PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 13-1765

CORETEL VIRGINIA, LLC,

Plaintiff – Appellant,

v.

VERIZON VIRGINIA, LLC; VERIZON SOUTH, INC.; MCIMETRO ACCESS 

TRANSMISSION SERVICES, LLC; MCI COMMUNICATIONS SERVICES, 

INC.; VERIZON BUSINESS GLOBAL LLC; BELL ATLANTIC 

COMMUNICATIONS, INC., d/b/a Verizon Long Distance,

Defendants – Appellees.

Appeal from the United States District Court for the Eastern 

District of Virginia, at Alexandria. Claude M. Hilton, Senior 

District Judge. (1:12-cv-00741-CMH-TCB)

Argued: January 30, 2014 Decided: May 13, 2014

Before WILKINSON, NIEMEYER, and DUNCAN, Circuit Judges.

Affirmed in part, reversed in part, and remanded with 

instructions by published opinion. Judge Duncan wrote the 

opinion, in which Judge Wilkinson joined. Judge Niemeyer wrote 

an opinion concurring in part and dissenting in part.

ARGUED: Edward Jay Tolchin, OFFIT KURMAN, P.C., Tysons Corner, 

Virginia, for Appellant. Scott H. Angstreich, KELLOGG, HUBER, 

HANSEN, TODD, EVANS & FIGEL, P.L.L.C., Washington, D.C., for 

Appellees. ON BRIEF: Andrew M. Hetherington, KELLOGG, HUBER,
2

HANSEN, TODD, EVANS & FIGEL, P.L.L.C., Washington, D.C., for 

Appellees.
3

DUNCAN, Circuit Judge:

Two telecommunications carriers, CoreTel Virginia, LLC and 

Verizon Virginia, LLC, dispute their respective responsibilities 

under their interconnection agreement (“ICA”), a contract which 

governs how the carriers connect their networks and exchange 

data. Each party contends that the other improperly billed it 

for various services. The district court granted summary 

judgment in Verizon’s favor on each claim. For the reasons that 

follow, we vacate the district court’s decision with respect to 

Verizon’s facilities claims, but affirm as to the others.

Ironically, in pursuit of its preferred result, the dissent 

does exactly what it accuses the majority of doing. As we 

explain in greater detail below, the dissent interprets the ICA 

as the dissent imagines it should have been written, and not as 

it was. With no textual support, and in contravention of the 

cardinal rule that a contract must be interpreted as a whole, 

giving effect to all its terms, the dissent elevates § 11 to an 

isolated and independent status, renders superfluous the only 

provision that specifically deals with interconnection, and 

altogether ignores § 2.1, which explicitly provides that 

headings are to have no substantive effect on the agreement’s 

meaning.
4

I.

The CoreTel/Verizon ICA1 at issue here is a private contract

that implements duties imposed by the Telecommunications Act of 

1996, Pub. L. 104–104, 110 Stat. 56, codified at 47 U.S.C. § 151 

et seq. We therefore begin with a brief discussion of the 

relevant provisions of the Telecommunications Act and the key 

provisions of the parties’ ICA before turning to the procedural 

history before us.

A.

The Telecommunications Act seeks to foster competition in 

the telecommunications market by reducing the competitive 

advantages enjoyed by the telecommunications carriers, known as 

“incumbent carriers,” that enjoyed a monopoly in the market at 

the time the statute was enacted. The Act requires incumbent 

carriers to share their physical networks with new market 

entrants, known as “competing carriers,” to mitigate the 

prohibitive cost of building a new network. This appeal 

implicates two of the duties imposed on incumbent carriers under 

47 U.S.C. § 251.

First, § 251(c)(3) allows a competing carrier to lease 

components of an incumbent carrier’s physical network for any 

 1 There are actually two Verizon/CoreTel ICAs. Because they 

are identical in every term relevant here, we will treat them as 

a single ICA.
5

purpose if an incumbent’s failure to provide these elements

would impair the competing carrier’s ability to provide 

services. 47 U.S.C. §§ 251(c)(3), 251(d)(2)(B). An incumbent 

carrier must provide these network elements at cost-based rates, 

known as “TELRIC,” as opposed to higher tariff rates.2 47 U.S.C.

§§ 251(c)(3), 252(d)(1); 47 C.F.R. § 51.505(b) (2010); see also 

Implementation of the Local Competition Provisions in the 

Telecommunications Act of 1996 [“Local Competition Order”], 11 

F.C.C. 15499, ¶ 29 (1996). These network elements also must be 

“unbundled,” meaning that they must be offered individually, and 

not only as part of a broader package of services. 47 U.S.C. § 

251(c)(3); Talk Am., Inc. v. Mich. Bell Tel. Co., 131 S. Ct. 

2254, 2258 (2011); Local Competition Order, 11 F.C.C. 15499,

¶ 27.

Second, § 251(c)(2) promotes interconnection, the physical 

link between two telecommunications networks that allows each 

carrier’s customers to call the other’s. The FCC has 

interpreted § 251(c)(2) to require, among other things, that an 

incumbent carrier lease a competing carrier “entrance 

 2 Carriers generally may only charge rates under tariffs 

filed with state and federal regulatory agencies but, in certain 

cases the Telecommunications Act requires a carrier to charge an 

even lower, TELRIC rate. See Verizon Commc'ns, Inc. v. FCC., 

535 U.S. 467, 478, 489 (2002); AT&T Commc'ns of Va., Inc. v. 

Bell Atl.-Va., Inc., 197 F.3d 663, 674 (4th Cir. 1999).
6

facilities” required for interconnection at TELRIC.3 See

Unbundled Access to Network Elements [“Remand Order”], 20 F.C.C. 

2533, ¶ 140 (2005); Review of the Section 251 Unbundling 

Obligations of Incumbent Local Exch. Carriers [“Triennial Review 

Order”], 18 F.C.C. 16978, ¶ 366 (2003); see also Talk Am., 131 

S. Ct. at 2261.

Until 2003, the FCC had also interpreted § 251(c)(3) to 

require incumbent carriers to provide all entrance facilities at 

TELRIC. However, the FCC reversed course in its Triennial 

Review Order and Remand Order. It concluded that because

“entrance facilities are less costly to build, are more widely 

available from alternative providers, and have greater revenue 

potential,” an incumbent carrier’s failure to provide access to 

these facilities would not impair the viability of competing 

carriers. Remand Order, 20 F.C.C. 2533, ¶ 138, 141 (2005).4 The 

 3 An “entrance facility” is the physical infrastructure, 

such as wires or cables, typically used to connect one network 

with another (“interconnection”) or to transport data to and 

from equipment that a carrier has installed on another carrier’s 

premises (“backhauling”). Talk Am., 131 S. Ct. at 2258–59. 

Backhauling “occurs when a competitive [carrier] uses an 

entrance facility to transport traffic from a leased portion of 

an incumbent network to the competitor’s own facilities. 

Backhauling does not involve the exchange of traffic between 

incumbent and competitive networks.” Id. at 2259 n.2.

4 The FCC initially concluded, in the Triennial Review 

Order, that entrance facilities are not covered by § 251(c)(3) 

because they are not “network elements.” 18 F.C.C. 16978, ¶ 

366. Competitive carriers challenged this interpretation, and 

(Continued)
7

FCC determined, therefore, that incumbent carriers need not 

provide entrance facilities on an unbundled basis at TELRIC 

rates under § 251(c)(3). Id. at ¶ 137.

Significantly, however, the FCC did not alter incumbent 

carriers’ duties under § 251(c)(2), the provision that 

specifically governs interconnection. Id. at ¶ 140. Therefore, 

while an incumbent carrier no longer has a general obligation to 

provide entrance facilities at TELRIC under § 251(c)(3), it 

remains obligated to provide entrance facilities at TELRIC when 

they are used for interconnection under § 251(c)(2). See Talk 

Am., 131 S. Ct. at 2264-65; Remand Order, 20 F.C.C. 1533, ¶ 140; 

Triennial Review Order, 18 F.C.C. 16978, ¶¶ 365, 366.

B.

With this regulatory framework in mind, we now turn to the 

ICA between Verizon, an incumbent carrier, and CoreTel, a 

competing carrier. A close examination of the ICA is necessary 

because the § 251 duties discussed above are not directly 

enforceable. See 47 U.S.C. §§ 251(c)(1), 252(a)(1). Instead, 

these duties only apply if they are incorporated into an ICA. 

See Core Commc’ns, Inc. v. SBC Commc’ns Inc., 18 F.C.C. 7568, ¶ 

 

the United States Court of Appeals for the District of Columbia 

Circuit remanded the matter to the FCC, observing that “the 

Commission's reasoning appears to have little or no footing in 

the statutory definition.” U.S. Telecom Ass'n v. FCC, 359 F.3d 

554, 586 (D.C. Cir. 2004). In response, the FCC promulgated the 

Remand Order. 20 F.C.C. 2533, ¶ 4.
8

32 (2003), vacated on other grounds by SBC Commc’ns Inc. v. FCC, 

407 F.3d 1223 (D.C. Cir. 2005).

The interplay between the ICA and the relevant statutory 

provisions is further complicated by the fact that the 

Verizon/CoreTel ICA is an adoption of an existing ICA under 47 

U.S.C. § 252(i). Because the original ICA took effect before 

the FCC reinterpreted § 251(c)(3) in its Triennial Review Order

and Remand Order, the adoption agreement that accompanies the 

CoreTel/Verizon ICA contains a provision meant to clarify 

Verizon’s duties in light of the changed regulatory backdrop. 

See ICA Adoption Agreement § 1.B, J.A. 366. Section 1.B of the 

adoption agreement provides that, “adoption of the [ICA] does 

not include adoption of any provision imposing an unbundling 

obligation on Verizon that no longer applies to Verizon under 

[the Triennial Review Order and Remand Order].” J.A. 366.

To aid in our analysis, we will discuss four provisions of 

the ICA. Section 4 addresses interconnection, § 11 addresses 

the leasing of network elements, § 5.7 sets out a compensation 

regime for local cross-network calls, and Exhibit A lists the 

rates that apply to the agreement. We now address each briefly 

in turn.

ICA § 4, “Interconnection and Physical Architecture,” 

addresses the physical interconnection of the parties’ two 

networks. J.A. 216. This section provides that CoreTel may 
9

specify one of three physical methods to connect with Verizon at 

an agreed-upon interconnection point. ICA § 4.3.1, J.A. 218.

One of the methods allows CoreTel to lease an entrance facility

from Verizon.5 Id. CoreTel may request any of the listed 

interconnection methods at the “rates and charges, set forth in 

this Agreement, in any applicable Tariff(s), or as may be 

subsequently agreed to between the parties.” ICA § 4.3.3, J.A. 

218. The ICA provides Verizon analogous rights to interconnect 

with CoreTel. ICA § 4.3.4, J.A. 218.

ICA § 11, “Unbundled Access,” enumerates the network 

elements, including entrance facilities, that Verizon will 

provide to CoreTel on an unbundled basis. J.A. 240–66. This

section primarily consists of a detailed list of network 

elements, expressed in highly technical terms, and the 

parameters under which they may be ordered.6 Id.

ICA § 5.7, “Reciprocal Compensation and other Intercarrier 

Compensation Arrangements,” provides a distinct billing regime 

 5 The other options allow CoreTel to interconnect through 

“collocation”--that is, by installing its equipment inside of 

Verizon’s facility. ICA § 4.3.1, J.A. 218. One option allows 

CoreTel to use its own collocated equipment, and the other 

allows CoreTel to use a third-party’s collocated equipment. Id.

6 ICA § 11 does not, for example, contain a listing for 

“entrance facilities.” Instead, it lists the various, specific 

types of physical wires and cables that Verizon is to make

available, such as “2-Wire HDSL Compatible Loop” or “4-Wire DS1-

compatible Loop.” ICA §§ 11.3.5, 11.3.7, J.A. 243.
10

for local calls originating within Verizon’s network and 

terminating within CoreTel’s network (i.e., local calls from 

Verizon customers to CoreTel customers), and vice versa. J.A. 

222. These calls are billed per minute of usage as “reciprocal 

compensation” by the recipient carrier. See ICA §§ 1.60, 1.60a, 

5.7.1, J.A. 212, 222–23; ICA Exhibit A §§ A.I, B.I, J.A. 322, 

353.

Finally, ICA Exhibit A lists TELRIC rates for various 

network elements and includes rates for leasing entrance 

facilities under the heading “Unbundled Transport.” ICA Exhibit 

A § A.II.C, J.A. 324. It also includes rates for reciprocal 

compensation. ICA Exhibit A §§ A.I, B.I, J.A. 322, 353.

C.

Soon after the parties agreed to their ICA, a dispute arose 

regarding the rates CoreTel is required to pay for 

interconnection entrance facilities. Verizon insisted that 

CoreTel pay tariff rates and CoreTel refused. This dispute 

continued until 2012 when Verizon finally threatened to 

terminate CoreTel’s service. CoreTel brought suit seeking to 

enjoin Verizon’s threatened service termination. Verizon filed 

various counterclaims, and CoreTel amended its complaint to add 

still more claims. The district court ultimately divided these 

claims and counterclaims into four broad categories: (1) 

Verizon’s facilities claims relating to its bills to CoreTel for 
11

the entrance facilities CoreTel leased; (2) CoreTel’s facilities 

claims relating to its bills to Verizon for the entrance 

facilities that CoreTel contends Verizon leased; (3) Verizon’s 

reciprocal compensation claims; and (4) Verizon’s claims that 

CoreTel improperly billed it for services under CoreTel’s 

tariffs.

The district court granted summary judgment in Verizon’s 

favor on each issue, but on liability only. It reserved the 

question of damages for trial. The parties then jointly moved 

for a final judgment reflecting “the stipulated damages that are 

required by [the district court’s summary judgment] ruling” to 

expedite an appeal. Joint Motion, J.A. 1500. The district 

court entered the agreed-to final judgment, and this appeal 

followed.

II.

Each of the issues discussed below was resolved on motions 

for summary judgment. Accordingly, we review each under the 

same familiar standard:

We review the district court’s order granting summary 

judgment de novo, viewing the facts in the light most 

favorable to, and drawing all reasonable inferences in 

favor of, the nonmoving party. Summary judgment is 

appropriate when there are no genuine issues of 

material fact and the moving party is entitled to 

judgment as a matter of law. 
12

Garofolo v. Donald B. Heslep Assocs., Inc., 405 F.3d 194, 198-99 

(4th Cir. 2005) (internal citations omitted).

While we must draw all reasonable inferences in the light 

most favorable to the nonmoving party, it is ultimately the 

nonmovant’s burden to persuade us that there is indeed a dispute 

of material fact. Thompson v. Potomac Elec. Power Co., 312 F.3d 

645, 649 (4th Cir. 2002). It must provide more than a scintilla 

of evidence--and not merely conclusory allegations or 

speculation--upon which a jury could properly find in its favor. 

Id.

Like any other contract, “[w]e interpret [an ICA] as 

written and, when its terms are clear and unambiguous, we 

construe the contract according to its plain meaning.” Cent. 

Tel. Co. of Va. v. Sprint Commc'ns Co. of Va., Inc., 715 F.3d 

501, 517 (4th Cir. 2013) (internal quotation marks and citation 

omitted). Because an ICA is a private agreement on the one 

hand, and an instrument of federal regulation on the other, we 

are guided in our interpretation by both contract law and 

relevant federal precedent. Id. at 517 n.20. When “[t]he

contractual duty at issue . . . is a duty imposed by the Act 

itself . . . the resolution of a claim regarding the scope of 

that statutory duty . . . depends on the interpretation and 

application of federal law.” Core Commc'ns, Inc. v. Verizon Md.

LLC, ___ F.3d ____, 2014 WL 868618 (4th Cir. Mar. 6, 2014).
13

III.

On appeal, CoreTel challenges the district court’s grant of 

summary judgment in Verizon’s favor on all claims. For clarity, 

we adopt the district court’s categorization of the claims, and

address each category in turn.

A.

We first address Verizon’s claims relating to the 

applicable rates for entrance facilities. Verizon contends that

§ 1.B of the Adoption Agreement eliminated its obligation under 

the ICA to provide entrance facilities at TELRIC for any 

purpose. As a result, Verizon has billed CoreTel for its 

interconnection entrance facilities at tariff rates since the 

adoption of the ICA. CoreTel has refused to pay those rates, 

maintaining that the ICA permits it to pay the lower TELRIC

rates.

We agree with the dissent that this is, ultimately, a 

contract dispute and, as with any contract, we interpret the ICA 

according to its terms. But the dissent ignores both the 

"cardinal principle of contract construction . . . that a 

document should be read to give effect to all its provisions," 

Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 63 

(1995), and the fundamental rule that, when the written terms of 

an agreement are clear, evidence of the parties' intent "is 
14

utterly inadmissible." Moran v. Prather, 90 U.S. 492, 501

(1874).

As discussed above, ICA § 4.3 is the only provision of the 

ICA that deals specifically with interconnection. Within that 

section, § 4.3.1 authorizes CoreTel to order “an Entrance 

Facility . . . leased from Verizon” for interconnection. J.A. 

218. ICA § 4.3.3 then provides that CoreTel may order this 

entrance facility at the “rates and charges, set forth in this 

Agreement, in any applicable Tariff(s), or as may be 

subsequently agreed to between the parties.” Id. Exhibit A of 

the ICA lists, in turn, the schedule of rates for various 

network elements and services, including TELRIC rates for 

entrance facilities. ICA Exhibit A § A.II.C, J.A. 324. Though 

Verizon contends otherwise, the most natural reading of these 

provisions is that the TELRIC rates listed at Exhibit A § 

A.II.C. are the “rates and charges, set forth in this Agreement”

referred to in ICA § 4.3.3.

Verizon advances an alternative interpretation of the ICA.

ICA § 4.3, it contends, does not give rise to any independent 

obligation to make entrance facilities available at TELRIC but, 

instead, simply indicates that entrance facilities may be leased 

under § 11 for interconnection. In Verizon’s view, § 1.B of the 

adoption agreement eliminates its obligation under § 11 to 

provide entrance facilities at TELRIC for any purpose. It 
15

contends that entrance facilities are therefore unavailable at 

those rates under § 4.3.

Simply put, no provision of the ICA indicates that § 4.3

relies upon § 11 in the way Verizon suggests. As explained

above, ICA § 4.3 imposes an obligation on Verizon, independent 

of § 11, to offer entrance facilities at the TELRIC rates listed 

in Exhibit A.7

 Therefore we need not consider the impact of 

§ 1.B of the Adoption Agreement on the services available under 

§ 11. Section 1.B of the Adoption Agreement does not affect our 

analysis of ICA § 4.3 because Verizon’s duties under ICA § 4.3

arise under the specific interconnection provisions of 47 U.S.C. 

§ 251(c)(2). These duties were unaltered by the Triennial 

Review Order and the Remand Order, the FCC orders incorporated 

by the Adoption Agreement.

We further note that our conclusion in no way renders the 

entrance facility provisions of ICA § 11 superfluous. ICA § 11 

permitted CoreTel to purchase entrance facilities for purposes 

not addressed by ICA § 4.3, such as backhauling. See Talk Am., 

131 S. Ct. at 2259.

 7 Verizon suggests that, because rates for entrance 

facilities are listed in Exhibit A only under the heading 

“Unbundled Transport,” they are available only to entrance 

facilities ordered under § 11, “Unbundled Access.” J.A. 240, 

322. The ICA, however, specifically provides that headings “are 

not intended to be a part of or to affect the meaning” of the 

agreement. ICA § 2.1, J.A. 214-15.
16

Verizon’s and the dissent’s arguments based on the ICA 

drafters’ intent are similarly unavailing. Verizon argues, and 

the dissent accepts, that the drafters of the ICA would never 

have suspected that 47 U.S.C. § 251(c)(2) imposed a duty, 

independent of § 251(c)(3), to provide entrance facilities for 

interconnection at TELRIC because the FCC first explicitly 

articulated that obligation after the ICA was drafted, in the 

Triennial Review Order. Thus, Verizon argues, there is no 

reason to think the drafters intended to write such an 

obligation into the ICA. 

This contention fails for at least two fundamental reasons. 

First, like any contract, an ICA is interpreted according to its 

written terms. Cent. Tel. Co. of Va., 715 F.3d at 517. If a 

contract’s language is clear, we may not choose to supplement it 

with evidence of the drafters’ intent. See Moran, 90 U.S. at

501. As explained above, we find the language of the ICA 

sufficiently clear to establish that Verizon must offer entrance 

facilities at TELRIC for interconnection, without resort to the 

intent of its drafters.

Second, we find Verizon’s speculation about the drafters’ 

subjective views unpersuasive. Contrary to Verizon’s and the 

dissent’s contentions, there are indications that the drafters 

of the ICA regarded § 251(c)(2) as imposing an independent duty 

to provide entrance facilities for interconnection at cost-based 
17

rates. The most obvious indication is the very existence of § 

4.3. This section would have been curiously redundant if § 

251(c)(3) and ICA § 11 already required that entrance facilities 

be provided at cost-based rates for interconnection but § 

251(c)(2) did not. Moreover, this obligation flows clearly from 

the text of the Telecommunications Act itself and longstanding 

FCC regulations. Section 251(c)(2) requires incumbent carriers 

to provide interconnection at “any technically feasible point 

within the carrier’s network,” and the FCC had long interpreted 

“the carrier’s network” to include its entrance facilities. See

Talk Am., 131 S. Ct. at 2261; Local Competition Order, 11 F.C.C. 

15499, ¶ 26. Therefore, “[s]ince the enactment of the 1996 Act, 

the FCC has consistently construed [47 U.S.C. 251(c)(2)] to mean 

that an incumbent may be required to provide facilities to a 

competitor in order to link the two carriers’ networks.” Brief 

for the United States as Amicus Curiae Supporting Petitioners at 

22, Talk Am., Inc. v. Mich. Bell Tel. Co., 131 S.Ct. 2254 (2011) 

(Nos. 10-313, 10-329).

We therefore conclude that the CoreTel/Verizon ICA entitles 

CoreTel to order entrance facilities for interconnection at 

TELRIC.8

 Accordingly, CoreTel was entitled to summary judgment 

 8 We are perplexed by the comfort taken by the dissent in 

distinguishing entrance facilities as such from interconnection 

(Continued)
18

in its favor on both its and Verizon’s claims for declaratory 

relief relating to Verizon’s facilities charges. We remand to 

the district court for consideration of CoreTel’s claim for 

injunctive relief and Verizon’s damages claim in light of this 

conclusion.

B.

We next turn to CoreTel’s facilities claims. After CoreTel 

initiated this case, CoreTel submitted 42 new bills--totaling 

more than $1.7 million--to Verizon for facilities charges 

beginning in 2009. These charges, CoreTel contends, are for 

trunk ports and multiplexers9 used to handle calls delivered by 

Verizon to CoreTel. CoreTel concedes that Verizon provided its 

own means of reaching CoreTel’s switch. But it contends that 

the ports and multiplexers that it provided on its side of the 

interconnection point qualify as entrance facilities and, 

 

as a “service,” as though the ICA did not specifically link the 

two by allowing CoreTel to interconnect via entrance facilities.

9 A trunk port is a physical port in a switch. See, e.g., 

Access Charge Reform for Incumbent Local Exch. Carriers Subject 

to Rate-of-Return Regulation, 13 F.C.C. 14238, ¶ 49 (1998). A 

switch is “[t]he critical piece of telephone network equipment 

that . . . connect[s] a call from any customer’s line to any 

other customer’s line.” Stuart M. Benjamin et al.,

Telecommunications law and Policy 952 (3d ed. 2012). 

Multiplexers encode multiple calls so that they may be 

transmitted on the same wire (and the reverse: extracting a 

single call from the encoded stream of multiple multiplexed 

calls). See, e.g., Worldcom, 17 F.C.C. 27039, ¶ 228 (2002).
19

accordingly, may be billed to Verizon under ICA §§ 1.25 and

4.3.5.10

We agree with Verizon that the multiplexing and trunk ports 

at issue are not entrance facilities under the ICA. ICA § 4.3.5 

therefore provides no basis for CoreTel’s facilities charges.

As it is defined in the ICA, an “entrance facility” is a 

facility connecting and, crucially, lying “between” the 

interconnecting carrier’s premises and the other party’s central 

office. ICA § 1.25, J.A. 208. But the trunk ports and 

multiplexers CoreTel provided lay within CoreTel’s central 

office, not “between” CoreTel’s central office and Verizon’s 

premises. Thus, Verizon’s facilities, not CoreTel’s, spanned 

the distance between Verizon’s premises and CoreTel’s central 

office. Accordingly, the facilities CoreTel provided were not 

entrance facilities under ICA § 1.25.11

CoreTel also contends that it was entitled to bill Verizon 

for its use of these facilities because they were “necessary” to 

 10 CoreTel supports its claim with documents that, it 

contends, reflect orders from Verizon for these facilities. As 

we explain below, CoreTel was not entitled to bill Verizon for 

these facilities regardless of whether Verizon submitted orders 

for them.

11 There is no merit to CoreTel’s related contention that 

Verizon breached the ICA by failing to order an entrance 

facility. The ICA does not require Verizon to order an entrance 

facility for interconnection but merely provides that it has the 

“sole right and discretion” to do so. ICA § 4.3.4, J.A. 208.
20

the use of Verizon’s self-provisioned facilities. But CoreTel 

points to no provision of the ICA that authorizes CoreTel to 

simply levy facilities charges for any piece of equipment that 

handles Verizon’s traffic. Instead, the ICA provides that 

CoreTel is to be compensated for the use of these facilities, on 

its side of the interconnection point, exclusively under the 

rubric of reciprocal compensation.

We therefore affirm the district court’s grant of summary 

judgment on CoreTel’s facilities claims.

C.

We next address Verizon’s reciprocal compensation claims. 

As discussed above, when a local call is generated on one 

party’s network and terminates on the other network, the party 

on whose network the call terminates may bill the originating 

party for reciprocal compensation. See ICA §§ 1.60, 1.60a, 

5.7.1, J.A. 212, 222–23. However, the ICA exempts two 

categories of traffic from this scheme: “third-party traffic” 

and “interLATA traffic.”12 See ICA § 5.7.2(a)-(c), J.A. 223.

 12 “Third-party traffic” is traffic originated by a third 

carrier, not a party to the ICA, and merely delivered to the 

terminating party by way of the other party’s network. See ICA 

§ 5.2.1(a)-(b), J.A. 223. Thus, if there were a third carrier, 

Carrier X that also interconnected with Verizon’s network, 

Carrier X’s customers might be able to call CoreTel’s customers 

by way of Verizon’s network. Such calls would constitute thirdparty traffic with respect to Verizon and CoreTel. “InterLATA 

traffic” is traffic generated outside the local calling area, 

(Continued)
21

Verizon claims that CoreTel violated these provisions by 

charging it reciprocal compensation for third-party and 

interLATA calls. CoreTel does not contest this allegation.

Instead, CoreTel argues that Verizon should have to pay 

reciprocal compensation charges for a call when it does not 

provide “EMI data” for it, data CoreTel claims is needed to 

properly categorize every call.

However, neither the ICA nor the FCC order on which CoreTel 

seeks to rely, Cavalier Telephone LLC, 18 F.C.C. 25887 (2003), 

support this conclusion. Simply put, there is no provision of

the ICA that requires Verizon to provide EMI data for every call 

delivered over the trunk at issue. In addition, Cavalier 

Telephone is not controlling. Cavalier Telephone was an 

arbitration order under 47 U.S.C. § 252(e)(5) relating to a 

separate interconnection agreement between Verizon and Cavalier 

Telephone. It required only that a provision be inserted into 

that particular ICA regarding Verizon’s duty to provide EMI data

to Cavalier Telephone, not that all carriers provide EMI data 

independent of the terms of their ICAs. See Id. ¶ 40. Adopting 

CoreTel’s argument would frustrate the regulatory approach 

articulated by the FCC in its Core Commc'ns order by allowing 

 

commonly known as “long distance calls.” See SBC Commc'ns Inc. 

v. FCC, 138 F.3d 410, 412 n.1 (D.C. Cir. 1998).
22

carriers to enforce § 251 duties not embodied in their own ICAs. 

See Core Commc'ns, Inc., 18 F.C.C. 7568, ¶ 32.13

We therefore affirm the district court’s grant of summary 

judgment in Verizon’s favor on CoreTel’s reciprocal compensation 

claims.

D.

We now address Verizon’s claims that CoreTel improperly 

billed it for services under its tariffs. Verizon contends that 

it is entitled to recoup, under the filed-rate doctrine, amounts 

that it paid to CoreTel for “end-office switched access” because 

the description of that service in CoreTel’s tariff was 

inaccurate.14 The filed-rate doctrine requires that, to charge 

for services under a tariff, a carrier must provide its services 

in exactly the way the carrier describes them in that tariff. 

Bryan v. BellSouth Commc'ns, Inc., 377 F.3d 424, 429 (4th Cir. 

2004); Brown v. MCI WorldCom Network Servs., Inc., 277 F.3d 

1166, 1170 (9th Cir. 2002).15

 13 We conclude that CoreTel’s remaining arguments relate 

only to damages and are foreclosed by the parties’ stipulated 

judgment. See J.A. 1518–19.

14 Neither party makes clear which switched-access rate 

category CoreTel applied in levying the contested charges. See

FCC Tariff No. 3, § 3.3, J.A. 474; Va. SCC Tariff No. 3,

§ 3.3, J.A. 555. The parties appear to agree, however, that 

“end-office switching” is the relevant category. See Br. at 54, 

Op. Br. at 52-53.

15 The parties provide no authority to establish that 

Virginia applies the filed-rate doctrine to its state tariffs.

(Continued)
23

CoreTel’s state and federal tariffs provide that CoreTel’s 

end-office switching service will include “terminations in the 

end office of end user lines.” FCC Tariff No. 3, § 3.3.2, J.A. 

474; Va. SCC Tariff No. 3, § 3.3.1(C), J.A. 555. The FCC has 

held that this tariff language carries a specific and 

established meaning: “a physical transmission facility that 

provides a point-to-point connection between a customer premises 

and a telephone company office.” AT&T Corp. v. YMax Comm. Corp.

[“YMax”], 26 F.C.C. 5742, ¶ 40 (2011). To provide “terminations 

in the end office of end user lines,” a carrier must “provide . 

. . physical transmission facilities that establish point-topoint connections between the premises of Called/Calling Parties 

and [the carrier’s] equipment.” YMax, 26 F.C.C. 5742, ¶ 37, 

41.

The undisputed evidence establishes that CoreTel does not 

provide the physical infrastructure over which calls are 

delivered from CoreTel’s premises to its customers. Instead, as 

in YMax, CoreTel converts incoming calls into a data stream once 

they reach its office and then delivers these calls to its 

customers over the public internet. See YMax, 26 F.C.C. 5742, ¶ 

41; J.A. 390(K), (Q)-(R), (T)-(W). This evidence makes clear 

 

CoreTel, however, does not contend otherwise. We therefore 

conclude that CoreTel has waived this argument and proceed with 

our analysis assuming, without deciding, that Virginia does 

indeed follow the filed-rate doctrine.
24

that CoreTel has not deployed its own physical facilities to 

connect it to its customers and, accordingly, does not provide 

“terminations in the end office of end user lines” as required 

by its tariffs.

It is no mere technicality that the language of CoreTel’s 

tariff requires that CoreTel itself provide the facilities. 

End-office switching charges are among the highest recurring 

charges in any carrier’s tariff, a price that is ordinarily 

justified by the need “to allow local exchange carriers to 

recover the substantial investment required to construct the 

tangible connections between themselves and their customers 

throughout their service territory.” YMax, 26 F.C.C., 5742, ¶ 

40. A carrier that finds a way to deliver incoming calls to its 

customers without building physical connections to each of them 

has far less infrastructure investment to recoup.

CoreTel argues in the alternative that its tariffs, unlike 

those in YMax, explicitly permit it to charge for “switchedaccess service” provided using IP technology. See FCC Tariff 

No. 3, § 1, J.A. 433. But this language only appears in 

CoreTel’s general definition of switched-access service. Id. 

The language interpreted in Ymax, discussed above, appears in 

CoreTel’s more specific definition of the particular type of 

switched access service at issue, end-office switched access. 

Id. at § 3.3.2, J.A. 474. The specific governs the general. 
25

See RadLAX Gateway Hotel, LLC v. Amalgamated Bank, 132 S. Ct. 

2065, 2071 (2012). The language of CoreTel’s end-office 

switching service does not permit that specific tariff rate to 

be applied when CoreTel delivers calls to customers over the 

public Internet rather than using a physical facility owed by 

CoreTel.16

We therefore affirm the district court’s grant of summary 

judgment in Verizon’s favor on Verizon’s switched-access claims.

IV.

For the reasons above, the judgment of the district court 

is 

AFFIRMED IN PART, REVERSED IN PART,

AND REMANDED WITH INSTRUCTIONS.

 16 Contrary to CoreTel‘s contention, a subsequent FCC 

regulation that incorporates this sort of IP-based termination 

into a definition of “switched exchange access services” does 

not alter our interpretation of CoreTel’s tariff. See 47 C.F.R. 

§ 61.26(a)(3)(ii) (2012). This regulation merely defines the 

term for the purposes of determining what tariffs will be 

subject to regulation as switched-access tariffs. It does not 

mandate a definition of “switched access” as the term is used in 

a switched-access tariffs, much less one that vitiates the 

descriptions of narrower switched-access rate categories.
26

NIEMEYER, Circuit Judge, concurring in part and dissenting in 

part:

This is a straightforward contract dispute between two 

telecommunications companies, CoreTel and Verizon, over the fees 

each agreed to pay the other in interconnecting their networks. 

When Verizon pressed CoreTel to pay over $880,000 in past-due 

amounts for “entrance facilities” that CoreTel leased from 

Verizon, CoreTel commenced this action.

While each party has disputed various amounts payable to 

the other, the principal dispute, on which I disagree with the 

majority, is whether CoreTel agreed to pay Verizon a tariff rate 

or a lower cost-based rate for lease of Verizon’s entrance 

facilities for the purpose of interconnection. Reading the 

contract as a whole and in context, I conclude that it clearly 

required CoreTel to pay tariff rates, as the district court also 

concluded.

I respectfully submit that the majority has rewritten this 

private agreement to bring it in line with what CoreTel might 

have been able to obtain through negotiations when it signed the 

contract, based on changing interpretations of the 

Telecommunications Act of 1996, which regulates such agreements. 

That is, it focuses on what CoreTel could have demanded under 

the law, not on what CoreTel actually agreed to accept when it 

executed the written contract. No one contends that the written 
27

contract was or is unenforceable or not in compliance with the 

Telecommunications Act. Indeed, the Telecommunications Act 

itself allows the parties to negotiate the rates and fees to be 

paid for connecting networks. See 47 U.S.C. § 252.

Thus, I would enforce the contract according to its terms 

and affirm the judgment of the district court.

I.

Verizon (referring collectively to Verizon Virginia LLC and 

Verizon South Inc.) is an incumbent local exchange carrier 

(“incumbent LEC”) that has been providing telephone exchange 

services throughout Virginia since before the enactment of the 

Telecommunications Act of 1996. In enacting that Act, Congress 

sought to introduce competition in the telecommunications market 

by lowering the barriers to entry for would-be competitors. To 

this end, the Act requires incumbent LECs to share their 

networks with any competitive local exchange carrier 

(“competitive LEC”) and allow the competitive LEC (1) to lease 

from the incumbent LEC unbundled network elements (i.e., “a la 

carte” network elements enabling the competitive LEC “to create 

its own network without having to build every element from 

scratch,” Talk Am., Inc. v. Mich. Bell Tel. Co., 131 S. Ct. 

2254, 2258 (2011)) and (2) to interconnect with the incumbent 

LEC’s network.
28

These obligations are codified in two statutory provisions. 

Section 251(c)(3) of the 1996 Act requires incumbent LECs to 

provide competitive LECs with “nondiscriminatory access to 

network elements on an unbundled basis.” 47 U.S.C. § 251(c)(3) 

(emphasis added). And, in a similar vein, § 251(c)(2) requires 

an incumbent LEC “to provide, for the facilities and equipment 

of any requesting telecommunications carrier, interconnection

with the local exchange carrier’s network . . . for the 

transmission and routing of telephone exchange service and 

exchange access.” Id. § 251(c)(2) (emphasis added). For such 

unbundled network elements and interconnection, the incumbent 

LEC may only charge “rates, terms, and conditions that are just, 

reasonable, and nondiscriminatory.” Id. §§ 251(c)(2)(D), 

251(c)(3). But the Telecommunications Act makes clear that 

those rates, terms, and conditions are subject to negotiation by 

the parties. See id. § 252(a).

CoreTel Virginia, LLC, is a competitive LEC that, like 

Verizon, serves customers in Virginia. When it requested 

unbundled network elements and interconnection from Verizon, the 

parties entered into an agreement on November 16, 2004 (“2004 

Adoption Agreement”), which adopted the terms and conditions of 

an earlier, 2002 arbitrated interconnection agreement between 

Verizon and Cox Virginia Telcom, Inc. (“2002 Interconnection 

Agreement”). The 2004 Adoption Agreement incorporated all the 
29

terms and conditions of the 2002 Interconnection Agreement with 

several modifications, including a modification that the 2004 

Adoption Agreement “[did] not include adoption of any provision 

[in the 2002 Interconnection Agreement] imposing an unbundling 

obligation on Verizon” because, as the 2004 Adoption Agreement 

explained, that obligation no longer applied to Verizon as a 

result of a 2003 FCC order, In re Review of Section 251 

Unbundling Obligations of Incumbent Local Exch. Carriers (“2003 

Triennial Order”), 18 FCC Rcd. 16978 (2003), and subsequent 

related decisions.

With respect to the “entrance facilities” that are at issue

in this case, the 2002 Interconnection Agreement authorized 

CoreTel to interconnect through, among other options, “an 

Entrance Facility . . . leased from Verizon . . . in accordance 

with . . . terms and conditions, including without limitation, 

rates and charges set forth [1] in this Agreement, [2] in any 

applicable Tariff(s), or [3] as may be subsequently agreed to 

between the Parties.” 2002 Interconnection Agreement, §§ 4.3.1, 

4.3.3. The “rates and charges set forth in this Agreement” were 

those described in Exhibit A, entitled “Detailed Schedule of 

Itemized Charges.” Exhibit A included a category of rates 

called “Unbundled Transport,” under which it specified rates for 

“Entrance Facilities,” as are at issue here. And the terms for 

unbundled transport were set forth in § 11 of the Agreement. 
30

The parties agree that Exhibit A’s rates and charges were costbased. Under the terms of the 2004 Adoption Agreement, however, 

Verizon’s unbundling obligations were eliminated, leading 

Verizon to bill CoreTel for entrance facilities not as unbundled 

elements under the cost-based rate in Exhibit A, but as entrance 

facilities under Verizon’s tariff rates.

Although Verizon thus billed CoreTel each month over the 

course of some eight years for entrance facilities at tariff 

rates, CoreTel maintained that it should only have been charged 

cost-based rates and refused even to pay those rates, making 

only a single payment of $591.95 in February 2006. By the time 

of this litigation, it had run up a bill of over $880,000, based 

on Verizon’s billings at tariff rates.

When Verizon sent CoreTel notice of default and threatened 

to terminate service, CoreTel commenced this action. While the 

parties have fought over various amounts owed, the main issue 

presented to us on appeal is whether the 2002 Interconnection 

Agreement, as modified by the 2004 Adoption Agreement, entitled 

CoreTel to pay only cost-based rates for entrance facilities for 

the purpose of interconnection instead of the tariff rates that 

Verizon billed.

The district court concluded that the 2002 Interconnection 

Agreement did not give CoreTel a right to lease entrance 

facilities for interconnection at cost-based rates, even though 
31

CoreTel could have insisted on such rates when the 2004 Adoption 

Agreement was executed. Despite this legal right, the district 

court noted that CoreTel was bound by the terms of the contract 

to which it actually agreed. The court thus entered judgment in 

favor of Verizon.

II.

Based on the contract as written, I agree with the district 

court and conclude that CoreTel was required to pay tariff rates 

for entrance facilities, as Verizon billed it.

The structure of the obligations between the parties is 

readily apparent from the agreement taken as a whole. Section 

4.3.1 of the 2002 Interconnection Agreement authorized CoreTel 

to specify any of three different methods by which to connect 

with Verizon’s network, including through “an Entrance 

Facility.” And § 4.3.3 provided that the rates and charges for 

such facilities were as (1) “set forth in this Agreement,” (2) 

“set forth . . . in any applicable Tariff(s),” or (3) “as may be 

subsequently agreed to between the Parties.” But critically, §

4.3.3 did not directly refer to any rates. In fact, the only 

rates for entrance facilities actually “set forth in the 

Agreement,” were referenced in § 11, which governed only

unbundled access. Section 11 addressed “interoffice 

transmission facilities” and provided that “Verizon shall 
32

provide [CoreTel] with dedicated local transport, common local 

transport in conjunction with unbundled local switching, 

unbundled interoffice transmission facilities, and other 

services in accordance with Exhibit A.” 2002 Interconnection 

Agreement, § 11.6 (emphasis added). And part II of Exhibit A 

listed cost-based rates for unbundled elements, including a 

cost-based rate for “Entrance Facilities.” Id. Exhibit A, part 

II.C. No other part of Exhibit A mentioned entrance facilities; 

they were listed only under “Unbundled Transport.”

In short, the 2002 Interconnection Agreement provided that 

entrance facilities were to be billed either at tariff rates or, 

if leased as unbundled elements, at cost-based rates as set 

forth in Exhibit A. Those rates were the only “rates and 

charges” “set forth” in the 2002 Interconnection Agreement. 

Thus, under the 2002 Agreement, if charges for entrance 

facilities were not payable in accordance with Exhibit A, they 

were only payable at tariff rates.

The 2002 Interconnection Agreement’s provisions allowing 

for purchase of unbundled network elements at cost-based rates 

were, at the time (in 2002), necessitated by 47 U.S.C. §

251(c)(3), which required Verizon, as an incumbent LEC, to 

provide any requesting competitive LEC, such as CoreTel, 

unbundled network elements at a reasonable, nondiscriminatory 

rate. And that rate was established by the FCC, in interpreting 
33

§ 251(c)(3), to be its cost-based TELRIC rate (standing for 

Total Element Long-Run Incremental Costs) -- a rate “based on 

the hypothetical construction and operation of the most 

efficient local network conceivable.” GTE South, Inc. v. 

Morrison, 199 F.3d 733, 747 (4th Cir. 1999).

After the 2002 Interconnection Agreement was executed, 

however, the law regarding § 251(c)(3)’s unbundling requirements 

changed. The FCC, in its 2003 Triennial Order, interpreted §

251(c)(3) not to require incumbents to provide competitive LECs 

with entrance facilities as unbundled network elements at costbased rates. Instead, the FCC concluded that entrance 

facilities must be provided at cost-based rates only for the 

limited purpose of interconnection: 

We conclude that our previous definition [of § 

251(c)(3)] was overly broad. As we explain in this 

Part, competitive LECs often use transmission links 

including unbundled transport connecting incumbent 

LEC switches or wire centers in order to carry traffic 

to and from its end users. . . . Unlike the 

facilities that incumbent LECs explicitly must make 

available for section 251(c)(2) interconnection, we 

find that the Act does not require incumbent LECs to 

unbundle transmission facilities connecting incumbent 

LEC networks to competitive LEC networks for the 

purpose of backhauling traffic.

In reaching this determination we note that, to the 

extent that requesting carriers need facilities in 

order to interconnect with the [incumbent LEC’s] 

network, section 251(c)(2) of the Act expressly 

provides for this and we do not alter the Commission’s 

interpretation of this obligation.
34

2003 Triennial Order, 18 FCC Rcd. ¶ 365, at 17203-04 

(alterations in original) (emphasis added) (footnotes omitted) 

(internal quotation marks omitted). The Supreme Court has since 

embraced that Order, stating that entrance facilities must be 

leased at cost-based rates for the purpose of interconnection 

only. See Talk America, 131 S. Ct. at 2258-60.

The parties were aware of these developments when they 

contracted in 2004. Accordingly, they included a provision 

eliminating any unbundling obligation in their 2004 Adoption 

Agreement:

For avoidance of doubt, adoption of the Terms does not 

include adoption of any provision imposing an 

unbundling obligation on Verizon that no longer 

applies to Verizon under the [2003 Triennial Order and 

related case law].

2004 Adoption Agreement, § 1.B. It is incontrovertible that, by 

reason of that language, CoreTel was not entitled to lease 

entrance facilities as unbundled network elements pursuant to §

251(c)(3). Indeed, CoreTel notes in its briefing that it “never 

ordered [an unbundled network element], period.” And with the 

elimination of the unbundling obligation, the rates for 

unbundled elements were rendered inapplicable, including the 

rate for “Entrance Facilities.”

But CoreTel contends that the 2002 Interconnection 

Agreement nonetheless required that Verizon provide entrance 

facilities under § 251(c)(2) at the cost-based rates in Exhibit 
35

A. It argues, and the majority accepts, that § 4.3.3 of the 

2002 Interconnection Agreement explicitly provided for 

“interconnection” at the rates “set forth in this Agreement” and 

that those rates were the cost-based rates provided in Exhibit 

A, even though the rates in Exhibit A were specifically for 

unbundled elements. Under CoreTel’s view, § 4.3.3 did not 

specify whether Verizon had to provide interconnection via 

leases of entrance facilities as unbundled elements under §

251(c)(3) (its right to which was abrogated under the 2004 

Adoption Agreement) or for purposes of interconnection only, as 

under § 251(c)(2). Thus, it argues, its rights to purchase 

entrance facilities for interconnection were not affected by the 

2004 Adoption Agreement, which only eliminated Verizon’s 

unbundling obligation under § 251(c)(3).

This argument, however, ignores both the explicit language 

of the 2002 Interconnection Agreement and the 2004 Adoption 

Agreement, as well as the underlying litigation that led to the 

2002 Agreement. As pointed out above, the only rates expressly 

provided for entrance facilities in the 2002 Interconnection 

Agreement were rates for unbundled facilities. And when 

Verizon’s unbundling obligation was eliminated, so too were the 

corresponding rates for unbundled elements. Thus, the only 

other rates available for entrance facilities were tariff rates.
36

Just as indicative of this point is the history of the 

litigation leading to the 2002 Interconnection Agreement. That 

Agreement, as well as similar agreements involving Verizon, was 

created as a result of an FCC arbitration order. In re 

Worldcom, Inc., 17 FCC Rcd. 27039 (2002). And paragraphs 210 

through 217 of that order described the dispute between Verizon 

and Cox (as well as other competitive LECs) as to 

“Interconnection Transport,” with the competitive LECs asserting 

that such interconnection had to be provided at unbundled 

network rates, and Verizon arguing that Cox and the other 

competitive LECs had to “purchase ‘entrance facilities and 

transport for interconnection’ from its access tariffs.” Id.

¶ 210, at 27142 (emphasis added). These paragraphs of the FCC 

order described the provision of interconnection exclusively in 

the context of the purchase of unbundled elements pursuant to § 

251(c)(3). See id. ¶ 215 & n.716, at 27144. Nowhere in this 

discussion was there any reference to Cox or the other 

competitive LECs having the right to purchase entrance 

facilities for the limited purpose of interconnection pursuant 

to § 251(c)(2). Entrance facilities were instead only discussed 

in the order as unbundled network elements. See id. ¶¶ 210-

217, at 27142-46.

The FCC’s reasoning, which is based exclusively on § 

251(c)(3), is clearly what gave rise to § 4.3.1 of the 2002 
37

Interconnection Agreement. The FCC order defined the proper 

rates at which Cox and other involved competitive LECs could 

“order ‘[e]ntrance [f]acilities and transport for 

[i]nterconnection.’” Id. ¶ 217, at 27145. This language is 

nearly identical to § 4.3.1 of the 2002 Interconnection 

Agreement, which allowed Cox to specify “an entrance facility 

and transport” as its interconnection method. Based on this, it 

is clear that § 4.3.3 of the 2002 Interconnection Agreement 

provided for the purchase of entrance facilities as unbundled 

network elements, and the obligation to provide unbundled 

network elements at cost-based rates was eventually removed from 

the contract through the 2004 Adoption Agreement.

This interpretation is also supported by Exhibit A itself. 

All of the cost-based rates in Exhibit A for “entrance 

facilities” were listed under the heading “Unbundled Transport.” 

Yet CoreTel now wants to apply those rates to the purchase of 

entrance facilities that it explicitly claims were not 

unbundled. It fails to recognize that Exhibit A’s rates for 

unbundled elements were removed from the Agreement through the 

2004 Adoption Agreement, and they were never applicable to 

entrance facilities except as an unbundled element. And absent 

any Exhibit A rate for entrance facilities, the only rates given 

by the 2002 Interconnection Agreement for entrance facilities 

were tariff rates. See 2002 Interconnection Agreement, § 4.3.3.
38

There is a reason why the 2002 Interconnection Agreement 

did not contain special rates for entrance facilities provided 

solely for interconnection. Before the FCC’s 2003 Triennial 

Order, the general understanding was that incumbent LECs had no 

obligation under § 251(c)(2) to provide entrance facilities at 

cost-based rates. That section was limited to 

“interconnection” -- a service, not a facility. Entrance 

facilities were always provided as unbundled network elements 

under § 251(c)(3). This was rational, as it allowed the 

competitive LECs the greatest flexibility in using the entrance 

facilities. This pre-2003 understanding of the law was 

explicitly affirmed by the FCC in its amicus brief in Talk 

America, to which the Supreme Court deferred as an agency 

interpretation. That brief stated:

The FCC’s interconnection rules, which were adopted in 

1996, do not expressly require incumbents to provide 

entrance facilities to satisfy their interconnection 

obligations under Section 251(c)(2). That is because, 

until 2003 -- when the FCC eliminated unbundled access 

to entrance facilities in the Triennial Review 

Order -- a competitive LEC typically would elect to 

order a cost-priced entrance facility under Section 

251(c)(3) since an unbundled network element can be 

used more expansively than the same facility provided 

solely for interconnection under Section 251(c)(2).

Only after the FCC eliminated access to entrance 

facilities as unbundled network elements did it have 

occasion to clarify, in the Triennial Review Order and 

the Triennial Review Remand Order, that Section 

251(c)(2) gives competitive LECs a right of access to 

such facilities for interconnection at cost-based 

rates.
39

Brief for the United States as Amicus Curiae Supporting 

Petitioners, at 22 n.6, Talk America, 131 S. Ct. 2254 (Nos. 10-

313, 10-329) (emphasis added) (citations omitted).

Thus, because § 251(c)(2) was never understood in 2002 to 

require the provision of entrance facilities, only 

“interconnection” as a service, the majority has no support for 

reading the 2002 Interconnection Agreement now to include such 

an obligation on Verizon. Instead, the drafting parties 

uniformly treated entrance facilities in the only way known at 

the time -- as unbundled elements to be provided under §

251(c)(3). And they included provisions in § 11.6 and Exhibit A 

allowing for the leasing of entrance facilities as such.

CoreTel points to § 27.1 of the 2002 Interconnection 

Agreement to suggest that Verizon’s obligations changed with the 

2003 Triennial Order. That paragraph provided:

Each Party shall remain in compliance with 

[a]pplicable . . . federal, state, and local laws, 

rules and regulations in the course of performing this 

Agreement. Each Party shall promptly notify the other 

Party in writing of any governmental action that 

suspends, cancels, withdraws, limits, or otherwise 

materially affects its ability to perform its 

obligations hereunder.

But CoreTel can point to no change in the law that “materially 

affect[ed]” either party’s “ability” to perform its obligations 

under the Agreement. The Telecommunications Act always provided 

that the rates to be paid to an incumbent LEC were subject to 
40

negotiation, even as the Act requires that any rates be 

reasonable and nondiscriminatory. See 47 U.S.C. § 252(a), (d). 

Moreover, CoreTel’s reading of § 27.1 cannot be squared with 

other provisions of the 2002 Interconnection Agreement. For 

example, § 27.3 -- which required the parties to negotiate in 

good faith to incorporate changes in the law -- would be 

rendered superfluous under CoreTel’s reading of § 27.1.

Finally, CoreTel argues that even if the 2002 

Interconnection Agreement did not explicitly allow for its 

leasing of entrance facilities at the cost-based rates listed in 

Exhibit A, the 2004 Adoption Agreement effectively incorporated 

the FCC’s 2003 Triennial Order into the contract to allow it to 

do so. This claim, however, finds no support in the language of 

the 2004 Adoption Agreement. That Agreement stated that it 

“does not include adoption of the provisions imposing an

unbundling obligation that no longer applies” after the 2003 

Triennial Order. This is a limitation on the terms of the 

contract, not an addition to it. If no § 251(c)(2) cost-based 

pricing duty can be found in the 2002 Interconnection Agreement, 

the 2004 Adoption Agreement does not add one. Indeed, it adds 

nothing at all. Rather, it strikes out the unbundling 

requirements in § 11 of the 2002 Interconnection Agreement 

because those provisions related to obligations that “no longer 
41

appl[ied]” following the 2003 Triennial Order, just as the 2004 

Adoption Agreement explicitly stated.

If CoreTel had wanted to change the terms of the 2002 

Interconnection Agreement as modified by the 2004 Adoption 

Agreement, it could have done so at any point under § 27.3. 

Indeed, it could have sought an entirely new Agreement with 

Verizon in 2004 rather than agreeing to adopt one that was 

drafted prior to the 2003 Triennial Order. But CoreTel did none 

of these things, and thus it is bound by the language of the 

2002 Interconnection Agreement as modified by the 2004 Adoption 

Agreement. See In re Core Commc’ns, Inc., 18 FCC Rcd. 7568, 

7582 § 32 (2003) (holding that a party to an Interconnection 

Agreement “cannot rely upon the general section 251 duties to 

circumvent the terms of its agreement”).

In sum, based on the language of the 2002 Interconnection 

Agreement and the 2004 Adoption Agreement, as well as the 

context of those Agreements, I cannot conclude that CoreTel is 

now entitled to pay only cost-based rates for its lease of 

entrance facilities for interconnection. Rather, as the 

Agreements provide, it is required to pay for those entrance 

facilities at tariff rates, the only other rate provided for in 

the Agreements.

I would accordingly affirm the judgment of the district 

court in all respects.