Petition for Writ of Certiorari — CenturyTel, Inc. v. Beattie (No. 08-414)

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Cupreme Court, U.S.

00 1) FILED

No. UB 414 AUG 26 2008

OFFICE OF THE CLERK

Jn The

Supreme Court of the Anited States

CENTURYTEL, INC.,

Petitioner,

Vv.

BARBRASUE BEATTIE and JAMES SOVIS,

Respondents.

On Petition for Writ of Certiorari to the United

States Court of Appeals for the Sixth Circuit

PETITION FOR WRIT OF CERTIORARI

JEFFERY V. STUCKEY

Counsel of Record

Davibd J. HOUSTON

JOSEPH A. FINK

DICKINSON WRIGHT PLLC

215 S. WASHINGTON SQUARE

SuiTE 200

LANSING, MI 48933

(517) 371-1730

Counsel for Petitioner

September 26, 2008

Becker Gallagher + Cincinnati, OH - Washington, D.C. - 800.890.5001

QUESTION PRESENTED FOR REVIEW

Section 206 of the federal Communications Act of

1934 (the “Act”), 47 U.S.C. § 206, provides that a

common carrier is liable to a person who is injured by

a violation of the Act.

The Sixth Circuit affirmed a class of 500,000 to

700,000 CenturyTel customers who were billed and

who paid for an optional CenturyTel service, where

CenturyTel’s billing description of that service was

found to be a violation of the Act.

The Sixth Circuit acknowledged CenturyTel’s

argument that seme-er most, CenturyTel contends)

class members affirmatively requested the service

(despite being billed for the service under an

inadequate description). Nonetheless, the Sixth

Circuit effectively eliminated the Act’s express injury

and causation elements of liability, holding that

whether a customer actually suffered an injury caused

by the inadequate billing-description “goes only to the

issue of damages ....” (App. 14a).

Accordingly, the question presented for review is:

Are injury and causation independent clements of

liability under section 206 (thus requiring independent

analysis as to whether those issues are predominantly

individualized for purposes of class certification), or do

they “go[] only to the issue of damages”?

PARTIES TO PROCEEDINGS

Plaintiffs Barbrasue Beattie and James Sovis are

class representatives ofa class consisting of residential

telephone customers of Defendant CenturyTel, Inc.,

each of whom paid CenturyTel for an inside wire

maintenance service beginning October 29, 2000,

described on their telephone bill as “Non-Regulated

Services.” The district court certified a class estimated

to consist of 500,000 to 700,000 residential customers

of CenturyTel, Inc.

Defendant CenturyTel, Inc., is a publicly held

corporation.

ill

RULE 29.6 STATEMENT

Petitioner CenturyTel, Inc. is a publicly held

corporation. There is no parent corporation. Further,

there is no publicly held company that owns 10% or

more of its stock.

TABLE OF CONTENTS

QUESTION PRESENTED FOR REVIEW ....... i

PARTIES TO PROCEEDINGS ...........005. ll

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TAR OF AUTEURS occ cc eee ees vil

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I at ia lee oa alen e bn oe a Ol 1

RELEVANT PROVISIONS INVOLVED ........ 2

STATEMENT OF THE CASE ................ 3

A. General Overview and Background ....... 3

B. District Court Proceedings And Decision .. 5

C..: Soeneee SES BOND, nk 6c ae ee eee ew 8

REASONS FOR GRANTING THE PETITION .. 10

A. The Sixth Circuit’s Decision Conflicts With

The Express Language Of The

Communications Act And A Supreme Court

Decision Interpreting Analogous Statutory

ae ee re re eae or eee ee 1]

1. The Act Requires Both The Existence Of

An Injury, And A Causal Connection

Between The Statutory Violation And

That Injury, In Order To Establish

RE 39-4 0 5 4S hn ens bien ee ewes 11

a. The Act Requires Proof Of Injury, And

Mere Payment Of The WireWatch Fee

Does Not Establish Injury ........ 14

b. The Act Requires Proof Of A Causal

Connection Between The Statutory

Violation And The Injury......... 16

c. The Sixth Circuit Wrongly Equated

Injury With Damages ........... 18

2. The Sixth Circuit’s Failure To Recognize

And Give Effect To The Liability

Requirements For A Cause Of Action

Under Section 206 Resulted In An

Improper Class Action Analysis And An

Erroneous Certification Of A Class Of

500,000 To 700,000 Persons ......... 20

B. By Equating A Statutory Violation With

Damages, The Sixth Circuit’s Decision

Conflicts With The Second Circuit’s Decision

In Conboy v. AT&T, Which Held That

Section 206 Requires Proof Of Injury .... 25

SP 2) Sk ws ke wd a wae eee 29

APPENDIX

Appendix A: Sixth Circuit Opinion, dated

Ye aga ow cee la

Appendix B: Sixth Circuit Order, dated May 2,

DS er bile bee Pati i aie ry ti ce, 3la

Appendix C: Eastern District of Michigan

Opinion and Order Granting Plaintiffs’ Motion

for Class Certification and Partial Judgment on

the Pleadings, and Denying Plaintiffs’ Motion to

Strike Affirmative Defenses, dated March 10,

TS Sk Goo woke Oa on SE ce RG era ee 8 33a

Appendix D: Sixth Circuit Order denying

rehearing en banc, dated Apnil 29, 2008 .... 69a

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TABLE OF AUTHORITIES

Cases

Amchem Prods., Inc. v. Windsor,

521 U.S. 591 (1997)

Anza v. Ideal Steel Supply Corp.,

547 U.S. 451 (2006)

Beattie v. CenturyTel, Inc.,

234 F.R.D. 160 (E.D. Mich. 2006)

Beattie v. CenturyTel, Inc.,

511 F.3d 554 (6th Cir. 2007)

Bell Atlantic Corp. v. AT&T,

339 F.3d 294 (5th Cir. 2003)

Blades v. Monsanto Co.,

400 F.3d 562 (8th Cir. 2005)

Conboy v. AT&T Corp.,

241 F.3d 242 (2d Cir. 2001)

Denney v. Deutsche Bank AG,

443 F.3d 253 (2d Cir. 2006)

Dunn v. Commodity Futures Trading Comm.,

519 U.S. 465 (1997)

Global Crossing Tele. Inc. v. Metrophones Tele., Inc.,

127 S.Ct. 1513 (2007) 12

Vili

Holmes v. Sec. Investor Prot. Corp..,

Oe KJ NEO E) 0 bees ewcwees 10, 17, 18

In re Am. Med. Sys., Inc.,

16 F.3a 1069 (Gth Cir. 1996)... 2. ws cee 22

In re The Joint Application of Ace Tele. Co. of

Michigan, Inc., et al, Opinion and Order of the

Michigan Public Service Commission, issued

December 17, 1986 (Case No. U-8608) ....... S

In re Visa Check/ MasterMoney Antitrust Litig.,

1962 F.2D. 66 C.D... 2000). cb cb ove eae 13

In re Visa Check/ MasterMoney Antitrust Litig.,

20 FSG 194126 Cir, BOGE) on on i ince 13, 14

Johnston v. HBO Film Mgmt, Inc.,

260 F .3G: 276 (ae Cae. DOOD) 2. ww 5 we wens 11

Lujan v. Defenders of Wildlife,

Oe Tad. We RAE beech iN eek ewe 14

Newton v. Merrill Lynch, Pierce, Fenner & Smith

Inc.,

259 F.3d 154 (3d Cir. 2001) ......... 18, 19, 22

Presbyterian Church of Sudan v. Talisman Energy,

Inc.,

244 F. Supp. 2d 289 (S.D.N.Y. 2003) ....... 15

Sprague v. Gen. Motors Corp.,

133 F.da SBS th Gir. TOFS) . ww 6c cee ten 22

Sterling v. Velsicol Chem. Corp.,

855 F.2d 1188 (6th Cir. 1988) ............. 18

Wit Capital Group, Inc. v. Benning,

$97 A.2d 172 (Del. 2006) .............. 18, 19

Statutes

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a 25

Other Authorities

OU 0 ee va ese cect eewee een 6

7AA Wright, Miller & Kane, Federal Practice and

oe By. 15

Rules

Te ie vue web ewes 15, 24

I I gen Ne oa 5 eee weve eae eae 20

Fed. R. Civ.

¥.

r’.

Pe ee 8, 20

SD ici G's bh 4 4 eye ee 9

EE eee 7, 20, 21, 22

Sis 0 oe KA Os ¥en Cao eee 8

OPINIONS BELOW

The opinion of the United States District Court for

the Eastern District of Michigan granting class

certification is reported at 234 F.R.D. 160 (E.D. Mich.

2006), and is reproduced in the appendix at 33a-68a.

CenturyTel, Inc. sought permission to appeal from the

district court’s class certification decision, which was

granted on May 2, 2006 (United States Court of

Appeals for the Sixth Circuit, Docket No. 06-105). The

order granting CenturyTel permission to take an

interlocutory appeal is not reported, and is reproduced

in the appendix at 31a-32a. The opinion of the United

States Court of Appeals for the Sixth Circuit is

reported at 511 F.3d 554 (6th Cir. 2007), and is

reproduced in the appendix at la-30a. The order

denying CenturyTel’s petition for rehearing and

suggestion for rehearing en banc is reproduced in the

appendix at 69a-70a.

JURISDICTION

The judgment of the United States Court of

Appeals for the Sixth Circuit was entered on December

18, 2007. A timely petition for rehearing and

suggestion for rehearing en banc was filed on January

2, 2008, and was denied on April 29, 2008. (App. 69a-

70a). Petitioner applied for an extension of time

within which to file a petition for a writ of certiorari,

which was presented to and granted by Justice

Stevens. The time within which to file a petition for

writ of certiorari was extended to and including

September 26, 2008. The Court has jurisdiction

pursuant to 28 U.S.C. § 1254(1).

RELEVANT PROVISIONS INVOLVED

Section 201(b) of the federal Communications Act

of 1934 provides:

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.

47 U.S.C. § 201(b).

Section 206 of the federal Communications Act of

1934 provides:

In case any common carrier shall 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, such

common carrier shall be liable to the person or

persons injured thereby for the full amount of

damages sustained in consequence of any such

violation of the provisions of this chapter,

together with a reasonable counsel or attorney’s

fee, to be fixed by the court in every case of

recovery, which attorney’s fee shall be taxed

and collected as part of the costs in the case.

47 U.S.C. § 206.

STATEMENT OF THE CASE

A. General Overview and Background

Defendant CenturyTcl, Inc. is the cighth largest

local exchange telephone company in the United

States, and offers local telephone, internet access, long

distance and high speed data services in more than 20

states to more than 1.7 million customers. (App. 3a,

34a).

One of the many services offered by CenturyTel is

an inside wire maintenance service plan known as

“WireWatch.” (App. 3a-4a, 34a-35a). WireWatch is an

“unregulated” service not covered by CenturyTel’s

tariffs or rate filings. (App. at 4a, 35a). WireWatch is

similar to an insurance plan, pursuant to which

CenturyTel covers the cost of diagnosis and repair of

wiring and/or jack damage inside a home, in return for

a small monthly fee. (App. 3a-4a, 35a).

CenturyTel’s WireWatch program varies from state

to state.

In some states, CenturyTel has offered

WireWatch for a number of years, but in others,

such as Alabama and Missouri, Wire Watch only

recently has become available through

CenturyTel to its customers. The main reason

for this variance is the manner in which

CenturyTel has grown through acquisition of

other telephone companies.

The state-by-state network of CenturyTel

telephone service providers is an amalgamation

of small companies acquired by CenturyTel over

time. As a consequence, the services offered to

current customers of CenturyTel historically

has [sic, have] differed from state to state, and

sometimes varied in regions within a single

state. Billing formats varied widely as well.

App. 35a.

Historically, the primary manner by which

CenturyTel customers have enrolled in WireWatch is

through oral communications with CenturyTel’s

customer service’ representatives. Generally,

customers enrolled in the WireWatch program when

they called to arrange for telephone service with

CenturyTel or when they called to add to or change

their existing service options. During these telephone

communications, CenturyTel’s customer service

representatives would inform the customer of the

benefits of, and rates for, WireWatch. CenturyTel did

not utilize a uniform script in its oral communications

to solicit individual customer subscriptions to

WireWatch. (App. 5a).

CenturyTel’s historical and extant corporate policy

is that each customer is subscribed to and billed for

the WireWatch service only after that customer

affirmatively and specifically requests to be enrolled in

WireWatch, typically, as noted, through a telephonic

conversation with a CenturyTel service representative.

CenturytTel’s policy has at all times (other than upon

initial de-regulation of inside wire maintenance

service) been that it does not enroll customers in

WireWatch without their express consent.’ (Affidavit

of Graylen Allen, {| 13, Ex. Ato CenturyTel’s Response

in Opposition to Plaintiffs’ Motion for Class

Certification, Record Entry No. 29).

B. District Court Proceedings And Decision

The named plaintiffs are two individual, residential

customers of CenturyTel, each of whom resides in

Michigan. (App. 6a). The named Plaintiffs alleged

that they each were billed for WireWatch pursuant to

an inadequate billing description of the charge for

WireWatch, from approximately the mid-1990s

through January 2002. (App. 6a). Plaintiffs filed a

six-count complaint against CenturyTel on behalf of

themselves “and all other persons similarly situated.”

In general:

The complaint alleges that beginning in at least

1994, and perhaps before that time, defendant

CenturyTel has been billing customers for the

' The only exception to this policy occurred during the 1986-1987

period of mandatory deregulation of all telecommunications

carriers’ obligations to provide inside wire repair services to all of

their customers as part of their basic telephone service. At that

time, the public service commissions of some states in which

CenturyTel provided service expressly approved or allowed

CenturyTel to continue to provide that service, in the form of a

WireWatch subscription, to its then-existing customers who had

previously received such repair service protection as part of their

regulated telephone service without those customers’

authorizations. See, e.g., In re The Joint Application of Ace Tele.

Co. of Michigan, Inc., et al, Opinion and Order of the Michigan

Public Service Commission, issued December 17, 1986 (Case No.

U-8608). (Declaration of David D. Cole, {4 5-6; filed Feb. 28,

2007, Record Entry No. 91).

maintenance of internal wiring .... Up through

approximately January of 2002, CenturyTel

labeled this charge as one for “Non-Regulated

Services.” At that time, it reorganized its

telephone bills and re-labeled the charge to

“Inside Wire Maintenance Plan.”

App. 36a. Plaintiffs alleged, in Count I of their

complaint, that CenturyTel’s “billing actions violate 47

U.S.C. §§ 201(b), 206 and 207, as well as the FCC’s

Truth-in-Billing regulation, 12 C.F.R. 64.2401 [sic, 47

C.F.R. 64.2401].” (App. 38a).

On August 15, 2003, Plaintiffs moved to certify a

class. More than two and one-half years later, during

which time the matter was held under advisement, the

district court issued an opinion and order on March 10,

2006, holding that Plaintiffs “have satisfied the

requisites for class certification....” (App. 34a).

The district court noted:

The plaintiffs agreed that section 201 is nota

strict liability statute, and that to establish a

claim under section 206 the plaintiffs would

have to show some type of injury.

App. 54a (emphasis added).

The district court then began its class certification

analysis with the determination that “[t]o prevail on

their federal claims, the plaintiffs must show that the

defendant’s billing practices violated section 201 [of

the federal Act] and they were injured by that

violation.” (App. 54a (emphasis added)).

However, after apparently recognizing that the

causation and injury elements of the claim, as well as

damage issues are, under the Act, separate inquiries,

the district court ruled incorrectly that the injury and

causation eler ents were subsumed by the court’s

damages analysis. Accordingly, the district court

relied on irrelevant case law holding that certification

need not be denied where individual damage

determinations can be bifurcated: “|Tlhe necessity of

each plaintiff proving the amount of his or her

damages is generally not an impediment to class

certification.” (App. 54a-56a (emphasis added)).

The district court ordered certification of the

following class pursuant to FED. R. Civ. 2. 23(b)(3):

All persons who have paid CenturyTel, Inc. for

charges for an inside wire maintenance

insurance program described in CenturyTel’s

residential telephone bills as “Non-Regulated

Services” during the period beginning October

29, 2000, or such earlier period if the charges

were not know [sic, known] or reasonably could

[stc, not] have been known by October 29, 2000

App. 66a. The district court also granted Plaintiffs’

motion for judgment on the pleadings as to Count I

and determined that CenturyTel’s billing description

for WireWatch as “Non-Regulated Services” violated

* Those excluded from the class include CenturyTel, its

subsidiaries, affiliates, officers, and directors.

47 U.S.C. § 201(b). (App. 67a). CenturyTel does not

here challenge that ruling.

CenturyTel timely petitioned the United States

Court of Appeals for the Sixth Circuit for permission to

appeal pursuant to FED. R. Civ. P. 23(f. That court

granted CenturyTel’s petition, concluding that

“interlocutory review of the class certification order in

this case is warranted.” (App. 32a).

C. Sixth Circuit Decision

On appeal, CenturyTel argued that “each class

member must establish injury to prove lability under

§§ 201 and 206, and ‘fact of injury is not a common

issue among class members,” thus precluding class

certification. (App. 18a). CenturyTel also argued that

“the need to prove causation for each plaintiff to show

liability demonstrates that individual issues

predominate ....” (App. 17a). CenturyTel further

argued that if CenturyTel “customers made the

WireWatch payments because they desired and

ordered the service ... then the manner by which

JenturyTel described the service is completely

irrelevant.” (CenturyTel’s Sixth Circuit Reply Br at

18-19).

The Sixth Circuit affirmed the certification decision

of the district court. (App 28a). In addressing the

typicality requirement of Rule 23(a)(3), the Sixth

Circuit rejected CenturyTel’s argument that

“individual issues of liability predominate over

common issues, and thereby preclude a finding of

typicality....” (App. 14a)

To establish hability, Plaintiffs . .. must show

that CenturyTel billed its customers for

WireWatch under a misleading and ambiguous

heading (a violation of § 201(b)), and that

customers nonetheless paid for WireWatch

(satisfying $ 206’s injury requirement). Whether

the customer authorized her enrollment in

WireWatch or benefitted [sic] from the plan’s

service, despite being billed for the service

under a misleading description, goes only to the

issue of damages and does not preclude a

finding that the typicality requirement is

satisfied. Thus, the fact that some of the class

members may have enrolled in WireWatch does

not make the .. . claim atypical.

App. 14a (emphasis added).

In further addressing the requirements of Kule

23(b), the Sixth Circuit determined that Plaintiffs

“have raised common allegations which would allow

the district court to determine liability for the class as

a whole.” (App. 22a) (emphasis added).

Thus, Plaintiffs ... should be able to establish

liability for the class as a whole because the

misleading description used by CenturyTel

violated § 201(b), and class members were

injured by that violation when they paid their

telephone bill, which included a charge for

WireWatch under a misleading description (a

§ 206 violation).

App. 24a.

REASONS FOR GRANTING THE PETITION

The Court should grant certiorari for at least two

reasons. First, section 206 of the Act provides that a

person who has been injured by a violation of the Act

may recover damages. In an important question of

federal law, the Sixth Circuit read out of the Act two

independent elements of the statutory claim: (1)

injury to the claimant, (2) which was caused by a

statutory violation. The Sixth Circuit incorrectly

determined that these separate statutory prerequisites

to hiability “go to damages.” Based on its

interpretation of the elements necessary to establish

the requisite standing of claimants and bases of

liability, the Sixth Circuit’s decision affirming class

certification relieved the certified class of 500,000 to

700,000 CenturyTel customers of their obligation to

prove injury and causation as a predicate to proving

liability and thereafter damages. The Sixth Circuit’s

decision omitting the required causation proofs is

contrary to the express language of the Act, as well as

the Court’s interpretation in Holmes v. Sec. Investor

Prot. Corp., 503 U.S. 258 (1992) of similar wording in

the RICO statute.

Second, in eliminating the required statutory

elements of injury and causation, the Sixth Circuit’s

opinion conflicts with the Second Circuit’s opinion in

Conboy v. AT&T, 241 F.3d 242 (2d Cir. 2001), which

properly recognized the injury and causation elements

of a claim under section 206.

A. The Sixth Circuit’s Decision Conflicts With

The Express Language Of The

Communications Act And A Supreme Court

Decision Interpreting Analogous Statutory

Language

1. The Act Requires Both The Existence Of

An Injury, And A Causal Connection

Between The Statutory Violation And That

Injury, In Order To Establish Liability

The prerequisites to a finding of liability against a

common carrier such as CenturyTel are specified by

section 206 of the Act, which establishes the elements"

of a claim:

In case any common carrier shall do... any act

... declared to be unlawful . . . such common

carrier shall be liable to the person or persons

injured thereby for the full amount of damages

sustained in consequence of any such violation

of the provisions of this chapter .. . .

47 U.S.C. § 206 (emphasis added). The district court

determined that CenturyTel’s “Non-Regulated Service”

billing description was unlawful within the meaning of

47 U.S.C. § 201(b). (App. 67a). Thus, according to the

plain meaning of section 206, and as applied here,

CenturyTel is liable only to a person who proves that

he or she has been injured by CenturyTel’s “Non-

* An examination of a class certification decision must begin with

the correct enunciation of the elements of the underlying cause of

action. See Johnston v. HBO Filin Mymt, Inc., 265 F.3d 178, 186-

87 (3d Cir. 2001).

Regulated Service” billing description. And if liability

is thus established, damages sustained “in

consequence of” the “Non-Regulated Service” billing

description are recoverable. The Court has previously

recognized that the Act authorizes “an injured person

to recover ‘damages’ for an ‘unlawful’ charge or

practice . . . .” Global Crossing Tele. Inc. uv.

Metrophones Tele., Inc., 127 S.Ct. 1513, 1517 (2007)

(emphasis added).

The Sixth Circuit, however, incorrectly ruled that

where the language of CenturyTel’s bill failed to

describe adequately the service provided (thus

establishing the “violation”), proof of payment of those

charges, alone, proves Plaintiffs’ legal injuries. In

other words, according to the Sixth Circuit, such

payment proves both injury-in-fact and the causal

connection between the “Non-Regulated Service”

billing description and that injury.

To establish hability, Plaintiffs . .. must show

that CenturyTel billed its customers for

WireWatch under a misleading and ambiguous

heading (a violation of § 201(b)), and that

customers nonetheless paid for WireWatch

(satisfying $ 206’s injury requirement).

App. 14a (emphasis added).

However, notwithstanding an inadequate billing

description and contrary to the Sixth Circuit’s ruling,

any customer who desired WireWatch coverage and

knowingly subscribed suffered no injury because that

customer received exactly what he or she wanted and

paid for — protection against repair costs. And, the

Sixth Circuit acknowledged CenturyTel’s position that

customers in the class generally enrolled in WireWatch

via telephone calls, during which a CenturyTel

customer service representative would “inform

customers of the benefits and costs of WireWatch.”

(App. 5a). Thus, payment for WireWatch does not

establish either injury or injury “caused by”

CenturyTel’s billing description for many of the class

members. The Sixth Circuit’s opinion is thus contrary

to the language of the Act and is contrary to a decision

of the Court interpreting analogous statutory

language."

ee —

‘The Sixth Circuit placed entire reliance for its class certification

decision on an inapposite antitrust case, /n re Visa

Check / MasterMoney Antitrust Litig., 280 F.3d 124 (2d Cir. 2001)

(App. 14a). But Visa is inapplicable because in that case, unlike

the present case, the plaintiffs’ payments did prove injury under

their anti-trust theory. In Visa, the putative class of merchants

claimed that defendants Visa and MasterCard had created an

illegal tying arrangement requiring those merchants who accepted

defendants’ credit cards also to accept their debit cards. Visa, 280

F.3d at 129-30. Critical to the class certification analysis in that

case, evidence showed that “all class members have been injured

by paying higher interchange fees for Visa Check and

MasterMoney than they would have absent the tie.” Visa, 280

¥.3d at 133 (emphasis added). The Second Circuit held “that

plaintiffs’ overcharge theory would permit them to establish

injury-in-fact on a class-wide basis.” /d. at 136 (emphasis added).

In dispositive contrast to the instant case, and as specifically held

by the Second Circuit, the antitrust violation in Visa caused and

was inseparable from the injury. The Visa court determined that

the “presence of injury and causation is binary; it is either there

or it is not..... [I])njury and causation is present for every

putative class member.” /d. at 137 (quoting /n re Visa

Check / MasterMoney Antitrust Litig., 192 F.R.D. 68, 86(E.D.N_Y.

2000)). In the present case, Plaintiffs did not allege an anti-trust

violation, and did not allege that CenturyTel had overcharged for

a. The Act Requires Proof Of Injury, And

Mere Payment Of The WireWatch Fee

Does Not Establish Injury

Section 206 provides for a common carrier’s liability

only to a person who has been injured.° However, by

eliminating any separate inquiry into the statutory

element of injury and by ruling incorrectly that any

such analysis is relevant only “to the issue of damages

and not liability,” App. 24a, the Sixth Circuit has, in

effect, established liability for all faulty billing

descriptions, regardless of absence of injury. Applying

the Sixth Circuit’s erroneous view of the elements

necessary to establish a cause of action under section

206, every WireWatch subscriber who received and

paid for that service “automatically” proves injury (and

causation), and thus liability. |

The element of injury under the Act is of

determinative import here because injury-in-fact is the

sine qua non of Article III standing. Lujan v. Defenders

of Wildlife, 504 U.S. 555, 560-61 (1992). And no

putative class which contains members who lack

Article III standing can ever be certified. See Amchem

Prods., Inc. v. Windsor, 521 U.S. 591, 612-13 (1997)

its WireWatch service. In re Visa is completely inapplicable in

both the facts and law.

° As conceded by Plaintiffs below (App. 22a), section 206 does not

impose “automatic” or “strict” hability for CenturyTel’s “Non-

Regulated Service” billing description.

(“Rule 23’s requirements must be interpreted in

keeping with Article III constraints . . . .”).®

Although the Sixth Circuit acknowledged that

Plaintiffs must establish that each class member was

injured by CenturyTel’s statutory violation, it

incorrectly determined that “[t]his can be done by

showing that each class member paid for WireWatch

during the period when the service was billed under

the misleading description.” (App. 23a). Expressly

confusing the distinct issues of injury and damages,

the Sixth Circuit stated that although each class

member “will have to show that she did not enroll in

WireWatch, .. . that is relevant, ... to the issue of

damages and not liability.” (App. 24a) (emphasis

added). “Whether the customer authorized her

enrollment in WireWatch, or whether the customer

would have terminated her enrollment in WireWatch

if the billing description had been clearer is, as the

district court concluded, an issue that goes to damages

.... (App. 14a).

2006) (“no class may be certified that contains members lacking

Article III standing”); Presbyterian Church of Sudan v. Talisman

Energy, Inc., 244 F. Supp. 2d 289, 334 (S.D.N.Y. 2003) (noting that

“each member of the class must have standing with respect to

injuries suffered as a result of defendants’ actions... .”); 7AA

Wright, Miller & Kane, FEDERAL PRACTICE AND PROCEDURE: CIVIL

2d § 1785.1, at p. 387 (“An appropriate application of standing in

class suits necessitates an inquiry into whether the class members

have been injured by defendant’s conduct, thereby presenting a

‘live’ case”); 7AA Wright, Miller & Kane, FEDERAL PRACTICE AND

PROCEDURE: CIVIL 2d § 1785.1, at p. 390 (“to avoid a dismissal

based on a lack of standing, the court must be able to find that

both the class and the representatives have suffered some injury

requiring court intervention”).

b. The Act Requires Proof Of A Causal

Connection Between The Statutory

Violation And The Injury

Section 206 also requires the injury to have been

caused by the violation — t.e. CenturyTel is liable to a

person “injured thereby.” As applied here, CenturyTel

is liable only to persons who suffered an injury that

was caused by the “Non-Regulated Service” billing

description. Just as the Sixth Circuit failed to

recognize the import and application of the injury

requirement, the Sixth Circuit failed to acknowledge

and apply the separate, express statutory requirement

that class members show that the statutory violation

caused an alleged injury.

Thus, Plaintiffs . . . should be able to establish

liability for the class as a whole because the

misleading description used by CenturyTel

violated § 201(b), and class members were

injured by that violation when they paid their

telephone bill, which included a charge for

WireWatch under a misleading description (a

§ 206 violation).

App. 24a.

The Act’s use of the phrase “injured thereby”

reflects a statutory framework requiring proof of

causation. Had Congress not intended to require

injury and causation as necessary elements of liability,

section 206 would simply have provided that: “In case

any common carrier shall (violate this Act) .. . such

common carrier shall be liable.”

In its class certification analysis, the Sixth Circuit

eliminated any separate examination of the statutory

requirements of injury and causation, equated a

violation of the Act with lability, and proceeded

directly to a damages analysis. The Sixth Circuit has

thus rendered as mere surplusage the statutory words

“injured thereby,” despite the well established

principle that “legislative enactments should not be

construed to render their provisions mere surplusage.”

Dunn v. Commodity Futures Trading Comm.,519 U.S.

465, 472 (1997) (citations omitted).

In addition to the plain language of the Act, the

Court has confirmed the necessity of the causation

element in applying functionally identical statutory

language. In Holmes v. Sec. Investor Prot. Corp., 503

U.S. 258 (1992), the Court analyzed 18 U.S.C.

§ 1964(c), the RICO liability statute, which provides

that: “[aJny person injured . . . by reason of a violation

of [RICO] .. . may sue therefor . . . and shall recover

threefold the damages he sustains... .” 18 U.S.C.

§ 1964(c) (emphasis added). In Holmes, the Court held

that the statutory language, “by reason of,” requires a

showing that the alleged injury was caused by the

violation of the statute. 503 U.S. at 268; accord Anza

v. Ideal Steel Supply Corp., 547 U.S. 451, 461 (2006)

(“When a court evaluates a RICO claim for proximate

’ Compare the language of section 206, which provides: “In case

any common carrier shall (violate this Act) ... such common

carrier shall be liable to the person or persons injured thereby. .

(emphasis added).

causation, the central question it must ask is whether

the alleged violation led directly to the plaintiffs

injuries”).

Section 206, and the Court’s decision in Holmes,

clearly require proof of causation, which here the Sixth

Circuit wholly ignored in its assessment of the class

certification criteria.

c. The Sixth Circuit Wrongly Equated

Injury With Damages

The distinction between injury and damages is

fundamental. “Proof of injury (whether or not an injury

occurred at all) must be distinguished from calculation

of damages (which determines the actual value of the

injury).” Newton v. Merrill Lynch, Pierce, Fenner &

Smith Inc., 259 F.3d 154, 188 (3d Cir. 2001); see also

Sterling v. Velsicol Chem. Corp., 855 F.2d 1188, 1197

(6th Cir. 1988).

In Wit Capital Group, Inc. v. Benning, 897 A.2d 172

(Del. 2006), the Delaware Supreme Court articulated

the distinction “between the amount of damages, the

calculation of which wil] not ordinarily defeat class

certification, and the fact of injury and causation,

which are liability elements ....” 897 A.2d at 179

(emphasis in original) (internal citation omitted).

The fact of damages is distinct from the issue of

actual damages. Fact of damages pertains to

the existence of injury, as a predicate to

liability; actual damages involve the quantum of

injury, and relates to the appropriate measure

of individual relief. Although actual damages

typically require the courts to become involved

in individual calculations of damages, this has

been held to be an insufficient basis for denying

class certification where the common issues

relevant to liability can be established on a

classwide basis. .. . Class treatment of fact of

damages issucs, however, presumes the ability

to prove the fact of damage without becoming

enmeshed in individual questions of actual

damage. ... Where proof of fact of damages

requires evidence concerning individual class

members, the common questions of fact become

subordinate to the individual issues, thereby

_ rendering class certification problematic. (“The

putative class must first demonstrate economic

loss on a common basis. As noted, the issue is

not the calculation of damages but whether or

not class members have any claims at all.”)

Wit Capital, 897 A.2d at 179 (emphasis added).

Recognition of the distinction between injury and

damages is critical to all class certification

determinations because “. . . the issue is not the

calculation of damages but whether or not class

members have any claims at all.” Newton v. Merrill

Lynch, 259 F.3d at 189. Absent injury, there is no

standing. Amchem, 521 U.S. at 612-13.

2. The Sixth Circuit’s Failure To Recognize

And Give Effect To The Liability

Requirements For A Cause Of Action

Under Section 206 Resulted In An

Improper Class Action Analysis And An

Erroneous Certification Of A Class Of

500,000 To 700,000 Persons

By mistakenly replacing the Act’s required analysis

of injury and causation with its discussion of damages,

the Sixth Circuit functionally eliminated those

elements with respect to its typicality analysis under

Rule 23(a) and its predominance analysis under Rule

23(b)(3). Once it had committed that fundamental

error, the Sixth Circuit inevitably reached the

incorrect conclusion that the instant class of 500,000

to 700,000 customers, each of whom must individually

prove injury in order to state a claim (or even have

standing) under the Act, could be certified.

CenturyTel argued to the Sixth Circuit that

Plaintiffs could not under any circumstance or analysis

meet the typicality requirement of Rule 23({a)(3)

because “resolution of the named Plaintiffs’ claims . . .

would not prove that other members of the class were

... injured.” (App. 11a) (internal quotation omitted).

The Sixth Circuit rejected that argument as

unavailing, relying on the true, but legally insufficient

fact that Plaintiffs’ claims arise from the same billing

violation.” The Sixth Circuit held that to establish

liability on a class-wide “typical” basis, Plaintiffs must

® Plaintiffs’ claims arose from “the same allegedly deceptive billing

practice that gives rise to the claims of the other class

members... .” (App. 13a).

merely show that “CenturyTel billed its customers for

WireWatch under a misleading and ambiguous

heading . . . and that customers nonetheless paid for

WireWatch ... .” (App. 14a).° The Sixth Circuit

further held, wrongly, that whether CenturyTel

customers authorized enrollment in WireWatch or

benefited from the plan’s services goes “only to the

issue of damages and does not preclude a finding that

the typicality requirement is satisfied.” (App. 14a).

The same error infected the Sixth Circuit’s Rule

23(b)\(3) analysis. In challenging the district court’s

certification decision, CenturyTel argued _ that

Plaintiffs could not meet the predominance

requirement of Rule 23(b)(3) because “only those

customers who can establish that they did not want or

request the WireWatch service can_ establish

CenturyTel’s liability ....” (App. 24a) (internal

citation omitted). The Sixth Circuit again rejected

CenturyTel’s argument, and held that under “§ 206,

CenturyTel is liable if it violated § 201(b), which

makes it unlawful for CenturyTel to bill for a service

under a misleading description, even where the

customer requested the service.” (App. 24a). Again,

* The Sixth Circuit acknowiedged but did not fulfill its obligation

to ensure “that ‘the class may only be certified if, ‘after a rigorous

analysis, the... [Rule 23(a)] prerequisites have been met.”

(App. 10a) (quoting inter alia, Gen. Tel. Co. v. Falcon, 457 U.S.

147, 161 (1982)). The Sixth Circuit opinion is completely devoid of

rigorous or any analysis of how — exactly or even hypothetically —

CenturyTel customers who were informed “of the benefits and

costs of WireWatch” (App. 5a) and who then authorized

enrollment in WireWatch (App. 14a) could have been injured by

the inadequate billing description which those customers may not

even have read.

the Sixth Circuit expressly stopped short of applying

the remaining elements of the Section 206 claim. That

court is correct in that a violation has occurred “even

where the customer requested the service.” Jd. But

the Act requires not only a violation, but also injury

and causation as a predicate to liability. The Sixth

Circuit failed to give effect to the separate injury and

causation components of liability.

Here, both typicality and predominance of common

questions are absent. “[T]he typicality requirement is

not satisfied when a plaintiff can prove his own claim

but not ‘necessarily have proved anybody[) else’s

claim.” App. 12a (quoting Sprague v. Gen. Motors

Corp., 133 F.3d 388, 399 (6th Cir. 1998) and citing In

re Am. Med. Sys., Inc., 75 F.3d 1069 (6th Cir. 1996)

(denying certification where “no common cause of

injury.”)). See Newton v. Merrill Lynch, 259 F.3d 154,

172 (3d Cir. 2001) (“If proof of the essential elements

of the cause of action requires individual treatment,

then class certification is unsuitable”). The Rule

23(b\(3) analysis serves to “prevent| | the class from

degenerating into a series of individual trials.” Bell

Atlantic Corp. v. AT&T, 339 F.3d 294, 302 (5th Cir.

2003) (internal citation omitted). Moreover, as noted

above, where injury is absent, so too is standing.

Because the class includes customers who wanted

and knowingly subscribed to WireWatch (as the Sixth

Circuit conceded),"° the only way to identify those class

‘© “Whether the customer authorized her enrollment in

WireWatch .. . goes only to the issue of damages. ... Thus, the

fact that some of the class members may have enrolled in

members to whom CenturyTel may actually be liable

is to individually litigate the claims of every customer

who received an inadequate bil] description.

Stated another way, the Sixth Circuit held that

liability arises from two facts: a faulty billing

description, plus payment of the bill." That analysis

presupposes that every WireWatch customer was

injured as a result of an “improper” billing description.

However, CenturyTel customers who voluntarily

subscribed to WireWatch because they wanted that

service when it was explained to them were neither

injured nor caused injury by the billing description,

regardless of what it said. Those subscribers were not

“injured” because (1) they made conscious, informed

decisions to subscribe to WireWatch; (2) they received

the’ service they wanted and paid the agreed-upon

price for that service; and (3) neither their decision to

purchase nor the price they paid were affected by the

billing description (the “violation”).

Further, customers who did not read the “services”

portion of their bills (including the faulty billing

description) were not caused injury by CenturyTel’s

billing description. Those customers were wholly

unaware of what the billing description said, or even

of its existence, and therefore could not have made or

refrained from making any payment decision based on

WireWautch does not make [these class members’] claim[s]

atypical.” (App. 14a) (emphasis added).

'' The only allegation of injury under Count I is that WireWatch

fees were paid pursuant to a billing descmption which violated the

Act. (Complaint at J 30-32).

that description, whatever it said. Under any of these

circumstances, CenturyTel’s billing description

violation did not cause, and could not have caused, a

cognizable injury.

An issue is subject to common, generalized proof

only where its resolution will not entail individualized

inquiries into the circumstances of each class member.

If the evidence necessary to resolve an issue is likely to

differ from class member to class member in a relevant

manner, then the issue is individualized. See Blades

v. Monsanto Co., 400 F.3d 562, 566 (8th Cir. 2005)

(“[tJhe nature of the evidence that will suffice to

resolve a question determines whether the question is

common or individual”).

In this case, neither injury nor liability can be

proven on a class-wide basis. Many of the class

members suffered no injury. Therefore, the class

cannot be certified under Rule 23 because typicality

and predominance of common questions are absent.

The Sixth Circuit improperly confused injury and

causation with damages, and thus read out of the Act

any separate analysis for injury and causation. The

Sixth Circuit failed to analyze the two liability

elements for which individual proofs are mandated.

The Sixth Circuit thus improperly affirmed the class

certification decision.

B. By Equating A Statutory Violation With

Damages, The Sixth Circuit’s Decision

Conflicts With The Second Circuit’s Decision

In Conboy v. AT&T, Which Held That Section

206 Requires Proof Of Injury

In Conboy v. AT&T Corp., 241 F.3d 242 (2d Cir.

2001), the Second Circuit addressed a class action

damages claim arising under the Act. The Second

Circuit, like the Sixth Circuit in the instant case, was

called upon to determine the circumstances under

which liability arose under Section 206 of the Act for a

“violation” of a substantive provision of the Act. In

Conboy, the Court assumed a substantive violation”

based on AT&T's improper disclosure of plaintiffs’

private information held by AT&T. Conboy, 241 F.3d

at 248.

The Conboy court held that liability could not be

proven on a class-wide basis. Despite the existence of

a class-wide “violation” of the Act (the improper

dissemination of customer information), the Conboy

Court recognized that individualized injury and

causation issues were nevertheless presented:

[I]t is “not reasonable to assume that every”

violation [of the Act] ... “no matter what the

circumstances ... 1s ... likely” to cause mental

and emotional distress /injury/. Many

2 Section 222(c)(1) of the Act, 47 U.S.C. § 222(c)(1), makes it a

“violation” of the Act for a telecommunications carrier to

improperly “use, disclose, or permit, access to individually

identifiable customer ... information ....” Conboy, 241 F.3d at

248, fn 3.

customers will not notice when their personal

information is disseminated in violation of [the

Act]. Moreover, those who learn of a violation

may not even care.

Conboy, 241 F.3d at 251 (emphasis added, internal

citations omitted).

While this analysis arose in the Conboy court’s

discussion of “presumed damages,” in reaching this

ruling the court nevertheless recognized, and ruled,

that payments by the putative plaintiff class (the basis

of the Sixth Circuit’s liability ruling in the present

case)’ could not serve as the basis for their claim of

actual injury because those plaintiffs (like the

Plaintiffs here) received services in exchange for those

payments, and thus suffered no monetary injury. The

Conboy plaintiffs argued that:

their monthly payments to AT&T for long-

distance service contained an implicit payment

for AT&T’s compliance with the

Telecommunications Act, and that disclosure of

plaintiffs’ private information [in violation of

the Act] deprived them of the full value of those

payments.

Conboy, 241 F.3d at 249. The Second Circuit flatly

rejected that argument:

'3 “Plaintiffs ... should be able to establish liability for the class as

a whole because the misleading description used by CenturyTel

violated § 201(b), and class members were injured by that

violation when they paid their telephone bill ....” App. 24a

(emphasis added).

[Pllaintiffs did not make monthly payments to

AT&T for compliance with the

Telecommunications Act; rather, they paid

AT&T for long-distance telephone service, which

they received. AT&T’s alleged failure to comply

with the Telecommunications Act did not

deprive them of the value of this service. . .

AT&T must comply with the

Telecommunications Act not because it receives

monthly payments from its customers, but

because it is a common carrier governed by [the

Act]. Indeed, even if plaintiffs had failed to pay

their regular monthly telephone bills, AT&T

would still have had an obligation to comply

with the provisions of the Act. Accordingly, it

cannot be argued that plaintiffs’ monthly

payments were, in part, consideration paid to

AT&T for compliance with [the Act].

Conboy, 241 F.3d at 250 (emphasis added).

The same rationale applies to the present Plaintiffs’

billing claim. Here, the class members made

payments to CenturyTel in exchange for a service —

WireWatch — essentially an insurance policy against

repair costs. In Conboy the putative class members

made payments in exchange for a service — long

distance telephone calls. No portion of CenturyTel

customers’ WireWatch payments were in consideration

for receipt by them of a sufficient billing description."

’ The Conboy decision suggests still further individualized injury:

Did the customer subscribe to and pay for the service, or for the

telecommunications carrier's compliance with the Act?

Specifically here, did CenturyTel customers subscribe to

The Second Circuit similarly ruled that no part of

those putative plaintiffs’ payments were in

consideration for AT&T’s nondisclosure of protected

information. Conboy, 241 F.3d at 250. In each case

the statutory requirement existed independently of

plaintiffs’ payments for services received.

In Conboy, only those individual putative class

members who could show injury caused by the

disclosure violation could have established liability.

See 47 U.S.C. § 206 and Conboy, 241 F.3d at 251. Such

injury, for example, could have been inappropriate

solicitations by other entities that improperly received

individual plaintiffs personal information.

Similarly here, only those individual class members

who can show injury caused by the billing violation can

establish liability. That may be shown, for example,

by class members who did not voluntarily subscribe to

WireWatch,”’ and who would have unsubscribed if

they had received and read a bill containing an

adequate billing description of the WireWatch service.

WireWatch because they desired to be protected from repair costs,

or because they wanted to receive a bill that adequately described

that service? While the question may or may not be rhetorical, at

a minimum it presents another individual fact question, and

manifestly underscores the fact that Plaintifs cannot establish

common liability of CenturyTel to all class members.

1S As noted above, few of the 500,000 to 700,000 class members in

the instant class will be able to make this showing, since

“historically [{CenturyTel] customers have enrolled in WireWatch

via oral communications with a [CenturyTel] customer service

representative, such as when a customer calls to set up

service. ...” App. 5a.

In the instant case, class members who voluntarily

subscribed to WireWatch arc in the same position as

Conboy plaintiffs who “didn’t care” about, and

therefore were not “injured by” the contested

disclosures. Such CenturyTel WireWatch customers

who subscribed and paid for that service received

exactly what they had requested, and therefore could

not have been “injured by” CenturyTel’s billing

statement, regardless of what it said. The Sixth

Circuit’s holding that proof of mere payment proves

injury, and the Sixth Circuit’s elimination of the

necessity of proving causation, conflict with Conboy.

As discussed previously, the Sixth Circuit’s

disregard of the injury and causation elements,

contrary to Conboy, inevitably resulted in the incorrect

certification of a class of 500,000 to 700,000

CenturyTel customers, the great preponderance of

whom (CenturyTel contends) wanted, paid for, and

received the WireWatch service. None of those

knowing subscribers were injured by CenturyTel’s

billing description or, for that matter, were injured at

all. Such class fails for lack of typicality and lack of

predominance of common issues.

This Court should grant the Petition to avoid

enshrinement in federal jurisprudence of the Sixth

Circuit’s inaccurate statement and understanding of

the elements of a cause of action arising under section

206 of the Act.

CONCLUSION

For all of the reasons set forth above, Petitioner

CenturyTel, Inc. respectfully requests issuance of a

writ of certiorari to the United States Court of Appeals

for the Sixth Circuit.

Respectfully submitted,

JEFFERY V. STUCKEY

(Counsel of Record)

DAVID J. HOUSTON

JOSEPH A. FINK

Counsel for Petitioner

DICKINSON WRIGHT PLLC

215 S. Washington Sq., Ste. 200

Lansing, MI 48933

Telephone: (517) 371-1730

Dated: September 26, 2008

APPENDIX

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

No. 06-1565

[Filed December 18, 2007]

BARBRASUE BEATTIE and

JAMES SOVIS,

Plai:itiffs-Appellees,

CENTURYTEL, INC.,

)

U. )

)

Defendant-Appellant. )

)

Appeal from the United States District Court for the

Eastern District of Michigan at Bay City. No.

02-10277—David M. Lawson, District Judge.

Argued: September 18, 2007

Decided and Filed: December 18, 2007

Before: COLE and COOK, Circuit Judges; FROST,

District Judge.”

COUNSEL

ARGUED: David J. Houston, DICKINSON WRIGHT,

Lansing, Michigan, for Appellant. Elwood S. Simon,

ELWOOD S. SIMON & ASSOCIATES, Birmingham,

Michigan, for Appellees. ON BRIEF: David J.

Houston, Jeffery V. Stuckey, Scott R. Knapp,

DICKINSON WRIGHT, Lansing, Michigan, for

Appellant. Elwood S. Simon, ELWOOD S. SIMON &

ASSOCIATES, Birmingham, Michigan, for Appellees.

OPINION

R. GUY COLE, JR. Circuit Judge.

Plaintiffs-Appellees brought this suit in federal district

court, alleging that Defendant-Appellant CenturyTel,

Inc. (““CenturyTel”) violated federal and state law by

using deceptive billing practices to bill customers for

WireWatch, a wire maintenance’ program.

Plaintiffs-Appellees brought suit under the Federal

Sommunications Act of 1934, 47 U.S.C. § 151 et seq.,

the Federal Communications Commission’s

Truth-in-Billing Act, 47 C.F.R. § 64.2400 et seq., and

the Michigan Consumer Protection Act, Mich. Comp.

Laws § 445.901 et seq. Plaintiffs-Appellees moved the

district court for class certification and for judgment

on the pleadings on Count I of the Complaint, which

alleged that CenturyTel engaged in unjust and

"The Honorable Gregory L. Frost, United States District Judge

for the Southern District of Ohio, sitting by designation.

unreasonable billing practices in violation of 47 U.S.C.

§ 201(b) and 47 C.F.R. § 64.2401. The district court

certified Plaintiffs-Appellees’ claims and granted

Plaintiffs-Appellees judgment on the pleadings as to

Count I. CenturyTel appeals only the district court’s

decision to certify the class. For the reasons discussed

below, we AFFIRM the district court’s order to certify

the Plaintiffs-Appellees’ class on its federal-law claims

under Rule 23 of the Federal Rules of Civil Procedure

(“Rule 23”). We further remand the state-law claims to

the district court to conduct a Ruie 23 analysis.

A. Factual Background

CenturyTel is a _telecommunications service

provider. As the eighth largest telephone company in

the United States, CenturyTel provides telephone

services to more than 1.7 million customers in

twenty-two states, including Michigan. CenturyTel

offers its customers a service entitled “WireWatch,” an

“inside wire maintenance plan,” described by the

company as follows:

WireWatch covers the cost of diagnosis and

repair of inside wiring and/or jack damages that

can interrupt your phone service. Once your

telephone wiring enters your house, it becomes

your responsibility to maintain it and typical

repairs can be costly. For a low monthly fee,

enjoy the convenience and satisfaction of having

a certified CenturyTel Tech to diagnose and

make any necessary repairs.

(JA 17; Compl. J 19.)

WireWatch is an unregulated service, and therefore

is not covered by CenturyTel’s tariffs or rate filings.

(JA 17; Compl. 7 20.) CenturyTel does not require its

customers to subscribe to WireWatch as a condition to

obtaining or keeping the company’s “tariffed telephone

and transmission services.” (/d.) As the district court

pointed out, WireWatch varies from state to state: “In

some states, CenturyTel has offered WireWatch for a

number of years, but in others, such as Alabama and

Missouri, WireWatch only recently has become

available through CenturyTel to its customers.”

Beattie v. CenturyTel, Inc., 234 F.R.D. 160, 163 (E.D.

Mich. 2006).

Plaintiffs-Appellees allege that CenturyTel began

billing customers for WireWatch as early as 1994. (JA

18; Compl. J 22.) From 1994 until 2001, the price of

WireWatch gradually increased, starting from as little

as $0.50 per month in 1994, increasing to $0.99 per

month in 1999, and capping off at $3.95 per month in

2001. (JA 19; Compl. ¥ 23.) Until January 2002,

CenturyTel billed customers for WireWatch using the

description “Non-Regulated Services” under a section

of its bill titled “Monthly Service Detail.” (JA 18-19;

Comp! § 22-23.) In or around January 2002,

CenturyTel reorganized its telephone bills, changing

the description used to bill customers for WireWatch

from “Non-Regulated Services” to “Inside Wire

Maintenance Plan.” (JA 19; Compl. J 24.) CenturyTel

also changed the heading under which it billed for

WireWatch to reflect “that these charges were for

‘Other . Services or Equipment,’ and _ not for

transmission services.” (/d.) It was this change, the

Plaintiffs-Appellees allege, which tnggered complaints

from customers who were unaware that they were

being billed for WireWatch. (Appellee’s Br. 11; JA 19;

Compl. 9 25 (“Numerous customer complaints have

been lodged against CenturyTel since January 2002,

when CenturyTel first revealed that ... it had been

systematically billing and charging customers for . . .

{[WireWatch].”).)

CenturyTel explains that historically customers

have enrolled in WireWatch via oral communications

with a customer service representative, such as when

a customer calls to set up service, or to add or change

their existing service. (Appellant’s Br. 8.) According

to CenturyTel, it is during these calls that a

CenturyTel representative will inform customers of the

benefits and costs of WireWatch. (/d.) CenturyTel

maintains that it “does not utilize a script with regard

to these oral communications concerning Wire Watch.”

Ud.)

Plaintiffs-Appellees, however, allege that

“CenturyTel has routinely and systematically charged

customers for its optional inside wire maintenance

program by ‘cramming’ charges onto customers’

telephone bills.” (JA 17-18; Compl. { 20.) The Federal

Communications Commission (“FCC”) defines

cramming as “the practice of placing unauthorized,

misleading, or deceptive charges on [a customer’s]

telephone bill. Entities that fraudulently cram people

appear to rely largely on confusing telephone bilis in

order to mislead consumers into paying for services

that they did not authorize or receive.” (JA 12; Compl.

q 2.) The complaint alleges that “[w]hile CenturyTel

has never provided Plaintiffs or other customers with

an application form or other materials describing the

supposed terms and obligations of CenturyTel’s inside

wire maintenance program, CenturyTel has

continuously billed customers for this service each

month for at least the last several years.” (Id.)

B. Procedural History

The named Plaintiffs are two individual, residential

customers of CenturyTel, each of whom reside in

Michigan. (JA 18-14; Compl. J 8.) The complaint

alleges that plaintiff Barbrasue Beattie paid for

WireWatch, unbeknownst to her, from November 1996

until January 2002, when CenturyTel’s change to its

billing statements alerted Beattie to this unauthorized

charge. (/d.) Beattie contacted CenturyTel and asked

for a refund of the charges. (/d.) Although CenturyTel

admitted, in a March 29, 2002 letter, that no

authorization for WireWatch was on file for Beattie’s

account, the company refused to credit Beattie for the

charges paid prior to May 2001. (/d.) Like Beattie,

plaintiff James Sovis unknowingly paid for WireWatch

from 1994 until January 2002. (JA 14; Compl. { 9.)

On October 28, 2002, Plaintiff-Appellees brought

suit in federal district court, pleading six counts: (1)

CenturyTel engaged in misleading or deceptive billing

practices in violation of 47 U.S.C. §§ 201(b), 206, and

207 (Count I); (2) CenturyTel’s unjust and

unreasonable practices constitute cramming in

violation of 47 U.S.C. §§ 201(b), 206, and 207 (Count

II); (3) Under 47 U.S.C. § 401, Plaintiffs-Appellees seek

(a)a declaratory judgment that CenturyTel violated 47

U.S.C. § 201(b) and the FCC’s Truth-in-Billing Act, 47

C.F.R. § 64.2401, and (b) an injunction barring

CenturyTel from continuing to violate these laws and

regulations (Count III); (4) CenturyTel breached its

contract with Plaintiffs-Appellees and breached its

corresponding duties of good faith and fair dealing by

engaging in unjust and deceptive billing and cramming

practices in violation of state law (Count IV); (5)

CenturyTel’s unlawful, unconscionable, and deceptive

practices have led to its unjust enrichment, and the

company should be forced to disgorge any of the

charges, monies, and fees that it derived from its

unlawful and deceptive billing practices (Count V); and

(6) CenturyTel’s unlawful billing practices violated the

Michigan Consumer Protection Act, Mich. Comp. Laws

§ 445.901 et seq. (Count VI). (JA 21-26; Compl.

q 29-49.)

Plaintiffs-Appellees brought this action on behalf of

themselves and a putative class under Rule 23 of the

Federal Rules of Civil Procedure. The parameters of

the class were defined as follows:

[A]ll persons who have paid CenturyTel, Inc. for

charges described in CenturyTel’s residential -

telephone bills as “Non-Regulated Services” or

“Inside Wire Maint. Plan” during the fullest

period allowed by law (the “Class”).

Excluded from the Class are CenturyTel; its

subsidiaries, affiliates, officers and directors;

any entity in which CenturyTel has a

controlling interest; and the _ legal

representatives, heirs, successors and assigns of

any such excluded party.

(JA 15; Compl. § 11.) On August 15, 2003,

Plaintiffs-Appellees moved to certify the class.

Plaintiffs-Appellees also moved for judgment on the

pleadings as to Count I of their complaint under

Federal Rule of Civil Procedure 12(c). On March 10,

2006, the district court certified the class, concluding

that the Plaintiffs-Appellees had “satisfied all the

prerequisites under Rule 23(a),” Beattie, 234 F.R.D. at

169, and had “satisfied the requirements for

certification ... under Rule 23(b)(3).” Jd. at 171. The

district court also granted the Plaintiffs-Appellees’

motion for judgment on the pleadings as to Count I.

Id. at 173 (“Based on the allegations and admissions in

the pleadings, the Court concludes that the

defendant’s practice of billing for its WireWatch

program using the description ‘Non-regulated Services’

constitutes a violation of section 201(b) of the

Telecommunications Act as a matter of law.”).

CenturyTel filed this timely appeal.

II.

A. Standard of Review

This Court permits interlocutory appeals of a

district court’s order to certify a class, Fed. R. Civ. P.

23(f), and reviews such orders for an abuse of

discretion, Alkire v. Irving, 330 F.3d 802, 810 (6th Cir.

2003). “The district court maintains substantial

discretion in determining whether to certify a class, as

it possesses the inherent power to manage and control

its own pending litigation.” Reeb v. Ohio Dep't of

Rehab. and Corr., 435 F.3d 639, 643 (6th Cir. 2006)

(citing Stout v. J.D. Byrider, 228 F.3d 709, 716 (6th

Cir. 2000)); but see Sprague v. Gen. Motors Corp., 133

F.3d 388, 397 (6th Cir. 1998) (en banc) (explaining that

“a district court may not certify any class without

‘rigorous analysis’ of the requirements of Rule 23”).

“The district court’s decision certifying the class is

subject to a very limited review and will be reversed ©

only upon a strong showing that the district court’s

decision was a clear abuse of discretion.” Olden v.

LaFarge Corp., 383 F.3d 495, 507 (6th Cir. 2004)

(internal quotation marks omitted). A district court

abuses its discretion “when [it] relies on erroneous

findings of fact, applies the wrong legal standard,

misapplies the correct legal standard when reaching a

conclusion, or makes a clear error of judgment.” Reeb,

435 F.3d at 644.

B. Merits

1. Class Certification

It is the plaintiff's burden “to establish his right” to

class certification. Alkire, 330 F.3d at 820 (quoting

Senter v. Gen. Motors Corp., 532 F.2d 511, 522 (6th

Cir. 1976)). Under Federal Rule of Civil Procedure

23(a), there are four prerequisites to a class action:

(1) the class is so numerous that joinder of all

members is impracticable, (2) there are

questions of law or fact common to the class, (3)

the claims or defenses of the representative

parties are typical of the claims or defenses of

the class, and (4) the representative parties will

10a

fairly and adequately protect the interests of

the class.

Fed. R. Civ. P. 23(a). In Alkire, this Court explained

that “the class may only be certified if, ‘after a rigorous

analysis, the district court is satisfied that these

prerequisites have been met.” 330 F.3d at 820

(quoting Gen. Tel. Co. v. Falcon, 457 U.S. 147, 161

(1982)).

In addition to the prerequisites of Rule 23(a), a

plaintiff must also show that her suit falls within one

of the three types of class actions under Federal Rule

of Civil Procedure 23(b). Here, the Plaintiffs-Appellees

sought, and the district court granted, class

certification under Rule 23(b)(3), which requires the

district court to find “that the questions of law or fact

common to the members of the class predominate over

any questions affecting only individual members, and

that a class action is superior to other available

methods for the fair and efficient adjudication of the

controversy.” Fed. R. Civ. P. 23(b)(3). Lastly, Rule 23

does not require a district court, in deciding whether

to certify a class, to inquire into the merits of the

plaintiffs suit. Kisen v. Carlisle & Jacquelin, 417 U.S.

156, 177 (1974) (“We find nothing in either the

language or history of Rule 23 that gives a court any

authority to conduct a preliminary inquiry into the

merits of a suit in order to determine whether it may

be maintained as a class action.”); Daffin v. Ford Motor

Co., 458 F.3d 549, 553 (6th Cir. 2006).

lla

2. Rule 23(a)

(a) Rule 23(a)(3): Typicality

CenturyTel challenges the district court’s

conclusion that the Plaintiffs-Appellees have satisfied

the typicality requirement of Rule 23(a)(3) because

“the resolution of the named Plaintiffs’ claims depends

upon facts unique to them, and would not prove that

other members of the class were misled, crammed or

injured.” (Appellant’s Br. 52.) Conversely,

Plaintiffs-Appellees contend that the _ typicality

requirement is satisfied here because “the claims of

Plaintiffs and all Class members arise from the same

practice (unlawful billing), that affected them in the

same manner (all received and paid bills that

unlawfully described the Plan as ‘Non-Regulated

Service’), and are based on the same legal theory

(violation of 47 U.S.C. § 201(b) and 47 C.F.R.

§ 64.2401).” (Appellee’s Br. 55.)

The district court concluded that the typicality

requirement was satisfied, explaining that the key

issue is “whether the billing language cited by the

plaintiffs satisfies the requirements of the statute and

regulation.” Beattie, 234 F.R.D. at 169. The court

explained that CenturyTel’s argument, “that a myriad

of legal and factual issues exist between the class

representative and the putative class members,”

“confounds the matters of liability and damages.” Id.

Under Rule 23(a)(3), “the claims or defenses of the

representative parties [must be] typical of the claims

or defenses of the class.” Fed. R. Civ. P. 23(a)(3). A

claim is typical if “it arises from the same event or

12a

practice or course of conduct that gives rise to the

claims of other class members, and if his or her claims

are based on the same lega! theory.” In re Am. Med.

Sys., Inc., 75 F.3d 1069, 1082 (6th Cir. 1996). In

Sprague, the Court explained that “[tlypicality

determines whether a sufficient relationship exists

between the injury to the named plaintiff and the

conduct affecting the class, so that the court may

properly attribute a collective naturc to the challenged

conduct.” 133 F.3d at 399 (citing In re Am. Med. Sys.,

Inc., 75 F.3d at 1082). On the other hand, the Sprague

Court explained, the typicality requirement is not

satisfied when a plaintiff can prove his own claim but

not “necessarily have proved anybody’s else’s claim.”

Id. Lastly, for the district court to conclude that the

typicality requirement is satisfied, “a representative's

claim need not always involve the same facts or law,

provided there is a common element of fact or law.”

Senter v. Gen. Motors Corp., 532 F.2d 511, 525 n.31

(6th Cir. 1976).

In Daffin, for instance, this Court concluded that

the typicality requirement was satisfied because the

plaintiffs claim—“that Ford breached its express

warranty by providing vehicles with defectively

designed throttle body assemblies”—involved “the same

defective throttle body assembly as the other class

members.” 458 F.3d at 552. The Court found the lead

plaintiffs’ claims to be typical “despite the different

factual circumstances regarding the manifestation of

the accelerator sticking and Ford’s attempts to remedy

manifested sticking.” Jd. at 553 (noting that “[t}]he

mere fact that Daffin’s throttle assembly stuck, while

other class members throttles have not stuck, does not

render Daffin atypical”). Although Ford argued that

l3a

“an owner who has not experienced accelerator

sticking and has not sought repair for the problem

cannot ‘prove’ an express warranty claim,” this Court

explained that a district court should not inquire into

the merits of the suit in assessing typicality. Jd.

Similarly, the Plaintiffs-Appellees’ claim that

CenturyTel violated §§ 201 and 206 by billing for

WireWatch under a misleading description is typical of

the claims of the class members. The mere fact that

some class members may have enrolled in WireWatch

after receiving a billing statement with the misleading

description does not make the Plaintiffs-Appellees’

claims atypical.

Plaintiffs-Appellees’ claims arise from the same

allegedly deceptive billing practice that gives rise to

the claims of the other class members, namely,

CenturyTel’s practice of billing for WireWatch under

a misleading description. Here, Plaintiffs-Appellees

allege that CenturyTel violated § 201(b) because it

billed customers for WireWatch under the description

“Non-Regulated Services,” which is_ inherently

ambiguous and misleading, and therefore unjust and

unreasonable under the statute. This is the same

allegation any other class member would bring against

CenturyTel, and therefore resolution of CenturyTel’s

liability under § 201(b) with regards to

Plaintiffs-Appellees’ claim will also resolve the

company’s liability as to claims brought by other class

members. See Sprague, 133 F.3d at 399 (explaining

that the typicality requirement is satisfied if “as goes

the claim of the named plaintiff, so go the claims of the

class”).

l4a

Further, CenturyTel’s argument that individual

issues of hability predominate over common issues,

and thereby preclude a finding of typicality, is

unavailing. Whether the customer authorized her

enrollment in WireWatch, or whether the customer

would have terminated her enrollment in WireWatch

if the billing description had been clearer is, as the

district court concluded, an issue that goes to damages

and can thereby be resolved through resort to

subclasses. See, e.g., In re Visa Check/MasterMoney

Antitrust Litig., 280 F.3d 124, 141 (2d Cir. 2001)

(explaining that “[t]here are a number of management

tools available to a district court to address any

individualized damages issues,” such as “bifurcating

liability and damage trials,” or “appointing a

magistrate judge or special master to preside over

individual damages proceedings”). To establish

liability, Plaintiffs-Appellees must show that

CenturyTel billed its customers for WireWatch under

a misleading and ambiguous heading (a violation of

§ 201(b)), and that customers nonetheless paid for

WireWatch (satisfying § 206’s injury requirement).

Whether the customer authorized her enrollment in

WireWatch or benefitted from the plan’s service,

despite being billed for the service under a misleading

description, goes only to the issue of damages and does

not preclude a finding that the typicality requirement

is satisfied. Thus, the fact that some of the class

members may have enrolled in WireWatch does not

make the Plaintiffs-Appellees’ claim atypical. Cf

Spicer v. Chicago Bd. Options Exch., Inc., No. CV

88-0905, 1990 WL 16983, at *6 (N.D. Ill. Jan. 31, 1990)

(concluding that “the fact differences relating to the

price at which each series traded do not undermine

typicality, since plaintiffs’ legal allegations and most

15a

of their general fact allegations are the same for the

representatives and all other members of the class”).

(b) Rule 23(a)(4): Adequacy

CenturyTel also challenges the district court’s

conclusion that the adequacy requirement of Rule

23(a)(4) is satisfied. CenturyTel maintains that

Plaintiffs-Appellees were required to introduce

evidence showing how each class member enrolled in

WireWatch to establish substantial uniformity, and

because Plaintiffs-Appellees failed to do so, they

canrot adequately represent the class members.

(Appellant’s Br. 55-56.) The district court rejected

CenturyTel’s argument and concluded that the

adequacy requirement of Rule 23(a)(4) was satisfied.

Beattie, 234 F.R.D. at 169. The court explained that

“(t]he interests in this case, while of varying degrees,

seem to all focus in the same direction.” Id.

“The adequacy inquiry under Rule 23(a)(4) serves

to uncover conflicts of interest between named parties

and the class they seek to represent. A class

representative must be part of the class and possess

the same interest and suffer the same injury as the

class members.” Amchem Prod., Inc. v. Windsor, 521

U.S. 591, 625-26 (1997) (internal quotation marks and

citations omitted). In Stout, this Court explained that

it “reviews the adequacy of class representation to

determine whether class counsel are qualified,

experienced and generally able to conduct the

litigation, and to consider whether the class members

have interests that are not antagonistic to one

another.” 228 F.3d at 717; see also In re Am. Med.

Sys., Inc., 75 F.3d at 1083 (explaining that “1) the

16a

representative must have common interests with

unnamed members of the class, and 2) it must aprear

that the representatives will vigorously prosecute the

interests of the class through qualified counsel”)

(citations omitted).

Based on this standard, the district court did not

err in concluding that the adequacy requirement of

Rule 23(a)(4) was satisfied. The court stated that

“plaintiffs’ attorney is an experienced practitioner in

this area” because of the “numerous class action cases

in which counsel has participated,” and CenturyTel did

not argue otherwise. Beattie, 234 F.R.D. at 169.

Further, the district court determined that the

interests of the named plaintiffs were not antagonistic

to those of the class members. Id. The facts support

the district court’s conclusion, because there is no

indication of a conflict of interest between the named

plaintiffs and the class members. See Intl Union,

United Auto., Aerospace, & Agric. Implement Workers

of Am. v. Gen. Motors Corp., __ F.3d __, 2007 WL

2239208, at *7 (noting that “adequacy of

representation turns in parton... absence of conflicts

of interest”) (internal quotation marks and citations

omitted). The Plaintiffs-Appellees and the class

members suffered the same injury—all were billed for

WireWatch under a misleading description—and,

therefore, there is every reason to believe that the

Plaintiffs-Appellees will vigorously prosecute the

interests of the class. Id. (“Class representatives are

adequate when it appear{s] that [they] will vigorously

prosecute the interests of the class through qualified

counsel, which usually will be the case if the

representatives are part of the class and possess the

same interest and suffer the same injury as the class

17a

members.”) (alterations in original; citations and

internal quotation marks omitted). Taken together,

these factors indicate that the district court did not

abuse its discretion in concluding that the

adequacy-of-representation requirement of Rule

23(a)(4) is satisfied.

3. Rule 23(b)

The district court also held that the requirements

of Rule 23(b)(3) were satisfied. Beattie, 234 F.R.D. at

169-171. In concluding that common questions

predominate over questions affecting individual class

members, the district court determined that

[a]lthough damages may be individualized and

not all customers who received ambiguous bills

will say that they did not order or authorize the

inside wire maintenance insurance program,

the overarching question of whether the billing

itself violates section 201(b) or Rule 64.2401

predominates and must be determined before

any customer has a right to recover under that

theory.

Id. at 170. In response to CenturyTel’s argument that

“the need to prove causation for each plaintiff to show

liability demonstrates that individual issues

predominate,” the district court stated that “the

necessity of each plaintiff proving the amount of his or

her damages is generally not an impediment to class

certification.” Id. The court explained that

the questions of causation and damages in this

case can be addressed later in the proceedings

18a

by means of a special master, representative

trials, or other means. However, because the

liability issue predominates, this case falls

easily into the category of “cases in which a

class action would achieve economies of time,

effort, and expense, and promote ... uniformity

of decision as to persons similarly situated,

without sacrificing procedural fairness or

bringing about other undesirable results.”

Id. at 171 (quoting Windsor, 521 U.S. at 615).

CenturyTel maintains that each class member

must establish injury to prove lability under §§ 201

and 206, and “fact of injury is not a common issue

among class members.” (Appellant’s Br. 21.)

According to CenturyTel, the district court confounded

the need of each class member to establish injury with

the need to establish damages. (/d.) CenturyTel

contends that causation and injury, unlike damages,

must be established on a class-wide basis. (Jd. 24)

(a) Predominance Requirement

A class action may be maintained only if it qualifies

under one of the subsections of Rule 23(b) of the

Federal Rules of Civil Procedure. Ball v. Union

Carbide Corp., 385 F.3d 713, 728 n.12 (6th Cir. 2004).

Under Rule 23(b)(3), a class action is appropriate

where

the court finds that the questions of law or fact

common to the members of the _ class

predominate over any questions affecting only

individual members, and that a class action is

19a

superior to other available methods for the fair

and efficient adjudication of the controversy.

The matters pertinent to the findings include:

(A) the interest of members of the class in

individually controlling the prosecution or

defense of separate actions; (B) the extent and

nature of any litigation concerning the

controversy already commenced by or against

members of the class; (C) the desirability or

undesirability of concentrating the litigation of

the claims in the particular forum; (D) the

difficulties likely to be encountered in the

management of a class action.

Fed. R. Civ. P. 23(b)(3). “The Rule 23(b)(3)

predominance inquiry tests whether proposed classes

are sufficiently cohesive to warrant adjudication by

representation.” Windsor, 521 U.S. at 632; see also In

re Visa Check/ MasterMoney Antitrust Litig., 280 F.3d

124, 136 (2d Cir. 2001). To satisfy the predominance

requirement in Rule 23(b)(3), “a plaintiff must

establish that ‘the issues in the class action that are

subject to generalized proof, and thus applicable to the

class as a whole, . . . predominate over those issues

that are subject only to individualized proof.” Jn re

Visa Check / MasterMoney Antitrust Litig., 280 F.3d at

136 (quoting Rutstein v. Avis Rent-A-Car Sys., Inc.,211

F.3d 1228, 1233 (11th Cir. 2000) (internal quotation

marks omitted)). Further, “the fact that a defense

‘may arise and may affect different class members

differently does not compel a finding that individual

issues predominate over common ones.” Id. at 138

(quoting Waste Mgmt. Holdings, Inc. v. Mowbray, 208

F.3d 288, 296 (ist Cir. 2000)). Lastly, “[clommon

issues may predominate when liability can be

20a

determined on a class-wide basis, even when there are

some individualized damage issues.” Id. at 139.

Section 201(b) provides that “[a]ll 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.” 47 U.S.C.

§ 201(b). Section 206 establishes that a common

carrier is liable for conduct that violates section 201(b):

In case any common carrier shall 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, such

common carrier shall be hable to the person or

persons injured thereby for the full amount of

damages sustained in consequence of any such

violation of the provisions of this chapter,

together with a reasonable counsel or attorney’s

fee, to be fixed by the court in every case of

recovery, which attorney’s fee shall be taxed

and collected as part of the costs in the case.

47 U.S.C. § 206. Section 207 authorizes individuals

injured by a common carrier’s actions to bring suit:

Any person claiming to be damaged by any

common carrier subject to the provisions of this

chapter may either make complaint to the

Commission as hereinafter provided for, or may

bring suit for the recovery of the damages for

which such common carrier may be liable under

2la

the provisions of this chapter, in any district

court of the United States of competent

jurisdiction; but such person shall not have the

right to pursue both such remedies.

47 U.S.C. § 207.

The FCC also enacted a regulation intended to

clarify the meaning of § 201(b):

Descriptions of billed charges. Charges

contained on_ telephone bills must be

accompanied by a brief, clear, non-misleading,

plain language description of the service or

services rendered. The description must be

sufficiently clear in presentation and specific

enough in content so that customers can

accurately assess that the services for which

they are billed correspond to those that they

have requested and received, and that the costs

assessed for those services conform to their

understanding of the price charged.

47 C.F.R. § 64.2401(b). Further, in its report issued

during the rulemaking process that led to the

enactment of § 64.2401(b), the FCC explained:

We contemplate that sufficient descriptions will

convey enough information to enable a customer

reasonably to identify and to understand the

service for which the customer is being charged.

Conversely, descriptions that convey ambiguous

or vague information, such as, for example,

charges identified as “miscellaneous,” would not

conform to our guideline. Similarly, in our

22a

view, a charge described by what it is not, such

as, for example,”service not regulated by the

Public Service Commission” is inherently

ambiguous and does not disclose sufficient

information. There is no way for a consumer to

discern from this description that the charge

refers to, for example, inside’ wiring

maintenance insurance.

In the Matter of Truth-In-Billing and Billing Format,

14 F.C.C.R. 7492, at 7517-18 (Apr. 15, 1999) (internal

footnotes omitted) (emphasis added). As the district

court noted, “[t]he language chosen by the defendant

to describe its optional inside wire maintenance

service closely tracks the phrasiology criticized by the

FCC as ‘inherently ambiguous,’ specifically as it might

be applied to describe the very service at issue in this

case.” Beattie, 234 F.R.D. at 166.

Plaintiffs-Appellees conceded before the district

court that § 201 is not a strict-hability statute and

therefore they must establish “some type of injury” to

allege a claim under §§ 201 and 206. Id. at 170.

Contrary to CenturyTel’s argument, however,

Plaintiffs-Appellees have raised common allegations

which would allow the district court to determine

liability for the class as a_ whole. First,

Plaintiffs-Appellees allege that CenturyTel billed for

WireWatch under the misleading description,

“Non-Regulated Services,” in violation of § 201(b). (JA

18; Compl. 4 22.) The district court noted that “[t]he

defendant’s custom of charging for its optional inside

wire maintenance insurance under the heading

‘non-regulated services’ gives no hint at the services

for which charges are assessed.” Beattie, 234 F.R.D. at

23a

172 (stating that the WireWatch description “does not

satisfy the FCC’s truth-in-billing requirement and

constitutes an unreasonable practice within the

meaning of section 201(b)”). As the FCC made clear in

its regulation, § 201(b)is violated when the description

for a billed service is not “sufficiently clear in

presentation and specific enough in content so that

customers can accurately assess that the services for

which they are billed correspond to those that they

have requested and received ....” 47 C.F.R.

§ 64.2401(b). Further, the FCC’s report specifically

states that “a charge described by what it is not, such

as, for example,’service not regulated by the Public

Service Commission’ is inherently ambiguous and does

not disclose sufficient information.” In the Matter of

Truth-In-Billing and Billing Format, 14F.C.C.R. 7492,

at 7517-18 (Apr. 15, 1999) (internal footnotes omitted).

Thus, Plaintiffs-Appellees have set forth sufficient

allegations to show that CenturyTel’s billing practice

violated § 201(b), because the description used by

CenturyTel is virtually identical to the misleading

description the FCC condemned in its regulation and

report.

Second, under § 206, Plaintiffs-Appellees must

establish that each class member was injured by

CenturyTel’s violation of § 201(b). 47 U.S.C. § 206

(stating that a “common carrier shall be liable to the

person or persons injured” by its unlawful practice).

This can be done by showing that each class member

paid for Wire Watch during the period when the service

was billed under the misleading description. Before

the district court, CenturyTel admitted that “it did

send some bills to customers that contained this

language,” Beattie, 234 F.R.D. at 173, and an

24a

inventory of CenturyTel’s billing records could disclose

which customers paid their bills in full, which would

include a payment for fees associated with WireWatch.

On appeal, CenturyTel argues that “only those

customers who can establish that they did not want or

request the WireWatch service can_ establish

CenturyTel’s liability ....” (Appellant’s Br. 40.)

CenturyTel is incorrect. Under § 206, CenturyTel

is liable if it violated § 201(b), which makes it unlawful

for CenturyTel to bill for a service under a misleading

description, even where the customer requested the

service. See 47 C.F.R. § 64.2401(b) (“The description

must be sufficiently clear in presentation and specific

enough in content so that customers can accurately

assess that the services for which they are billed

correspond to those that they have requested and

received ....”). True, each class member will have to

show that she did not enroll in WireWatch, but that is

relevant, as the district court concluded, to the issue of

damages and not liability. Thus, Plaintiffs-Appellees

should be able to establish liability for the class as a

whole because the misleading description used by

CenturyTel violated § 201(b), and class members were

injured by that violation when they paid their

telephone bill, which included a charge for WireWatch

under a misleading description (a § 206 violation).

(b) Superiority Requirement

The district court also addressed the superiority

requirement of Rule 23(b)(3). The court noted that the

amount of a single class member’s potential recovery

was small, making class resolution superior to other

methods of adjudicating the controversy. Beattie, 234

25a

F.R.D. at 171. In concluding that the

Plaintiffs-Appellees satisfied the requirements of Rule

23(b)(3), the district court explained that “the potential

recovery by an individual is relatively small, the

liability issue predominates, the issues of management

can be addressed by various procedural mechanisms

and careful definition of subclasses, and the likelihood

of an individual class member preferring to take

control of the litigation is remote.” Jd.

One factor to consider in determining whether the

superiority requirement of Rule 23(b)(3) is satisfied are

“the difficulties likely to be encountered in the

management of a class action.” Fed. R. Civ. P.

23(b)(3). In Windsor, the Supreme Court explained

that litigation should be brought as a class action if

individual suits would yield small recoveries. The

Court stated that “[t]he policy at the very core of the

class action mechanism is to overcome the problem

that small recoveries do not provide the incentive for

any individual to bring a solo action prosecuting his or

her rights.” 521 U.S. at 617 (quoting Mace v. Van Ru

Credit Corp., 109 F.3d 338, 344 (7th Cir. 1997)).

Here, individual suits would yield only a small

amount of damages, because the most each class

member would have paid for WireWatch between 1994

and 2001 is roughly $124.68.' Such a small possible

* This amount was calculated based on -Plaintiffs-Appellees’

allegation that CenturyTe! charged $0.50 per month for

WireWatch in 1994, $0.99 per month between 1995 and 2000, and

$3.95 per month in 2001. (JA 19; Compl. 9 23.) Assuming that a

customer was billed twelve times a year, WireWatch fees would

26a

recovery would not encourage individuals to bring suit,

thereby making a class action a superior mechanism

for adjudicating this dispute. See id. (“A class action

solves this problem by aggregating the relatively

paltry potential recoveries into something worth

someone’s (usually an attorney’s) labor.”) (quoting

Mace, 109 F.3d at 344); see also Carroll v. United

Compucred Collections, Inc., 399 F.3d 620, 625 (6th

Cir. 2005) (same). Thus, the district court did not err

in holding that the superiority requirement of Rule

23(b)(3) is satisfied.

4. Plaintiffs-Appellees’ State Law Claims

Lastly, we briefly address CenturyTel’s contention

that the district court erred in _ certifying

Plaintiffs-Appellees’ state-law claims (Counts IV and

V). CenturyTel argues that the district court’s decision

failed to analyze whether Plaintiffs-Appellees’

state-law claims met the Rule 23 requirements, and,

alternatively, Plaintiffs-Appellees’ state-law claims are

not appropriate for class certification because

individual issues overwhelm any common issues.

(Appellant’s Br. 44-45.) Conversely, Plaintiffs-

Appellees point out that the district court’s

class-certification decision “purposely did not address

the state law claims.” (Appellee’s Br. 46.)

A review of the district court’s decision leaves some

ambiguity as to how that court intended to proceed

with Plaintiffs-Appellees’ state-law claims. In an order

have been approximately $6 for 1994, $11.88 each year between

1995 and 2000, and $47.40 in 2001.

27a

dated May 29, 2003, the district judge presiding over

the case stated that, “la]fter further discussion with

the parties, the [clourt finds that the parties should

first focus on the merit of the plaintiffs’ federal claims

and the propriety of class certification concerning

those claims.” (JA 76.) Plaintiffs-Appellees urge us to

construe this language as binding rather than merely

hortatory: in their estimation, this language makes

clear that their state-law claims were not pending

before the district court in its certification decision and

therefore are not currently pending before us on

appeal.

On the other hand, Plaintiffs-Appellees’ August 15,

2003 motion for class certification, which was filed

after the May 29, 2003 order, requested certification

that included the state-law claims. The district court’s

opinion granting class certification expressly

references state-law theories and specifically lists

Plaintiffs-Appellees’ state-law claims by count. The

opinion also grants the motion for certification without

qualification exempting the state-law_ claims.

Moreover, the district court’s instruction to “first focus

on... plaintiffs’ federal claims” is ambiguous. The

court may have meant that it planned to deal with the

certification of state-law issucs in a_ separate

proceeding at a later time, or it may have meant that,

within the same proceeding, it first planned to deal

with the federal-law issues and then move on to the

state-law matters. Given this uncertainty and the fact

that the district court’s certification analysis does not

account for Plaintiffs-Appellees’ state-law claims, a

remand is appropriate for the district court to apply

the Rule 23 criteria to the state-law claims.

28a

Ill.

CONCLUSION

For the reasons set forth above, we AFFIRM the

district court's judgment certifying Plaintiffs-

Appellees’ class as to Plaintiffs-Appellees’ federal-law

claims in Count I and REMAND Plaintiffs-Appellees’

state-law claims to the district court to conduct a

certification analysis of such claims consistent with

this opinion.

29a

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

No. 06-1565

{Filed December 18, 2007]

BARBRASUE BEATTIE and

JAMES SOVIS,

Plaintiffs-Appellees,

CENTURYTEL, INC.,

Defendant-Appellant.

)

v. )

)

Before: COLE and COOK, Circuit Judges; FROST,

District Judge.

JUDGMENT

On Appeal from the United States District Court for

the Eastern District of Michigan at Bay City.

THIS CAUSE was heard on the record from the

district court and was argued by counsel.

IN CONSIDERATION WHEREOF, it is ORDERED

that the judgment of the district court is AFFIRMED

IN PART, and the case is REMANDED for further

proceedings consistent with the opinion of this court.

ENTERED BY THE ORDER OF THE COURT

30a

/s/

Leonard Green, Clerk

3la

APPENDIX B

No. 06-0105

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

[Filed May 2, 2006]

In re: CENTURYTEL, INC.,

)

Petitioner. )

)

ORDER

Before: KENNEDY, GUY, and COLE, Circuit

Judges.

The defendant petitions for permission to take an

interlocutory appeal of a class certification order

pursuant to Fed. R. Civ. P. 23(f). The plaintiffs oppose

the petition. The defendant also moves for leave to file

a reply memoranda in support of its petition and has

submitted a reply to the plaintiffs opposition. We will

grant the motion for leave to file a reply.

Fed. R. Civ. P. 23(f) authorizes the courts of appeals

to hear interlocutory appeals of class certification

rulings. See In re Delta Air Lines, 310 F.3d 953 (6" Cir.

2002), cert. denied, 539 U.S. 904 (2003). In considering

a Rule 23(f) petition, the court “eschew|s] any hard-

32a

and-fast test in favor of a broad discretion to evaluate

relevant factors that weigh in favor or against an

interlocutory appeal.” In re Delta Air Lines, 310 F.3d

at 959. However, the following factors support the

acceptance of a Rule 23(f) interlocutory appeal: 1) if

the class certification ruling is the death knell of the

litigation; 2) if the appeal raises a novel or unsettled

question; 3) if the petitioner has a likelihood of success

on the merits of the appeal; and 4) if the posture of the

case below supports an immediate appeal. /d.

Upon consideration of these factors, we conclude

that interlocutory review of the class certification

order in this case is warranted. Therefore, the

defendant’s motion for leave to file a reply and its

petition for permission to appeal are GRANTED.

ENTERED BY ORDER OF THE COURT

/s/

Clerk

A TRUE COPY

Attest:

LEONARD GREEN, Clerk

By /s/ Sue Burlage

Deputy Clerk

33a

APPENDIX C

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

NORTHERN DIVISION

Case Number 02-10277-BC

[Filed March 10, 2006]

BARBRASUE BEATTIE and JAMES

SOVIS, on behalf of themselves and

others similarly situated,

Plaintiffs,

CENTURYTEL, INCORPORATED,

)

Defendant. )

)

OPINION AND ORDER GRANTING

PLAINTIFFS’ MOTIONS FOR CLASS

CERTIFICATION AND PARTIAL JUDGMENT

ON THE PLEADINGS, AND DENYING

PLAINTIFFS’ MOTION TO STRIKE

AFFIRMATIVE DEFENSES

The plaintiffs, Barbara Sue Beattie and Jim Sovis,

have filed a putative class action against their

34a

telephone service provider under certain provisions of

the Federal Telecommunications Act, 47 U.S.C. 201 et

seqg., and regulations enacted thereunder, as well as

various state law theories, challenging the practice

used by the defendant for billing for inside wire

maintenance insurance and for charging for such

optional service when it was not ordered. The case

presently is before the Court on motions by the

plaintiffs for class certification, for judgment on the

pleadings, and to strike certain affirmative defenses.

Sixth Circuit precedent suggests that claims of

fraudulent billing practices by telecommunications

companies fall within the primary jurisdiction of the

Federal Communications Commission, and _ the

question whether the federal claims in this case ought

to be transferred to that agency is a close one.

However, the Court finds that the purposes of the

primary jurisdiction doctrine will not be advanced by

a transfer, jurisdiction lies in this Court, the plaintiffs

have satisfied the requisites for class certification, and

defendant’s acknowledged billing practice violated the

Federal Telecommunications Act as a matter of law.

The Court, therefore, will grant the motion for class

certification, grant the plaintiffs’ motion for partial

judgment on the pleadings, and deny the motion to

strike affirmative defenses.

According to the parties, defendant CenturyTel is

the eighth largest telephone company in the United

States and currently provides telephone, internet

access, long distance, and high-speed data services to

more than 1.7 million customers in 22 states. As part

of its services, the defendant also offers an

35a

unregulated inside wire maintenance service program

called “WireWatch.” CenturyTel describes the program

in its promotional literature as follows:

WireWatch covers the cost of diagnosis and

repair of inside wiring and/or jack damages that

can interrupt your phone service. Once your

telephone wiring enters your house, it becomes

your responsibility to maintain it and typical

repairs can be costly. For a low monthly fee,

enjoy the convenience and satisfaction of having

a certified CenturyTel Tech to diagnose and

make any necessary repairs.

Compl. at { 19; Ans. at J 19.

This plan is an unregulated service not covered by

CenturyTel’s tariffs or rate filings. In some states,

CenturyTel has offered WireWatch for a number of

years, but in others, such as Alabama and Missouri,

WireWatch only recently has become available through

CenturyTel to its customers. The main reason for this

variance is the manner in which CenturyTel has

grown through acquisition of other telephone

companies.

The state-by-state network of CenturyTel telephone

service providers is an amalgamation of small

companies acquired by CenturyTel over time. As a

consequence, the services offered to current customers

of CenturyTel historically has differed from state to

state, and sometimes varied in regions within a single

state. Billing formats varied widely as well. According

to CenturyTel, the defendant acquired access lines and

customers in Missouri from GTE (now Verizon) in

36a

September 2000 and 2002; and in Alabama from

Verizon in July 2002. The defendant purchased

properties in Arkansas and Wisconsin in the late

summer/early fall of 2000. When the defendant

purchased Pacific Telecommunications, Inc. in 1997, it

obtained customers in Arizona, Colorado, Idaho, Iowa,

Minnesota, Montana, New Mexico, Oregon,

Washington, and Wisconsin.

The complaint alleges that beginning in at least

1994, and perhaps before that time, defendant

CenturyTel has been billing customers for the

maintenance of internal wiring at a rate of $.50 to

$.99, and that the rate increased to $3.95 in or about

May 2001. Up through approximately January of

2002, CenturyTel labeled this charge as one for

“Non-Regulated Services.” At that time, it reorganized

its telephone bills and re-labeled the charge to “Inside

Wire Maintenance Plan.” The complaint alleges that

this is the first time CenturyTel customers were given

any indication that this charge had all along been for

an optional wire protection program. The plaintiffs

describe this procedure as a form of “cramming,” a

term used by the Federal Communications

Commission (“FCC”) to refer to the practice of placing

unauthorized, misleading, or deceptive charges on

customer phone bills.

Plaintiff Barbrasue Beattie resides in Chesaning,

Michigan and has been a customer of CenturyTel since

at least November of 1996. Beattie’s telephone bills

from November 1996 through May 2001 contained the

above-described charge for “Non-Regulated Services,”

which Beattie paid. She also paid a monthly charge of

$3.95 from May 2001 through January 2002 when the

37a

label for the maintenance program was changed. At

that time, Beattie contacted CenturyTel to complain

about the charge and to seek a refund of charges

dating back to 1996. CenturyTel responded with a

letter that acknowledged Beattie had never signed up

for the optional service, but refused to credit her

account for charges before May 2001.

Plaintiff James Sovis resides in New Lothrop,

Michigan, and has been a residential telephone

customer of CenturyTel since at least 1994. Like Ms.

Beattie, Sovis paid for “Non-Regulated Services”

through January 2002.

The complaint seeks certification of the following

nationwide class, spanning approximately 1.8 million

access lines in twenty-two states:

All persons who have paid CenturyTel, Inc. for

charges described in CenturyTel’s residential

telephone bills as “Non-Regulated Services” or

“Inside Wire Maint. Plan” during the fullest

period allowed by law.

Compl. at J 11. Excluded from the proposed class are

CenturyTel, its employees and subsidiaries, and the

successors and representatives of any excluded party.

The plaintiffs’ suit alleges that the defendant

intentionally mislabeled the wire service program and

by keeping the charge relatively small reaped

substantial rewards for what amounts to a deceptive

billing practice under the Federal Communications

Act, 47 U.S.C. § 201(b), and under the Truth-in- Billing

regulations. They also claim that the defendant’s

38a

practices caused it to breach its contracts with

customers, resulted in unjust enrichment to the

defendant, and the defendant’s practices violate

numerous provisions of the Michigan Consumer

Protection Act.

The plaintiffs’ complaint pleads six counts: Count

1 alleges that the defendant’s billing actions violate 47

U.S.C. §§ 201(b), 206, and 207, as well as the FCC’s

Truth-in-Billing regulation, 12 C.F.R. § 64.2401; Count

2 claims that the defendant’s activities constitute

“cramming” contrary to these same statutes and rules;

Count 3 seeks declaratory and injunctive relief

pursuant to 47 U.S.C. § 401 for a declaration that the

defendant violated 47 U.S.C. § 201(b) and 12 C.F.R.

§ 64.2401, and to enjoin the defendant from continuing

to violate these laws and regulations; Count 4 alleges

breach of contract and the duty of good faith and fair

dealing with existing customers in relation to billing

for telephone services in violation of state law; Count

5 raises a claim for unjust enrichment and

disgorgement by the defendant for any profits it gained

from deceptive billing practices; and Count 6

challenges the defendant’s billing practices under the

Michigan Consumer Protection Act, Mich. Comp. Laws

§ 445.901 et seq.

The defendant previously moved to dismiss the

plaintiffs’ complaint on February 24, 2003; within that

motion the defendant also requested that the Court

apply the doctrine of primary jurisdiction to the

plaintiffs’ fourth (breach of contract and breach of the

duty of good faith and fair dealing) and fifth (unjust

enrichment and disgorgement) claims since the

doctrine required that specific deference be given to

39a

the Michigan Public Service Commission. The

plaintiffs opposed the motion, and the Court

subsequently granted the defendant’s request to

withdraw it without prejudice on May 30, 2003.

Subsequently, the plaintiffs sought to certify this

action as class consisting of “all CenturyTel, Inc.

(‘CenturyTel’) residential telephone customers who

have paid charges for an inside wire maintenance

service program described in CenturyTel’s telephone

bills as ‘Non-Regulated Services’ or ‘Inside Wire Maint.

Plan’ from January 1, 1987 to the present (the ‘Class’).

Excluded from the Class are CenturyTel; its

subsidiaries, affiliates, officers and directors; any

entity in which CenturyTel has a controlling interest;

and the legal representatives, heirs, successors and

assigns of any such excluded party.” See Pls.’ Mot. for

Class Cert.; Compl. at 9 11. The plaintiffs also have

filed their own motion for judgment on the pleadings

or for partial summary judgment.

Il.

The first three counts of the complaint plead claims

under sections 201(b), 206 and 207 of the

Telecommunications Act. Section 201(b) states:

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. .. .

The Commission may prescribe such rules and

regulations as may be necessary in the public

40a

interest to carry out the provisions of this

chapter.

47 U.S.C. § 201(b). Section 206 states that a common

carrier who violates the Act is liable “for the full

amount of damages sustained in consequence of any

such violation . . . together with a reasonable counsel

or attorney's fee.” 47 U.S.C. § 206. Section 207

permits an aggrieved person to file a complaint with

the FCC or commence an action in the district court.

Sixth Circuit precedent suggests that the question

of whether a telecommunications carrier’s billing

practices are “unjust or unreasonable” presents a

matter within the expertise of the FCC and is referable

to its primary jurisdiction. See In re Long Distance

Telecomm. Litig., 831 F.2d 627 (6 Cir. 1987). In that

case, a long distance carrier sued certain competitors

alleging that the competitors failed to disclose certain

bulling practices, rendering those bills “unreasonable

and unjust” within the meaning of section 206(b). The

district court dismissed the case because it found the

claims were within the primary jurisdiction of the

FCC. The court of appeals agreed that the doctrine of

primary jurisdiction made the FCC the forum best able

to decide the issue, but it held that the district court

should not have dismissed the case. Kather, it should

have transferred the case for resolution of the question

and stayed the lawsuit until after the FCC acted. The

case was followed with the same result in Kiefer v.

Paging Network, Inc., 50 F. Supp. 2d 681 (E.D. Mich.

1999), where the plaintiffs challenged the billing

practice of a communications service provider under

section 201(b).

4la

These cases make clear that the doctrine “is

concerned with promoting proper relationships

between the courts and administrative agencies

charged with particular regulatory duties.” Nader v.

Allegheny Airlines, Inc., 426 U.S. 290, 303 (1976).

“The doctrine is properly invoked when enforcement of

a claim in court would require resolution of issues that

have already been placed within the _ special

competence of an administrative body.” Kiefer, 50 F.

Supp. 2d at 683. But the doctrine must be applied on

a case-by-case basis, Jn re Long Distance Telecomm.

Litig., 831 F.2d at 630, and it should not cause the

court to abstain from determining a dispute unless

“the reasons for the existence of the doctrine are

present and... the purposes it serves will be aided by

its application in the particular litigation.” United

States v. Western Pac. R. Co., 352 U.S. 59, 64 (1956);

see also Allied Tennessee v. Tennessee Pub. Sru.

Comm'n, 913 F.2d 305, 309 (6th Cir. 1990) (stating

that “{a] court must apply the doctrine of primary

jurisdiction on a case-by-case basis, deferring to an

administrative agency only when the reasons for the

existence of the doctrine are resent”).

In In re Long Distance Telecommunications

Litigation, the court recognized that two factors

favoring application of the doctrine are the need for

uniform application of a rule and the desirability of a

specialized agency first passing on the disputed

question. 831 F.2d at 630. Courts also should consider

whether (1) the issue is within the conventional

expertise of judges; (2) the issue lies within the

agency’s discretion or requires the exercise of agency

expertise; (3) there is a substantial danger of

inconsistent rulings; (4) a prior application to the

42a

agency has been made; (5) the issue has already been

addressed by the agency; (6) judicial economy is served

by having the agency decide the question; and (7)

referral will result in substantial delay and added

expense. See Gilmore v. Southwestern Bell Mobile

Systems, L.L.C., 210 F.R.D. 212, 221 (N.D. Ill. 2001);

Young Soon Oh v. AT&T Co., 76 F. Supp. 2d 551, 557

(D.N.J. 1999).

In this case, both parties have filed supplemental

briefs arguing that the case should not be transferred,

although each party offers substantially different

reasons for its position. The Court is persuaded that

transfer would not serve the purpose of the primary

jurisdiction doctrine because the FCC plainly has

expressed its views on the issue presented and the

economies are better served if the matter remains in

the district court.

Although the language of the statute prohibiting

“unjust or unreasonable” charges and billing practices

leaves considerable room for interpretation, the FCC

has enacted a clarifying regulation:

(b) Descriptions of billed charges. Charges

contained on telephone bills must be

accompanied by a brief, clear, non-misleading,

plain language description of the service or

services rendered. The description must be

sufficiently clear in presentation and specific

enough in content so that customers can

accurately assess that the services for which

they are billed correspond to those that they

have requested and received, and that the costs

43a

assessed for those services conform to their

understanding of the price charged.

47 C.F.R. § 64.2401(b). In its report filed as part of the

rulemaking process that led to this regulation, the

FCC explained:

We contemplate that sufficient descriptions will

convey enough information to enable a customer

reasonably to identify and to understand the

service for which the customer is being charged.

Conversely, descriptions that convey ambiguous

or vague information, such as, for example,

charges identified as “miscellaneous,” would not

conform to our guideline. Similarly, in our

view, a charge described by what it is not, such

as, for example “service not regulated by the

Public Service Commission” is_ inherently

ambiguous and does not disclose sufficient

information. There is no way for a consumer to

discern from this description that the charge

refers to, for example, inside wiring maintenance

insurance.

First Report and Order and Further Notice of Proposed

Rulemaking, FCC 99-72 at 26 (Apr. 15, 1999)

(emphasis added). The language chosen by the

defendant to describe its optional inside wire

maintenance service closely tracks the phrasiology

criticized by the FCC as “inherently ambiguous,”

specifically as it might be applied to describe the very

service at issue in this case. It is quite unlikely that

the FCC would determine that language complied with

its regulation. Although the FCC’s pronouncement did

not occur in the context of an actual controversy, the

44a

uncanny overlay of the example given by the agency

and the facts of this case allows the language of the

report to serve as a suitable proxy for a prior

adjudication for the purpose of obviating the need ofa

referral under the primary jurisdiction doctrine.

Likewise, there are other issues that must be

decided in this action, such as whether the plaintiffs’

class should be certified and whether the plaintiffs

may-proceed with theirstate law claims while seeking

certification of a nationwide class. The delay inherent

in a referral would not serve the parties’ interests.

For these reasons, the Court declines to refer the

case to the FCC under the doctrine of primary

jurisdiction.

Il.

The plaintiffs seek certification of the following

class:

{A]ll CenturyTel, Inc. (“CenturyTel”) residential

telephone customers who have paid for charges

for an inside wire maintenance service program

described in CenturyTel’s telephone bills as

“Non-Regulated Services” or “Inside Wire

Maint. Plan” from January 1, 1987 to the

present (the “Class”). Excluded from the Class

are CenturyTel; its subsidiaries, affiliates,

officers and directors; any entity in which

CenturyTel has a controlling interest; and the

legal representatives, heirs, successors and

assigns of any such excluded party.

45a

Pls’ Mot. for Class Cert. at 1.

According to Federal Rule of Civil Procedure 23, a

matter may proceed as a class action in the name of

representative parties if (1) the class is so numerous

that joinder of all members is impracticable; (2) there

are questions of law and fact common to the class; (3)

the claims and defenses of the representative parties

are typical of the claims and defenses of the class; and

(4) the representative parties will fairly and

adequately protect the interests of the class. Amchem

Prods., Inc. v. Windsor, 521 U.S. 591, 613 (1997) (citing

Fed. R. Civ. P. 23(a)); Olden v. LaFarge Corp., 203

F.R.D. 254, 268 (E.D. Mich. 2001), affd 383 F.3d 495

(6th Cir. 2004). These factors are normally referred to

as numerosity, commonality, typicality, and adequacy

of representation.

A class must meet all of the above prerequisites

plus one of those listed in Federal Rule of Civil

Procedure 23(b) to be certified. Amchem Prods., Inc.,

521 U.S. at 614; Sprague v. General Motors Corp., 133

F.3d 388, 397 (6th Cir. 1998). The plaintiff bears the

burden of establishing that all prerequisites for class

certification are satisfied. Thompson v. County of

Medina, 29 F.3d 238, 241 (6th Cir. 1994).

The first prerequisite to class certification under

Rule 23(a) is numerosity. Olden, 203 F.R.D. at 268.

There is no strict numerical test to determine when

the class is large enough or too numerous to be joined

under the Federal Rules of Civil Procedure. Bremiller

v. Cleveland Psychiatric Inst., 195 F.R.D. 1, 19 (N.D.

46a

Ohio 2000). The Court may consider many factors,

including “class size, ease of identification of members

of the proposed class . . . geographic dispersion of class

members, and whether proposed members of the class

will be able to pursue remedies on an individual basis.”

Liberty Lincoln Mercury, Inc. v. Ford Marketing Corp.,

149 F.R.D. 65, 74 (D. N.J. 1995).

In this case, the plaintiffs have discovered that

CenturyTel has approximately 1.7 million customers

in 22 states, and that 500,000 to 700,000 customers

have been billed for CenturyTel’s wire maintenance

service plan during each of the last few years.

CenturyTel argues, however, that certification is not

appropriate because the plaintiffs rely solely upon

“conclusory allegations that joinder is impracticable.”

Rockey v. Courtsey Motors, Inc., 199 F.R.D. 578, 582

(W.D. Mich. 2001) (stating that “[p]laintiffs are not

required to specify the exact number of persons in the

class, but cannot rely on conclusory allegations that

joinder is impractical. Mere speculation as to the

numbers of parties involved is not sufficient to satisfy

Rule 23(a)(1)”). The defendant contends that an

assertion that all CenturyTel customers receiving

WireWatch were duped goes too far because it fails to

recognize the multitude of customers who: (1)

knowingly signed up for the service; (2) cannot claim

they were misled by the billing statements; (3)

benefitted from the service; or (4) would have enrolled

in WireWatch notwithstanding the allegedly deceptive

billing descriptions. Similarly, the plaintiffs’

arguments ignore the fact that they have not isolated

customers who were allegedly “crammed.” In fact, “to

date, [the] plaintiffs have only identified about a dozen

alleged incidents of cramming in three states

47a

(Michigan, Ohio and Montana)... This clearly does

not constitute a class so ‘numerous that joinder would

be impracticable.” See Defendant’s Amended Response

in Opposition to Plaintiffs’ Motion for Class

Certification (Def's Opp) at 8-9.

However, “[t]he numerosity requirement is met

when plaintiffs demonstrate that the number of

potential class members is large, even if plaintiffs do

not know the exact figure.” Jn re Consumers Power Co.

Sec. Litig., 105 F.R.D. 583, 601 (E.D. Mich. 1985).

“Where the exact size of the class is unknown but

general knowledge and common sense indicate that it

is large, the numerosity requirement is satisfied.”

Orantes-Hernandez v. Smith, 541 F. Supp. 351, 370

(C.D. Cal. 1982). Here, the plaintiffs state that

between 500,000 and 700,000 customers may have

been unwittingly charged for WireWatch. This

suggests that some if not all of these customers are

potential class members. Additionally, the defendants

concede that there are at least a dozen potential class

members are spread over three states. The plaintiffs

do admit that the potential class members are easily

ascertainable since the names and addresses of

putative class members appear in a computer database

in the defendant’s control. Nonetheless, the amount of

each claim, perhaps no more than a few hundred

dollars, is a relatively small amount, when compared

to the potential profits earned by the defendant if the

allegations of the class prove to be true, suggesting

that a class action may be the only effective remedy.

Moreover, the concerns of the defendant over

identifying those customers who were not deceived by

its billing descriptions, such as people who would have

48a

enrolled anyway or who benefitted by their unwitting

participation in the plan, confounds the liability issues

with the matter of damages. The defendant will be

liable for deceptive or misleading billing language,

regardless of the desire of the customer for the service

or a customer’s subsequent actions. The damages that

flow from that statutory violation might be reduced if

the customer had ordered the service; but the point of

the statute and clarifying regulation is that bills must

be clear enough to allow customers to “accurately

assess that the services for which they are billed

correspond to those that they have requested.” 47

C.F.R. § 64.2401(b). If the billing language is

inadequate, a violation occurs, and it remains to

determine the consequence of the violation. The

plaintiffs suggest that the ambiguous billing practice

was widespread, and therefore it is reasonable to

accept the conclusion that the class is large. The

matter of damages can be addressed by the creation of

subclasses to conform to the circumstances shared by

various members of the class whose losses may have

varied depending on the consequences of the

defendant’s actions.

The Court finds that the numerosity requirement

is satisfied.

Bb.

The-second prerequisite for class certification is

commonality. Olden, 203 F.R.D. at 269. Commonality

simply means that “there are questions of law or fact

common to the class.” Fed. R. Civ. P. 23(a)(2). This

provision does demand that all questions of law and

fact raised in the complaint are common. “The

49a

standard is not [that] demanding. ‘Rule 23(a) simply

requires a common question of law or fact.” Rockey,

199 F.R.D. at 583 (quoting Bittinger v. Tecumseh

Prods. Co., 123 F.3d 877, 884 (6th Cir. 1997)).

In its response to the plaintiffs’ motion for class

certification, the defendant contests commonality by

arguing that the presence of oral representations and

the need for each plaintiff to show reliance undermines

a finding of commonality. However, as noted above,

the common claim in Count I arises out of continuous

action by the defendant, namely its WireWatch billing

practices, which suggests a violation by the issuance of

telephone bills with ambiguous or deceptive language.

The allegations of “cramming” in Count II may be

narrower in scope, but that does not diminish the fact

that claimed billing violations are common among the

putative class members.

The Sixth Circuit has explained that the

commonality and typicality requirements “serve as

guideposts for determining whether under the

particular circumstances maintenance of a class action

is economical and whether the named plaintiffs’ claim

and the class claims are so interrelated that the

interests of the class members will be fairly and

adequately protected in their absence.” Rutherford v.

City of Cleveland, 137 F.3d 905, 909 (6th Cir. 1998).

The Court finds that the plaintiffs have established

the commonality requirement.

The third prerequisite for class certification is

typicality. Olden, 203 F.R.D. at 269. Typicality

50a

requires that a “sufficient relationship exist[}] between

the injury to the named plaintiff and conduct affecting

the class, so that the court may properly attribute a

collective nature to the ch. 'lenged conduct.” Stout v.

Byrider, 228 F.3d 709, 717 (6th Cir. 2000). Although

the named plaintiffs’ claims must fairly encompass the

class members’ claim, they need not always involve the

same facts or law. See Sprague v. General Motors

Corp., 133 F.3d 388, 399 (6th Cir. 1998); Senter v.

General Motors Corp. 532 F.2d 511, 525 n.31 (6th Cir.

1976). “The test for typicality, like commonality, is not

demanding.” Rockey, 199 F.R.D. at 584.

In the present case, CenturyTel alleges that the

typicality prerequisite is not met because of the great

variance in damages sought by the named class

members. Additionally, the defendant challenges a

finding of typicality because there has been no showing

on this record of how many of the putative class

members were the victim of deceptive billing. The

defendant contends that a myriad of legal and factual

issues exist between the class representative and the

putative class members, which destroys typicality.

The underlying claims center around the existence of

a contract. Thus, questions of oral modification,

consent, ratification and acquiescence arise as to the

individual claims and the individual class members.

Once again, however, the defendant’s argument

confounds the matters of liability and damages. A

claim is typical if “it arises from the same event or

practice or course of conduct that gives rise to the

claims of other class members, and if his or her claims

are based on the same legal theory.” Jn re Am. Med.

Sys., Inc., 75 F.3d 1069, 1082 (6th Cir. 1996). The

5la

question presented is whether the billing language

cited by the plaintiffs satisfies the requirements of the

statute and regulation. If it does not, an additional

question of what damages result may require the

creation of subclasses. However, the Court believes

that the plaintiffs have satisfied the typicality

requirement and the resolution of the common issue

should advance the resolution of the litigation.

Sprague, 133 F.3d at 397.

The fourth prerequisite for class certification is the

adequate representation of the class by the class

representatives. Olden, 203 F.R.D. at 270. “Adequate

representation” invokes two inquiries: (1) whether the

class counsel are “qualified, experienced and generally

able to conduct the litigation” and (2) whether the

class members have interests that are antagonistic to

the other class members. Stout, 228 F.3d at 717. The

plaintiffs list the numerous class action cases in which

counsel has participated. The defendant does not

argue that the plaintiffs’ counsel is not qualified to

represent the plaintiffs in this class action lawsuit.

The plaintiffs’ attorney is an experienced practitioner

7in this area.

The second consideration focuses on the possible

antagonistic interests between the named plaintiffs

and absent class members. “Antagonistic” means

“mutually opposed” or “actively opposed.” Oxford

English Dictionary 501 (2d ed. 1989). “Interests are

antagonistic when there is evidence that the

representative plaintiffs appear unable to vigorous

prosecute the interests of the class.” Stout, 228 F.3d at

52a

717-18. The defendant does not seriously contest that

the plaintiffs adequately represent the class. The

interests in this case, while of varying degrees, seem to

all focus in the same direction. Thus, the Court finds

that the plaintiffs have satisfied their burden with

regard to the adequacy of representation.

The plaintiffs have satisfied all the prerequisites

under Rule 23(a).

The plaintiffs also contend that the putative class

action meets the requirements of both mandatory and

opt-out classes under Rule 23(b). See Amchem

Products, Inc., 521 U.S. at 615-17 (explaining

differences between mandatory class actions and

opt-out class actions). The plaintiffs point to Rule

23(b)(1) and argue that permitting individual lawsuits

against the defendant would create a risk of

“adjudications with respect to individual members of

the class which would as a practical matter be

dispositive of the interests of the other members.”

Fed. R. Civ. P. 23(b)(1)(B). The Court disagrees. There

is no evidence of other litigation against the defendant

on similar grounds, and the adjudication of one claim

would not have preclusive effect except, perhaps,

under the rule of stare decisis, which is an

ever-present risk. Nor does the plaintiffs’ alternative

reliance on Rule 23(b)2) have merit. That rule

contemplates actions for equitabie relief, specifically

injunctions. Although the plaintiffs have requested an

injunction, it appears that the defendant amended its

billing practices in May 2002 to eliminate reference to

ambiguous terms when billing for optional inside wire

53a

maintenance services. Moreover, the main thrust of

the plaintiffs’ case is to recover damages. “The court

may not use a mandatory Rule 23(b)(2) class as an

expedient to circumvent the requirements of Rule

23(b)\(3), where the case is principally one for money

damages.” Rockey, 199 F.R.D. at 594.

Rule 23(b)(3) permits class certification when class

suit “may nevertheless be convenient and desirable.”

Fed. R. Civ. P. 23 Adv. Comm. Notes, 28 U.S.C. App.,

p. 697. To qualify for certification under Rule 23(b\(3),

a class must _ satisfy Rule 23(a) and meet two

additional requirements: common questions must

“predominate over any questions affecting only

individual members”; and class resolution must be

“superior to other available methods for the fair and

efficient adjudication of the controversy.” Fed. R. Civ.

P. 23(b)(3). To determine superiority, Rule 23(b) sets

out factors to consider, although the list is not

exhaustive:

(A) the interest of members of the class in

individually controlling the prosecution or

defense of separate actions; (B) the extent and

nature of any litigation concerning the

controversy already commenced by or against

members of the class; (C) the desirability or

undesirability of concentrating the litigation of

the claims in the particular forum; (D) the

difficulties likely to be encountered in the

management of a class action.

Fed. R. Civ. P. 23(b)(3)A)-(D).

54a

The predominance test focuses on attempting “to

achieve a balance between the value of allowing

individual actions to be instituted so that each person

can protect his own interests and the economy that can

be achieved by allowing a multiple party dispute to be

resolved on a class action basis.” Rockey, 199 F.R.D. at

588 (citation omitted). To determine if common issues

predominate, the Court is “under a duty to evaluate

the relationship between the common and individual

issues... taking a pragmatic approach to determine

the relative weight and importance of the common and

individual issues.” Ibid.

To prevail on their federal claims, the plaintiffs

must show that the defendant’s billing practices

violated section 201 and they were injured by that

violation. The plaintiffs conceded this point during the

hearing on the motion for partial judgment on the

pleadings on March 18, 2004, when counsel for the

plaintiffs agreed that section 201 is not a strict

liability statute, and that to establish a claim under

section 206 the plaintiffs would have to show some

type of injury. Based on that fact, the defendant

argues that the need to prove causation for each

plaintiff to show liability demonstrates that individual

issues predominate. Cf. Stout v. J.D. Byrider, 228 F.3d

709 (6th Cir. 2000) (holding that a plaintiff fails to

satisfy the requirements of Fed. R. 23(b)(3) when the

factual core of a case is whether each putative member

relied upon false representations). However, the

necessity of each plaintiff proving the amount of his or

her damages is generally not an impediment to class

certification. See Sterling v. Velsicol Chem. Corp., 855

F,2d 1188, 1197 (6th Cir. 1988). Although damages

may be individualized and not all customers who

55a

received ambiguous bills will say that they did not

order or authorize the inside wire maintenance

insurance program, the overarching question of

whether the billing itself violates section 201(b) or

Rule 64.2401 predominates and must be determined

before any customer has a right to recover under that

theory.

In Olden v. LaFarge Corp, 383 F.3d 495 (6th Cir.

2004), the Sixth Circuit rejected a similar argument

that the specter of manifold individual damage

determinations destroyed the predomination of the

liability question. That case concerned a lawsuit

brought by homeowners against the owner of a cement

manufacturing plant alleging property and personal

damages as a result of emissions. The defendant

argued that “individual issues related to establishing

causation will overwhelm the case because toxins: (a)

originated from disparate sources within the

one-square mile Lafarge facility and perhaps other

industrial sources; (b) were dispersed to properties in

varying concentrations; (c) allegedly caused a variety

of personal injuries; and (d) allegedly caused widely

varying property damages.” Jd. at 508. However, the

court concluded that the defendant’s arguments

may suggest that individual damage

determinations might be necessary, but the

plaintiffs have raised common allegations which

would likely allow the court to determine

liability (including causation) for the class as a

whole. ... As the district court properly noted,

it can bifurcate the issue of liability from the

issue of damages, and if liability is found, the

issue of damages can be decided by a special

56a

master or by another method. Fed. R. Civ. P.

23(c)(4)(A); see also Simon v. Philip Morris Inc.,

200 F.R.D. 21, 30 (E.D.N.Y. 2001) (“By

bifurcating issues like general liability or

general causation and damages, a court can

await the outcome ofa prior liability trial before

deciding how to provide relief to the individual]

class members.”). Therefore, the

aforementioned minor complaints can be dealt

with in the damages phase if necessary, and it

is likely premature to address these issues at

this point.

Id. at 508-509.

Similarly, the questions of causation and damages

in this case can be addressed later in the proceedings

by means of a special master, representative trials, or

other means. However, because the liability issue

predominates, this case falls easily into the category of

“cases in which a class action would achieve economies

of time, effort, and expense, and promote

uniformity of decision as to persons similarly situated,

without sacrificing procedural fairness or bringing

about other undesirable results.” Amchem Products,

Inc., 521 U.S. at 615 (internal quotes and citation

omitted).

In discussing superiority, the Supreme Court has

observed that the rule drafters were mindful of the

need to balance an individual’s interest in exercising

independent decisions in the course of litigation and

the benefits that a group action may bring. Id. at

615-16. That balance tips in favor of class actions

when the amount of potential individual recovery is

57a

small, as here. The Court noted that “[t]he policy at

the very core of the class action mechanism is to

overcome the problem that small recoveries do not

provide the incentive for any individual to bring a solo

action prosecuting his or her rights. A class action

solves this problem by aggregating the relatively

paltry potential recoveries into something worth

someone’s (usually an attorney’s) labor.” Jd. at 617

(quoting Mace v. Van Ru Credit Corp., 109 F.3d 338,

344 (7th Cir. 1997)); see also Carroll v. United

Compucred Collections Inc., 399 F.3d 620 (6th Cir.

2005) (approving class certification of action under the

Fair Debt Collection Practices Act).

In this case, the potential recovery by an individual

is relatively small, the liability issue predominates, the

issues of management can be addressed by various

procedural mechanisms and careful definition of

subclasses, and the likelihood of an individual class

member preferring to take control of the litigation is

remote. The Court finds, therefore, that the plaintiffs

have satisfied the requirements for certification of its

class as an opt-out class under Rule 23(b)(3). The

Court will grant the motion for class certification.

IV.

The plaintiffs also argue that they are entitled to

judgment on the pleadings on Count I of their

complaint pursuant to Federal Rule of Civil Procedure

12(c), contending that the defendant has admitted

sending bills to customers describing its WireWatch

program as “Non-Regulated Services,” and that

description in a bill is an “unjust and unreasonable”

practice in violation of section 201(b) as a matter of

58a

law. The defendant contends that the plaintiffs’

interpretation of section 201(b) is not consistent with

the FCC’s stated intent behind its clarifying

regulations or with analogous federal case law

interpreting the Lanham Act. The defendant insists

that the FCC’s regulations are intended to be

interpreted with regard for context and circumstance,

including all of the documents provided to the

customer regarding WireWatch and any verbal

explanations provided at the time the service was

ordered. In addition, the defendant argues that even

if the Court finds that CenturyTel’s billing practices

violated section 201(b) as asserted in Count 1, that

finding should be limited to the Michigan plaintiffs

only for the time period between September 2000 and

January 2002.

Federal Rule of Civil Procedure 12(c) allows “any

party may move for judgment on the pleadings” “[a]fter

the pleadings are closed.” Although not typical, a

plaintiff may bring a motion under this Rule. Ramsey

v. Amfac, 960 F. Supp. 1424, 1426 (N.D. Cal. 1997).

Judgment under Rule 12(c) is proper “when the

moving party clearly establishes on the face of the

pleadings that no material issue of fact remains to be

resolved and that it is entitled to judgment as a matter

of law.” Ibid.

As noted earlier, Count I of the complaint is based

on 47 U.S.C. § 201(b), which states that a “charge [or]

practice” made in connection with a communications

service “that is unjust or unreasonable is declared to

be unlawful.” 47 U.S.C. § 201(b). The defendant

asserts that traditionally this statute was never

applied to billing practices. That argument may have

59a

been plausible at one time, but the Court believes that

it is unconvincing because the statutory language

plainly permits such a construction. See United States

v. Boucha, 236 F.3d 768 (6th Cir. 2001) (stating the

familiar rule of statutory construction that “[t]he

language of the statute is the starting point to

interpretation, and it should also be the ending point

if the plain meaning of that language is clear”). It is

not too much to ask of a communications vendor that

its bills contain a description of the services for which

it is demanding payment. To insist upon a charge

without an explanation is a practice that can be

understood to be unreasonable.

Moreover, the FCC, which specifically is authorized

to “prescribe such rules and regulations as may be

necessary in the public interest to carry out the

provisions” of the Telecommunications Act, 47 U.S.C.

§ 201(b), has determined that the statute applies to

billing practices. The provisions of the regulation

discussed earlier mandate billing that is “sufficiently

clear in presentation and specific enough in content so

that customers can accurately assess that the services

for which they are billed correspond to those that they

have requested and received.” 47 C.F.R. § 64.2401(b).

The defendant’s custom of charging for its optional

inside wire maintenance insurance under the heading

“non-regulated services” gives no hint at the services

for which charges are assessed. It does not satisfy the

FCC’s truth-in-billing requirement and constitutes an

unreasonable practice within the meaning of section

201(b). Any doubt about the inadequacy of that

description is dispelled by reference to the FCC’s

report. See First Report and Order and Further Notice

of Proposed Rulemaking, FCC 99-72 at 26 (Apr. 15,

60a

1999) (stating that “in our view, a charge described by

what it is not, such as, for example “service not

regulated by the Public Service Commission” is

inherently ambiguous and does not disclose sufficient

information. There is no way for a consumer to

discern from this description that the charge refers to,

for example, inside wiring maintenance insurance”).

It is well established that “considerable weight

should be accorded to an executive department’s

construction of a statutory scheme it is entrusted to

administer.” Chevron U.S.A., Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837, 843

(1984). The Supreme Court has held that the FCC is

entitled to Chevron deference when enacting rules

under section 201(b) of the Telecommunications Act.

See National Cable & Telecomm. Assn. v. Brand X

Internet Servs.,545U.S.___, __, 125 S. Ct. 2688, 2699

(2005) (explaining that an FCC regulation receives

Chevron deference because “Congress has delegated to

the Commission the authority to. . . ‘prescribe such

rules and regulations as may be necessary in the

public interest to carry out the provisions’ of the Act”)

(quoting 47 U.S.C. § 201(b)).

The defendant contends that the billing statement

description of Wire Watch as a “Non-Regulated Service”

is a true statement, and under scction 64.2401(b) a

court cannot determine whether a billing description

violates section 201(b) without looking at the

description in context of all other information provided

to consumers. But this argument ignores the

regulation’s plain language, which requires that

“[cJharges contained on telephone bills must be

accompanied by a brief, clear, non-misleading, plain

6la

language description of the service or services

rendered.” 47 C.F.R. § 64.2401(b) (emphasis added).

Even if oral notice or additional documentation was

provided to consumers, the information contained on

the billing document was not provided as required. A

violation of section 201(b) occurred when the defendant

billed a customer for WireWatch service under the

heading “non-regulated service.” The practice was

“unlawful,” in the words of the statute. If “any

common carrier . . . permit[s] to be done, any act,

matter, or thing in this chapter prohibited or declared

to be unlawful . .. such common carrier shall be liable

to the person or persons injured.” 47 U.S.C. § 206.

The injured person may commence an action against

the carrier “in any district court of the United States

of competent jurisdiction.” 47 U.S.C. § 206. Since the

defendant concedes that it did send some bills to

customers that contained this language, judgment

under Rule 12(c) is appropriate because the practice is

unlawful as a matter of law.

By the same reasoning, however, the Court has no

trouble concluding that bills that charged for “Inside

Wire Maint. Plan” were adequate to constitute a “plain

language description of the service or services

rendered.” 47 C.F.R. § 64.2401(b). That description

was clear and specific, and it stated precisely the basis

for the charge. The Court finds that bills that

contained that description complied with the statute

and regulation as a matter of law. To the extent that

the plaintiffs seek to define their class as including

customers who received bills with that description, the

class definition will be modified.

62a

The defendant also contends that its liability

cannot predate November 18, 1999 when the

regulation took effect. Although agency rules typically

will not be applied retroactively in the absence of

express statutory authority, a rule clarifying an

unsettled or confusing area of law “does not change the

law, but restates what the law according to the agency

has always been. ‘It is no more retroactive in its

operation than is a judicial determination construing

and applying a statute to a case in hand.” Orr v.

Hawk, 156 F.3d 651 (6th Cir. 1998). Here, the

Regulation simply clarified an unsettled area of law.

The defendant also relies on _ the

Telecommunication Act’s two year statute of

limitations codified at 47 U.S.C. § 415. However, fact

issues preclude that application of that limitation at

this time because a cause of action under the Act

accrues on the date of the discovery of the injury; the

discovery rule could extend the two-year period, which

begins to run from the date when the plaintiff

discovers or with reasonable diligence should have

discovered the injury. MCI Telecomm. Corp. v. FCC,

59 F.3d 1407, 1416-17 (D.C. Cir. 1995). The plaintiffs

assert that they did not discover nor could they have

discovered the injury until January 2002, when the

defendant changed its billing descriptions to reveal for

the first time the basis of the charges. That

determination requires factual development.

Based on the allegations and admissions in the

pleadings, the Court concludes that the defendant’s

practice of billing for its WireWatch program using the

description “Non-regulated Services” constitutes a

violation of section 201(b) of the Telecommunications

63a

Act as a matter of law. The parties have not offered

information as to the extent of the practice or the

damages that might have been caused. Those

determinations will require factual resolution through

further motion practice or trial. However, the

plaintiffs’ motion for judgment on the pleadings will be

granted as to the narrow issue discussed with respect

to Count I of the complaint.

The plaintiffs also have moved under Federal Rule

of Civil Procedure 12(f) to strike paragraphs six and

eight of the defendant’s affirmative defenses on the

grounds that they are insufficient and entirely

inconsistent with the positions and admissions set

forth in the defendant’s answer. The two affirmative

defenses state:

6. The relief requested in the Complaint is

barred by applicable statutes of limitations in

YenturyTel’s respective state and federal tariffs.

* oK ok

8. This Court lacks jurisdiction over the subject

matter of the Complaint for the reason that the

Michigan Legislature has’ provided the

Michigan Public Service Commission with

jurisdiction and authority to adjudicate

“slamming and cramming” disputes.

Def.’s Affirmative Defenses. The plaintiffs argue that

if inside wire maintenance services are non-regulated

services, as the parties agree in their respective

64a

(

pleadings, then defenses which purport to treat the

wire maintenance program as regulated services

should be stricken as superfluous and inadequate as a

matter of law because these purported defenses

improperly assume that the issues in this case are

somehow governed by, or related to, the defendant’s

tariffs for regulated transmission services.

The defendant responds that the Federal Rules of

Civil Procedure reflect the policy that pleadings should

be treated liberally, and that a party should have the

opportunity to support its contentions at trial. Since

discovery has not been completed and the plaintiffs

have not alleged prejudice, the motion should be

denied because the defendant may be able to set forth

a factual scenario in which the affirmative defenses

are determinative. The defendant does, however,

agree to abandon its eighth affirmative defense, which

argues that the Michigan Public Service Commission

has primary jurisdiction over the cramming and

slamming disputes.

Courts disfavor motions to strike. Ciminelli v.

Cablevision, 583 F. Supp. 144, 162 (E.D.N.Y. 1984). A

motion to strike a defense will be denied unless the

defense asserted is clearly insufficient as a matter of

law. Durham Indus., Inc. v. North River Ins. Co. , 482

F. Supp. 910, 913 (S.D.N.Y. 1979). If the sufficiency of

the defense depends upon disputed questions of law or

fact, then a motion to strike should be denied. Linker

v. Custom-Bilt Mach. Inc., 594 F. Supp. 894, 898 (E.D.

Pa. 1984). Therefore, a motion to strike should only be

granted if there is a clear showing that the challenged

defense has no bearing on the subject matter and that

permitting the defense to stand would prejudice the

65a

plaintiff. FRA S v. Surg-O-Flex of Am., Inc., 415 F.

Supp 421, 427 (S.D.N.Y. 1976).

The plaintiffs have not made such a showing here.

Moreover, even if this case has nothing to do with the

defendant’s regulated rates or tariffs, any affirmative

defenses related to such matters are superfluous and

insufficient as a matter of law, the plaintiffs fail to

show how they will be prejudiced by permitting the

defense to stand. Therefore, the Court will deny the

plaintiffs’ motion to strike the defendant’s sixth

defense, but the eighth affirmative defense will be

stricken by agreement.

VI.

The Court finds that this case or any aspect of it

should not be referred to the Federal Communications

Commission for resolution of any issue under the

doctrine of primary jurisdiction. The Court will certify

the action as a class action under Rule 23(b)\(3). The

Court also finds that the defendant’s billing practice

described above violates 47 U.S.C. § 201(b) and 27

C.F.R. § 64.2401(b) as a matter of law. The plaintiff

has failed to establish gounds to strike the deferdant’s

affirmative defense number six.

Accordingly, it is ORDERED that the plaintiffs’

motion for class certification [dkt # 21] is GRANTED.

The determination of class certification is conditional

and may be altered or amended prior to the decision on

the merits in light of any changes in circumstances

that make such action advisable. See Fed. R. Civ. P.

23(c)(1).

66a

It is further ORDERED that pursuant to Federal

Rule of Civil Procedure 23(b)(3), the following class is

certified in this cause: _

All persons who have paid CenturyTel, Inc. for

charges for an inside wire maintenance

insurance program described in CenturyTel’s

residential telephone bills as “Non-Regulated

Services” during the period beginning October

29, 2000, or such earlier period if the charges

were not know or reasonably could have been

known by October 29, 2000; but excluding

CenturyTel; its subsidiaries, affiliates, officers

and directors; any entity in which CenturyTel

has a controlling interest; and the legal

representatives, heirs, successors and assigns of

any such excluded party. |

It is further ORDERED that counsel of record for

the named plaintiffs in this matter, namely Elwood S.

Simon, Esquire and George G. Burke, II1, Esquire,

shall be appointed counsel for the designated class.

Itis further ORDERED that the plaintiffs shall, at

their expense, provide appropriate notice to all class

members via first-class mail and in conformance with

the requirements of Rule 23 of the Federal Rules of

Civil Procedure. The notice shall provide putative

class members until June 2, 2006 to notify the counsel

for the parties and the Court of their intent to opt out

of the proposed class. The notice shall also provide

that class members wishing to enter their own

appearance in the matter through counsel shall do so

by that same date.

67a

It is further ORDERED that the parties shall

confer and forward to the Court on or before March

23, 2006 an agreed document that will be used to serve

notice upon all members of the class. If the parties are

unable to agree on the proper text for said notice, the

parties shall forward the plaintiffs’ proposed text along

with a detailed list of objections from the defendant.

The notice shal! not be sent until Court approval is

given. The notice shall be submitted for approval on or

before March 26, 2006.

It is further ORDERED that the plaintiffs’ motion

for partial judgment on the pleadings [dkt # 18] is

GRANTED IN PART with respect to Count I of the

complaint. The Court determines that the defendant’s

billing practice during the relevant period describing

charges for its WireWatch or other inside wire

maintenance insurance program as “Non-Regulated

Services” in unlawful within the meaning of 47 U.S.C.

§ 201(b) as a matter of law; and bills describing such

charges as “Inside Wire Maint. Plan” were lawful

within the meaning of 47 U.S.C. § 201(b) as a matter

of law.

It is further ORDERED that the plaintiffs’ motion

to strike affirmative defenses (dkt # 18] is DENIED;

however by agreement of the parties affirmative

defense number 8 is STRICKEN.

It is further ORDERED that the parties appear for

a Case Management and Scheduling Conference on

March 27, 2006 at 4:00 p.m.

68a

s/David M. Lawson

DAVID M. LAWSON

United States District Judge

Dated: March 10, 2006

APPENDIX D

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

No. 06-1565

[Filed April 29, 2008)

BARBRASUE BEATTIE, ET AL., )

)

Plaintiffs-Appellees, )

)

v. )

)

CENTURYTEL, INC., )

)

Defendant-Appellant. )

)

ORDER

BEFORE: COLE and COOK, Circuit Judges; and

FROST, District Judge.

The Court having received a petition for rehearing

en banc, and the petition having been circulated not

only to the original panel members but also to all other

" Hon. Gregory L. Frost, United States District Judge for the

Southern District of Ohio, sitting by designation.

70a

active judges of this court, and no judge of this court

having requested a vote on the suggestion for

rehearing en banc, the petition for rehearing has been

referred to the original panel.

The panel has further reviewed the petition for

rehearing and concludes that the issues raised in the

petition were fully considered upon the original

submission and decision of the case. Accordingly, the

petition is denied.

ENTERED BY ORDER OF THE COURT

/s/

Leonard Green

Clerk

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.