Warren Havens v. Mobex Network Services LLC

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

____________

No. 14-4043

____________

WARREN HAVENS; SKYBRIDGE SPECTRUM

FOUNDATION, a Delaware nonprofit corporation;

TELESAURUS VPC, LLC, a Delaware Limited Liability

Company; AMTS CONSORTIUM, LLC, a Delaware Limited

Liability Company; INTELLIGENT TRANSPORTATION &

MONITORING, LLC, a Delaware Limited Liability

Company; TELESAURUS GB, LLC, a Delaware Limited

Liability Company,

Appellants

v.

MOBEX NETWORK SERVICES, LLC, a Delaware Limited

Liability Company; MOBEX COMMUNICATIONS, INC, a

Delaware corporation; MARITIME COMMUNICATIONS

LAND MOBILE LLC, a Delaware Limited Liability

Company; PAGING SYSTEMS, INC, a California

corporation; TOUCH TEL CORPORATION, a California

company; JOHN DOE Nos. 1-20

On Appeal from the United States District Court

for the District of New Jersey

(D. N.J. No. 2-11-cv-00993)

District Judge: Honorable Katherine S. Hayden

Argued on July 7, 2015

Before: FUENTES, *SLOVITER and ROTH, Circuit Judges

(Filed: April 14, 2016)

Stephen M. Hudspeth, Esq. [Argued]

6 Glen Hill Road

Wilton, CT 06897

Michael Grohs, Esq.

Sean R. Kelley, Esq.

Saiber

18 Columbia Turnpike

Suite 200

Florham Park, NJ 07932

Counsel for Appellants

*

The Honorable Dolores K. Sloviter assumed inactive status

on April 4, 2016 after the argument and conference in this

case, but before the filing of the opinion. The opinion is filed

by a quorum of the panel pursuant to 28 U.S.C. § 46(d) and

Third Circuit I.O.P. Chapter 12.

2

Robert W. Mauriello, Jr., Esq. [Argued]

Graham Curtin, P.A.

4 Headquarters Plaza

P.O. Box 1991

Morristown, NJ 07962

Counsel for Appellee

OPINION

ROTH, Circuit Judge:

Warren Havens and five entities under his control

brought this suit against competitors Mobex Network

Services, LLC, Mobex Communications, Inc., Maritime

Communications/Land Mobile, LLC (MCLM), Paging

Systems, Inc. (PSI), and Touch Tel Corporation for allegedly

violating the Federal Communications Act (FCA) and the

Sherman Antitrust Act. The District Court dismissed the two

FCA claims for failure to state a claim. After a nine-day

bench trial, the District Court entered judgment for MCLM

on the basis that no conspiracy existed. We will affirm.

I.

A. FACTS

3

Marine radio providers enable vessels to communicate

while on waterways and on the high seas. An Automated

Maritime Telecommunications System (AMTS) station is a

special type of radio station in the United States that provides

communication services between land and vessels in

navigable waterways. The AMTS spectrum is 217 to 218

MHz and 219 to 220 MHz.1 Advances in wireless technology

have greatly expanded the potential uses of AMTS’s,

including systems for public transportation safety, such as

“Positive Train Control.”

The FCC originally issued licenses to use AMTS-

designated frequencies on a site-based system. In this system,

the site is a small geographic region defined by location and

the waterway served. These “site-based” licenses were

provided at no cost on a first-come, first-served basis. In

2000, the FCC stopped issuing site-based licenses and began

issuing AMTS licenses on a geographic basis through a

competitive bidding process. Under the new procedure, the

FCC divided the United States into ten regions and, at two

public auctions, sold “geographic” licenses for two blocks of

AMTS frequencies (A block and B block) in each region.

Both site-based and geographic licensees are subject to

buildout and service requirements to remain valid.2

Although geographic licensees may generally place

stations anywhere within their allotted region, they may not

interfere with the functioning of existing site-based stations.

Specifically, 47 C.F.R. § 80.385(b)(1) requires that an

“AMTS geographic area licensee must locate its stations at

least 120 kilometers from the stations of co-channel site-

1

See 47 C.F.R. §§ 2.106, 30.385.

2

See 47 C.F.R. §§ 1.946(c), 1.955(a), 80.49(a)(3).

4

based AMTS licensees” to avoid radio interference with site-

based usage. In other words, the location of a site-based

station creates a gap in a geographic licensee’s coverage area

in which the geographic licensee is barred from transmitting

on AMTS frequencies. If a site-based license is terminated,

revoked, or found invalid, however, the spectrum will revert

automatically to the geographic licensee.3

Plaintiffs and defendants are holders of various AMTS

licenses in the United States. Out of the twenty geographic

licenses in the United States that were available at auction,

plaintiffs obtained thirteen, MCLM obtained four, and PSI

obtained two. None of the defendants sought to bid on

licenses in the same block and region in which the other

defendants held a pre-existing site-based license. But

plaintiffs obtained geographic licenses in areas overlaying

many of Mobex, MCLM, and PSI’s pre-existing site-based

licenses. At the center of this dispute is MCLM’s refusal to

disclose to plaintiffs the location of MCLM’s operating site-

based stations within plaintiffs’ geographic regions. Unable

to agree on who should turn over their geographic coordinates

first, the parties did not exchange information. This action,

along with various FCC administrative proceedings,

followed.

B. PROCEEDINGS

On June 20, 2008, plaintiffs brought claims against

MCLM, Mobex Network Services, PSI, and Touch Tel. The

parties then agreed to dismiss the case without prejudice in

light of a pending action in California state court. On

3

See id. § 80.385(c).

5

February 18, 2011, Havens filed a Second Amended

Complaint under a new docket number and added Mobex

Communications as a defendant. Plaintiffs assert three claims

in the Second Amended Complaint. In Count I, they seek a

mandatory injunction under § 401(b) of the FCA to force

defendants to comply with 47 C.F.R. § 80.385 and with the

directives set out in three FCC documents, which plaintiffs

refer to as the “Cooperation Orders.”4 Specifically, plaintiffs

request that the court require defendants to provide plaintiffs

with the operating contours for their site-based locations that

are located within plaintiffs’ geographic locations. In Count

II, plaintiffs allege that defendants violated § 201(b) of the

FCA by taking actions that are “unjust and unreasonable” and

seek monetary damages under §§ 206 and 207. Plaintiffs also

allege in Count III that defendants violated § 1 of the

Sherman Act by conspiring among themselves and with non-

named parties, in unreasonable restraint of trade or commerce

in the AMTS market, as evidenced by defendants’

coordination of the purchase of A and B block licenses, their

agreement to “warehouse” licenses by failing to construct

site-based stations and by refusing to disclose the operating

stations’ contours, and their false representations to the

industry and the FCC.5

4

We use this term simply to refer to the documents described

by Plaintiffs, and not to imply that they constitute “orders”

within the meaning of § 401(b). See infra Part II.A.

5

Count III also includes claims under § 2 of the Sherman Act

based on the “Essential Facilities Doctrine.” These claims

were dismissed by the District Court pursuant to Rule

12(b)(6) and are not at issue in this appeal.

6

Plaintiffs attached the three “Cooperation Orders” to

the Second Amended Complaint. The first document is an

April 8, 2009, FCC declaratory ruling in response to

MCLM’s request for clarification regarding § 80.385(b)(1), in

which the Commission declared that a geographic licensee’s

co-channel interference protection obligations should be

based on actual operating parameters, rather than maximum

permissible operating parameters. In a footnote, the FCC

then stated: “As we noted in [a prior] decision, we expect

incumbent AMTS licensees to cooperate with geographic

licensees in order to avoid and resolve interference issues.

This includes, at a minimum, providing upon request

sufficient information to enable geographic licensees to

calculate the site-based station’s protected contour.”6

The second Cooperation Order, dated March 20, 2009,

concerns a marine radio provider’s application to modify its

AMTS geographic license and PSI’s petition to dismiss the

application on the basis that the geographic licensee had not

afforded PSI’s site-based location adequate protection. In

dismissing PSI’s petition, the FCC noted that the application

had to make certain assumptions regarding PSI’s site-based

location. In the immediately following footnote, the FCC

then stated that “AMTS site-based incumbents are expected

to cooperate with geographic licensees in order to avoid and

resolve interference issues. . . . This includes, at a minimum,

providing upon request sufficient information to enable

6

Dennis C. Brown, Esq., Letter, 24 FCC Rcd. 4135, 4136 n.9

(2009) (Letter) (internal quotations omitted).

7

geographic licensees to calculate the site-based station’s

protected contour.”7

The last Cooperation Order is an April 16, 2010, FCC

denial of reconsideration of its declaratory ruling at issue in

the first Cooperation Order. In reaffirming its decision that

actual parameters should be used for determining co-channel

interference protection, the FCC observed that “AMTS site-

based licensees are expected to cooperate with geographic

licensees in avoiding and resolving interference issues, and . .

. this obligation requires, at a minimum, that the site-based

licensee ‘provid[e] upon request sufficient information to

enable geographic licensees to calculate the site-based

station’s protected contour.’”8

On December 22, 2011, the District Court dismissed

plaintiffs’ FCA claims pursuant to Federal Rule of Civil

Procedure 12(b)(6).9 On Count I, the District Court held that

47 C.F.R. § 80.385 and the Cooperation Orders do not

constitute “orders” under the meaning of § 401(b) because

they do not require defendants to engage in any particular

disclosure of their contour information. On Count II, the

7

In re Applications of Ne. Utils. Serv. Co. to Modify License

for Station WQEJ718, 24 FCC Rcd. 3310, 3311 n.12 (2009)

(NUSCO Order).

8

In re Maritime Commc’ns/Land Mobile, LLC Warren

Havens, Envtl. LLC, Intelligent Transp. & Monitoring LLC,

Skybridge Spectrum Found., 25 FCC Rcd. 3805, 3807 ¶ 6

(2010) (Reconsideration Order) (quoting Letter, 24 FCC Rcd.

at 4136 n.9).

9

See Havens v. Mobex Network Servs., LLC, No. 11-993,

2011 WL 6826104 (D.N.J. Dec. 22, 2011).

8

District Court held that the FCC had not yet addressed

whether the precise type of conduct at issue here was “unjust

or unreasonable” and therefore plaintiffs had no private right

of action under §§ 206 and 207.

MCLM subsequently moved for summary judgment

on the remaining claim. Plaintiffs sought to reopen discovery

pursuant to Rule 56(d). At this point, the other defendants

had stopped actively litigating the case. Mobex had become

defunct and had had default entered against it in February

2013; PSI and Touch Tel entered into a settlement agreement

with plaintiffs on April 8, 2013. On March 20, 2014, the

District Court denied both MCLM’s motion for summary

judgment and plaintiffs’ Rule 56(d) motion.

The bench trial began on May 20, 2014, and proved

contentious. Prior to trial, plaintiffs sought to admit 6,500

trial exhibits but then revised the list to 522 exhibits, and

were eventually ordered to limit the list further. Six witnesses

testified, including two plaintiffs’ experts who described

advances in accident avoidance in railroad transportation.

Warren Havens also testified on behalf of all plaintiffs.

Additional witnesses were Sandra DePriest, MCLM founder;

Donald DePriest, her husband and a communications

businessman; and John Reardon, former Mobex

Communications president, CEO, and general counsel. The

parties also submitted excerpts of deposition testimony of

David Kling, a Touch Tel engineer; David Predmore, a

former Mobex Communications and Mobex Network in-

house attorney; and Robert Cooper, Touch Tel’s president.

The nine-day bench trial concluded on June 10, 2014.

Almost a month after the parties had submitted

proposed findings of fact and conclusions of law, plaintiffs

9

wrote to the District Court to appraise it of “certain new and

material information.” Plaintiffs attached MCLM’s responses

to interrogatories served by the FCC, in which MCLM stated

that it had abandoned many of its sites prior to May 12, 2012,

and December 2, 2013. Plaintiffs claim that, had MCLM

disclosed this previously, plaintiffs would have been

significantly less hindered in their build-out plans for their

geographic stations. According to plaintiffs, “the only

credible reason for MCLM not so advising plaintiffs was to

uphold, and keep hidden, MCLM’s contribution to its

antitrust conspiracy with PSI.”

On September 2, 2014, the District Court found in

favor of MCLM on the basis that plaintiffs had failed to show

by a preponderance of the evidence that a conspiracy

existed.10 “Put another way, were the Court as factfinder

presented with [this] question in a typical verdict sheet given

to the jury in a Sherman Act § 1 case, . . . the Court would

answer, easily, No.”11 Because plaintiffs lost on the merits,

the court dismissed the default judgment against Mobex as

well.

II.12

10

See Havens v. Maritime Commc’ns/Land Mobile, LLC, No.

11-993, 2014 WL 4352300 (D.N.J. Sept. 2, 2014).

11

Id. at *30.

12

The District Court had subject matter jurisdiction pursuant

to 28 U.S.C. §§ 1331 and 1337, and we exercise jurisdiction

pursuant to 28 U.S.C. § 1291. We exercise plenary review

over a district court’s grant of a motion to dismiss for failure

to state a claim under Rule 12(b)(6). See Farber v. City of

10

A. PRIVATE ENFORCEMENT OF FCC ORDERS

Section 401(b) of the FCA gives private individuals an

express right to enforce FCC “orders.” This provision

authorizes injunctive relief for any party injured where

another party “fails or neglects to obey any order of the

Commission other than for the payment of money.”13

Plaintiffs seek a court order directing MCLM to provide them

with contour information for its site-based AMTS stations.

However, plaintiffs are entitled to a remedy only if the

provisions of 47 C.F.R. § 80.385(b)(1) or the so-called

Cooperation Orders constitute “orders” within the meaning of

§ 401(b).

We previously addressed the definition of an “order”

under § 401(b) in Mallenbaum v. Adelphia Communications

Corp.14 There, the plaintiffs challenged Adelphia’s monthly

Paterson, 440 F.3d 131, 134 (3d Cir. 2006). “A motion to

dismiss pursuant to Rule 12(b)(6) may be granted only if,

accepting all well pleaded allegations in the complaint as true,

and viewing them in the light most favorable to plaintiff,

plaintiff is not entitled to relief.” In re Burlington Coat

Factory Sec. Litig., 114 F.3d 1410, 1420 (3d Cir. 1997). “We

review the District Court’s factual finding from the non-jury

trial under a clearly erroneous standard . . ..” Gordon v.

Lewistown Hosp., 423 F.3d 184, 201 (3d Cir. 2005). When

we are confronted with mixed questions of law and fact,

however, “we apply the clearly erroneous standard except that

the District Court’s choice and interpretation of legal precepts

remain subject to plenary review.” Id.

13

47 U.S.C. § 401(b).

14

74 F.3d 465 (3d Cir. 1996).

11

fee to cable subscribers who received programming on more

than one television set. The monthly fee was based on 47

C.F.R. § 76.923, which requires that charges for multiple

outlets be based on actual cost.15 In analyzing whether the

plaintiffs had an express right of action under § 401(b), we

began by considering the Supreme Court’s decision in

Columbia Broadcasting System, Inc. v. United States.16

Although CBS interpreted a different provision of the FCA,

we identified from it the general principle that “an agency

regulation should be considered an ‘order’ if it requires a

defendant to take concrete actions.”17 We then outlined the

circuit split in applying this principle,18 but declined to

15

Id. at 467.

16

316 U.S. 407 (1942).

17

Mallenbaum, 74 F.3d at 468 (citing CBS, 316 U.S. at 416-

25).

18

Currently, the Fourth, Fifth, Sixth, Seventh, and Ninth

Circuits expressly or implicitly hold that “order” encompasses

both FCC adjudicatory and rulemaking orders, see

Lansdowne on the Potomac Homeowners Ass’n, Inc. v.

OpenBand at Lansdowne, LLC, 713 F.3d 187, 200-01 (4th

Cir. 2013); Alltel Tenn., Inc. v. Tenn. Pub. Serv. Comm’n, 913

F.2d 305, 308 (6th Cir. 1990); Hawaiian Tel. Co. v. Pub.

Utils. Comm’n, 827 F.2d 1264, 1271 (9th Cir. 1987); Ill. Bell

Tel., Co. v. Ill. Commerce Comm’n, 740 F.2d 566, 571 (7th

Cir. 1984); S. Cent. Bell Tel. Co. v. La. Pub. Serv. Comm’n,

744 F.2d 1107, 1115-19 (5th Cir. 1984), vacated and

remanded on other grounds by 476 U.S. 1166 (1986),

whereas, the First Circuit requires that an “order” be judicial

in nature, see New England Tele. and Tele. Co. v. Pub. Utils.

Comm’n, 742 F.2d 1, 4-8 (1st Cir. 1984). Much of this

disagreement stems from the question of whether a court

12

choose between the two approaches because the plaintiffs lost

under either test.19 Specifically, 47 C.F.R. § 76.923 does not

order cable operators to charge specific rates; rather, it offers

“guidelines to be followed by local franchising authorities”

and “[did] not itself require particular actions to be taken by

defendant Adelphia.”20

As in Mallenbaum, we will not adopt either approach

to defining “order” under § 401(b) because 47 C.F.R. §

80.385(b)(1) and the Cooperation Orders fail under both

standards. For its part, § 80.385 does not address a site-based

licensee’s duty to provide contour information. In fact, it is

focused solely on the obligation of a geographic licensee to

protect the site-based licensee’s rights by adhering to certain

requirements, and imposes no obligations on site-based

licensees.21 While the rule may “presuppose” that a site-

based licensee will provide a geographic licensee its

coordinates to safeguard its own interests, such an assumption

cannot form the basis of an enforceable “order” under §

should rely on the Administrative Procedure Act’s definition

of “order,” which is limited to “a final disposition . . . in a

matter other than rule making.” See 5 U.S.C. § 551(6).

19

Mallenbaum, 74 F.3d at 468 n.5 (“We need not choose

between the First Circuit and Ninth Circuit approaches, for,

even assuming arguendo that some rules may be considered

orders under § 401(b), the FCC rule at issue here may not.”).

20

Id. at 469.

21

47 C.F.R. § 80.385(b)(1) (“[E]ach AMTS geographic area

licensee may place stations anywhere within its region

without obtaining prior Commission approval provided:

(1) The AMTS geographic area licensee must locate its

stations at least 120 kilometers from the stations of co-

channel site-based AMTS licensees . . ..”).

13

401(b). Since 47 C.F.R. § 80.385(b)(1) imposes no duties on

MCLM, it does not afford plaintiffs a remedy.22

Similarly, the Cooperation Orders do not impose any

obligations on MCLM. Most of the language highlighted by

plaintiffs describes the FCC’s mere expectation that site-

based and geographic licensees will cooperate with one

another.23 This makes sense considering that the documents

were not intended to address a site-based licensee’s

obligations. Like § 80.385, the Cooperation Orders describe

a geographic licensee’s duty to a site-based licensee: the first

and third documents provide the procedure for determining

the necessary level of interference protection and the second

document resolves a dispute concerning interference. Only in

dicta—indeed, relegated mostly to footnotes—did the FCC

describe any duty owed by site-based licensees. We do not

view this language as creating any binding or enforceable

requirement under § 401(b).

22

See Mallenbaum, 74 F.3d at 469; see generally CBS, 316

U.S. at 416-25.

23

See, e.g., Letter, 24 FCC Rcd. at 4136 n.9 (“[W]e expect

incumbent AMTS licensees to cooperate with geographic

licensees in order to avoid and resolve interference issues.”

(internal quotations omitted)); NUSCO Order, 24 FCC Rcd.

at 3311 n.12 (“AMTS site-based incumbents are expected to

cooperate with geographic licensees in order to avoid and

resolve interference issues.”); Reconsideration Order, 25

FCC Rcd. at 3807 ¶ 6 (“AMTS site-based licensees are

expected to cooperate with geographic licensees in avoiding

and resolving interference issues . . ..”).

14

Furthermore, even if the Cooperation Orders require

MCLM to take some action, that action is not sufficiently

concrete. The FCC requested that site-based licensees, “at a

minimum, provid[e] upon request sufficient information to

enable geographic licensees to calculate the site-based

station’s protected contour.”24 This language says nothing

about how any alleged obligation should be undertaken:

When, and in what matter, must the information be provided?

In fact, the FCC described cooperation as needed “in order to

avoid and resolve interference issues,”25 implying that

disclosure of contour information may occur only after an

interference issue arises.

We therefore reiterate that vague statements by the

FCC, particularly when made in dictum, cannot form the

basis of an “order” under § 401(b). Because neither 47

C.F.R. § 80.385(b)(1) nor the so-called Cooperation Orders

constitute an “order,” we will affirm the District Court’s

dismissal of Count I.

24

Letter, 24 FCC Rcd. at 4136 n.9; NUSCO Order, 24 FCC

Rcd. at 3311 n.12; see Reconsideration Order, 25 FCC Rcd.

at 3807 ¶ 6.

25

Letter, 24 FCC Rcd. at 4136 n.9; NUSCO Order, 24 FCC

Rcd. at 3311 n.12; see Reconsideration Order, 25 FCC Rcd.

at 3807 ¶ 6; see also In re Amendment of the Commission’s

Rules Concerning Maritime Communications, Second

Memorandum Opinion and Order and Fifth Report and

Order, 17 FCC Rcd. 6685, 6704 ¶ 39 (2002) (“In instances

where interference occurs, we will expect the licensees to

coordinate among themselves to minimize such interference

and to cooperate to resolve any interference problems that

may arise.”).

15

B. PRIVATE ACTIONS UNDER SECTION 207.

Under 47 U.S.C. § 207, any person damaged by a

common carrier may either make a complaint to the FCC or

sue in district court for “the recovery of the damages for

which such common carrier may be liable under the

provisions of this chapter.” Common carriers, such as

MCLM, are liable if they “do, or cause or permit to be done,

any act, matter, or thing in this chapter prohibited or declared

to be unlawful, or shall omit to do any act, matter, or thing in

this chapter required to be done.”26 Plaintiffs claim that

MCLM violated § 201(b), which declares that all practices in

connection with common carrier service shall be “just and

reasonable” and that any “unjust or unreasonable [practice] is

declared to be unlawful.”27

A plaintiff is not entitled to a cause of action under §

207 simply on the basis of its own determination that conduct

was “unjust or unreasonable.” In Global Crossing

Telecommunications, Inc. v. Metrophones

Telecommunications, Inc., the Supreme Court considered

whether a payphone operator could bring a federal claim

under § 207 on the basis of the FCC’s determination that “a

carrier’s refusal to pay the compensation ordered amounts to

an ‘unreasonable practice’ within the terms of § 201(b).”28

26

47 U.S.C. § 206.

27

Plaintiffs identify many other FCC rules and orders that

Defendants allegedly violated, but they confine their appeal to

the question of whether the conduct underlying these

violations was “unjust or unreasonable” under § 201(b).

28

550 U.S. 47, 52 (2007) (internal quotations omitted).

16

The Court held that a private lawsuit is proper under § 207

only “if the FCC could properly hold that a carrier’s failure to

pay compensation is an ‘unreasonable practice’ deemed

‘unlawful’ under § 201(b).”29 Here, plaintiffs do not rely on

any regulation determining that the particular type of actions

taken by MCLM were “unjust or unreasonable” under the

meaning of § 201(b). Instead, plaintiffs assert that such a

finding is unnecessary based on the FCA’s grant of a broad

private remedy and “the Supreme Court’s intentional use of

the phrase ‘could properly hold’ instead of ‘did properly

hold’” in Global Crossing.30 We do not agree.

In creating § 201(b), Congress “delegated to the

agency authority to ‘fill’ a ‘gap,’ i.e., to apply § 201 through

regulations and orders with the force of law.”31 Although

§ 201(b)’s language is certainly broad, its purpose is to

empower the FCC to declare unlawful certain common carrier

practices.32 Nothing in the statute implies that violations of

29

Id. at 52-53.

30

See Pls.’ Br. at 55-57 (emphasis added in brief).

31

Global Crossing, 550 U.S. at 57; see Nat’l Cable &

Telecomms. Ass’n v. Brand X Internet Servs., 545 U.S. 967,

980-81 (2005) (“[Section 201(b)] give[s] the Commission the

authority to promulgate binding legal rules . . ..”).

32

See 47 U.S.C. § 201(b) (“All charges, practices,

classifications, and regulations for and in connection with

such communication service, shall be just and reasonable, and

any such charge, practice, classification, or regulation that is

unjust or unreasonable is declared to be unlawful. . . .

Provided, That communications by wire or radio subject to

this chapter may be classified . . . as the Commission may

decide to be just and reasonable . . .. The Commission may

prescribe such rules and regulations as may be necessary in

17

all FCC regulations amount to unjust or unreasonable

practices, and plaintiffs point to no authority supporting such

an interpretation. Furthermore, adopting plaintiffs’ approach

would “put interpretation of a finely-tuned regulatory scheme

squarely in the hands of private parties and some 700 federal

district judges, instead of in the hands of the Commission.”33

It strains reason to believe that Congress intended such a

result. A more common sense reading of the statute is that

the FCC must first determine that a particular type of practice

constitutes an “unjust or unreasonable” practice under §

201(b) before a plaintiff may bring a cause of action under §

207 on the basis of that conduct.

Although Global Crossing did not state that there must

be an FCC ruling deeming the conduct at issue “unjust or

unreasonable,” an FCC determination was critical to its

analysis. The Court first noted that “the FCC has long

implemented § 201(b) through the issuance of rules and

regulations.”34 It then considered the more “difficult

question” of “whether the particular FCC regulation . . .

lawfully implements § 201(b)’s ‘unreasonable practice’

prohibition.”35 Applying the Chevron framework, the Court

held that the FCC properly implemented § 201(b) due to its

reasonable determination that failure to abide by its rate

the public interest to carry out the provisions of this

chapter.”).

33

N. Cnty. Comm’ns Corp. v. Cal. Catalog & Tech., 594 F.3d

1149, 1158 (9th Cir. 2010) (internal quotations omitted).

34

Global Crossing, 550 U.S. at 53.

35

Id. at 54-55.

18

determinations was an unjust or unreasonable action.36 In

other words, the question of lawful implementation was

premised on there being an FCC finding in the first place.

Moreover, the Court carefully limited its holding by stating

that not “every violation of FCC regulations is an unjust and

unreasonable practice.”37 Although the Court used the phrase

“if the FCC could properly hold” instead of “if the FCC did

properly hold,” its emphasis in the sentence—and throughout

the opinion—was on “if” the FCC’s determination was

proper.38 We therefore do not agree that, by using one turn of

phrase, the Court sanctioned such an expansive reading of the

FCA.

We will affirm the District Court’s dismissal of Count

II because plaintiffs do not identify any particular actions

taken by MCLM that have been determined by the FCC to be

unreasonable or unjust. Therefore, plaintiffs do not possess a

private right of action under § 207.39

36

Id. at 55-57; see id. at 60 (“[T]he FCC properly implements

§ 201(b) when it reasonably finds that the failure to follow a

Commission, e.g., rate or rate-division determination made

under a different statutory provision is unjust or unreasonable

under § 201(b).”).

37

Id. at 56.

38

See id. at 53 (“Insofar as the statute’s language is

concerned, to violate a regulation that lawfully implements §

201(b)’s requirements is to violate the statute.”).

39

The FCC need not have declared a particular defendant’s

actions unreasonable in a prior adjudication. In Demmick v.

Cellco Partnership, Verizon argued that claims under §

201(b), prior to being filed in federal court, “must be brought

to the Federal Communications Commission . . . for a

19

C. CONCERTED ACTION.

Section 1 of the Sherman Act provides that “[e]very

contract, combination in the form of trust or otherwise, or

conspiracy, in restraint of trade or commerce among the

several States, or with foreign nations, is hereby declared to

be illegal.”40 “The existence of an agreement is the hallmark

of a Section 1 claim.”41 For liability under § 1 to exist, there

must be a “unity of purpose or a common design and

understanding or a meeting of the minds in an unlawful

arrangement.”42 This can be shown by putting forth direct

evidence of concerted action, such as “a document or

conversation explicitly manifesting the existence of the

agreement in question,”43 or circumstantial evidence of

determination regarding the reasonableness of the challenged

conduct.” No. 06-2163, 2011 WL 1253733, at *2 (D.N.J.

Mar. 29, 2011). The court rejected this argument based, in

part, on the fact that there was no prior adjudication in Global

Crossing. Id. at *4-5. But, in Global Crossing, the FCC

announced through general rulemaking that a particular type

of practice was unjust or unreasonable. This, too, is all our

holding today requires in order to maintain a cause of action.

40

15 U.S.C. § 1.

41

In re Baby Food Antitrust Litig., 166 F.3d 112, 117 (3d Cir.

1999).

42

Alvord-Polk, Inc. v. F. Schumacher & Co., 37 F.3d 996,

999 (3d Cir. 1994) (internal quotations omitted).

43

See In re Ins. Brokerage Antitrust Litig., 618 F.3d 300, 324

n.23 (3d Cir. 2010).

20

conscious parallel conduct and other “plus factors.”44 The

term “plus factors” refers to circumstances demonstrating that

the wrongful conduct “was conscious and not the result of

independent business decisions of the competitors.”45

Plaintiffs’ direct evidence of concerted action at trial

was an alleged agreement that was reached during a

conversation over twenty-five years ago between Touch Tel’s

president Cooper and a businessman named Fred Daniel.

Daniel is the founder of Regionet, a marine radio provider

that was later acquired by Mobex. According to plaintiffs,

Cooper and Daniel agreed to split up the market for

geographic licenses, whereby Regionet would only bid on A

block licenses and PSI and Touch Tel would only bid on B

block licenses. Plaintiffs further alleged that knowledge of

this conspiracy passed to Mobex employees after Regionet

was acquired in 2000, and then to MCLM after it purchased

Mobex’s licenses in 2005. Plaintiffs also sought to prove the

existence of concerted action by virtue of certain plus factors,

including that defendants refused to provide contour

information, did not construct or operate their stations, and

took actions not in their individual economic interests.

On appeal, plaintiffs mainly quibble with the District

Court’s conclusion that no agreement existed. Notably absent

from this discussion is any recitation or application of the

clearly erroneous standard of review, which must guide our

analysis. A finding of fact is clearly erroneous only if it is

“completely devoid of minimum evidentiary support

44

See In re Flat Glass Antitrust Litig., 385 F.3d 350, 360 &

n.11 (3d Cir. 2004).

45

Baby Food, 166 F.3d at 122.

21

displaying some hue of credibility or bears no rational

relationship to the supportive evidentiary data.”46 In an

extensive 59-page opinion, the District Court examined all of

the evidence and provided more than ample support for its

conclusion that no concerted action existed. The District

Court first found that Daniel and Cooper’s early conversation

illustrated only “a course of action that Daniel and his

company intended to take, which arguably warned Cooper off

of pursuing the same course” and did not amount to direct

evidence of market-allocation.47 As to any evidence that such

an agreement continued, the District Court found the evidence

speculative, only showing an opportunity for, not the

existence of, an unlawful agreement.48 Lastly, the District

Court determined that the alleged plus factors did not amount

to evidence that a meeting of the minds existed.49 We find no

clear error in the District Court’s factual findings.

Plaintiffs argue that the District Court applied an

improper standard of proof in its treatment of the plus factors.

Specifically, plaintiffs cite cases in which we found that the

sharing of confidential information between horizontal

competitors could indicate that a conspiracy existed.50 But, in

those cases, we were asked to review a district court’s grant

of summary judgment, when the facts must be viewed in the

46

Berg Chilling Sys., Inc. v. Hull Corp., 369 F.3d 745, 754

(3d Cir. 2004) (internal quotations omitted).

47

Havens, 2014 WL 4352300, at *17.

48

See id. at *20-22.

49

See id. at *22-30.

50

See, e.g., Flat Glass, 385 F.3d 350; Baby Food, 166 F.3d

122; Petruzzi’s IGA Supermarkets, Inc. v. Darling-Delaware

Co., 998 F.2d 1224 (3d Cir. 1993).

22

light most favorable to the non-moving party and all

reasonable inferences must be drawn in that party’s favor. In

other words, we held that the sharing of confidential

information may be evidence of a conspiracy, not that it must

be. Here, the District Court properly denied summary

judgment and allowed the claims to proceed to trial. At trial,

the court was then tasked with evaluating the credibility of

the witnesses and weighing the evidence that plaintiffs

actually put forth. The court’s findings were made on this

basis.

Plaintiffs claim that the District Court erred further by

crediting the testimony of MCLM’s key witnesses despite

plaintiffs’ after-trial submission, which allegedly

demonstrates that those witnesses lied at trial. As a

preliminary matter, plaintiffs do not clarify how the District

Court should have treated this evidence. They included no

formal request for relief in their August 22, 2014, letter,

seeking only consideration of MCLM’s interrogatory

responses as additional evidence of conspiracy. It appears

that the District Court did just that but was not persuaded.

And rightfully so: Rather than offering “new and material”

information, this submission repeated the same

unsubstantiated and largely irrelevant arguments plaintiffs

made at the bench trial. We therefore find no clear error in

the District Court’s decision to credit the testimony of

MCLM’s witnesses.

III. CONCLUSION.

For the foregoing reasons, we will affirm the District

Court’s dismissal of Counts I and II pursuant to Rule 12(b)(6)

and its entry of judgment in favor of MCLM on Count III.

23