GLOBAL CROSSING TELECOMMUNICATIONS, INC. v. METROPHONES TELECOMMUNICATIONS, INC.

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45 OCTOBER TERM, 2006
Syllabus
GLOBAL CROSSING TELECOMMUNICATIONS, INC. v.
METROPHONES TELECOMMUNICATIONS, INC.
certiorari to the united states court of appeals for
the ninth circuit
No. 05–705. Argued October 10, 2006—Decided April 17, 2007
Under authority of the Communications Act of 1934, the Federal Commu
nications Commission (FCC) regulates interstate telephone communica
tions using a traditional regulatory system similar to what other com
missions have applied when regulating other common carriers. Indeed,
Congress largely copied language from the earlier Interstate Commerce
Act, which authorized federal railroad regulation, when it wrote Com
munications Act §§ 201(b) and 207, the provisions at issue. Both Acts
authorize their respective Commissions to declare any carrier “charge,”
“regulation,” or “practice” in connection with the carrier’s services to
be “unjust or unreasonable”; declare an “unreasonable,” e. g., “charge”
to be “unlawful”; authorize an injured person to recover “damages” for
an “unlawful” charge or practice; and state that, to do so, the person
may bring suit in a “court” “of the United States.” Interstate Com
merce Act §§ 1, 8, 9; Communications Act §§ 201(b), 206, 207. The un
derlying regulatory problem here arises at the intersection of tradi
tional regulation and newer, more competitively oriented approaches.
Legislation in 1990 required payphone operators to allow payphone
users to obtain “free” access to the long-distance carrier of their choice,
i. e., access without depositing coins. But recognizing the “free” call
would impose a cost upon the payphone operator, Congress required
the FCC to promulgate regulations to provide compensation to such
operators. Using traditional ratemaking methods, the FCC ordered
carriers to reimburse the operators in a specified amount unless a car
rier and an operator agreed to a different amount. The FCC subse
quently determined that a carrier’s refusal to pay such compensation
was an “unreasonable practice” and thus unlawful under § 201(b). Re
spondent payphone operator brought a federal lawsuit, claiming that
petitioner long-distance carrier (hereinafter Global Crossing) had vio
lated § 201(b) by failing to pay compensation and that § 207 authorized
respondent to sue in federal court. The District Court agreed that
Global Crossing’s refusal to pay violated § 201(b), thereby permitting
respondent to sue under § 207. The Ninth Circuit affirmed.

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46 GLOBAL CROSSING TELECOMMUNICATIONS, INC. v.
METROPHONES TELECOMMUNICATIONS, INC.
Syllabus
Held: The FCC’s application of § 201(b) to the carrier’s refusal to pay com
pensation is lawful; and, given the linkage with § 207, § 207 authorizes
this federal-court lawsuit. Pp. 52–64.
(a) The language of §§ 201(b), 206, and 207 and those sections’ history,
including that of their predecessors, Interstate Commerce Act §§ 8 and
9, make clear that § 207’s purpose is to allow persons injured by § 201(b)
violations to bring federal-court damages actions. The difficult ques
tion is whether the FCC regulation at issue lawfully implements
§ 201(b)’s “unreasonable practice” prohibition. Pp. 52–55.
(b) The FCC’s § 201(b) “unreasonable practice” determination is rea
sonable, and thus lawful. See Chevron U. S. A. Inc. v. Natural Re
sources Defense Council, Inc., 467 U. S. 837, 843–844. It easily fits
within the language of the statutory phrase. Moreover, the underlying
regulated activity at issue resembles activity long regulated by both
transportation and communications agencies. Traditionally, the FCC,
exercising its rate-setting authority, has divided revenues from a call
among providers of segments of the call. Transportation agencies have
similarly divided revenues from a larger transportation service among
providers of segments of the service. The payphone operator and
long-distance carrier resemble those joint providers of a communication
or transportation service. Differences between the present “unreason
able practice” classification and more traditional regulatory subject mat
ter do not require a different outcome. When Congress revised the
telecommunications laws in 1996 to enhance the role of competition, cre
ating a system that relies in part upon competition and in part upon the
role of tariffs in regulatory supervision, it left § 201(b) in place. In light
of the absence of any congressional prohibition, and the similarities with
traditional regulatory action, the Court finds nothing unreasonable
about the FCC’s § 201(b) determination. United States v. Mead Corp.,
533 U. S. 218, 229. Pp. 55–58.
(c) Additional arguments made by Global Crossing, its supporting
amici, and the dissents—that § 207 does not authorize actions for viola
tions of regulations promulgated to carry out statutory objectives; that
no § 207 action lies for violations of substantive regulations promulgated
by the FCC; that §§ 201(a) and (b) concern only practices that harm
carrier customers, not carrier suppliers; that the FCC’s “unreasonable
practice” determination is unlawful because it is inadequately reasoned;
and that § 276 prohibits the FCC’s § 201(b) classification—are ultimately
unpersuasive. Pp. 58–64.
423 F. 3d 1056, affirmed.
Breyer, J., delivered the opinion of the Court, in which Roberts, C. J.,
and Stevens, Kennedy, Souter, Ginsburg, and Alito, JJ., joined.

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Scalia, J., post, p. 67, and Thomas, J., post, p. 74, filed dissenting
opinions.
Jeffrey L. Fisher argued the cause for petitioner. With
him on the briefs were Daniel M. Waggoner, Kristina Silja
Bennard, and Michael J. Shortley III.
Roy T. Englert, Jr., argued the cause for respondent.
With him on the briefs were Donald J. Russell, Michael W.
Ward, and David J. Russell.
James A. Feldman argued the cause for the United States
as amicus curiae urging affirmance. With him on the brief
were Solicitor General Clement, Deputy Solicitor General
Hungar, Samuel L. Feder, and Joel Marcus.*
Justice Breyer delivered the opinion of the Court.
The Federal Communications Commission (Commission or
FCC) has established rules that require long-distance (and
certain other) communications carriers to compensate a pay
phone operator when a caller uses a payphone to obtain free
access to the carrier’s lines (by dialing, e. g., a 1–800 number
or other access code). The Commission has added that a
carrier’s refusal to pay the compensation is a “practice . . .
that is unjust or unreasonable” within the terms of the Com
munications Act of 1934, § 201(b), 48 Stat. 1070, 47 U. S. C.
§ 201(b). Communications Act language links § 201(b) to
§ 207, which authorizes any person “damaged” by a violation
of § 201(b) to bring a lawsuit to recover damages in federal
court. And we must here decide whether this linked sec
tion, § 207, authorizes a payphone operator to bring a
federal-court lawsuit against a recalcitrant carrier that re
fuses to pay the compensation that the Commission’s order
says it owes.
In our view, the FCC’s application of § 201(b) to the carri
er’s refusal to pay compensation is a reasonable interpreta
*Briefs of amici curiae urging reversal were filed for AT&T et al. by
Mark L. Evans, Aaron M. Panner, and Michael E. Glover; and for Sprint
Communications Co. L. P. by David P. Murray and Christopher J. Wright.

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tion of the statute; hence it is lawful. See Chevron U. S. A.
Inc. v. Natural Resources Defense Council, Inc., 467 U. S.
837, 843–844, and n. 11 (1984). And, given the linkage with
§ 207, we also conclude that § 207 authorizes this federal
court lawsuit.
I
A
Because regulatory history helps to illuminate the proper
interpretation and application of §§ 201(b) and 207, we begin
with that history. When Congress enacted the Communica
tions Act of 1934, it granted the FCC broad authority to
regulate interstate telephone communications. See Louisi
ana Pub. Serv. Comm’n v. FCC, 476 U. S. 355, 360 (1986).
The Commission, during the first several decades of its his
tory, used this authority to develop a traditional regulatory
system much like the systems other commissions had applied
when regulating railroads, public utilities, and other common
carriers. A utility or carrier would file with a commission a
tariff containing rates, and perhaps other practices, classifi
cations, or regulations in connection with its provision of
communications services. The commission would examine
the rates, etc., and, after appropriate proceedings, approve
them, set them aside, or, sometimes, set forth a substitute
rate schedule or list of approved charges, classifications, or
practices that the carrier or utility must follow. In doing
so, the commission might determine the utility’s or carrier’s
overall costs (including a reasonable profit), allocate costs to
particular services, examine whether, and how, individual
rates would generate revenue that would help cover those
costs, and, if necessary, provide for a division of revenues
among several carriers that together provided a single serv
ice. See 47 U. S. C. §§ 201(b), 203, 205(a); Missouri ex rel.
Southwestern Bell Telephone Co. v. Public Serv. Comm’n of
Mo., 262 U. S. 276, 291–295 (1923) (Brandeis, J., concurring in
judgment) (telecommunications); Verizon Communications

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Inc. v. FCC, 535 U. S. 467, 478 (2002) (same); Chicago &
North Western R. Co. v. Atchison, T. & S. F. R. Co., 387 U. S.
326, 331 (1967) (railroads); Permian Basin Area Rate Cases,
390 U. S. 747, 761–765, 806–808 (1968) (natural gas field
production).
In authorizing this traditional form of regulation, Con
gress copied into the 1934 Communications Act language
from the earlier Interstate Commerce Act of 1887, 24 Stat.
379, which (as amended) authorized federal railroad regula
tion. See American Telephone & Telegraph Co. v. Central
Office Telephone, Inc., 524 U. S. 214, 222 (1998). Indeed,
Congress largely copied §§ 1, 8, and 9 of the Interstate Com
merce Act when it wrote the language of Communications
Act §§ 201(b) and 207, the sections at issue here. The rele
vant sections (in both statutes) authorize the Commission to
declare any carrier “charge,” “regulation,” or “practice” in
connection with the carrier’s services to be “unjust or unrea
sonable”; they declare an “unreasonable,” e. g., “charge” to
be “unlawful”; they authorize an injured person to recover
“damages” for an “unlawful” charge or practice; and they
state that, to do so, the person may bring suit in a “court”
“of the United States.” Interstate Commerce Act §§ 1, 8, 9,
24 Stat. 379, 382; Communications Act §§ 201(b), 206, 207, 48
Stat. 1070, 1072, 1073, 47 U. S. C. §§ 201(b), 206, 207.
Historically speaking, the Interstate Commerce Act sec
tions changed early, preregulatory common-law rate
supervision procedures. The common law originally per
mitted a freight shipper to ask a court to determine whether
a railroad rate was unreasonably high and to award the ship
per damages in the form of “reparations.” The “new” regu
latory law, however, made clear that a commission, not a
court, would determine a rate’s reasonableness. At the
same time, that “new” law permitted a shipper injured by
an unreasonable rate to bring a federal lawsuit to collect
damages. Interstate Commerce Act §§ 1, 8–9; Arizona Gro
cery Co. v. Atchison, T. & S. F. R. Co., 284 U. S. 370, 383–386

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(1932); Texas & Pacific R. Co. v. Abilene Cotton Oil Co., 204
U. S. 426, 436, 440–441 (1907); Keogh v. Chicago & North
western R. Co., 260 U. S. 156, 162 (1922); Louisville & Nash
ville R. Co. v. Ohio Valley Tie Co., 242 U. S. 288, 290–291
(1916); J. Ely, Railroads and American Law 71–72, 226–227
(2001); A. Hoogenboom & O. Hoogenboom, A History of
the ICC 61 (1976). The similar language of Communications
Act §§ 201(b) and 207 indicates a roughly similar sharing of
agency authority with federal courts.
Beginning in the 1970’s, the FCC came to believe that com
munications markets might efficiently support more than one
firm and that competition might supplement (or provide a
substitute for) traditional regulation. See MCI Telecommu
nications Corp. v. American Telephone & Telegraph Co., 512
U. S. 218, 220–221 (1994). The Commission facilitated entry
of new telecommunications carriers into long-distance mar
kets. And in the 1990’s, Congress amended the 1934 Act
while also enacting new telecommunications statutes, in
order to encourage (and sometimes to mandate) new compe
tition. See Telecommunications Act of 1996, 110 Stat. 56, 47
U. S. C. § 609 et seq. Neither Congress nor the Commission,
however, totally abandoned traditional regulatory require
ments. And the new statutes and amendments left many
traditional requirements and related statutory provisions, in
cluding §§ 201(b) and 207, in place. E. g., National Cable &
Telecommunications Assn. v. Brand X Internet Services,
545 U. S. 967, 975 (2005).
B
The regulatory problem that underlies this lawsuit arises
at the intersection of traditional regulation and newer, more
competitively oriented approaches. Competing long
distance carriers seek the business of individual local callers,
including those who wish to make a long-distance call from
a local payphone. A payphone operator, however, controls
what is sometimes a necessary channel for the caller to reach
the long-distance carrier. And prior to 1990, a payphone op

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erator, exploiting this control, might require a caller to use
a long-distance carrier that the operator favored while block
ing access to the caller’s preferred carrier. Such a practice
substituted the operator’s choice of carrier for the caller’s,
and it potentially placed disfavored carriers at a competitive
disadvantage. In 1990, Congress enacted special legislation
requiring payphone operators to allow a payphone user to
obtain “free” access to the carrier of his or her choice, i. e.,
access from the payphone without depositing coins. Tele
phone Operator Consumer Services Improvement Act of
1990, 104 Stat. 986, note following 47 U. S. C. § 226. (For
ease of exposition, we often use familiar terms such as “long
distance” and “free” calls instead of more precise terms such
as “interexchange” and “coinless” or “dial-around” calls.)
At the same time, Congress recognized that the “free” call
would impose a cost upon the payphone operator; and it
consequently required the FCC to “prescribe regulations
that . . . establish a per call compensation plan to ensure that
all payphone service providers are fairly compensated for
each and every completed intrastate and interstate call.”
§ 276(b)(1)(A) of the Communications Act of 1934, as added
by § 151 of the Telecommunications Act of 1996, 110 Stat. 106,
codified at 47 U. S. C. § 276(b)(1)(A).
The FCC then considered the compensation problem.
Using traditional ratemaking methods, it found that the
(fixed and incremental) costs of a “free” call from a payphone
to, say, a long-distance carrier warranted reimbursement of
(at the time relevant to this litigation) $0.24 per call. The
FCC ordered carriers to reimburse the payphone operators
in this amount unless a carrier and an operator agreed upon a
different amount. 47 CFR § 64.1300(d) (2005). At the same
time, it left the carriers free to pass the cost along to their
customers, the payphone callers. Thus, in a typical “free”
call, the carrier will bill the caller and then must share the
revenue the carrier receives—to the tune of $0.24 per call—
with the payphone operator that has, together with the car

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rier, furnished a communications service to the caller. The
FCC subsequently determined that a carrier’s refusal to pay
the compensation ordered amounts to an “unreasonable prac
tice” within the terms of § 201(b). (We shall refer to these
regulations as the Compensation Order and the 2003 Pay
phone Order, respectively. See Appendix A, infra, for full
citations.) See generally P. Huber, M. Kellogg, & J. Thorne,
Federal Telecommunications Law § 8.6.3, pp. 710–713 (2d ed.
1999) (hereinafter Huber). That determination, it believed,
would permit a payphone operator to bring a federal-court
lawsuit under § 207 to collect the compensation owed. 2003
Payphone Order, 18 FCC Rcd. 19975, 19990, ¶ 32.
C
In 2003, respondent, Metrophones Telecommunications,
Inc., a payphone operator, brought this federal-court lawsuit
against Global Crossing Telecommunications, Inc., a long
distance carrier. Metrophones sought compensation that it
said Global Crossing owed it under the FCC’s Compensation
Order, 14 FCC Rcd. 2545 (1999). Insofar as is relevant here,
Metrophones claimed that Global Crossing’s refusal to pay
amounted to a violation of § 201(b), thereby permitting Met
rophones to sue in federal court, under § 207, for the compen
sation owed. The District Court agreed. 423 F. 3d 1056,
1061 (CA9 2005). The Ninth Circuit affirmed the District
Court’s determination. Ibid. We granted certiorari to de
termine whether § 207 authorizes the lawsuit.
II
A
Section 207 says that “[a]ny person claiming to be damaged
by any common carrier . . . may bring suit” against the car
rier “in any district court of the United States” for “recovery
of the damages for which such common carrier may be liable
under the provisions of this chapter.” 47 U. S. C. § 207 (em
phasis added). This language makes clear that the lawsuit

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is proper if the FCC could properly hold that a carrier’s
failure to pay compensation is an “unreasonable practice”
deemed “unlawful” under § 201(b). That is because the im
mediately preceding section, § 206, says that a common car
rier is “liable” for “damages sustained in consequence of ”
the carrier’s doing “any act, matter, or thing in this chap
ter prohibited or declared to be unlawful.” And § 201(b)
declares “unlawful” any common-carrier “charge, practice,
classification, or regulation that is unjust or unreasonable.”
(See Appendix B, in fra, for full text; emphasis added
throughout.)
The history of these sections—including that of their pred
ecessors, §§ 8 and 9 of the Interstate Commerce Act—simply
reinforces the language, making clear the purpose of § 207
is to allow persons injured by § 201(b) violations to bring
federal-court damages actions. See, e. g., Arizona Grocery
Co., 284 U. S., at 384–385 (Interstate Commerce Act §§ 8–9);
Part I–A, supra. History also makes clear that the FCC
has long implemented § 201(b) through the issuance of rules
and regulations. This is obviously so when the rules take
the form of FCC approval or prescription for the future of
rates that exclusively are “reasonable.” See 47 U. S. C.
§ 205 (authorizing the FCC to prescribe reasonable rates and
practices in order to preclude rates or practices that violate
§ 201(b)); 5 U. S. C. § 551(4) (“ ‘rule’ . . . includes the approval
or prescription for the future of rates . . . or practices”). It
is also so when the FCC has set forth rules that, for example,
require certain accounting methods or insist upon certain
carrier practices, while (as here) prohibiting others as unjust
or unreasonable under § 201(b). See, e. g. (to name a few),
Verizon Tel. Cos. v. FCC, 453 F. 3d 487, 494 (CADC 2006)
(rates unreasonable (and hence unlawful) if not adjusted pur
suant to accounting rules ordered in FCC regulations);
Cable & Wireless P. L. C. v. FCC, 166 F. 3d 1224, 1231 (CADC
1999) (failure to follow Commission-ordered settlement prac
tices unreasonable); MCI Telecommunications Corp. v. FCC,

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59 F. 3d 1407, 1414 (CADC 1995) (violation of rate-of-return
prescription unlawful); In re NOS Communications, Inc., 16
FCC Rcd. 8133, 8136, ¶ 6 (2001) (deceptive marketing an un
reasonable practice); In re Promotion of Competitive Net
works in Local Telecommunications Markets, 15 FCC Rcd.
22983, 23000, ¶ 35 (2000) (entering into exclusive contracts
with commercial building owners an unreasonable practice).
Insofar as the statute’s language is concerned, to violate a
regulation that lawfully implements § 201(b)’s requirements
is to violate the statute. See, e. g., MCI Telecommunica
tions Corp., 59 F. 3d, at 1414 (“We have repeatedly held that
a rate-of-return prescription has the force of law and that
the Commission may therefore treat a violation of the pre
scription as a per se violation of the requirement of the Com
munications Act that a common carrier maintain ‘just and
reasonable’ rates, see 47 U. S. C. § 201(b)”); cf. Alexander v.
Sandoval, 532 U. S. 275, 284 (2001) (it is “meaningless to talk
about a separate cause of action to enforce the regulations
apart from the statute”). That is why private litigants have
long assumed that they may, as the statute says, bring an
action under § 207 for violation of a rule or regulation that
lawfully implements § 201(b). See, e. g., Oh v. AT&T Corp.,
76 F. Supp. 2d 551, 556 (NJ 1999) (assuming validity of § 207
suit alleging violation of § 201(b) in carrier’s failure to pro
vide services listed in FCC-approved tariff); Southwestern
Bell Tel. Co. v. Allnet Communications Servs., Inc., 789
F. Supp. 302, 304–306 (ED Mo. 1992) (assuming validity of
§ 207 suit to enforce FCC’s determination of reasonable prac
tices related to payment of access charges by long-distance
carrier to local exchange carrier); cf., e. g., Chicago & North
Western Transp. Co. v. Atchison, T. & S. F. R. Co., 609 F. 2d
1221, 1224–1225 (CA7 1979) (same in respect to Interstate
Commerce Act equivalents of §§ 201(b), 207).
The difficult question, then, is not whether § 207 covers
actions that complain of a violation of § 201(b) as lawfully
implemented by an FCC regulation. It plainly does. It re

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mains for us to decide whether the particular FCC regula
tion before us lawfully implements § 201(b)’s “unreasonable
practice” prohibition. We now turn to that question.
B
In our view the FCC’s § 201(b) “unreasonable practice” de
termination is a reasonable one; hence it is lawful. See
Chevron U. S. A. Inc., 467 U. S., at 843–844. The determina
tion easily fits within the language of the statutory phrase.
That is to say, in ordinary English, one can call a refusal to
pay Commission-ordered compensation despite having re
ceived a benefit from the payphone operator a “practic[e] . . .
in connection with [furnishing a] communication service . . .
that is . . . unreasonable.” The service that the payphone
operator provides constitutes an integral part of the total
long-distance service the payphone operator and the long
distance carrier together provide to the caller, with respect
to the carriage of his or her particular call. The carrier’s
refusal to divide the revenues it receives from the caller
with its collaborator, the payphone operator, despite the
FCC’s regulation requiring it to do so, can reasonably be
called a “practice” “in connection with” the provision of that
service that is “unreasonable.” Cf. post, p. 74 (Thomas, J.,
dissenting).
Moreover, the underlying regulated activity at issue here
resembles activity that both transportation and communica
tions agencies have long regulated. Here the agency has
determined through traditional regulatory methods the cost
of carrying a portion (the payphone portion) of a call that
begins with a caller and proceeds through the payphone,
attached wires, local communications loops, and long
distance lines to a distant call recipient. The agency allo
cates costs among the joint providers of the communications
service and requires downstream carriers, in effect, to pay
an appropriate share of revenues to upstream payphone op
erators. Traditionally, the FCC has determined costs of

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some segments of a call while requiring providers of other
segments to divide related revenues. See, e. g., Smith v.
Illinois Bell Telephone Co., 282 U. S. 133, 148–151 (1930)
(communications). And traditionally, transportation agen
cies have determined costs of providing some segments of
a larger transportation service (for example, the cost of
providing the San Francisco–Ogden segment of a San
Francisco–New York shipment) while requiring providers of
other segments to divide revenues. See, e. g., New England
Divisions Case, 261 U. S. 184 (1923); Chicago & North West
ern R. Co., 387 U. S. 326; cf. Cable & Wireless P. L. C., 166 F.
3d, at 1231. In all instances an agency allocates costs and
provides for a related sharing of revenues.
In these more traditional instances, transportation carri
ers and communications firms entitled to revenues under
rate divisions or cost allocations might bring lawsuits under
§ 207, or the equivalent sections of the Interstate Commerce
Act, and obtain compensation or damages. See, e. g., Allnet
Communication Serv., Inc. v. National Exch. Carrier Assn.,
Inc., 965 F. 2d 1118, 1122 (CADC 1992) (§ 207); Southwestern
Bell Tel. Co., supra, at 305 (same); Chicago & North Western
Transp. Co., supra, at 1224–1225 (Interstate Commerce Act
equivalent of § 207). Again, the similarities support the rea
sonableness of an agency’s bringing about a similar result
here. We do not suggest that the FCC is required to find
carriers’ failures to divide revenues to be § 201(b) violations
in every instance. Cf. U. S. Telepacific Corp. v. Tel-America
of Salt Lake City, Inc., 19 FCC Rcd. 24552, 24555–24556, and
n. 27 (2004) (citing cases). Nor do we suggest that every
violation of FCC regulations is an unjust and unreasonable
practice. Here there is an explicit statutory scheme, and
compensation of payphone operators is necessary to the
proper implementation of that scheme. Under these cir
cumstances, the FCC’s finding that the failure to follow the
order is an unreasonable practice is well within its authority.

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There are, of course, differences between the present “un
reasonable practice” classification and the similar more tradi
tional regulatory subject matter we have just described.
For one thing, the connection between payphone operators
and long-distance carriers is not a traditional “through
route” between carriers. See § 201(a). For another, as
Global Crossing’s amici point out, the word “practice” in
§ 201(b) has traditionally applied to a carrier practice that
(unlike the present one) is the subject of a carrier tariff—
i. e., a carrier agency filing that sets forth the carrier’s rates,
classifications, and practices. Brief for AT&T et al. as
Amici Curiae 8–11. We concede the differences. Indeed,
traditionally, the filing of tariffs was “the centerpiece” of the
“[Communications] Act’s regulatory scheme.” MCI Tele
communications Corp., 512 U. S., at 220. But we do not
concede that these differences require a different outcome.
Statutory changes enhancing the role of competition have
radically reduced the role that tariffs play in regulatory su
pervision of what is now a mixed communications system—
a system that relies in part upon competition and in part
upon more traditional regulation. Yet when Congress re
wrote the law to bring about these changes, it nonetheless
left § 201(b) in place. That fact indicates that the statute
permits, indeed it suggests that Congress likely expected,
the FCC to pour new substantive wine into its old regulatory
bottles. See Policy and Rules Concerning the Interstate,
Interexchange Marketplace, 12 FCC Rcd. 15014, 15057, ¶ 77
(1997) (despite the absence of tariffs, FCC’s § 201 enforce
ment obligations have not diminished); Boomer v. AT&T
Corp., 309 F. 3d 404, 422 (CA7 2002) (same). And this cir
cumstance, by indicating that Congress did not forbid the
agency to apply § 201(b) differently in the changed regula
tory environment, is sufficient to convince us that the FCC’s
determination is lawful.
That is because we have made clear that where “Congress
would expect the agency to be able to speak with the force

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of law when it addresses ambiguity in the statute or fills a
space in the enacted law,” a court “is obliged to accept the
agency’s position if Congress has not previously spoken to
the point at issue and the agency’s interpretation” (or the
manner in which it fills the “gap”) is “reasonable.” United
States v. Mead Corp., 533 U. S. 218, 229 (2001); National
Cable & Telecommunications Assn., 545 U. S., at 980; Chev
ron U. S. A. Inc., 467 U. S., at 843–844. Congress, in
§ 201(b), delegated to the agency authority to “fill” a “gap,”
i. e., to apply § 201 through regulations and orders with the
force of law. National Cable & Telecommunications Assn.,
supra, at 980–981. The circumstances mentioned above
make clear the absence of any relevant congressional prohibi
tion. And, in light of the traditional regulatory similarities
that we have discussed, we can find nothing unreasonable
about the FCC’s § 201(b) determination.
C
Global Crossing, its supporting amici, and the dissents
make several additional but ultimately unpersuasive argu
ments. First, Global Crossing claims that § 207 authorizes
only actions “seeking damages for statutory violations” and
not for “violations merely of regulations promulgated to
carry out statutory objectives.” Brief for Petitioner 12 (em
phasis in original). The lawsuit before us, however, “seek[s]
damages for [a] statutory violatio[n],” namely, a violation of
§ 201(b)’s prohibition of an “unreasonable practice.” As we
have pointed out, supra, at 53–54, § 201(b)’s prohibitions have
long been thought to extend to rates that diverge from FCC
prescriptions, as well as rates or practices that are “unrea
sonable” in light of their failure to reflect rules embodied in
an agency regulation. We have found no limitation of the
kind Global Crossing suggests.
Global Crossing seeks to draw support from Alexander v.
Sandoval, 532 U. S. 275 (2001), and Adams Fruit Co. v. Bar

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rett, 494 U. S. 638 (1990), which, Global Crossing says, hold
that an agency cannot determine through regulation when a
private party may bring a federal court action. Those cases
do involve private actions, but they do not support Global
Crossing. The cases involve different statutes and different
regulations, and the Court made clear in each of those cases
that its holding relied on the specific statute before it. In
Sandoval, supra, at 288–289, the Court found that an implied
right of action to enforce one statutory provision, 42 U. S. C.
§ 2000d, did not extend to regulations implementing another,
§ 2000d–1. In contrast, here we are addressing the FCC’s
reasonable interpretation of ambiguous language in a sub
stantive statutory provision, 47 U. S. C. § 201(b), which Con
gress expressly linked to the right of action provided in
§ 207. Nothing in Sandoval requires us to limit our defer
ence to the FCC’s reasonable interpretation of § 201(b); to
the contrary, as we noted in Sandoval, it is “meaningless to
talk about a separate cause of action to enforce the regula
tions apart from the statute. A Congress that intends the
statute to be enforced through a private cause of action in
tends the authoritative interpretation of the statute to be so
enforced as well.” 532 U. S., at 284. In Adams Fruit Co.,
supra, at 646–647, we rejected an agency interpretation of
the worker-protection statute at issue as contrary to “the
plain meaning of the statute’s language.” Given the differ
ences in statutory language, context, and history, those two
cases are simply beside the point.
Our analysis does not change in this case simply because
the practice deemed unreasonable (and hence unlawful) in
the 2003 Payphone Order is in violation of an FCC regulation
adopted under authority of a separate statutory section,
§ 276. The FCC here, acting under the authority of § 276,
has prescribed a particular rate (and a division of revenues)
applicable to a portion of a long-distance service, and it has
ordered carriers to reimburse payphone operators for the

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relevant portion of the service they jointly provide. But the
conclusion that it is “unreasonable” to fail so to reimburse is
not a § 276 conclusion; it is a § 201(b) conclusion. And courts
have treated a carrier’s failure to follow closely analogous
agency rate and rate-division determinations as we treat the
matter at issue here. That is to say, the FCC properly im
plements § 201(b) when it reasonably finds that the failure to
follow a Commission, e. g., rate or rate-division determina
tion made under a different statutory provision is unjust or
unreasonable under § 201(b). See, e. g., MCI Telecommuni
cations Corp., 59 F. 3d, at 1414 (failure to follow a rate pro
mulgated under § 205 properly considered unreasonable
under § 201(b)); see also Baltimore & O. R. Co. v. Alabama
Great Southern R. Co., 506 F. 2d 1265, 1270 (CADC 1974)
(statutory obligation to provide reasonable rate divisions is
“implemented by orders of the ICC” issued pursuant to a
separate statutory provision). Moreover, in resting our con
clusion upon the analogy with rate setting and rate divisions,
the traditional, historical subject matter of § 201(b), we avoid
authorizing the FCC to turn §§ 201(b) and 207 into a back
door remedy for violation of FCC regulations.
Second, Justice Scalia, dissenting, says that the “only
serious issue presented by this case [is] whether a practice
that is not in and of itself unjust or unreasonable can be
rendered such (and thus rendered in violation of the Act it
self) because it violates a substantive regulation of the Com
mission.” Post, at 68. He answers this question “no,” be
cause, in his view, a “violation of a substantive regulation
promulgated by the Commission is not a violation of the Act,
and thus does not give rise to a private cause of action.”
Post, at 69. We cannot accept either Justice Scalia’s
statement of the “serious issue” or his answer.
We do not accept his statement of the issue because
whether the practice is “in and of itself ” unreasonable is ir
relevant. The FCC has authoritatively ruled that carriers

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must compensate payphone operators. The only practice
before us, then, and the only one we consider, is the carrier’s
violation of that FCC regulation requiring the carrier to pay
the payphone operator a fair portion of the total cost of car
rying a call that they jointly carried—each supplying a par
tial portion of the total carriage. A practice of violating the
FCC’s order to pay a fair share would seem fairly character
ized in ordinary English as an “unjust practice,” so why
should the FCC not call it the same under § 201(b)?
Nor can we agree with Justice Scalia’s claim that a “vio
lation of a substantive regulation promulgated by the Com
mission is not a violation of ” § 201(b) of the Act when, as
here, the Commission has explicitly and reasonably ruled
that the particular regulatory violation does violate § 201(b).
(Emphasis added.) And what has the substantive/interpre
tive distinction that Justice Scalia emphasizes, ibid., to
do with the matter? There is certainly no reference to this
distinction in § 201(b); the text does not suggest that, of
all violations of regulations, only violations of interpretive
regulations can amount to unjust or unreasonable practices.
Why believe that Congress, which scarcely knew of this dis
tinction a century ago before the blossoming of administra
tive law, would care which kind of regulation was at issue?
And even if this distinction were relevant, the FCC has long
set forth what we now would call “substantive” (or “legisla
tive”) rules under § 205. Cf. 1 R. Pierce, Administrative
Law Treatise § 6.4, p. 325 (4th ed. 2002); post, at 70. And
violations of those substantive § 205 regulations have clearly
been deemed violations of § 201(b). E. g., MCI Telecommu
nications Corp., 59 F. 3d, at 1414. Conversely, we have
found no case at all in which a private plaintiff was kept out
of federal court because the § 201(b) violation it challenged
took the form of a “substantive regulation” rather than an
“interpretive regulation.” Insofar as Justice Scalia uses
adjectives such as “traditional” or “textually based” to de

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scribe his distinctions, post, at 71, and “novel” or “absurd” to
describe ours, post, at 72, 68, we would simply note our
disagreement.
We concede that Justice Scalia cites three sources in
support of his theory. See post, at 69–70. But, in our view,
those sources offer him no support. None of those sources
involved an FCC application of, or an FCC interpretation of,
the section at issue here, namely, § 201(b). Nor did any in
volve a regulation—substantive or interpretive—promul
gated subsequent to the authority of § 201(b). Thus none is
relevant to the case at hand. See APCC Servs., Inc. v.
Sprint Communications Co., 418 F. 3d 1238, 1247 (CADC
2005) (per curiam) (“There was no authoritative interpreta
tion of § 201(b) in this case”), cert. pending, No. 05–766;*
Greene v. Sprint Communications Co., 340 F. 3d 1047, 1052
(CA9 2003) (violation of substantive regulation does not vio
late § 276; silent as to § 201(b)). The single judge who
thought that the FCC had authoritatively interpreted
§ 201(b) (as has occurred in the case before us) would have
reached the same conclusion that we do. APCC Servs., Inc.,
supra, at 1254 (D. H. Ginsburg, C. J., dissenting) (finding a
private cause of action, because there was “clearly an author
itative interpretation of § 201(b)” that deemed the practice
in question unlawful). See also Huber § 3.14.3, p. 317 (no
discussion of § 201(b)).
Third, Justice Thomas (who also does not adopt Justice
Scalia’s arguments) disagrees with the FCC’s interpreta
tion of the term “practice.” He, along with Global Crossing,
claims instead that §§ 201(a) and (b) concern only practices
that harm carrier customers, not carrier suppliers. Post, at
67–70 (Scalia, J., dissenting); Brief for Petitioner 37–38. But
that is not what those sections say. Nor does history offer
this position significant support. A violation of a regulation
or order dividing rates among railroads, for example, would
*[Reporter’s Note: For the April 23, 2007, order granting certiorari,
vacating the judgment, and remanding APCC Servs., see post, p. 901.]

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likely have harmed another carrier, not a shipper. See, e. g.,
Chicago & North Western Transp. Co., 609 F. 2d, at 1225,
1226 (“Act . . . provides for the regulation of inter-carrier
relations as a part of its general rate policy”). Once one
takes account of this fact, it seems reasonable, not unreason
able, to include as a § 201(b) (and § 207) beneficiary a firm that
performs services roughly analogous to the transportation of
one segment of a longer call. We are not here dealing with
a firm that supplies office supplies or manual labor. Cf., e. g.,
Missouri Pacific R. Co. v. Norwood, 283 U. S. 249, 257 (1931)
(“practice” in § 1 of the Interstate Commerce Act does not
encompass employment decisions). The long-distance car
rier ordered by the FCC to compensate the payphone opera
tor is so ordered in its role as a provider of communications
services, not as a consumer of office supplies or the like. It
is precisely because the carrier and the payphone operator
jointly provide a communications service to the caller that
the carrier is ordered to share with the payphone operator
the revenue that only the carrier is permitted to demand
from the caller. Cf. Cable & Wireless P. L. C., 166 F. 3d, at
1231 (finding that § 201(b) enables the Commission to regu
late not “only the terms on which U. S. carriers offer tele
communication services to the public,” but also “the prices
U. S. carriers pay” to foreign carriers providing the foreign
segment of an international call).
Fourth, Global Crossing argues that the FCC’s “unreason
able practice” determination is unlawful because it is inade
quately reasoned. We concede that the FCC’s initial opinion
simply states that the carrier’s practice is unreasonable
under § 201(b). But the context and cross-referenced opin
ions, 2003 Payphone Order, 18 FCC Rcd., at 19990, ¶ 32 (cit
ing American Public Communications Council v. FCC, 215
F. 3d 51, 56 (CADC 2000)), make the FCC’s rationale obvious,
namely, that in light of the history that we set forth supra,
at 53–54, it is unreasonable for a carrier to violate the FCC’s

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mandate that it pay compensation. See also In re APCC
Servs., Inc. v. NetworkIP, LLC, 21 FCC Rcd. 10488, 10493–
10495, ¶¶ 13–16 (2006) (spelling out the reasoning).
Fifth, Global Crossing argues that a different statutory
provision, § 276, see supra, at 51, prohibits the FCC’s § 201(b)
classification. Brief for Petitioner 26–28. But § 276 simply
requires the FCC to “take all actions necessary . . . to pre
scribe regulations that . . . establish a per call compensation
plan to ensure” that payphone operators “are fairly compen
sated.” 47 U. S. C. § 276(b)(1). It nowhere forbids the FCC
to rely on § 201(b). Rather, by helping to secure enforce
ment of the mandated regulations the FCC furthers basic
§ 276 purposes.
Finally, Global Crossing seeks to rest its claim of a § 276
prohibition upon the fact that § 276 requires regulations that
secure compensation for “every completed intrastate,” as
well as every “interstate,” payphone-related call, while
§ 201(b) (referring to § 201(a)) extends only to “interstate
or foreign” communication. Brief for Petitioner 37. But
Global Crossing makes too much of too little. We can as
sume (for argument’s sake) that § 201(b) may consequently
apply only to a portion of the Compensation Order’s require
ments. But cf., e. g., Louisiana Pub. Serv. Comm’n, 476
U. S., at 375, n. 4 (suggesting approval of FCC authority
where it is “not possible to separate the interstate and the
intrastate components”). But even if that is so (and we re
peat that we do not decide this question), the FCC’s classifi
cation will help to achieve a substantial portion of its § 276
compensatory mission. And we cannot imagine why Con
gress would have (implicitly in this § 276 language) wished
to prohibit the FCC from concluding that an interstate half
loaf is better than none.
For these reasons, the judgment of the Ninth Circuit is
affirmed.
It is so ordered.

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Appendix B to opinion of the Court
APPENDIXES TO OPINION OF THE COURT
A
In re Implementation of the Pay Telephone Reclassification
and Compensation Provisions of the Telecommunications
Act of 1996, 14 FCC Rcd. 2545, 2631–2632, ¶¶ 190–191 (1999)
(Compensation Order).
In re the Pay Telephone Reclassification and Compensation
Provisions of the Telecommunications Act of 1996, 18 FCC
Rcd. 19975, 19990, ¶ 32 (2003) (2003 Payphone Order).
B
Communications Act § 201:
“(a) It shall be the duty of every common carrier en
gaged in interstate or foreign communication by wire or
radio to furnish such communication service upon rea
sonable request therefor; and, in accordance with the or
ders of the Commission, in cases where the Commission,
after opportunity for hearing, finds such action neces
sary or desirable in the public interest, to establish
physical connections with other carriers, to establish
through routes and charges applicable thereto and the
divisions of such charges, and to establish and provide
facilities and regulations for operating such through
routes.
“(b) All charges, practices, classifications, and regula
tions for and in connection with such communication
service, shall be just and reasonable, and any such
charge, practice, classification, or regulation that is un
just or unreasonable is declared to be unlawful: Pro
vided, That communications by wire or radio subject to
this chapter may be classified into day, night, repeated,
unrepeated, letter, commercial, press, Government, and
such other classes as the Commission may decide to be
just and reasonable, and different charges may be made
for the different classes of communications: Provided

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66 GLOBAL CROSSING TELECOMMUNICATIONS, INC. v.
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Appendix B to opinion of the Court
further, That nothing in this chapter or in any other
provision of law shall be construed to prevent a common
carrier subject to this chapter from entering into or
operating under any contract with any common carrier
not subject to this chapter, for the exchange of their
services, if the Commission is of the opinion that such
contract is not contrary to the public interest: Provided
further, That nothing in this chapter or in any other
provision of law shall prevent a common carrier subject
to this chapter from furnishing reports of positions of
ships at sea to newspapers of general circulation, either
at a nominal charge or without charge, provided the
name of such common carrier is displayed along with
such ship position reports. The Commission may pre
scribe such rules and regulations as may be necessary
in the public interest to carry out the provisions of this
chapter.” 47 U. S. C. § 201.
Communications Act § 206:
“In case any common carrier shall do, or cause or per
mit 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 per
son 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 reason
able 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.
Communications Act § 207:
“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

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67 Cite as: 550 U. S. 45 (2007)
Scalia, J., dissenting
damages for which such common carrier may be liable
under 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 rem
edies.” 47 U. S. C. § 207.
Justice Scalia, dissenting.
Section 276(b)(1)(A) of the Communications Act of 1934, as
added by the Telecommunications Act of 1996, instructed the
Federal Communications Commission (FCC or Commission)
to issue regulations establishing a plan to compensate pay
phone operators, leaving it up to the FCC to prescribe who
should pay and how much. Pursuant to that authority, the
FCC promulgated a substantive regulation that required
carriers to compensate payphone operators at a rate of 24
cents per call (the payphone-compensation regulation). The
FCC subsequently declared a carrier’s failure to comply with
the payphone-compensation regulation to be unlawful under
§ 201(b) of the Act (which prohibits certain “unjust or unrea
sonable” practices) and privately actionable under § 206 of
the Act (which establishes a private cause of action for viola
tions of the Act). Today’s judgment can be defended only
by accepting either of two propositions with respect to these
laws: (1) that a carrier’s failure to pay the prescribed com
pensation, in and of itself and apart from the Commission’s
payphone-compensation regulation, is an unjust or unreason
able practice in violation of § 201(b); or (2) that a carrier’s
failure to pay the prescribed compensation is an “unjust or
unreasonable” practice under § 201(b) because it violates the
Commission’s payphone-compensation regulation.
The Court coyly avoids rejecting the first proposition.
But make no mistake: that proposition is utterly implausible,
which is perhaps why it is nowhere to be found in the FCC’s
opinion. The unjustness or unreasonableness in this case,
if any, consists precisely of violating the FCC’s payphone

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68 GLOBAL CROSSING TELECOMMUNICATIONS, INC. v.
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compensation regulation.1 Absent that regulation, it would
be neither unjust nor unreasonable for a carrier to decline to
act as collection agent for payphone companies. The person
using the services of the payphone company to obtain access
to the carrier’s network is not the carrier but the caller. It
is absurd to suggest some natural obligation on the part of
the carrier to identify payphone use, bill its customer for that
use, and forward the proceeds to the payphone company.
As a regulatory command, that makes sense (though the
free-rider problem might have been solved in some other
fashion); but, absent the Commission’s substantive regula
tion, it would be in no way unjust or unreasonable for the
carrier to do nothing. Indeed, if a carrier’s failure to pay
payphone compensation had been unjust or unreasonable in
its own right, the Commission’s payphone-compensation reg
ulation would have been unnecessary, and the payphone com
panies could have sued directly for violation of § 201(b).
The only serious issue presented by this case relates to
the second proposition: whether a practice that is not in and
of itself unjust or unreasonable can be rendered such (and
thus rendered in violation of the Act itself) because it vio
lates a substantive regulation of the Commission. Today’s
opinion seems to answer that question in the affirmative, at
least with respect to the particular regulation at issue here.
1 See In re the Pay Telephone Reclassification and Compensation Pro
visions of the Telecommunications Act of 1996, 18 FCC Rcd. 19975, 19990,
¶ 32 (2003) (“[F]ailure to pay in accordance with the Commission’s pay
phone rules, such as the rules expressly requiring such payment . . . consti
tutes . . . an unjust and unreasonable practice in violation of section
201(b)”); In re APCC Servs., Inc. v. NetworkIP, LLC, 21 FCC Rcd. 10488,
10493, ¶ 15 (2006) (“[F]ailure to pay payphone compensation rises to the
level of being ‘unjust and unreasonable’ ” because it is “a direct violation
of Commission rules”); id., at 10493, ¶ 15, and n. 46 (“The fact that a failure
to pay payphone compensation directly violates Commission rules spe
cifically requiring such payment distinguishes this situation from other
situations where the Commission has repeatedly declined to entertain
‘collection actions’ ”).

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Scalia, J., dissenting
That conclusion, however, conflicts with the Communications
Act’s carefully delineated remedial scheme. The Act draws
a clear distinction between private actions to enforce inter
pretive regulations (by which I mean regulations that rea
sonably and authoritatively construe the statute itself) and
private actions to enforce substantive regulations (by which
I mean regulations promulgated pursuant to an express dele
gation of authority to impose freestanding legal obligations
beyond those created by the statute itself). Section 206 of
the Act establishes a private cause of action for violations of
the Act itself—and violation of an FCC regulation authorita
tively interpreting the Act is a violation of the Act itself.
(As the Court explains, when it comes to regulations that
“reasonabl[y] [and] authoritatively construe the statute it
self,” Alexander v. Sandoval, 532 U. S. 275, 284 (2001), “it is
‘meaningless to talk about a separate cause of action to en
force the regulations apart from the statute.’ ” Ante, at 54
(quoting Sandoval, supra, at 284).) On the other hand, vio
lation of a substantive regulation promulgated by the Com
mission is not a violation of the Act, and thus does not give
rise to a private cause of action under § 206. See, e. g.,
APCC Servs., Inc. v. Sprint Communications Co., 418 F. 3d
1238, 1247 (CADC 2005) (per curiam), cert. pending,
No. 05–766; Greene v. Sprint Communications Co., 340 F. 3d
1047, 1052 (CA9 2003), cert. denied, 541 U. S. 988 (2004);
P. Huber, M. Kellogg, & J. Thorne, Federal Telecommuni
cations Law § 3.14.3 (2d ed. 1999).2 That is why Congress
2 The Court asserts that “[n]one of th[ese] [cases] involved an FCC appli
cation of, or an FCC interpretation of, the section at issue here, namely,
§ 201(b)[,] [n]or did any involve a regulation—substantive or interpretive—
promulgated subsequent to the authority of § 201(b).” Ante, at 62. I
agree. They involved the payphone-compensation regulation, which was
not promulgated pursuant to § 201(b), but pursuant to § 276. The relevant
point is that violations of substantive regulations are not directly action
able under § 206.
[Reporter’s Note: For the April 23, 2007, order granting certiorari,
vacating the judgment, and remanding APCC Servs., see post, p. 901.]

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has separately created private rights of action for violation
of certain substantive regulations. See, e. g., 47 U. S. C.
§ 227(b)(3) (violation of substantive regulations prescribed
under § 227(b) (2000 ed. and Supp. III)); § 227(c)(5) (violation
of substantive regulations prescribed under § 227(c)). These
do not include the payphone-compensation regulation au
thorized by § 276(b).
There is no doubt that interpretive rules can be issued
pursuant to § 201(b)—that is, rules which specify that certain
practices are in and of themselves “unjust or unreasonable.”
Orders issued under § 205 of the Act, see ante, at 60, which
authorizes the FCC, upon finding that a practice will be un
just and unreasonable, to order the carrier to adopt a just
and reasonable practice in its place, similarly implement the
statute’s proscription against unjust or unreasonable prac
tices. But, as explained above, the payphone-compensation
regulation does not implement § 201(b) and is not predicated
on a finding of what would be unjust and unreasonable ab
sent the regulation.
The Court naively describes the question posed by this
case as follows: Since “[a] practice of violating the FCC’s
order to pay a fair share would seem fairly characterized in
ordinary English as an ‘unjust practice,’ . . . why should the
FCC not call it the same under § 201(b)?” Ante, at 61.
There are at least three reasons why it is not as simple as
that. (1) There has been no FCC “order” in the ordinary
sense, see 5 U. S. C. § 551(6), but only an FCC regulation.3
That is to say, the FCC has never determined that petitioner
is in violation of its regulation and ordered compliance.
Rather, respondent has alleged such a violation and has
3 The Court’s departure from ordinary usage is made possible by the
fact that “[t]he FCC commonly adopts rules in opinions called ‘orders.’ ”
New England Tel. & Tel. Co. v. Public Util. Comm’n of Me., 742 F. 2d 1,
8–9 (CA1 1984) (Breyer, J.). If there had been violation of an FCC order
in this case, a private action would have been available under § 407 of
the Act.

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Scalia, J., dissenting
brought that allegation directly to District Court without
prior agency adjudication. (2) The “practice of violating”
virtually any FCC regulation can be characterized (“in ordi
nary English”) as an “unjust practice”—or if not that, then
an “unreasonable practice”—so that all FCC regulations
become subject to private damages actions. Thus, the tradi
tional (and textually based) distinction between private en
forceability of interpretive rules and private nonenforceabil
ity of substantive rules is effectively destroyed. And (3) it
is not up to the FCC to “call it” an unjust practice or not.
If it were, agency discretion might limit the regulations
available for harassing litigation by telecommunications com
petitors. In fact, however, the practice of violating one or
another substantive rule either is or is not an unjust or un
reasonable practice under § 201(b). The Commission is enti
tled to Chevron deference with respect to that determination
at the margins, see Chevron U. S. A. Inc. v. Natural Re
sources Defense Council, Inc., 467 U. S. 837 (1984), but it
will always remain within the power of private parties to go
directly to court, asserting that a particular violation of a
substantive rule is (“in ordinary English”) “unjust” or “un
reasonable” and hence provides the basis for suit under
§ 201(b).
The Court asks (more naively still) “what has the substan
tive/interpretive distinction that [this dissent] emphasizes to
do with the matter? There is certainly no reference to this
distinction in § 201(b) . . . . Why believe that Congress,
which scarcely knew of this distinction a century ago before
the blossoming of administrative law, would care which kind
of regulation was at issue?” Ante, at 61 (citation omitted).
The answer to these questions is obvious. Section 206
(which was enacted at the same time as § 201(b), see 48 Stat.
1070, 1072) does not explicitly refer to the distinction be
tween interpretive and substantive regulations. And yet
the Court acknowledges that, while a violation of an inter
pretive regulation is actionable under § 206 (as a violation of

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72 GLOBAL CROSSING TELECOMMUNICATIONS, INC. v.
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Scalia, J., dissenting
the statute itself), a violation of a substantive regulation is
not. (Were this not true, the Court’s lengthy discussion of
§ 201(b) would be wholly unnecessary because violation of
the payphone-compensation regulation would be directly ac
tionable under § 206.) The Court evidently believes that
Congress went out of its way to exclude from § 206 private
actions that did not charge violation of the Act itself (or regu
lations that authoritatively interpret the Act) but was per
fectly willing to have those very same private actions
brought in through the back door of § 201(b) as an “interpre
tation” of “unjust or unreasonable practice.” It does not
take familiarity with “the blossoming of administrative law”
to perceive that this would be nonsensical.4
Seemingly aware that it is in danger of rendering the limi
tation upon § 206 a nullity, the Court seeks to limit its novel
approval of private actions for violation of substantive rules
to substantive rules that are “analog[ous] with rate setting
and rate divisions, the traditional, historical subject matter
of § 201(b),” ante, at 60 (emphasis added). There is abso
lutely no basis in the statute for this distinction (nor is it
anywhere to be found in the FCC’s opinion). As I have de
scribed earlier, interpretive regulations are privately en
forceable because to violate them is to violate the Act, within
the meaning of the private-suit provision of § 206. That a
substantive regulation is analogous to traditional interpre
tive regulations, in the sense of dealing with subjects that
those regulations have traditionally addressed, is supremely
4 The Court further asserts that “the FCC has long set forth what
we now would call ‘substantive’ (or ‘legislative’) rules under § 205,” “viola
tions of [which] . . . have clearly been deemed violations of § 201(b),” ante,
at 61. The § 205 orders to which the Court refers are not substantive in
the relevant sense because they interpret § 201(b)’s prohibition against
unjust and unreasonable rates or practices. See ante, at 53 (§ 205 “au
thoriz[es] the FCC to prescribe reasonable rates and practices in order
to preclude rates or practices that violate § 201(b)”). The payphone
compensation regulation, by contrast, does not interpret § 201(b) or any
other statutory provision.

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Scalia, J., dissenting
irrelevant to whether violation of the substantive regulation
is a violation of the Act—which is the only pertinent inquiry.
The only thing to be said for the Court’s inventive distinction
is that it enables its holding to stand without massive dam
age to the statutory scheme. Better an irrational limitation,
I suppose, than no limitation at all; even though it is unclear
how restrictive that limitation will turn out to be. What
other substantive regulations are out there, one wonders,
that can be regarded as “analogous” to actions the Commis
sion has traditionally taken through interpretive regulations
under § 201(b)?
It is difficult to comprehend what public good the Court
thinks it is achieving by its introduction of an unprincipled
exception into what has hitherto been a clearly understood
statutory scheme. Even without the availability of private
remedies, the payphone-compensation regulation would
hardly go unenforced. The Commission is authorized to im
pose civil forfeiture penalties of up to $100,000 per violation
(or per day, for continuing violations) against common carri
ers that “willfully or repeatedly fai[l] to comply with . . . any
rule, regulation, or order issued by the Commission.” 47
U. S. C. § 503(b)(1)(B). And the Commission can even place
enforcement in private hands by issuing a privately enforce
able order forbidding continued violation. See §§ 154(i),
276(b)(1)(A), 407. Such an order, however, would require a
prior Commission adjudication that the regulation had been
violated, thus leaving that determination in the hands of the
agency rather than a court, and preventing the unjustified
private suits that today’s decision allows.
I would hold that a private action to enforce an FCC regu
lation under §§ 201(b) and 206 does not lie unless the regu
lated practice is “unjust or unreasonable” in its own right
and apart from the fact that a substantive regulation of the
Commission has prohibited it. As the practice regulated by
the payphone-compensation regulation does not plausibly fit

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74 GLOBAL CROSSING TELECOMMUNICATIONS, INC. v.
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that description, I would reverse the judgment of the Court
of Appeals.
Justice Thomas, dissenting.
The Court holds that failure to pay a payphone operator
for coinless calls is an “unjust or unreasonable” “practice”
under 47 U. S. C. § 201(b). Properly understood, however,
§ 201 does not reach the conduct at issue here. Failing to
pay is not a “practice” under § 201 because that section reg
ulates the activities of telecommunications firms in their
role as providers of telecommunications services. As such,
§ 201(b) does not reach the behavior of telecommunication
firms in other aspects of their business. I respectfully
dissent.
I
The meaning of § 201(b) of the Communications Act of 1934
becomes clear when read, as it should be, as a part of the
entirety of § 201. Subsection (a) sets out the duties and
broad discretionary powers of a common carrier:
“It shall be the duty of every common carrier engaged
in interstate or foreign communication by wire or radio
to furnish such communication service upon reasonable
request therefor; and . . . to establish physical connec
tions with other carriers, to establish through routes
and charges applicable thereto and the divisions of such
charges, and to establish and provide facilities and regu
lations for operating such through routes.”
Immediately following that description of duties and powers,
subsection (b) requires:
“All charges, practices, classifications, and regulations
for and in connection with such communication service,
shall be just and reasonable, and any such charge, prac
tice, classification, or regulation that is unjust or unrea
sonable is declared to be unlawful . . . .”

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The “charges, practices, classifications, and regulations” re
ferred to in subsection (b) are those “establish[ed]” under
subsection (a). Having given common carriers discretionary
power to set charges and establish regulations in subsection
(a), Congress required in subsection (b) that the exercise of
this power be “just and reasonable.” Thus, unless failing to
pay a payphone operator arises from one of the duties under
subsection (a), it is not a “practice” within the meaning of
subsection (b).
Subsection (a) prescribes a carrier’s duty to render service
either to customers (“furnish[ing] . . . communication serv
ice”) or to other carriers (e. g., “establish[ing] physical con
nections”); it does not set out duties related to the receipt of
service from suppliers. Consequently, given the relation
ship between subsections (a) and (b), subsection (b) covers
only those “practices” connected with the provision of serv
ice to customers or other carriers. The Court embraced this
critical limitation in Missouri Pacific R. Co. v. Norwood, 283
U. S. 249 (1931), which held that the term “practice” means
a “ ‘practice’ in connection with the fixing of rates to be
charged and prescribing of service to be rendered by the
carriers.” Id., at 257. In Norwood, the Court interpreted
language from the Interstate Commerce Act (as amended by
the Mann-Elkins Act) that Congress just three years later
copied into the Communications Act. 283 U. S., at 253; see
§ 7 of the Mann-Elkins Act of 1910, 36 Stat. 546. In passing
the Communications Act, Congress may “be presumed to
have had knowledge” and to have approved of the Court’s
interpretation in Norwood. See Lorillard v. Pons, 434 U. S.
575, 581 (1978). As a result, the Supreme Court’s contempo
raneous interpretation of “practice” should bear heavily on
our analysis.
Other terms in § 201 support using Norwood’s restrictive
interpretation of “practice.” A word “is known by the com
pany it keeps,” and one should not “ascrib[e] to one word a
meaning so broad that it is inconsistent with its accompany

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ing words.” Gustafson v. Alloyd Co., 513 U. S. 561, 575
(1995). Of the quartet “charges, practices, classifications,
and regulations,” the terms “charges,” “classifications,” and
“regulations” could apply only to the party “furnish[ing]”
service. “[C]harges” refers to the charges for physical con
nections and through routes. 47 U. S. C. §§ 201(a), 202(b).
“[R]egulations” relates to the operation of through routes.
§ 201(a). “[C]lassifications” refers to different sorts of com
munications that carry different charges. § 201(b). These
three terms involve either setting rules for the provision of
service or setting rates for that provision. In keeping with
the meaning of these terms, the term “practices” must refer
to only those practices “in connection with the fixing of rates
to be charged and prescribing of service to be rendered by
the carriers.” Norwood, supra, at 257.
The statutory provisions surrounding § 201 confirm this in
terpretation. Section 203 requires that “[e]very common
carrier . . . shall . . . file with the Commission . . . schedules
showing all charges for itself and its connecting carriers . . .
and showing the classifications, practices, and regulations af
fecting such charges.” See also §§ 204–205 (also using the
phrase “charge, classification, regulation, or practice” in the
tariff context). The “charges” referred to are those related
to a carrier’s own services. § 203 (“charges for itself and
its connecting carriers”). The “classifications, practices, and
regulations” are also limited to a carrier’s own services.
Ibid. (applying only to practices “affecting such charges”).
In this context, “practices” must mean only those “in connec
tion with the fixing of rates to be charged.” Norwood, 283
U. S., at 257. Section 202—outside of the tariff context—
also supports this limitation. It forbids discrimination “in
charges, practices, classifications, regulations, facilities, or
services.” Discrimination occurs with respect to a carrier’s
provision of service—not its purchasing of services from oth
ers. I am unaware of any context in which §§ 202–205 were

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77 Cite as: 550 U. S. 45 (2007)
Thomas, J., dissenting
applied to conduct relating to the service that another party
provided to a telecommunications carrier.
In this case, Global Crossing has not provided any service
to Metrophones. Rather, Global Crossing has failed to pay
for a service that Metrophones supplied. The failure to pay
a supplier is not in any sense a “ ‘practice’ in connection with
the fixing of rates to be charged and prescribing of service
to be rendered by the carriers.” Id., at 257. Accordingly,
Global Crossing has not engaged in a practice under subsec
tion (b) because the failure to pay has not come in connection
with its provision of service or setting of rates within the
meaning of subsection (a). On this understanding of § 201,
Global Crossing’s failure to pay Metrophones is not a statu
tory violation. All that remains is a regulatory violation,
which does not provide Metrophones a private right of action
under § 207.1
II
The majority suggests that deference under Chevron
U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467
U. S. 837 (1984), compels its conclusion that a carrier’s refusal
to pay a payphone operator is unreasonable. But “unjust or
unreasonable” is a statutory term, § 201(b), and a court may
not, in the name of deference, abdicate its responsibility to
interpret a statute. Under Chevron, an agency is due no
deference until the court analyzes the statute and deter
mines that Congress did not speak directly to the issue
under consideration:
“The judiciary is the final authority on issues of statu
tory construction and must reject administrative con
1 Other enforcement mechanisms exist to redress Global Crossing’s fail
ure to pay. The Federal Communications Commission (FCC) has the
power to impose fines under 47 U. S. C. §§ 503(b)(1)(B) and (2)(B). In addi
tion, the FCC may have the authority to create an administrative right of
action under § 276(b)(1) (giving the FCC power to “take all actions neces
sary” to “establish a per call compensation plan” that ensures “all pay
phone service providers are fairly compensated”).

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structions which are contrary to clear congressional
intent. . . . If a court, employing traditional tools of stat
utory construction, ascertains that Congress had an in
tention on the precise question at issue, that intention is
the law and must be given effect.” Id., at 843, n. 9.
The majority spends one short paragraph analyzing the
relevant provisions of the Communications Act to determine
whether a refusal to pay is an “ ‘unjust or unreasonable’ ”
“ ‘practice.’ ” Ante, at 53. Its entire statutory analysis is
essentially encompassed in a single sentence in that para
graph: “That is to say, in ordinary English, one can call a
refusal to pay Commission-ordered compensation despite
having received a benefit from the payphone operator a
‘practice . . . in connection with [furnishing a] communication
service . . . that is . . . unreasonable.’ ” Ante, at 55 (omissions
and modifications in original). This analysis ignores the in
teraction between § 201(a) and § 201(b), supra, at 74–75; it
ignores the three terms surrounding the word “practice” and
the context those terms provide, supra, at 76; it ignores the
use of the term “practice” in nearby statutory provisions,
such as §§ 202–205, supra, at 76–77; and it ignores the under
standing of the term “practice” at the time Congress enacted
the Communications Act, supra, at 75.
After breezing by the text of the statutory provisions at
issue, the majority cites lower court cases to claim that “the
underlying regulated activity at issue here resembles activ
ity that both transportation and communications agencies
have long regulated.” Ante, at 55. It argues that these
cases demonstrate that “communications firms entitled to
revenues under rate divisions or cost allocations might bring
lawsuits under § 207 . . . and obtain compensation or dam
ages.” Ante, at 56 (citing Allnet Communication Serv., Inc.
v. National Exch. Carrier Assn., Inc., 965 F. 2d 1118 (CADC
1992), and Southwestern Bell Tel. Co. v. Allnet Communica
tions Servs., Inc., 789 F. Supp. 302 (ED Mo. 1992)). But in
both cases, the only issue before the court was whether the

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lawsuit should be dismissed because the FCC had primary
jurisdiction; and in both cases, the answer was yes. Allnet,
supra, at 1120–1123; Southwestern Bell, supra, at 304–306.
The Court’s reliance on these cases is thus entirely misplaced
because both courts found they lacked jurisdiction; the cases
do not address § 201 at all—the interpretation of which is the
sole question in this case; and both cases assume without
deciding that § 207 applies, thus not grappling with the point
for which the majority claims its support.2
III
Finally, independent of the FCC’s interpretation of the
language “unjust or unreasonable” “practice,” the FCC’s in
terpretation is unreasonable because it regulates both in
terstate and intrastate calls. The unjust-and-unreasonable
requirement of § 201(b) applies only to “practices . . . in con
nection with such communication service,” and the term
“such communication service” refers to “interstate or foreign
communication by wire or radio” in § 201(a) (emphasis
added). Disregarding this limitation, the FCC has applied
its rule to both interstate and intrastate calls. 47 CFR
§ 64.1300 (2005). In light of the fact that the statute ex
plicitly limits “unjust or unreasonable” “practices” to those
involving “interstate or foreign communication,” the FCC’s
application of § 201(b) to intrastate calls is plainly an
unreasonable interpretation of the statute. To make mat
ters worse, the FCC has not even bothered to explain its
clear misinterpretation. See In re Pay Telephone Reclassi
2 The majority’s citation to Chicago & North Western Transp. Co. v. At
chison, T. & S. F. R. Co., 609 F. 2d 1221 (CA7 1979), is similarly misplaced.
There, the Court of Appeals interpreted the meaning of the statutory re
quirement to “ ‘establish just, reasonable, and equitable divisions’ ” under
the Interstate Commerce Act. Id., at 1224. It is difficult to understand
why the Seventh Circuit’s interpretation of different statutory language
is relevant to the question we face in this case.

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fication and Compensation Provisions of the Telecommuni
cations Act of 1996, 18 FCC Rcd. 19975 (2003).
The majority avoids directly addressing this argument by
stating there is no reason “to prohibit the FCC from conclud
ing that an interstate half loaf is better than none.” Ante,
at 64. But if the FCC’s rule is unreasonable, Metrophones
should not be able to recover for intrastate calls in a suit
under § 207. Because intrastate calls cannot be the subject
of an “unjust or unreasonable” practice under § 201, there is
no private right of action to recover for them, and the Court
should cut off that half of the loaf. By sidestepping this
issue, the majority gives the lower court no guidance about
how to handle intrastate calls on remand.
IV
Because the majority allows the FCC to interpret the
Communications Act in a way that contradicts the unambigu
ous text, I respectfully dissent.