Opinion ID: 159803
Heading Depth: 3
Heading Rank: 3

Heading: Application of College Savings Bank

Text: 30 47 U.S.C.A. 252 invites states to participate in the federal government's regulation of local telephone service. Congress has clearly expressed its intention that if a state elects to approve or reject an interconnection agreement, then it waives its sovereign immunity. See 47 U.S.C.A. 252(e)(6) (In any case in which a State commission makes a determination under [ 252], any party aggrieved by such determination may bring an action in an appropriate Federal district court . . . .); see also id. 252(e)(4) (No State court shall have jurisdiction to review the action of a State commission in approving or rejecting an agreement under this section.). 5 Thus, 252 puts Utah on notice that Congress intends to subject it to suits brought by individuals if it acts under 252. See College Sav. Bank, 119 S. Ct. at 2228. College Savings Bank, however, makes it clear that Congress's intent to effect a waiver is insufficient, standing alone, to render a state's waiver altogether voluntary. Id. 31 Instead, Utah has voluntarily waived its immunity only if Congress, through the 1996 Act, threatened it with the denial of a gratuity, rather than the imposition of a sanction. Prior to 1996, the states were permitted to regulate local phone service. Indeed, the 1934 Act specifically left regulation of intrastate telephone services to the states. However, the 1996 Act preempted state regulatory authority over some aspects of local phone service. See AT&T Corp., 525 U.S. at 730 n.6 (stating that [w]ith regard to matters addressed by the 1996 Act, Congress unquestionably has taken the regulation of local telecommunications competition away from the States). Although it did not do so, Congress could have preempted all state regulation of local phone service. See FERC v. Mississippi, 456 U.S. 742, 764 (1982) ([T]he commerce power permits Congress to pre-empt the States entirely in the regulation of private utilities.); Hodel v. Virginia Surface Mining & Reclamation Ass'n, 452 U.S. 264, 290-91 (1981). 32 Thus, with the passage of the 1996 Act, Congress essentially transformed the regulation of local phone service from an otherwise permissible state activity into a federal gratuity. As in Petty and Dole, Congress was under no obligation to allow states to participate in the Act's regulatory scheme. Accordingly, by conditioning a state's ability to regulate local phone service on its consent to suit in federal court, Congress threatened the state with the denial of a gratuity rather than exclusion from an otherwise lawful activity. 6 We therefore hold that Utah voluntarily waived its sovereign immunity when the UPSC, through its commissioners, arbitrated the interconnection dispute in this case. 7 Defendants are subject to suit in federal court, and this case may proceed.