Dial Around Juggernaut - Page 6

Shortly after the per call compensation rate was finally pinned down, in 2001 the FCC attempted to overhaul the dial around compensation system by shifting the payphone compensation payment obligation from resale carriers to the initial underlying carriers in instances when more than one carrier handled the routing of a long distance call. The FCC was trying to answer cries from the many PSPs who complained that the honor system of carriers coming forward and paying the per call system wasn't working.

STRIKE 4. The FCC's "first carrier pays system" was short lived. The D.C. Circuit Court of Appeals vacated the FCC's overhauled system based on an administrative technicality - the FCC failed to seek public comment before issuing the new rule. Sprint Corporation, et al. v. FCC, 315 F.3d 369 (D.C. Cir. 2003).

THE PRESENT DAY. Ultimately, the FCC responded to the court's disapproval of its new system by issuing the 2003 Payphone Order that significantly improved the per call compensation system, first by adding the needed rules for PSPs to effectively monitor the dial around payment performance of the correct long distance carriers owing compensation, and second, by declaring the practice of nonpayment of the required compensation by any long distance carrier to be a federally unlawful practice. Through a civil challenge to this second aspect of the FCC's 2003 order, the United States Supreme Court ultimately reviewed the FCC's declaration of law and found it to be a permissively authoritative interpretation of federal law. Global Crossing Telecommunications, Inc. v. Metrophones Telecommunications, Inc., 550 U.S. 45, 127 S. Ct. 1513 (2007). Consequently, under the Supreme Court's holding, PSPs have a right of action in the federal courts to collect unpaid dial around compensation from a recalcitrant carrier. Under the concurrent jurisdiction doctrine of American jurisprudence, state courts also have the authority to adjudicate federal dial around collection claims.

As a result of the forgoing dial around compensation juggernaut, PSPs are in the unique position of asserting powerful legal rights against long distance carriers for the recovery of compensation for each and every toll free call completed from their payphones at the current rate of $.494 per call, and any long distance carrier who fails to remit its proper per call compensation payments can be held easily accountable using the legal system.

Any interested person can obtain the official codified version of the dial around compensation system regulations by clicking here.

This article was written by PSP Legal Services who is is a dial around compensation collection agent for PSPs.