MCI Telecommunicatio v. IL Commerce Commissi

In the

United States Court of Appeals

For the Seventh Circuit

No. 98-2127

MCI TELECOMMUNICATIONS CORPORATION, a Delaware

Corporation, and MCI METRO ACCESS TRANSMISSION

SERVICES, INCORPORATED, a Delaware Corporation,

Plaintiffs-Appellees,

and

UNITED STATES OF AMERICA and FEDERAL

COMMUNICATIONS COMMISSION,

Intervenors-Appellees,

v.

ILLINOIS BELL TELEPHONE COMPANY, doing business as

Ameritech Illinois, Incorporated,

Defendant-Appellee,

and

ILLINOIS COMMERCE COMMISSION, TERRY HARVILL,

RUTH K. KRETSCHMER, in their official capacities as

Commissioners of the Illinois Commerce Commission

and not as individuals, et al.,

Defendants-Appellants.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 97 C 2225--David H. Coar, Judge.

Argued November 6, 1998--Reargued December 2, 1999--

Decided July 24, 2000

No. 99-2805

WISCONSIN BELL, INCORPORATED, doing business as

AMERITECH WISCONSIN,

Plaintiff-Appellant,

v.

PUBLIC SERVICE COMMISSION OF WISCONSIN, CHERYL L.

PARRINO, in her official capacity as a member of

the Commission, DANIEL J. EASTMAN, in his official

capacity as a member of the Commission, et al.,

Defendants-Appellees.

No. 99-2806

WISCONSIN BELL, INCORPORATED, doing business as

AMERITECH WISCONSIN,

Plaintiff-Appellant,

v.

PUBLIC SERVICE COMMISSION OF WISCONSIN, CHERYL L.

PARRINO and JOSEPH P. METTNER, Commissioners of the

Public Service Commission of Wisconsin,

Defendants-Appellees.

No. 99-2811

WISCONSIN BELL, INCORPORATED, doing business as

Ameritech Wisconsin,

Plaintiff-Appellant,

v.

PUBLIC SERVICE COMMISSION OF WISCONSIN, CHERYL L.

PARRINO, DANIEL J. EASTMAN, et al.,

Defendants-Appellees.

No. 99-2873

MCI METRO ACCESS TRANSMISSION SERVICES,

INCORPORATED, and MCI TELECOMMUNICATIONS

CORPORATION,

Plaintiffs-Appellants,

v.

PUBLIC SERVICE COMMISSION OF WISCONSIN, CHERYL L.

PARRINO, DANIEL J. EASTMAN, in their official

capacities as members of the Commission, et al.,

Defendants-Appellees.

No. 99-2992

WISCONSIN BELL, INCORPORATED, doing business as

Ameritech Wisconsin,

Plaintiff,

v.

PUBLIC SERVICE COMMISSION OF WISCONSIN, CHERYL L.

PARRINO, DANIEL J. EASTMAN, et al.,

Defendants-Appellees,

and

UNITED STATES OF AMERICA,

Intervenor-Appellant.

Appeals from the United States District Court

for the Western District of Wisconsin.

Nos. 97 C 566; 98 C 11; 98 C 153;

98 C 366--Barbara B. Crabb, Judge.

Argued December 2, 1999--Decided July 24, 2000

Before RIPPLE, KANNE and DIANE P. WOOD, Circuit

Judges.

RIPPLE, Circuit Judge. These consolidated

appeals challenge determinations made by state

regulatory commissions exercising their authority

under the Telecommunications Act of 1996 ("the

1996 Telecommunications Act" or "the Act"), Pub.

L. No. 104-104, 110 Stat. 56 (1996) (codified in

scattered sections of Title 47 of the United

States Code). We must decide whether private

carriers may sue state commissions and their

commissioners in federal court for alleged

violations of sec.sec. 251 and 252 of the Act.

These sections set forth the process by which

Congress sought to bring competition to local

telephone exchange markets through

interconnection agreements between incumbent and

new carriers. See 47 U.S.C. sec.sec. 251 & 252

(Supp. II 1996).

One of the consolidated cases, 98-2127, is

before us on rehearing. In this case, Illinois

Bell, Inc. (doing business as Ameritech Illinois)

("Ameritech Illinois") and MCI Telecommunications

and MCI Metro Access Transmission Services, Inc.

(collectively "MCI") claim that the Illinois

Commerce Commission ("the ICC") and various

individual Commissioners ("the ICC

Commissioners") violated the Act with respect to

the ICC’s arbitration and approval of the

carriers’ interconnection agreement. The ICC and

the ICC Commissioners filed motions to dismiss on

Eleventh Amendment immunity grounds. The district

court denied those motions, see MCI Telecomms.

Corp. v. Illinois Bell Tel. Co., No. 97 C 2225,

1998 WL 156678 (N.D. Ill. 1998), and the ICC and

the ICC Commissioners have appealed.

We affirmed the district court’s judgment in a

previous opinion. See MCI Telecomms. Corp. v.

Illinois Commerce Comm’n, 168 F.3d 315, amended

by 183 F.3d 558 (7th Cir. 1999). Thereafter,

however, the Supreme Court issued a trio of

opinions addressing the scope of Eleventh

Amendment immunity. See Alden v. Maine, 527 U.S.

706 (1999); College Savings Bank v. Florida

Prepaid Postsecondary Educ. Expense Bd., 527 U.S.

666 (1999); Florida Prepaid Postsecondary Educ.

Expense Bd. v. College Savings Bank, 527 U.S. 627

(1999). We therefore granted rehearing, restored

98-2127 to our calendar for oral argument, and

requested that the parties file supplemental

briefs addressing the impact of the Supreme

Court’s decisions on this case. See 183 F.3d 567,

567-68 (7th Cir. 1999).

The other cases, all from Wisconsin, are before

us for the first time. Although aligned in

various ways, the parties involved in the

disputes include Wisconsin Bell, Inc. (doing

business as Ameritech Wisconsin) ("Ameritech

Wisconsin"), MCI,/1 the Public Service

Commission of Wisconsin ("the PSCW") and various

members of that commission ("the PSCW

Commissioners"). In each case, the PSCW or the

PSCW Commissioners or both were named as

defendants, and they filed motions to dismiss the

lawsuits against them on Eleventh Amendment

grounds. The district court granted the motions,

see Wisconsin Bell, Inc. v. Public Serv. Comm’n,

57 F. Supp.2d 710 (W.D. Wis. 1999), and the

carriers now appeal the district court’s

judgment.

For the reasons that follow, we hold that the

Eleventh Amendment does not bar these suits

against the state commissions and their

commissioners because, in the particular

circumstances present in these cases, the states

have waived their Eleventh Amendment immunity by

participating in the regulatory scheme created by

the Act. We also hold, as an independent basis

for decision, that the carriers may proceed with

their respective federal claims for equitable

relief against the individual commissioners under

the Ex parte Young doctrine.

I

BACKGROUND

A. The Statutory Scheme

Congress enacted the 1996 Telecommunications Act

"[t]o promote competition and reduce regulation

in order to secure lower prices and higher

quality services for American telecommunications

consumers and encourage the rapid deployment of

new telecommunications technologies." Pub. L. No.

104-104, 110 Stat. 56, 56 (1996). The Act

"fundamentally restructures local telephone

markets" by transforming the "long-standing

regime of state-sanctioned monopolies" into a

competitive market. AT&T Corp. v. Iowa Utils.

Bd., 525 U.S. 366, 371 (1999). Congress

recognized that, even after the removal of

regulatory restrictions on competition,

significant economic barriers would remain to

block entry into local telephone markets.

Prospective market entrants would face the cost

of duplicating an incumbent provider’s local

network infrastructure. To remove this economic

barrier, the Act essentially requires incumbent

local exchange carriers ("LECs") to share their

networks with competitors. Section 251 of the Act

requires incumbent LECs to allow new entrants to

interconnect with existing local networks, to

lease elements of existing local networks at

reasonable rates, and to purchase the incumbents’

services at wholesale rates and resell those

services to retail customers. See 47 U.S.C. sec.

251 (Supp. II 1996).

Section 252 sets out the process by which

incumbent LECs and prospective carriers establish

interconnection agreements. First, incumbent LECs

and prospective carriers must negotiate in good

faith to reach voluntary interconnection

agreements. At any time during the negotiations,

a party may ask the appropriate state commission

to participate as a mediator in the negotiations.

See id. sec. 252(a)(2). If negotiations prove

unsuccessful, subsection 252(b) provides for

compulsory arbitration of any open issues. During

the period from the 135th to the 160th day after

an incumbent LEC receives a request for

negotiation, any party to the negotiation may

petition the state commission to arbitrate any

open issues. See id. sec. 252(b)(1). Sections 251

and 252 establish certain standards that the

state commission must follow in resolving open

issues by arbitration and in imposing conditions

on the parties. The state commission is also

bound by Federal Communications Commission

("FCC") regulations issued pursuant to sec. 251.

Subsection 252(e) requires any interconnection

agreement reached by negotiation or arbitration

to be submitted to the state commission for

approval and specifies the grounds on which a

state commission can reject an agreement.

Specifically, state commissions may reject

negotiated interconnection agreements only if the

commission finds (1) that the agreement

discriminates against a carrier that is not a

party to the agreement or (2) that implementation

of the agreement (or a part thereof) would be

inconsistent with "the public interest,

convenience, and necessity." Id. sec.

252(e)(2)(A). A state commission may reject an

arbitrated interconnection agreement only if the

agreement (or part thereof) (1) does not meet the

requirements of sec. 251 and its implementing

regulations or (2) fails to meet the pricing

standards set forth in subsection 252(d). See id.

sec. 252(e)(2)(B).

Subsection 252(e)(5) further provides that, if

a state commission fails to carry out any of its

responsibilities under sec. 252, then the FCC

must assume responsibility for the proceeding and

act for the state commission in carrying out its

functions. An implementing regulation to sec. 252

provides that a state commission "fails to act"

for purposes of subsection 252(e)(5)--thus

prompting the FCC to step in and assume the state

commission’s responsibilities--if it fails to

respond within a reasonable time to a request for

mediation or a request for arbitration, or if it

fails to complete an arbitration within the

established time limits. See 47 C.F.R. sec.

51.801(b). A state commission will not be deemed

to have failed to act, however, if it merely

fails to approve or reject an agreement within

the established time limits. See id. sec.

51.801(c). In such a case, the agreement will be

deemed approved. See 47 U.S.C. sec. 252(e)(4)

(Supp. II 1996).

Therefore, subsections 252(e)(1), (e)(4), and

(e)(5), taken together and read in conjunction with

the FCC regulations, create a scheme that provides

regulatory oversight of interconnection agreements,

either by a state commission or by the FCC in the

state commission’s place. Only one scenario, not

present in our cases, appears to be a variation to

this scheme: when the parties reach a voluntarily

negotiated agreement without any request for

mediation or arbitration and the state commission

fails to act to approve or reject the agreement.

When these two circumstances occur, the resulting

agreement will be deemed approved by the state

commission, see id. sec. 252(e)(4); the FCC will

not step in to assume the approval function.

The Act provides that federal district courts

have exclusive jurisdiction to review FCC or

state commission actions relating to

interconnection agreements. In subsection

252(e)(4), Congress expressly eliminated state

court jurisdiction to review actions of state

commissions in approving or rejecting agreements

under sec. 252. Moreover, subsection 252(e)(6),

titled "Review of State commission actions,"

provides that, whenever a state commission fails

to act, the exclusive remedies for that failure

to act will be proceedings by the FCC and any

judicial review of the FCC’s actions. Subsection

252(e)(6) also provides that, "[i]n any case in

which a State commission makes a determination

under this section, any party aggrieved by such

determination may bring an action in an

appropriate Federal district court to determine

whether the agreement or statement meets the

requirements of section 251 [and section 252]."

On a separate but related note, Congress also

has opened up long distance service competition.

The Act allows Bell operating companies/2

("BOCs"), such as Ameritech Illinois or Ameritech

Wisconsin in our cases, to provide long distance

service to their customers--a service generally

off limits to BOCs under the pre-1996

Telecommunications Act regime--once certain

conditions have been met. Section 271 of the Act

allows BOCs to provide "out-of-region" long

distance service. See id. sec. 271(b)(2). For a

BOC to provide "in-region" long distance service,

however, the BOC must obtain FCC approval. See

id. sec. 271(b)(1). To obtain FCC approval, the

BOC must satisfy numerous requirements, one of

which is to show that the BOC has opened up its

local network to interconnection with new

competitors. See id. sec. 271(c). A BOC may make

this showing either by entering into

interconnection agreements with "one or more

unaffiliated competing providers of telephone

exchange service," id. sec. 271(c)(1)(A), or, if

no new entrants have requested interconnection

with the BOC, by showing that the appropriate

state commission has approved "a statement of the

terms and conditions that the [BOC] generally

offers to provide such access and

interconnection," id. sec. 271(c)(1)(B). These

two "methods" of obtaining FCC approval are

commonly known as "Track A" and "Track B." See

generally SBC Communications Inc. v. F.C.C., 138

F.3d 410, 413-21 (D.C. Cir. 1998) (discussing the

tracks by which BOCs may obtain FCC approval

under sec. 271 to provide in-region long distance

services).

For a BOC seeking to obtain FCC approval using

the Track B approach, subsection 271(c)(1)(B)

requires the BOC to file with the appropriate

state commission a statement of generally

available terms and conditions (a "SGAT") and to

obtain approval of the SGAT as provided by

subsection 252(f). The SGAT sets forth the terms

and conditions the company intends to offer new

entrants seeking interconnection and access to

the BOC’s network. Once a BOC has filed a SGAT

with a state commission, that commission has 60

days within which to complete a review of it, see

47 U.S.C. sec. 252(f)(3)(A) (Supp. II 1996), or

to permit the statement to take effect, see id.

sec. 252(f)(3)(B). According to subsection

252(f)(2), a state commission may not approve an

SGAT unless the SGAT complies with subsection

252(d) and sec. 251 and the FCC regulations

thereunder. The Act also allows state commissions

to establish and enforce state law requirements

in their review of an SGAT, but the commissions

may do so only if those standards do not conflict

with the Act. See id. sec. 252(f)(2). Even after

an SGAT has been allowed to take effect under

subsection 252(f)(3)(B), however, the state

commission may continue to review such an SGAT

and may approve or disapprove it under subsection

252(f)(2) at any time. See id. sec. 252(f)(4). As

with the interconnection process, if a state

commission fails to act and the FCC has been made

aware of that failure to act, the FCC must assume

responsibility for the SGAT and act in place of

the state commission within 90 days. See id. sec.

252(e)(5). Similarly, the judicial review

provision in subsection 252(e)(6) also applies to

state commission determinations regarding SGATs.

B. The Illinois Litigation

1. The Lawsuit

Appeal 98-2127 began as a lawsuit over an

interconnection agreement between Ameritech

Illinois and MCI. After negotiations failed to

produce an interconnection agreement between the

two companies, MCI petitioned the ICC, in

accordance with subsection 252(b)(1) of the Act

to arbitrate the unresolved issues. The ICC held

arbitration hearings and eventually approved a

final interconnection agreement for the two

companies. MCI then filed suit against Ameritech

Illinois, the ICC, and various individual ICC

Commissioners in their official capacities. MCI

alleged that the ICC had violated certain

sections of the Act when conducting the

arbitration proceedings and approving the terms

of the interconnection agreement. Ameritech

Illinois filed a cross-claim against MCI, the

ICC, and the ICC Commissioners in their official

capacities, asserting that one aspect of the

approved interconnection agreement was contrary

to the Act. In their complaints, both MCI and

Ameritech Illinois sought declaratory and other

equitable relief./3

2. The Motions to Dismiss

The ICC and the ICC Commissioners moved to

dismiss the claims against them on Eleventh

Amendment sovereign immunity grounds. The ICC and

the ICC Commissioners argued to the district

court that the Act could not abrogate Illinois’

immunity. They pointed out that Illinois had not

explicitly authorized waiver of its immunity

through any statute or constitutional provision.

They further contended that their participation

in the arbitration and review process under the

Act did not constitute waiver of sovereign

immunity because no provision of the Act required

the state to submit to suit as a condition for

exercising the authority granted it.

Ameritech Illinois and MCI replied that Congress

had conditioned state commissions’ participation

in the arbitration and approval process on their

submission to federal court jurisdiction. Thus,

they argued, the ICC and the ICC Commissioners

waived any Eleventh Amendment immunity when they

elected to implement the federal regulatory

scheme set forth in the Act with full knowledge

that their determinations would be reviewable

exclusively in federal court.

In reply, the ICC and the ICC Commissioners

reemphasized that the Act contains no specific

language expressly conditioning state commission

participation in the regulatory process on

consent to suit in federal court. Rather, they

contended, the Act provides only for federal

court review of the agreements themselves.

3. Decision of the District Court

The district court denied the motions to

dismiss. The district court determined that the

ICC defendants constructively had waived their

Eleventh Amendment immunity and, in the

alternative, that there was no Eleventh Amendment

barrier to the suits against the ICC

Commissioners because of the Ex parte Young

doctrine. The district court’s decision in this

case preceded the Supreme Court’s decisions in

Alden, College Savings and Florida Prepaid, and,

therefore, the district court could not have

accounted for any impact those decisions might

have on the Eleventh Amendment analysis.

(a)

The district court first determined that

Seminole Tribe v. Florida, 517 U.S. 44 (1996),

had not invalidated the doctrine of implied

waiver. In the court’s view, although Seminole

Tribe restricted Congress’ ability to abrogate

directly the states’ sovereign immunity, the

Supreme Court’s decision left untouched the

"unremarkable and completely unrelated" doctrine

of waiver. MCI Telecomms. Corp. v. Illinois Bell

Tel. Co., No. 97 C 2225, 1998 WL 156678, at *6

(N.D. Ill. 1998) (quoting Seminole Tribe, 517

U.S. at 63) (internal quotation marks omitted).

The district court then concluded that the ICC

had participated voluntarily in the regulatory

scheme established by the 1996 Telecommunications

Act because the Act provided states with the

option to arbitrate and to approve the

interconnection agreements themselves or,

instead, to let the FCC perform that function.

Additionally, the district court noted, Congress

had made it expressly clear in subsection

252(e)(6) that, if a state opted to participate

in the regulatory scheme, its actions would be

reviewable in federal court. Thus, the court

concluded, the ICC had waived immunity from suit

in federal court by participating voluntarily in

the arbitration and approval process.

(b)

In the alternative, the district court also held

that the doctrine of Ex parte Young provided a

basis for the ICC Commissioners’ lack of Eleventh

Amendment immunity from this suit. The district

court first noted that, contrary to the ICC

Commissioners’ arguments, the relief sought by

Ameritech Illinois and MCI was prospective in

nature. The companies sought no money damages but

only declaratory and injunctive relief to redress

ongoing violations of federal law.

The district court also rejected the ICC

Commissioners’ argument that an Ex parte Young

action is available only when plaintiffs allege a

constitutional (as opposed to statutory)

violation. Relying on our decision in Marie O. v.

Edgar, 131 F.3d 610 (7th Cir. 1997), the court

held that an Ex parte Young action can be brought

to vindicate violations of a federal statute.

The district court then concluded that the

limitations placed on the Ex parte Young doctrine

by Seminole Tribe and Idaho v. Coeur d’Alene

Tribe, 521 U.S. 261 (1997), did not affect the

application of the Ex parte Young doctrine to

this case. Seminole Tribe limited, the district

court acknowledged, the reach of Ex parte Young

in cases in which Congress has created a detailed

and comprehensive remedial scheme. But, the

district court held, the provisions of the 1996

Telecommunications Act at issue in this case did

not create any such detailed scheme that would

limit the type of remedies available to a

district court. The district court further held

that the narrow exception to Ex parte Young

created in Coeur d’Alene also did not apply to

this case. The district court explained that "the

issues of sovereign immunity presented by review

of state actions taken pursuant to the

Telecommunication Act are not nearly as

compelling as those presented by the state of

Idaho in the dispute over lands that it has

historically considered a part of its territory."

1998 WL 156678, at *12.

Finally, the district court rejected the ICC

Commissioners’ argument that Congress did not

intend to make states parties to the federal

suits reviewing interconnection agreements, but

instead meant only to provide review of the

agreements themselves. In rejecting this

argument, the district court pointed out that the

subsection providing for federal court review was

titled "Review of State Commissions Actions." Id.

at *14.

C. The Wisconsin Litigation

1. The Lawsuits

(a)

Appeals 99-2805, 99-2873 and 99-2992 are the

result of a dispute over an interconnection

agreement entered into by Ameritech Wisconsin and

MCI and approved by the PSCW. Ameritech Wisconsin

and MCI had entered into interconnection

negotiations as provided under subsection 252(a)

of the Act, but because the parties failed to

reach an agreement on some issues, MCI petitioned

the PSCW under subsection 252(b)(1) to arbitrate

the remaining issues. The PSCW held arbitration

hearings and ultimately approved a final

interconnection agreement between Ameritech

Wisconsin and MCI.

The final agreement satisfied neither party.

Thus, Ameritech Wisconsin filed suit against MCI,

the PSCW, and the PSCW Commissioners in their

official capacities to challenge portions of the

final agreement approved by the PSCW. In its

complaint, Ameritech Wisconsin alleged that

certain provisions of the final agreement were

contrary to the 1996 Telecommunications Act. The

complaint sought declaratory and injunctive

relief to enjoin the enforcement of the

challenged provisions. Thereafter, MCI filed its

own suit against Ameritech Wisconsin, the PSCW,

and the PSCW Commissioners in their official

capacities to challenge other portions of the

same agreement. Like Ameritech Wisconsin, MCI

alleged in its complaint that various provisions

of the final agreement violated the 1996

Telecommunications Act. MCI also sought

declaratory and injunctive relief. The district

court consolidated the two cases, and the United

States later intervened. After the district court

issued its decision in this case, each party

filed its own notice of appeal.

(b)

Appeal 99-2806 involves the PSCW’s

interpretation and enforcement of previously

approved interconnection agreements between

Ameritech Wisconsin and TCG of Milwaukee, Inc.

("TCG") and between Ameritech Wisconsin and Time

Warner Communications of Milwaukee L.P. ("Time

Warner"). Ameritech Wisconsin and TCG entered

into their agreement, which was approved by the

PSCW, following negotiations and arbitration;

Ameritech Wisconsin and Time Warner arrived at

their final agreement, which the PSCW also

approved, after negotiations only.

Ameritech Wisconsin’s interconnection agreements

with TCG and Time Warner require "reciprocal

compensation" only for "local traffic" calls

(calls "beginning" and "terminating" within the

"local calling area"). After the PSCW had

approved these agreements, a dispute arose over

whether Ameritech Wisconsin was required, under

its respective interconnection agreements with

TCG and Time Warner, to pay reciprocal

compensation for calls placed by Ameritech

Wisconsin customers to the Internet via Internet

service providers who were, in turn, customers of

TCG or Time Warner. Because Ameritech Wisconsin

believed that the disputed Internet calls did not

"terminate" within the local calling area, it

deemed these calls not to be "local traffic" and

therefore refused to pay reciprocal compensation

for them.

TCG and Time Warner, however, understood their

respective interconnection agreements to entitle

them to reciprocal compensation for the disputed

Internet calls. Thus, they filed separate

complaints with the PSCW. The companies alleged

that Ameritech Wisconsin was not complying with

the reciprocal compensation provisions of their

respective interconnection agreements, and they

asked the PSCW to enforce those provisions. The

PSCW adopted the interpretation proffered by TCG

and Time Warner and later entered separate

enforcement orders against Ameritech Wisconsin

ordering it to pay the requested reciprocal

compensation. Ameritech Wisconsin then filed suit

in the district court and named as defendants

TCG, Time Warner, the PSCW, and the PSCW

Commissioners in their official capacities. In

its complaint, Ameritech Wisconsin alleged that

the PSCW’s enforcement orders were contrary to

the 1996 Telecommunications Act, FCC regulations,

and Wisconsin law. The complaint sought

declaratory and other equitable relief.

(c)

The final appeal, 99-2811, stems from the PSCW’s

rejection of an SGAT filed with the PSCW by

Ameritech Wisconsin. In proceedings before the

PSCW, a number of new entrants opposed portions

of the SGAT filed by Ameritech Wisconsin. The

PSCW adopted the views of those that opposed

Ameritech Wisconsin’s SGAT, and the PSCW

eventually rejected the SGAT. Ameritech Wisconsin

filed suit in the district court against the PSCW

and the PSCW Commissioners in their official

capacities to obtain judicial review of that

decision. Ameritech Wisconsin’s complaint alleged

violations of the 1996 Telecommunications Act,

and, to the extent that the PSCW had purported to

rely on state law to make its decision, the

complaint further alleged that the Act preempted

the state laws. Ameritech Wisconsin sought

declaratory and other equitable relief./4

2. The Motions to Dismiss

Like their Illinois counterparts, the PSCW and

the PSCW Commissioners filed motions to dismiss

each of these cases. They argued that the

Eleventh Amendment provided them with immunity

from suit in federal court.

Ameritech Wisconsin and MCI argued that

Wisconsin had waived its immunity by choosing to

regulate interconnection agreements in accordance

with the 1996 Telecommunications Act. By

exercising the power granted by the Act,

according to Ameritech Wisconsin and MCI, the

PSCW and the PSCW Commissioners had consented

implicitly to being sued in federal court under

subsection 252(e)(6). Alternatively, Ameritech

Wisconsin and MCI argued that the PSCW

Commissioners could be sued under the Ex parte

Young doctrine.

3. Decision of the District Court

The district court issued two decisions relevant

to our discussion. In both opinions, the district

court held that Eleventh Amendment immunity

barred the suits against the PSCW and the PSCW

Commissioners.

(a)

In its first opinion, reported at Wisconsin

Bell, Inc. v. Public Serv. Comm’n, 27 F. Supp.2d

1149 (W.D. Wis. 1998), the district court granted

the motions to dismiss. According to the court,

the PSCW had not waived its immunity by

performing its role under sec. 252 of the 1996

Telecommunications Act. Furthermore, the district

court concluded that the suits against the PSCW

Commissioners could not proceed under the Ex

parte Young doctrine.

The district court first analyzed whether the

PSCW and the PSCW Commissioners could have waived

their immunity by acting on the interconnection

agreements and SGAT at issue in the cases before

it. In the court’s estimation, Congress had made

its intention sufficiently clear in the 1996

Telecommunications Act that state commissions

would be subject to suit in federal court to

defend their rulings. Nevertheless, the district

court concluded, the Act did not obtain a valid,

voluntary waiver of immunity from states. The

court reached this conclusion after evaluating

the Supreme Court’s decisions in Parden v.

Terminal Railway of the Alabama State Docks

Department, 377 U.S. 184 (1964), and Employees of

the Department of Public Health & Welfare v.

Department of Public Health & Welfare, 411 U.S.

279 (1973), both of which concerned the so-called

"constructive waiver" doctrine.

According to the district court, under these

cases the constructive waiver doctrine could not

apply to the 1996 Telecommunications Act for

several reasons. First, the court noted that,

despite the many changes in telecommunications

regulation wrought by the Act, the Act preserved

the states’ role as the primary regulators of

local telephone service; the district court

understood the Supreme Court’s holding in

Employees to preclude the application of the

constructive waiver doctrine "when the federal

government amends or enacts a law making a state

subject to suit merely by continuing in existing

activities to protect its citizens." 27 F.

Supp.2d at 1158 (citing Employees, 411 U.S. at

296 (Marshall, J., concurring)). The district

court next observed that when state commissions

are asked to review voluntarily negotiated

interconnection agreements, state commissions

must review that agreement "or accept the

consequence that the agreement will go into

effect without any form of government oversight."

Id. Finally, the district court explained its

view that "staying out of the interconnection

process cannot be said to be a realistic option

for a state commission" because the commission

cannot be expected to abandon its mandate to

protect the public interest. Id. For these

reasons, the district court explained, any waiver

obtained from Wisconsin under the Act could not

have been voluntary.

The district court also determined that the Ex

parte Young doctrine was inapplicable to these

cases. The court reached this conclusion based on

its reading of the Supreme Court’s decision in

Seminole Tribe. According to the district court,

in order for it to determine whether application

of the Ex parte Young doctrine was appropriate

here, Seminole Tribe required the court to engage

in a two-step inquiry. Thus, it analyzed (1)

whether Congress created a remedy for the rights

created in the 1996 Telecommunications Act and

(2) whether the remedy created by Congress

contemplated a suit against a state official. The

district court never reached the second aspect of

this inquiry because it concluded that, with the

Act, Congress had created an adequate remedy to

secure federal rights such that Seminole Tribe

precluded the application of the Ex parte Young

doctrine in these cases. The district court

explained that, although the remedy created in

subsection 252(e)(6) was "much less ’detailed’"

than the statutory remedy at issue in Seminole

Tribe, the court believed that it would be

improper simply to compare the two statutory

schemes to see which one was more detailed. Id.

at 1161. Rather, the court stated, "a ’simple’

remedy may be all that is necessary to secure

federal rights." Id. The district court concluded

that Congress made a choice in the Act to limit

the available remedy under sec. 252 "to having a

commission’s ruling tested in federal court." Id.

This "limited review" scheme, said the court,

allowed federal courts "to cure errors in federal

law without subjecting state commissioners to the

full remedial powers of a federal district

court." Id. Under Seminole Tribe, the court

concluded, the Ex parte Young doctrine could not

be used here "because the remedy Congress chose

secures federal rights adequately." Id. That

Congress had chosen, as it turns out, an

unconstitutional remedy did not change the result

here, the district court explained, because under

Seminole Tribe it was "prevented from ’rewriting

the statutory scheme in order to approximate what

[it thought] Congress might have wanted.’" Id.

(quoting Seminole Tribe, 517 U.S. at 76).

(b)

Although the district court had ruled that the

suits against the PSCW and the PSCW Commissioners

should be dismissed, the court stayed the

enforcement of its ruling pending further

briefing and argument by the parties on whether

the PSCW and the PSCW Commissioners were

necessary parties under Rule 19(b) of the Federal

Rules of Civil Procedure. The district court also

allowed the PSCW and the PSCW Commissioners to

amend their answers to include a Tenth Amendment

defense.

Before the district court issued an opinion

addressing the remaining Rule 19(b) issues,

however, we issued our initial decision in 98-

2127. See MCI Telecomms. Corp. v. Illinois

Commerce Comm’n, 168 F.3d 315, amended by 183

F.3d 558 (7th Cir. 1999). The district court

ordered further briefing and argument from the

parties on the effect our opinion had on the

cases before the district court. Then, the

Supreme Court issued its rulings in Alden,

College Savings and Florida Prepaid. After

hearing argument from the parties, the district

court issued a final opinion, reported at

Wisconsin Bell, Inc. v. Public Serv. Comm’n, 57

F. Supp.2d 710 (W.D. Wis. 1999), dismissing the

suits.

In this second ruling, the district court

explained that our initial decision in 98-2127

was no longer controlling in light of the Supreme

Court’s intervening decision in College Savings.

According to the district court, it was obligated

to follow the most recent Supreme Court

precedent, and College Savings, the court

believed, compelled the dismissal of the suits

against the PSCW and the PSCW Commissioners. The

district court recognized that College Savings

preserved "some apparent constructive waivers,"

such as when Congress provides a gift to a state

in return for the state’s waiver of immunity, but

it concluded that the Supreme Court’s decision

precluded the finding of such a waiver in the

context of the 1996 Telecommunications Act. Id.

at 715. Instead, the court explained, "[t]here is

no arguable basis to a claim that equates a gift

with a state’s participation in the act’s

cooperative federalism (supervising the

regulation of local telephone carriers in the

state)." Id. Within the context of the 1996

Telecommunications Act, the district court

explained, a state’s acceptance of the "gift" of

being able to participate in the interconnection

process could not be equated with the kind of

"gifts" found acceptable by the Supreme Court in

College Savings. "A state’s continued regulation

of local enterprise (local telephone carriers),"

the district court reasoned, "is an ’otherwise

permissible activity’ that can yield no inference

as to a state’s motivation for doing it." Id.

The district court also reaffirmed its prior

ruling on the applicability of the Ex parte Young

doctrine. In addition to the points it had raised

in its first decision, the court further noted

two other problems with proceeding under the Ex

parte Young doctrine in these cases. First, the

court noted that "one must acknowledge the

conceptual difference between a state official

performing state functions in a way that violates

federal law and a state official who is

performing federally authorized functions but is

alleged to have performed those functions

improperly." Id. at 713. Second, the court noted

"the oddity" of allowing an Ex parte Young suit

to proceed against individual commissioners, some

of whom may have dissented from the decision

being challenged in court. Id. In the end,

however, the district court explained that, even

if these hurdles to applying the Ex parte Young

doctrine could be overcome, Seminole Tribe

precluded the application of the doctrine to

these cases because the 1996 Telecommunications

Act provided a limited remedy for violations of

the Act./5

II

DISCUSSION

The Eleventh Amendment to the Constitution of

the United States provides:

The Judicial power of the United States shall not

be construed to extend to any suit in law or

equity, commenced or prosecuted against one of

the United States by Citizens of another State,

or by Citizens or Subjects of any Foreign State.

U.S. Const. amend. XI. The Supreme Court has long

held that this Amendment bars federal

jurisdiction over suits brought against a state,

not only by citizens of another state or a

foreign state, but also by its own citizens. See,

e.g., College Savings Bank v. Florida Prepaid

Postsecondary Educ. Expense Bd., 527 U.S. 666,

669-70 (1999); Edelman v. Jordan, 415 U.S. 651,

662-63 (1974); Hans v. Louisiana, 134 U.S. 1, 13-

15 (1890). The immunity conferred on a state by

the Eleventh Amendment extends to state agencies

as well. See, e.g., Puerto Rico Aqueduct & Sewer

Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139, 144

(1993). Subject to the exception carved out in Ex

parte Young, 209 U.S. 123 (1908), the Eleventh

Amendment also bars federal jurisdiction over

suits against state officials acting in their

official capacities when the state is the real

party in interest. See, e.g., Pennhurst State

Sch. & Hosp. v. Halderman, 465 U.S. 89, 101-02

(1984) ("Pennhurst II").

The immunity afforded to states by the Eleventh

Amendment, however, is not absolute. See College

Savings, 527 U.S. at 670. Congress may exercise

its power under the Fourteenth Amendment and

thereby authorize private suits against

unconsenting states. See id.; Fitzpatrick v.

Bitzer, 427 U.S. 445, 456 (1976). A state also

may waive its immunity from suit. See College

Savings, 527 U.S. at 670; Atascadero State Hosp.

v. Scanlon, 473 U.S. 234, 238 (1985); Marie O. v.

Edgar, 131 F.3d 610, 615 (7th Cir. 1997).

Additionally, the Ex parte Young doctrine allows

private parties to sue individual state officials

for prospective relief to enjoin ongoing

violations of federal law. See, e.g., Ex parte

Young, 209 U.S. at 159-60; Dean Foods Co. v.

Brancel, 187 F.3d 609, 613 (7th Cir. 1999); Marie

O., 131 F.3d at 615.

We review de novo a district court’s judgment on

whether to dismiss a claim on Eleventh Amendment

immunity grounds. See Goshtasby v. Board of

Trustees of the Univ. of Ill., 141 F.3d 761, 764

(7th Cir. 1998), abrogated on other grounds by

Kimel v. Florida Bd. of Regents, 120 S. Ct. 631

(2000).

A. Threshold Matters

As a threshold matter, the ICC and the ICC

Commissioners, relying on subsection 252(e)(6),

submit that we need not concern ourselves with

the application of the Eleventh Amendment because

the 1996 Telecommunications Act does not even

provide for suits against states in federal

court, but instead provides only for federal

court review of the interconnection agreements

themselves. We cannot accept this contention; the

provisions of the Act, read as a whole, will not

permit such a construction and, indeed, make

clear that Congress’ intent was to the contrary.

At the outset, we note that the subsection

providing for judicial review is titled "Review

of State commission actions," not "Review of

interconnection agreements," thus signaling that

Congress intended that the state commissions be

parties to the federal court suits reviewing

their actions, just as the FCC is a party to

suits seeking review of its actions. Moreover,

subsection 252(e)(4), when read in conjunction

with subsection 252(e)(6), provides additional

evidence that Congress contemplated suits against

state defendants in federal court. Subsection

252(e)(4) provides that "[n]o State court shall

have jurisdiction to review the action of a State

commission in approving or rejecting an agreement

under this section." 47 U.S.C. sec. 252(e)(4)

(Supp. II 1996). This language indicates that

Congress envisioned suits reviewing "actions" by

state commissions, as opposed to suits reviewing

only the agreements themselves, and that Congress

intended that such suits be brought exclusively

in federal court.

In a similar vein, the PSCW and the PSCW

Commissioners contend that we lack subject matter

jurisdiction in case 99-2806 because that case

involves the enforcement of previously approved

interconnection agreements. According to the PSCW

and the PSCW Commissioners, subsection 252(e)(6)

does not confer jurisdiction on federal courts to

review enforcement or other post-approval

determinations made by state commissions.

Instead, they submit, the plain language of

subsection 252(e)(6) limits federal jurisdiction

to reviewing a state commission’s approval or

rejection of an interconnection agreement or

SGAT.

We decline to read subsection 252(e)(6) so

narrowly. See Southwestern Bell Tel. Co. v.

Public Util. Comm’n, 208 F.3d 475, 479-81 (5th

Cir. 2000). A state commission’s authority to

approve or reject interconnection agreements

under the Act necessarily includes the authority

to interpret and enforce, to the same extent, the

terms of those agreements once they have been

approved by that commission. See id. at 479-80;

Iowa Utils. Bd. v. F.C.C., 120 F.3d 753, 804 &

n.24 (8th Cir. 1997) (stating that "the state

commissions’ plenary authority to accept or

reject these [interconnection] agreements

necessarily carries with it the authority to

enforce the provisions of agreements that the

state commissions have approved"), aff’d in part

and rev’d in part on other grounds sub nom. AT&T

Corp. v. Iowa Utils. Bd., 525 U.S. 366 (1999)./6

In sum, we believe that subsection 252(e)(6)

contemplates that state commissions will be

parties to suits brought by those aggrieved by

their determinations. This provision confers

federal jurisdiction to review "state commission

rulings on complaints pertaining to

interconnection agreements and . . . such

jurisdiction is not restricted to mere approval

or rejection of such agreements." Southwestern

Bell, 208 F.3d at 481; see also Illinois Bell

Tel. Co. v. Worldcom Techs., Inc., 179 F.3d 566,

570-71 (7th Cir. 1999) (stating that federal

courts have jurisdiction under subsection

252(e)(6) to review "actions" by state

commissions that relate to interconnection

agreements).

B. Abrogation

Unquestionably, Congress could not have

abrogated state sovereign immunity with the 1996

Telecommunications Act. The Act is an exercise of

Congress’ Commerce Power under Article I of the

Constitution, see 47 U.S.C. sec. 151 (Supp. II

1996), and as the Supreme Court has made

inescapably clear, Congress may not abrogate

Eleventh Amendment immunity through the exercise

of its Article I powers. See College Savings, 527

U.S. at 672; Florida Prepaid Postsecondary Educ.

Expense Bd. v. College Savings Bank, 527 U.S.

627, 636 (1999); Seminole Tribe v. Florida, 517

U.S. 44, 72 (1996) ("Even when the Constitution

vests in Congress complete lawmaking authority

over a particular area, the Eleventh Amendment

prevents congressional authorization of suits by

private parties against unconsenting States.").

Thus, because the states’ immunity cannot be

abrogated by the 1996 Telecommunications Act, we

must look to whether Illinois and Wisconsin have

waived their Eleventh Amendment immunity in the

cases before us.

C. Waiver

1.

The decision to waive Eleventh Amendment

immunity lies solely with the state, see College

Savings, 527 U.S. at 675, and we "indulge every

reasonable presumption against" a state’s waiver

of its immunity, see id. at 682 (quotation marks

and citation omitted). Thus, the test "for

determining whether a State has waived its

immunity from federal-court jurisdiction is a

stringent one." Id. at 675 (quoting Atascadero,

473 U.S. at 241 (internal quotation marks

omitted)). We may find that a state has waived

its immunity when "the State voluntarily invokes"

federal jurisdiction or when "the State makes a

’clear declaration’ that it intends to submit

itself" to federal jurisdiction. College Savings,

527 U.S. at 675-76 (citations omitted). In either

case, there must be an "unequivocal indication

that the State intends to consent to federal

jurisdiction that otherwise would be barred by

the Eleventh Amendment." Atascadero, 473 U.S. at

238 n.1; see also College Savings, 527 U.S. at

680 ("The whole point of requiring a ’clear

declaration’ by the State of its waiver is to be

certain that the State in fact consents to

suit."); Mueller v. Thompson, 133 F.3d 1063, 1064

(7th Cir. 1998) ("No magic words are required,

but implicit waivers won’t do; the court must be

highly confident that the state really did intend

to allow itself to be sued in federal court."

(citations omitted)).

2.

The Supreme Court’s recent decisions in Alden,

College Savings and Florida Prepaid have refined

the jurisprudence with respect to state sovereign

immunity. The Court’s decisions in Alden and

Florida Prepaid, although impacting Eleventh

Amendment jurisprudence in other important ways,

do not bear directly on the questions of waiver

that we confront in our cases. In contrast, the

Court’s decision in College Savings is especially

pertinent to our analysis here because that

decision squarely addressed Congress’ power to

obtain waivers of state immunity when Congress

acts within its Article I powers. In College

Savings, the Court held that states do not

"constructively" waive their sovereign immunity

by engaging in activities in interstate commerce

that are regulated by Congress under its Article

I power. See College Savings, 527 U.S. at 680. By

so holding, the Court overruled Parden v.

Terminal Railway of the Alabama Docks Department,

377 U.S. 184 (1964), a case in which the Court

had held that Alabama waived its sovereign

immunity by operating a railroad that was

regulated by Congress under its Commerce Power.

At issue in College Savings was whether the

state of Florida had "constructively" waived its

immunity by marketing a college savings plan in

interstate commerce. By an amendment to the

Lanham Act,/7 Congress had subjected states to

suit in federal court for false representations

in commerce, and the plaintiff, College Savings

Bank, argued that Florida had waived its immunity

by engaging in the activity regulated by that

federal statute. The Supreme Court disagreed.

According to the Court, Florida could not waive

its immunity merely by engaging in the regulated

activity because "there is little reason to

assume actual consent based upon the State’s mere

presence in a field subject to congressional

regulation." College Savings, 527 U.S. at 680;

see also Burnette v. Carothers, 192 F.3d 52, 60

(2d Cir. 1999) (holding, in a post-College

Savings case, that a state did not consent to

suit for CERCLA violations by operating a prison

that had released toxic chemicals).

The commissions in our cases argue that the

Court’s decision in College Savings has

eliminated all so-called "constructive" or

"implied" waivers. We, however, cannot agree with

their assessment of that case. The Court in

College Savings limited its abandonment of

"constructive" or "implied" waivers to the "ill

conceived" "constructive-waiver experiment of

Parden." College Savings, 527 U.S. at 680.

Indeed, the Court did not call into question

other types of "constructive" waivers obtained by

Congress acting within its Article I powers.

Rather, the Court simply held that states cannot

"constructively" waive their immunity by being

forced by Congress to choose between preserving

their sovereign immunity and engaging in an

"otherwise lawful activity." Id. at 687.

To illustrate the types of "constructive"

waivers that Congress may still obtain from

states, the Court provided two examples of

constructive waivers that are "fundamentally

different" from Parden-style waivers and that are

viable after College Savings. Id. at 686. In the

first example, Petty v. Tennessee-Missouri Bridge

Commission, 359 U.S. 275 (1959), Congress

required Tennessee and Missouri to waive their

immunity as a condition for Congress’ approval of

the interstate compact made between the two

states. The Court in College Savings explained

that the constructive waiver exacted by Congress

in that case was valid because, under the Compact

Clause of the Constitution, states cannot form

interstate compacts without congressional

approval. As the Court explained it, Congress’

consent to an interstate compact is a "gratuity"

that Congress could give or withhold. College

Savings, 527 U.S. at 686.

In the second example, South Dakota v. Dole, 483

U.S. 203 (1987), the Court held that Congress

could impose conditions on a state’s acceptance

of federal funds allocated under the Spending

Power. In Dole, Congress had conditioned the

allocation of federal highway funds on South

Dakota’s raising its drinking age. The Court in

College Savings explained that its holding in

Dole made clear that "Congress may, in the

exercise of its spending power, condition its

grant of funds to the States upon their taking

certain actions that Congress could not require

them to take, and that acceptance of the funds

entails an agreement to the actions." College

Savings, 527 U.S. at 686. Just as it was a

"gratuity" for Congress to approve an interstate

compact, the Court in College Savings noted that

federal funds were a "gift" from Congress that it

was under no obligation to give. Id. at 686-87.

Because the Court in College Savings endorsed

some kinds of "constructive" waivers, we cannot

accept the commissions’ argument that all

constructive waivers are now foreclosed. We

instead understand the Court’s holding in College

Savings to set boundaries for congressional

attempts to obtain waivers from states. See id.

at 690 (stating that "[o]ur opinion today has

sought to discern what the bounds [of federal

power] are"). In Seminole Tribe, the Court had

held that Congress could not abrogate state

sovereign immunity through the exercise of its

Article I powers. Parden-style waivers--in which

a state was deemed to have waived its immunity

simply by engaging in an activity regulated by

Congress in the exercise of its Article I powers-

-nevertheless effectively allowed Congress to

circumvent the holding of Seminole Tribe. See id.

at 683. As the Court explained in College

Savings, the type of "forced waiver" exacted by

Congress under Parden, whereby the state is

threatened with the sanction of waiving its

immunity if it engages in a regulated enterprise,

was really an abrogation of the state’s immunity

prohibited by Seminole Tribe. See id. (noting

that forced waiver and abrogation are "the same

side of the same coin"); see also Chavez v. Arte

Publico Press, 204 F.3d 601, 604 n.5 (5th Cir.

2000) ("College Savings expressly overruled

Parden and its implied waiver theory. That theory

is no longer available to support an Article I

abrogation of Eleventh Amendment Immunity."

(emphasis added) (citation omitted)). The Court’s

decision in College Savings closed the "forced

waiver" loophole left open by Parden.

With these principles in mind, we shall now turn

to the cases before us to examine whether there

is a valid waiver.

3.

We first examine, as a threshold matter, whether

Congress, in inviting the states to waive their

Eleventh Amendment immunity, has done so with

sufficient clarity. When it intends to obtain a

waiver of immunity from the states, Congress must

"speak with a clear voice" so that the states may

exercise their choice to waive their immunity

"knowingly, cognizant of the consequences of

their participation." Pennhurst State Sch. &

Hosp. v. Halderman, 451 U.S. 1, 17 (1981)

("Pennhurst I"); accord Atascadero, 473 U.S. at

238-40 (stating that the Court has required "an

unequivocal expression of congressional intent"

to obtain an Eleventh Amendment waiver from

states (citation omitted)); see also Dole, 483

U.S. at 207 (quoting Pennhurst I and stating that

Congress must state the condition

"’unambiguously’").

The commissions submit that there can be no

waiver of sovereign immunity in these cases

because the language of the 1996

Telecommunications Act contains no clear and

unambiguous expression of Congress’ intent to

condition the states’ participation in the Act’s

regulatory scheme on their consent to suit in

federal court. The commissions point out that the

Act does not even mention sovereign immunity or

indicate an intent to give states a choice

between carrying out their responsibilities under

the Act or retaining their sovereign immunity by

letting the FCC fulfill their responsibilities.

The absence of these elements from the statutory

language negates, in the commissions’ view, any

possibility of a valid waiver; the statutory

language contains no explicit manifestation that

Congress clearly intended to condition the

states’ participation under the Act on their

waiver of sovereign immunity.

We cannot accept this argument. Although the

language of the statute does not contain the

express waiver language that the commissions

seek, the structure of the pertinent section of

the statute, notably 47 U.S.C. sec. 252 (Supp. II

1996), nevertheless makes clear that Congress

intended to provide for federal court review of

any regulatory determination made under the

section, whether by a state commission or, if the

state commission chooses not to act, by the FCC

acting in its place. Section 252 first describes

the duties of the carriers seeking to enter into

an interconnection agreement and then details the

role of the state commissions in the mediation,

arbitration and review process. It sets forth the

standards by which the state commissions may

impose terms upon the parties to the

interconnection agreements during arbitration as

well as the standards by which the state

commissions must approve or reject an agreement.

Subsection 252(e)(5) then provides that, if a

state commission does not carry out its

responsibilities under sec. 252, the FCC will act

in place of the state commission. Subsection

252(e)(6), titled "Review of State commission

actions," then provides that the exclusive remedy

for a state commission’s failure to act will be

the proceedings before the FCC and any judicial

review of the FCC’s actions. It further provides

that any party aggrieved by a state commission’s

determination under sec. 252 may obtain review

"in an appropriate Federal district court to

determine whether the agreement or statement

meets the requirements of section 251 [and

section 252]." 47 U.S.C. sec. 252(e)(6) (Supp. II

1996).

Thus, under the terms of sec. 252, the state

commission or, if that body chooses not to act,

the FCC will exercise regulatory authority over

interconnection agreements. That administrative

action, whether taken by a state administrative

tribunal or by the FCC, is subject to review in

federal court. If the reviewing body is a state

commission, the statute provides that the

commission’s actions are reviewable in federal

court under subsection 252(e)(6); if the

reviewing body is the FCC, its actions are

reviewable in federal court under 28 U.S.C. sec.

2342(1). In short, Congress has expressed

unmistakably that, under the 1996

Telecommunications Act, states could participate

in the federal regulatory function delegated to

them by the federal government on the condition

that their participation be reviewable in federal

court. We therefore conclude that the 1996

Telecommunications Act satisfies the requirement

that Congress clearly state that participation by

the state in the regulatory scheme entails a

waiver of immunity from suit in federal court.

Accord MCI Telecomms. Corp. v. Public Serv.

Comm’n, No. 99-4203, 2000 WL 783382, at *8 (10th

Cir. June 20, 2000) (concluding that sec. 252

puts states on notice that Congress intends to

subject them to suit in federal court if they act

under sec. 252).

4.

We now turn to the question of whether the

states have unequivocally waived their Eleventh

Amendment immunity. As the Supreme Court has

noted, there is "a fundamental difference"

between "Congress’s expressing unequivocally its

intention that if the State takes certain action

it shall be deemed to have waived [its] immunity"

and "a State’s expressing unequivocally that it

waives its immunity." College Savings, 527 U.S.

at 680-81. Therefore, we must determine whether

the states made a clear declaration that they

desired to waive their immunity.

The carriers do not contend that Illinois or

Wisconsin waived their immunity by statute.

Rather, they maintain that these states have

waived their Eleventh Amendment immunity by

accepting the federal government’s invitation to

act as regulators of the local telephone market

in accordance with sec. 252 of the 1996

Telecommunications Act. We agree with that

assessment and therefore hold, as the Tenth

Circuit held in MCI Telecommunications Corp. v.

Public Service Commission, No. 99-4203, 2000 WL

783382, (10th Cir. June 20, 2000), that states

voluntarily waive their sovereign immunity by

accepting that invitation.

The commissions endeavor to distinguish the

Petty- and Dole-style waivers endorsed by the

Supreme Court in College Savings from the

situations in the cases before us. According to

the commissions, the waivers obtained by the 1996

Telecommunications Act are fundamentally

different than those in Petty and Dole. They

point out that Petty involved Congress’ Compact

Power and Dole its Spending Power, while the 1996

Telecommunications Act is an exercise of

Congress’ Commerce Power. We do not believe that

this distinction is helpful to the analysis

required by College Savings. In College Savings,

the Supreme Court’s analysis did not hinge on

whether Congress was acting within its Commerce

or Spending or Compact Powers, all of which are

Article I powers. Rather, the validity of a

purported waiver turns on whether the waiver is

conditioned on the state’s truly voluntary

acceptance of a federal "gratuity." Accord Public

Serv. Comm’n, 2000 WL 783382, at *7 ("[F]or a

constructive waiver of sovereign immunity to be

valid under College Savings Bank, it must be

altogether voluntary and not forced from a state

by Congress."). The significant commonality

between Dole and Petty is not that each involved

a power other than the Commerce Power; the key in

those cases was that Congress had the prerogative

to bestow a gratuity and that, by accepting the

gratuity, the states agreed to undertake certain

actions that Congress could not otherwise have

required them to take.

It is clear that Congress, in exercising its

Commerce Power, could determine that all

regulation of the telecommunications industry

ought to be entrusted to the federal government.

See F.E.R.C. 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."); Public Serv. Comm’n, 2000

WL 783382, at *8. And with the 1996

Telecommunications Act, we believe it equally

clear that Congress did take over some aspects of

the telecommunications industry. See AT&T Corp.,

525 U.S. at 378-79 n.6 (stating that, as to those

aspects addressed by the 1996 Telecommunications

Act, Congress has "unquestionably" taken the

regulation of local telecommunications

competition away from the states); Public Serv.

Comm’n, 2000 WL 783382, at *8. Although Congress

cannot abrogate state sovereign immunity by

exercising its Article I powers, see Seminole

Tribe, 517 U.S. at 72-73, and cannot "commandeer"

state regulatory agencies with legislation

forcing them to regulate on behalf of Congress,

see Printz v. United States, 521 U.S. 898, 935

(1997); New York v. United States, 505 U.S. 144,

168 (1992), these limitations on congressional

power do not prohibit Congress from obtaining a

state’s voluntary consent to federal

jurisdiction. With the 1996 Telecommunications

Act, Congress has created a complex federal

regulatory scheme for many aspects of the

telecommunications industry. One component of

that scheme is the invitation from Congress to

the states to participate in the federal

regulation of interconnection agreements and

other aspects of the local telephone market.

Congress certainly had the power to take up the

regulation of these areas on its own, and it

certainly can invite the states to act on its

behalf in carrying out those regulatory

functions.

After the 1996 Telecommunications Act, the

regulation of interconnection agreements and the

approval of SGATs are no longer, in the terms

employed by the Supreme Court in College Savings,

"otherwise permissible activit[ies]" for the

states. 527 U.S. at 687; cf. Public Serv. Comm’n,

2000 WL 783382, at *8 ("[W]ith 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."). Congress, exercising its

authority to regulate commerce has precluded all

other regulation except on its terms. Unlike the

situation in Parden and in College Savings, the

states are not merely acting in an area regulated

by Congress; they are now voluntarily regulating

on behalf of Congress./8 Unlike the situation in

Parden, in which Alabama exercised its sovereign

authority to operate a railroad, the state

commissions have conducted arbitrations for

interconnection agreements, have approved and

enforced those agreements, and have acted on an

SGAT under a federal grant of power. Their

authority to act was derived from provisions of

the Act and not from their own sovereign

authority.

The commissions submit that the waivers in our

cases cannot be likened to the kind of waiver

obtained by Congress in the exercise of its

Spending Power. This is so, the commissions tell

us, because with Spending Clause waivers the

states effectively enter into a "contract" with

Congress--in exchange for the federal funding,

the state agrees to the terms offered by

Congress. We think that the commissions’ analogy,

however, tends to support, rather than weaken,

our conclusion. The state commissions have

entered into the same kind of exchange with

Congress that takes place when Congress offers

federal funds conditioned on a state’s acceptance

of the federal terms./9 The only difference

between the classic example of a Spending Clause

gratuity of federal funds and the waivers in our

cases is that, with the 1996 Telecommunications

Act, Congress has offered the states, not federal

funds, but a role as what the carriers have

called a "deputized" federal regulator. In

exchange for this grant of regulatory power,

Congress has required the states to agree to

submit to federal jurisdiction to review their

actions. In Dole, the gratuity was money; the

condition was a higher drinking age. Here, the

gratuity is federal regulatory power; the

condition is waiver of the state’s immunity.

Having accepted the regulatory power offered by

Congress, Illinois and Wisconsin now must accept

the condition that was attached to that grant of

power. Cf. Board of Educ. of Oak Park v. Kelly

E., 207 F.3d 931, 935 (7th Cir. 2000) (noting

that "[o]ne string attached to money under the

IDEA is submitting to suit in federal court" and

holding that "having accepted the money, [states]

must litigate in federal court"), petition for

cert. filed, 69 U.S.L.W. 3001 (U.S. June 16,

2000) (No. 99-2027)./10

We believe that College Savings does not alter

the principle that states may waive their

immunity by accepting a benefit from Congress

that has conditions attached to that

acceptance./11 Congress could--and did--take

over regulation of a part of the

telecommunications industry in accordance with

its Commerce Power. Such regulation is no longer

an "otherwise permissible activity" for states.

Congress may choose to "give back" to states some

of the regulatory power Congress has taken away,

and Congress may attach conditions to the return

of that power. Cf. College Savings, 527 U.S. at

686-87 (explaining that, when Congress bestows a

gift or gratutity, it may attach conditions to a

state’s acceptance of that gift or gratuity).

States are free to accept or reject the terms

Congress has offered the states if they want a

continued role in regulating this segment of the

local telephone service market./12

D. Ex parte Young

1.

As an independent basis for decision, we also

believe that the Eleventh Amendment does not bar

the carriers from pursuing injunctive relief

against the individual members of the state

commissions. Under the Ex parte Young doctrine, a

private party may sue individual state officials

in federal court to obtain prospective relief for

an ongoing violation of federal law. See Ex parte

Young, 209 U.S. at 159-60; Idaho v. Coeur d’Alene

Tribe, 521 U.S. 261, 294 (1997) (O’Connor, J.,

concurring); id. at 298-99 (Souter, J.,

dissenting) ("The plaintiff must allege that the

officers are acting in violation of federal law,

and must seek prospective relief to address an

ongoing violation, not compensation or other

retrospective relief for violations past."

(internal citation and footnote omitted)); Marie

O., 131 F.3d at 615. Under this doctrine, federal

courts are enabled to "vindicate federal rights

and hold state officials responsible to ’the

supreme authority of the United States.’"

Pennhurst II, 465 U.S. at 105 (quoting Ex parte

Young, 209 U.S. at 160)./13 The Supreme Court’s

decisions in Alden, College Savings and Florida

Prepaid have not called the Ex parte Young

doctrine into question. Indeed, the Court in

Alden reaffirmed the doctrine’s role in the

sovereign immunity context. See Alden v. Maine,

527 U.S. 706, 748 (1999) (calling the Ex parte

Young doctrine an "essential" part of the Court’s

sovereign immunity jurisprudence).

We agree with the Sixth and Tenth Circuits that

these suits are "straightforward" Ex parte Young

cases. Public Serv. Comm’n, 2000 WL 783382, at *9

(holding that state commissioners may be sued

under the Ex parte Young doctrine for their

approval and enforcement of a sec. 252

interconnection agreement); Michigan Bell Tel.

Co., 202 F.3d at 867 (same). The carriers seek

injunctive relief from what they allege to be

determinations made by the commissioners that are

contrary to the 1996 Telecommunications Act. The

commissioners argue that, if any violations

occurred, they occurred in the past, and that

therefore the Ex parte Young doctrine should not

apply. We cannot accept this argument. The

challenged determinations are still in place, and

the carriers seek to have the commissioners

conform their future actions, including their

continuing enforcement of the challenged

determinations, with federal law. See Entergy,

Arkansas, Inc. v. Nebraska, 210 F.3d 887, 898

(8th Cir. 2000) ("While the relief granted under

Ex parte Young may only be prospective, proof for

the claim necessitating relief can be based on

historical facts, and most often will be."). Such

relief is precisely the type contemplated by the

Ex parte Young doctrine. Thus, the carriers’

suits fit squarely within the traditional

framework of Ex parte Young.

2.

The commissioners submit that the Supreme

Court’s decision in Seminole Tribe renders the Ex

parte Young doctrine inapplicable to the cases

before us. In Seminole Tribe, the Supreme Court

admonished that "where Congress has prescribed a

detailed remedial scheme for the enforcement

against a State of a statutorily created right, a

court should hesitate before casting aside those

limitations and permitting an action against a

state officer based upon Ex parte Young."

Seminole Tribe, 517 U.S. at 74. According to the

commissioners, Congress has created in sec. 252 a

"detailed remedial scheme" that is on par with

the remedial scheme at issue in Seminole Tribe.

Consequently, the commissioners argue, an Ex

parte Young suit against them would run afoul of

the Court’s decision in Seminole Tribe.

We cannot accept the commissioners’

characterization of the available remedies under

the 1996 Telecommunications Act and,

consequently, find their analogy to the situation

in Seminole Tribe to be flawed. Section 252 of

the Act does not create a "detailed remedial

scheme" that manifests Congress’ intent to limit

the scope of statutory remedies available to

parties aggrieved by the commissioners’

interconnection determinations. The enforcement

provision implicated in our cases merely states:

"In any case in which a State commission makes a

determination under this section, any party

aggrieved by such determination may bring an

action in an appropriate Federal district court

to determine whether the agreement or statement

meets the requirements of section 251 [and

section 252]." 47 U.S.C. sec. 252(e)(6) (Supp. II

1996). The power of the court under subsection

252(e)(6) stands in stark contrast with the

court’s powers to impose what the Supreme Court

called a "modest set of sanctions" under the

statute at issue in Seminole Tribe. Seminole

Tribe, 517 U.S. at 75.

In Seminole Tribe, the Court addressed the

judicial enforcement scheme created by the Indian

Gaming Regulatory Act ("the IGRA"). Congress had

passed the IGRA in 1988 in order to provide a

statutory framework for the operation and

regulation of tribal gaming operations. Under the

IGRA, Indian tribes could enter into the most

heavily regulated class of gaming (i.e., slot

machines, casino games, banking card games, dog

racing, and lotteries) only after certain

conditions had been met. One of those conditions

imposed by the IGRA was that the tribe’s

operations had to conform to a valid compact

between the tribe and the state in which the

gaming operations were located. See 25 U.S.C.

sec. 2710(d)(1).

The IGRA set forth the process by which tribes

and states were to enter into these compacts.

First, a tribe was required to request that the

state enter into compact negotiations. Once a

request had been made, the state was obligated

under the IGRA to "negotiate with the Indian

tribe in good faith" to enter into a compact. Id.

sec. 2710(d)(3)(A). Still other provisions of the

IGRA made the state’s obligation to negotiate in

good faith judicially enforceable. See id. sec.

2710(d)(7)(A)(i) and (B)(i). Other provisions set

forth what the Supreme Court described as "an

elaborate remedial scheme" designed to ensure

that a Tribal-State compact would be formed. See

id. sec. 2710(d)(7)(B)(ii)-(vii)./14 Under this

scheme, if the district court determined that the

state had failed to negotiate in good faith, the

IGRA only allowed the court to issue an order

mandating that the tribe and the state enter into

a compact within 60 days. See Seminole Tribe, 517

U.S. at 74. If the parties disregarded this

order, the only recourse available to the

district court was to order each party to submit

a proposed compact to a mediator, who would then

choose one. See id. at 74. And if the state

refused to accept the compact chosen by the

mediator, the IGRA provided that the mediator was

to inform the U.S. Secretary of the Interior, who

would then issue regulations to govern the

tribe’s gaming operations. See id. at 74-75.

Unlike the IGRA, in which "Congress chose to

impose upon the State a liability that is

significantly more limited than would be the

liability imposed upon the state officer under Ex

parte Young," Seminole Tribe, 517 U.S. at 75-76,

Congress has not limited the court’s remedial

power under subsection 252(e)(6) of the 1996

Telecommunications Act. We reach this conclusion

guided by our decision in Marie O. v. Edgar, 131

F.3d 610 (7th Cir. 1997). In Marie O., a case

decided in the wake of Seminole Tribe, we held

that the Individuals with Disabilities Education

Act ("the IDEA") did not contain an "explicit

remedial scheme" that would prevent an Ex parte

Young suit. Marie O., 131 F.3d at 616. The IDEA

section involved in that case empowered a

district court to grant "’such relief as it

determines is appropriate’" to ensure compliance

with certain provisions of the IDEA. Id. (quoting

20 U.S.C. sec. 1480(1)). Importantly, we noted

that the remedial measures available under the

IDEA did not expressly limit the role of the

district court in redressing complaints with

regard to the IDEA. Similarly, subsection

252(e)(6) does not limit the role or the power of

the district court. Quite the contrary,

subsection 252(e)(6) is silent as to how a

district court would enforce its ruling under

that section. Thus, we hold that Seminole Tribe

does not preclude an Ex parte Young suit against

the state commissioners here.

3.

Nor can we accept the contention that the

Supreme Court’s decision in Coeur d’Alene Tribe

bars Ex parte Young suits by the carriers against

the commissioners. The commissioners maintain

that Ex parte Young suits against them would

trammel "special sovereignty interests" of their

states and, thus, should be precluded by Coeur

d’Alene Tribe.

In Coeur d’Alene Tribe, a majority of the Court

held that a federal court cannot grant

prospective equitable relief under the Ex parte

Young doctrine when that relief would implicate

"special sovereignty interests" of the state and

would be the "functional equivalent" to a form of

legal relief otherwise barred by the Eleventh

Amendment. Coeur d’Alene Tribe, 521 U.S. at 281-

82. More precisely, the Court held that the Ex

parte Young doctrine was inapplicable to the

"particular and special circumstances" present in

that case. Id. at 287. A majority of the Court

held that the lawsuit against Idaho could not

proceed under the Ex parte Young doctrine because

the suit, in which the Coeur d’Alene Tribe sought

to have the federal court divest the state of its

ownership of land under Lake Coeur d’Alene, in

essence would affect "Idaho’s sovereign interest

in its lands and waters" to a degree "fully as

intrusive as almost any conceivable retroactive

levy upon funds in its Treasury." Id. at 287; see

also id. at 296 (O’Connor, J., concurring)

(agreeing that the Ex parte Young doctrine should

not be extended to reach the Tribe’s claim "to

quiet title to sovereign lands" because such a

lawsuit is really a suit against the state). The

Court explained that the Tribe’s lawsuit could

not proceed under the Ex parte Young doctrine

because the suit was the "functional equivalent

of a quiet title action which implicates special

sovereignty interests." Id. at 281.

Illinois’ and Wisconsin’s interests in the

regulation of telecommunications providers in

their respective states cannot be equated with

Idaho’s interest in its land, which the Court in

Coeur d’Alene Tribe found so fundamental. In the

wake of the 1996 Telecommunications Act, any

"sovereign" interest Illinois and Wisconsin may

have in regulating interconnection agreements and

SGATs is derived solely from the regulatory role

Congress has bestowed upon the states. Thus, the

suits against the state commissioners to require

compliance with the 1996 Telecommunications Act

do not strike at core functions or fundamental

powers of either Illinois or Wisconsin./15

Therefore, the availability of an Ex parte Young

suit in our cases is not affected by the special

limitation recognized by a majority of the Court

in Coeur d’Alene Tribe. Accord Public Serv.

Comm’n, 2000 WL 783382, at *9 n.8.

Conclusion

We hold that, by deciding to exercise the power

delegated to them by the Act, the states agreed

to the conditions attached to that grant of power

and thereby waived their Eleventh Amendment

immunity from suit in federal court. The federal

regulatory scheme set forth in sec.sec. 251 and

252 of the Act bestowed upon states a "gratuity."

Acceptance of that federal invitation to share in

the regulation of the telecommunications industry

is conditioned on a waiver of Eleventh Amendment

immunity. A state’s decision to exercise that

regulatory authority--which would otherwise lie

with the federal government--necessarily

constitutes a waiver of its immunity from suit in

federal court.

We also hold that, under Ex parte Young, the

Eleventh Amendment does not bar the carriers’

lawsuits against the individual commissioners.

Because the carriers have alleged ongoing

violations of federal law and because they seek

prospective equitable relief, their lawsuits fit

squarely within the traditional framework of Ex

parte Young. Moreover, the more recent

limitations on Ex parte Young suits that the

Supreme Court announced in Seminole Tribe and

Coeur d’Alene Tribe are not applicable here. The

1996 Telecommunications Act does not contain a

specific remedial scheme, and these lawsuits do

not implicate special sovereignty interests.

Accordingly, we affirm the judgment of the

district court in 98-2127. We reverse the

judgment of the district court in 99-2805, 99-

2806, 99-2811, 99-2873, and 99-2992, and we

remand these cases to the district court for

further proceedings consistent with this opinion.

98-2127 AFFIRMED;

99-2805, 99-2806, 99-2811,

99-2873 & 99-2992 REVERSED and REMANDED

/1 Again, both MCI Telecommunications Corp. and MCI

Metro Access Transmission Services, Inc.

/2 A "Bell operating company" is one of the local

"Baby Bells" split off from AT&T in the

divestiture decree. See Peter W. Huber et al.,

Federal Telecommunications Law 1362 (2d ed.

1999); see also 47 U.S.C. sec. 153(4) (Supp. II

1996) (listing the individual Bell operating

companies).

/3 Ameritech Illinois also filed a separate action

against the ICC Commissioners, challenging their

approval of two negotiated interconnection

agreements between Ameritech Illinois and other

telecommunications carriers. An appeal in that

case, 98-2256, originally was part of this

appeal. The agreements at issue in 98-2256 were

made through private negotiations without

mediation or arbitration by the ICC. During the

pendency of the appeal in 98-2256, however,

Ameritech Illinois filed a motion requesting that

we remand 98-2256 to the district court so that

it may be dismissed voluntarily with prejudice.

We have granted that motion and therefore need

not address the applicability of the Eleventh

Amendment to litigation involving such privately

negotiated agreements.

We also have remanded to the district

court a different case, 98-

2566, which was originally part of this

consolidated appeal, so that it too may be

dismissed voluntarily.

/4 Three new entrants sought to intervene in

Ameritech Wisconsin’s suit over the SGAT, but the

district court denied the motions because it

concluded that the PSCW would adequately

represent the prospective intervenors’ interests.

The district court’s denial of the motions to

intervene is not before us on appeal.

/5 In its second decision, the district court also

held that, in light of this circuit’s decision in

Illinois Bell Telephone Co. v. Worldcom

Technologies, Inc., 179 F.3d 566 (7th Cir. 1999),

the PSCW and the PSCW Commissioners were

necessary parties to these suits. Because the

PSCW and the PSCW Commissioners were necessary

parties and because the district court had

concluded that they were entitled to immunity,

the district court held that the cases had to be

dismissed in their entirety for failure to join

necessary parties. We hold today, however, that

the PSCW and the PSCW Commissioners may be sued

in federal court; thus, we need not address the

Rule 19(b) arguments raised by the parties.

/6 See also Puerto Rico Tel. Co. v.

Telecommunications Regulatory Bd., 189 F.3d 1, 10

(1st Cir. 1999) (assuming, without deciding, that

state commission interpretations and enforcements

of agreements are subject to federal court review

under subsection 252(e)(6)).

/7 See 15 U.S.C. sec.sec. 1122, 1125(a) (as amended

by the Trademark Remedy Clarification Act, Pub.

L. No. 102-542, sec. 3(b)-(c), 106 Stat. 3567,

3567-68 (1992)).

/8 See also Public Serv. Comm’n, 2000 WL 783382, at

*8 ("47 U.S.C.A. sec. 252 invites states to

participate in the federal government’s

regulation of local telephone service."); Peter

W. Huber et al., Federal Telecommunications Law

sec. 3.3.4, at 227 (2d ed. 1999) ("As a backdrop

to its primary reliance on privately negotiated

agreements, however, Congress enlisted the aid of

state public utility commissions to ensure that

local competition was implemented fairly and with

due regard to the local conditions and the

particular historical circumstances of local

regulation under the prior regime.").

/9 Cf. Litman v. George Mason Univ., 186 F.3d 544,

555 (4th Cir. 1999) (holding that a public

university had waived its immunity by accepting

Title IX funding and thus agreeing to the

condition of waiver Congress had attached to

those funds), cert. denied, 120 S. Ct. 1220

(2000); In re Innes, 184 F.3d 1275, 1284 (10th

Cir. 1999) (holding that a state had waived

voluntarily its immunity by agreeing to

participate in the federal Perkins Loan Program,

a federal program in which states are required to

undertake certain actions in federal bankruptcy

court proceedings), cert. denied, 120 S. Ct. 1530

(2000).

/10 It has been suggested to us that the

commissioners do not have the power to waive the

immunity of their respective states; that only

the state legislatures can waive their states’

Eleventh Amendment immunity. We believe, however,

that the waivers of immunity have come from the

states themselves (and not the commissions). It

is the states that have authorized the

commissions to regulate the telecommunications

industry, see Ill. Comp. Stat. 5/2-101; Wis. Stat. sec.

196.02, and, despite the clear warning from

Congress in subsection 252(e)(6) of the 1996

Telecommunications Act, neither Illinois nor

Wisconsin have taken any steps to forbid their

respective commissions from exercising the

authority granted to them by Congress. Indeed,

the states have agreed unmistakably and

affirmatively to waive their immunity. By

accepting the grant of regulatory power offered

by Congress, and by allowing the state

commissions to exercise that power, Illinois and

Wisconsin cannot contend now that they are not

bound by the conditions attached to that grant of

power.

/11 At one time, privately negotiated agreements were

at issue in a case before us. But as we have

explained, supra note 3, we have granted

Ameritech Illinois’ motion to remand 98-2256 to

the district court for a voluntary dismissal with

prejudice. We therefore need not decide--and

reserve for another day--whether a state

commission might have no true choice but to

involve itself in the review process of a

privately negotiated interconnection agreement in

order to avoid the consequence of having the

agreement be "deemed approved" under 47 U.S.C.

sec. 252(e)(4) (Supp. II 1996). Cf. College

Savings, 527 U.S. at 687 (stating that, in some

instances, the inducement offered by Congress

might be so coercive that the voluntariness of

the waiver is destroyed).

/12 We are not unmindful that our colleagues in the

Sixth Circuit have expressed the view that, in

light of the Supreme Court’s decisions in College

Savings and Florida Prepaid, "it is virtually

certain that a state utility commission’s

decision to accept regulatory authority under the

[1996 Telecommunications Act] cannot legitimately

be construed as a valid waiver of sovereign

immunity." GTE North, Inc. v. Strand, 209 F.3d

909, 922 n.6 (6th Cir. 2000); see also Michigan

Bell Tel. Co. v. Climax Tel. Co., 202 F.3d 862,

867 & n.2 (6th Cir. 2000) (declining to find that

the state had waived its immunity by regulating

under the Act and instead relying on the Ex parte

Young doctrine to allow suits against individual

state commissioners), petition for cert. filed,

68 U.S.L.W. 3742 (U.S. May 15, 2000) (No. 99-

1878). As we have already indicated, however, we

believe that the Court of Appeals for the Tenth

Circuit has expressed the correct view, and we

agree with its analysis. See Public Serv. Comm’n,

2000 WL 783382, at *8.

/13 The Ex parte Young doctrine may not be used to

enjoin violations of state law. See Pennhurst II,

465 U.S. at 106.

/14 To illustrate the elaborate nature of this

remedial scheme, we shall set out the Supreme

Court’s full description of it:

Sections 2710(d)(7)(B)(ii)-(vii) describe

an elaborate remedial scheme

designed to ensure the formation of a

Tribal-State compact. A tribe that brings an

action under sec. 2710(d)(7)(A)(i) must show that

no Tribal-State compact has been entered and that

the State failed to respond in good faith to the

tribe’s request to negotiate; at that point, the

burden then shifts to the State to prove that it

did in fact negotiate in good faith. sec.

2710(d)(7)(B)(ii). If the district court

concludes that the State has failed to negotiate

in good faith toward the formation of a

Tribal-State compact, then it "shall order the

State and Indian Tribe to conclude such a compact

within a 60-day period." sec. 2710(d)(7)(B)(iii).

If no compact has been concluded 60 days after

the court’s order, then "the Indian tribe and the

State shall each submit to a mediator appointed

by the court a proposed compact that represents

their last best offer for a compact." sec.

2710(d)(7) (B)(iv). The mediator chooses from

between the two proposed compacts the one "which

best comports with the terms of the Act and any

other applicable Federal law and with the

findings and order of the court," ibid., and

submits it to the State and the Indian tribe,

sec. 2710(d)(7)(B)(v). If the State consents to

the proposed compact within 60 days of its

submission by the mediator, then the proposed

compact is "treated as a Tribal-State compact

entered into under paragraph (3)." sec.

2710(d)(7)(B)(vi). If, however, the State does

not consent within that 60-day period, then the

Act provides that the mediator "shall notify the

Secretary of the Interior" and that the Secretary

"shall prescribe procedures under which class III

gaming may be conducted on the Indian lands over

which the Indian tribe has jurisdiction." sec.

2710(d) (7)(B)(vii).

Seminole Tribe, 517 U.S. at 50.

/15 Compare J.B. ex rel. Hart v. Valdez, 186 F.3d

1280, 1287 (10th Cir. 1999) (holding that "[a]

state’s interest in administering a welfare

program at least partially funded by the federal

government is not such a core sovereign interest

as to preclude the application of Ex parte

Young"), and Branson Sch. Dist. RE-82 v. Romer,

161 F.3d 619, 632-33 (10th Cir. 1998) (holding

that an action, which was "the functional

equivalent of a breach of trust action" against

the state for planned changes to its management

of public lands, was within the scope of the Ex

parte Young doctrine because the relief sought

would not alter the nature of the state’s

ownership in the land but would affect only the

manner in which the state managed the lands at

issue), cert. denied, 119 S. Ct. 1461 (1999),

with MacDonald v. Village of Northport, 164 F.3d

964, 972 (6th Cir. 1999) (holding that a state’s

"great interest in maintaining access to the

Great Lakes" was a "special sovereignty interest"

that precluded an Ex parte Young suit), and ANR

Pipeline Co. v. Lafaver, 150 F.3d 1178, 1193

(10th Cir. 1998) (holding that a state’s power to

tax is akin to the "special sovereignty

interests" identified in Coeur d’Alene Tribe),

cert. denied, 525 U.S. 1122 (1999).