCongress intended § 252(e)(6), which grants federal courtsexclusive jurisdiction to review for FTA compliance statecommission orders approving or rejecting interconnectionagreements, to preclude federal review of state law orders thatpermit telecommunications carriers to circumvent theprocedures prescribed in the FTA for negotiating networkaccess. We recognize, of course, that the significance of thechallenged order’s state law origins has engendered legitimatedebate among the parties and in the district court. However,absent clear evidence that Congress intended to allow statecommissions to issue orders that may be enforced withoutbeing incorporated into final interconnection agreements, wewill not construe § 252(e)(6) to preclude federal review of14GTE North, Inc. v. Strand, et al.No. 98-1851agreement was so strong as to eliminate the contingency andvirtually guarantee judicial review.We disagree, and find that in this case § 252(e)(6) cannotbe relied upon to provide adequate federal review becausethere is a chance, regardless how small, that GTE’scompetitors may obtain service from GTE on the terms setforth in the February 25 orderwithout ever executinga finalagreement. Indeed, we think the appropriate inquiry is notwhether, in the court’s estimation, it is more likely than notthat the challenged order will be incorporated into areviewable agreement, but whether there is any possibility atall that an LEC’s competitors could enforce the terms of thechallenged order by means other than those prescribed in theFTA. If there is such a chance, § 252(e)(6) does not providethe party challenging the order with adequate review underCalifano, and the federal district courts have generaljurisdiction to review the order under 28 U.S.C. § 1331.Under Michigan law, a buyer interested in purchasingnetwork elements from GTE at the rates established in theFebruary order need not execute a final interconnectionagreement with GTE to enforce the tariff; it need only petitiona state court for an injunction enforcing the terms of the tariffagainst GTE.See, e.g.,Rinaldo’s Construction Corp. v.Michigan Bell Telephone Co., 559 N.W.2d 647, 653–54(Mich. 1997). InRinaldo’s, the Michigan Supreme Courtheld:[W]here a plaintiff seeks relief against a telephonecompany in a [state] court of general jurisdiction, underValentine [v. Michigan Bell, 199 N.W.2d 182 (Mich.1972)], the court may entertain (1) a cause of action intort, or (2)a claim that the telephone company hasviolated the regulatory code or tariffs.Id.at 653–54 (emphasis added). As the Michigan SupremeCourt went on to explain, “[c]auses of action in tort and thosecauses of action alleging that a telephone company hasviolated the tariffs or code are not cases in which the rationaleunderlying the doctrine of primary jurisdiction [requires theNo. 98-1851GTE North, Inc. v. Strand, et al.114InStrand, the district court noted that an MPSC order is a“determination” subject to federal review under section 252(e)(6) only ifthe order approves or rejects a final interconnection agreement.SeeStrand, 1997 WL 811422, at *2 (quotingGTE South v. Morrison, 957 F.Supp. 800, 804 (E.D. Va. 1997)).and this section.” 47 U.S.C. § 252(e)(6) (1996) (emphasisadded). Because the MPSC initiated the state lawproceedings that resulted in the challenged order independentof the procedures prescribed in the FTA, § 252(e)(6) does notlimit federal judicial review of the February 25 order, and theMPSC’s failure, thus far, to incorporate the terms of the orderin a final decision approving or rejecting an interconnectionagreement does not bar review of GTE’s claims.In holding that GTE’s suit was premature because theMPSC had yet to issue a final order reviewable under§ 252(e)(6), the district court relied heavily on its priordecision inGTE North v. Strand, No. 5:97CV01, 1997 WL811422 (W.D. Mich.),4and in so doing failed to recognize thelegal significance of the February 25 order’s state law origins.As the district court implicitly acknowledged inMichiganBell Telephone Co. v. MFS Intelenet of Michigan, Inc., 16 F.Supp. 2d 817, 823 (W.D. Mich. 1998),Strandstands for thelimited proposition that federal district courts have “nojurisdiction to review MPSC decisions arisingduring the§ 252 processuntil after [an] interconnection agreement ha[s]become final by way of commission approval or rejection.”Ibid. (citing cases) (emphasis added). The court inMFSthusdistinguishedStrandand upheld jurisdiction over theplaintiff’s challenge to an MPSC order interpreting (ratherthan approving or rejecting) an existing interconnectionagreement.See id.at 823-24;cf.Michigan Bell Telephone v.Strand, 26 F. Supp. 2d 993, 999 (W.D. Mich. 1998)(emphasizing the “Congressionally assigned role of thedistrict courts in preventing violations of theTelecommunications Act flowing from enforcement decisionsor other decisions inconsistent with existing interconnectionagreements”). In this case, as inMFS, the challenged orderdid not arise “during the § 252 process,” and is therefore not12GTE North, Inc. v. Strand, et al.No. 98-1851subject to the reasoning inStrandor the many other casescited by the lower court in which district judges have refusedto review interlocutory orders issued by state commissions inthe course of § 252 arbitrations.Id.at 823.Although the order at issue in this case is clearlydistinguishable from an interlocutory order entered in a § 252proceeding, the commissioners urge us to overlook the order’sstate law origins because the order establishes rates that theparties agree will likely be incorporated in a final agreementsubject to review under § 252(e)(6). Were we to adopt thisapproach, we would simply equate the February 25 order withan interlocutory order in a § 252 proceeding that GTE couldnot challenge in federal court until the Commission issued afinal decision approving or rejecting an agreementincorporating the terms of the order. Recharacterizing theFebruary 25 order in this manner appears consistent with theFTA if one reads § 252(e)(6) broadly to govern not onlyclaims that a state utility commission erred in approving afinal agreement negotiated under § 252, but also claims thatthe commission violated the FTA by approving an agreementthat was not the product of a § 252 proceeding. Although thisconstruction of § 252(e)(6) is superficially appealing, wecannot adopt this approach and assume that GTE wouldeventually be able to seek federal review of the challengedorder because any approach that equates a decision arising outof independent state law proceedings with an interlocutoryorder in a § 252 arbitration ignores the critical fact that theformer may be enforced against the parties even if it isneverincorporated in a final interconnection agreement.At first blush, § 252(e)(6) seems to guarantee adequate,albeit deferred, judicial review of the Commission’sFebruary 25 order.See, e.g.,Thunder Basin Coal v. Reich,510 U.S. 200 (1994) (holding that a statutory provision thatplaces temporal restrictions on a party’s ability to bring anaction in federal court still provides adequate opportunity forreview and therefore satisfies due process). As the districtcourt noted in its opinion, the parties agree that the ratesestablished in the Commission’s February 25 order will likelyNo. 98-1851GTE North, Inc. v. Strand, et al.13be incorporated into a final arbitration agreement. Standingalone, this admission appears to undercut GTE’s argumentthat the district court has jurisdiction over its claims under§ 1331. Indeed, when combined with the Commission’sassertion that it has been prevented from ruling on anagreement incorporating the challenged terms because GTEhas not made certain filings, the parties’ admission virtuallyguarantees that, if GTE were to execute an agreement, eitherthe MPSC or the FCC would approve or reject the terms ofthe challenged order, at which point GTE could seek federalreview under § 252(e)(6).See47 U.S.C. § 252(e)(1) (1996)(stating that a state commission “shall” approve or reject“any” interconnection agreement between an incumbent anda requesting carrier, whether the agreement is the product ofvoluntary negotiation or binding arbitration before the statecommission). The problem with this logic, and the reason§ 252(e)(6) does not provide for adequate review of thechallenged order underCalifano v. Sanders, 430 U.S. 99, 108(1977), or even underThunder Basin, 510 U.S. 200 (1994), isthat an interested buyer could enforce the tariffs establishedin the February order in the Michigan courts without everexecuting a final interconnection agreement with GTE.In determining whether the lower court has jurisdictionover GTE’s claims despite the limitations in § 252(e)(6), thiscourt must look “not only [to] the particular statutorylanguage, but to the design of the [FTA] as a whole and to itsobject and policy.”Crandon v. United States, 494 U.S. 152,158 (1990). Citing the Supreme Court’s decision inCalifano,the district court correctly observed that, “[w]here Congresshas provided an adequate procedure to obtain review of anagency determination, alternative bases for jurisdiction areinapplicable.”Califano, 430 U.S. at 108. The district courtnoted in its opinion that confining federal review of GTE’sclaims to the circumstances outlined in § 252(e)(6) mighttheoretically deprive GTE of “adequate” review underCalifanobecause such review would be contingent upon theMPSC’s approval of a final agreement incorporating theFebruary 25 order. However, the court found that theprobability that the order would be incorporated into a final