United States District Court, D. South Carolina, Charleston Division
County of Dorchester, South Carolina, and Town of Summerville, South Carolina, Plaintiffs,
Level 3 Communications, LLC, et al., Defendants.
ORDER AND OPINION
RICHARD MARK GERGEL UNITED STATES DISTRICT COURT.
the Court is Defendants' joint partial motion to dismiss
the Complaint. (Dkt. No. 15.) For the reasons set forth
below, the motion is denied.
Act authorizes local governments such as Plaintiffs to adopt
an ordinance imposing monthly charges on telephone consumers
in order to fund local 911 call centers. See S.C.
Code Ann. § 23-47-10 et seq. Plaintiffs adopted
such ordinances. See Dorchester Cnty. Ord. §
12-20(2). (Dkt. No. 1 ¶¶ 26-27, No. 1-1.) The
companies providing telephone service to consumers in the
jurisdiction bill the 911 charges to their consumers, collect
the charges from the consumers, and remit the amount to the
local government minus a 2% administrative fee. See
S.C. Code Ann. §§ 23-47-40, 50.
allege that Defendants violate the 911 Act among other claims
by undercharging their consumers the 911 charge and, as a
result, under-remitting the charge to Plaintiffs, which
results in inadequately funded 911 call centers and a
potential public safety concern. Plaintiffs seek to enforce
their implied private rights of action under the 911 Act and
bring claims for (i) violation of the South Carolina Unfair
Trade Practices Act, (ii) violation of the 911 Act, (iii)
breach of statutory duty, (iv) breach of fiduciary duty, (v)
negligence and negligence per se, and (vi) constructive
fraud. Plaintiffs also seek a declaratory judgment, a
permanent injunction, and punitive damages. (Dkt. No. 1.)
12(b)(6) of the Federal Rules of Civil Procedure permits the
dismissal of an action if the complaint fails "to state
a claim upon which relief can be granted." Fed.R.Civ.P.
12(b)(6). A motion to dismiss, therefore, tests the legal
sufficiency of the complaint and "does not resolve
contests surrounding the facts, the merits of the claim, or
the applicability of defenses." Republican Party of
N.C. v. Martin, 980 F.2d 943, 952 (4th Cir. 1992). The
court's "inquiry then is limited to whether the
allegations constitute a short and plain statement of the
claim showing that the pleader is entitled to relief."
Id. The allegations are sufficient if they offer
"a short and plain statement of the claim showing that
the pleader is entitled to relief and "a demand for the
relief sought." Fed.R.Civ.P. 8(a)(2), (3). The Rule 8
standard is satisfied when the complaint gives "the
defendant fair notice of what ... the claim is and the
grounds upon which it rests." Am. Dental Ass'n
v. Cigna Corp., 605 F.3d 1283, 1288 (11th Cir. 2010).
"complaint attacked by a Rule 12(b)(6) motion to dismiss
does not need detailed factual allegations," but must
include more than "labels and conclusions, and a
formulaic recitation of a cause of action's elements will
not do." Bell Ail. Corp. v. Twombly, 550 U.S.
544, 555 (2007). Meaning, to survive a motion to dismiss,
"a complaint must contain sufficient factual matter,
accepted as true, to 'state a claim to relief that is
plausible on its face.'" Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S.
at 570). This plausibility requirement does not impose a
probability requirement, but the complaint must show more
than a "sheer possibility that a defendant has acted
unlawfully." Iqbal, 556 U.S. at 678. The claims
are plausible on their face where the complaint "allows
the court to draw the reasonable inference that the defendant
is liable for the misconduct alleged." Id.
plaintiff alleging fraud is held to a higher standard and
"must state with particularity the circumstances"
constituting the fraud. Fed. R. Civ. Pro. 9(b). The
circumstances of the fraud are "the time, place, and
contents of the false representations, as well as the
identity of the person making the misrepresentations and what
he obtained thereby." Weidman v. Exxon Mobil
Corp., 776 F.3d 214, 219 (4th Cir. 2015) (internal
quotation marks omitted). A plaintiff claiming constructive
fraud may allege that the defendant knew or should have known
the falsity of its misrepresentations; alleging intent to
deceive or actual dishonesty is not required. Cheney
Bros. Inc. v. Batesville Casket Co., Inc., 47 F.3d 111,
114 (4th Cir. 1995); see also Pitts v. Jackson Nat. Life
Ins. Co., 574 S.E.2d 502, 509 (S.C. 2002).
Rule 12(b)(6) motion, the court is obligated to "assume
the truth of all facts alleged in the complaint and the
existence of any fact that can be proved, consistent with the
complaint's allegations." E. Shore Mkts., Inc.
v. J.D. Assocs. Ltd P'ship, 213 F.3d 175, 180 (4th
Cir. 2000). But while the court must accept the facts in a
light most favorable to the Plaintiff, it "need not
accept as true unwarranted inferences, unreasonable
conclusions, or arguments." Id.
move under Rule 12(b)(6) for "partial dismissal" of
each count "to the extent that it claims violation of
the 911 Act" predicated on two interpretations of the
Act that are contrary to its clear meaning. (Dkt. No. 15 at
7.) First, the Complaint alleges that Defendants fail to
fully charge and remit on VoIP lines, which could be
unlimited because the 911 Act mandates that a "VoIP
provider must collect the VoIP 911 charge established in
subsection (A) on each VoIP service line" (S.C.
Code Ann. § 23-47-67(B)); the 911 Act defines
"service line" in part as "a VoIP service that
offers an active telephone number" (id. §
23-47-10(38); and VoIP lines can support thousands of numbers
and devices with "no physical limitation on how many
users may connect to the 911 system." (Dkt. No. 1 ¶
44.) Defendants contend, however, that the 911 Act must be
read to impose a 50-charge cap on a VoIP line. This cap is
expressly applied to non-VoIP lines (see S.C. Code.
Ann. § 23-47-50(A), providing that for an individual
local exchange access facility, the "total number of 911
charges remains subject to the maximum of fifty 911 charges
per account" as tiered) and, Defendants argue, is
incorporated by reference to also apply to VoIP lines
(see S.C. Code. Ann. § 23-47-67(A), providing
that "[t]here is hereby imposed a VoIP 911 charge in an
amount identical to the amount of the 911 charge imposed on
each local exchange access facility . . ."). (Dkt. No.
15 at 13-15.) Plaintiffs argue that Defendants' reading
of the 911 Act requires misinterpreting the phrases "an
amount" and "the amount"-in the singular-to
refer to the total quantity or combined value of charges to
the customer, rather than to the individual per-charge rate,
which happens to be $.99 in Dorchester and $.93 in
Summerville. (Dkt. No. 21 at 15-16, No. 1 ¶
the Complaint alleges that Defendants failed to fully charge
and remit on multiplex customers. Plaintiffs allege that
primary rate interface ("PRI") allows a service
provider to carry up to twenty-three simultaneous voice
conversations over a single wire connection; that the 911 Act
imposes a cap of five charges per access line only where the
subscriber can modify the number of channels without
assistance of the service provider (see S.C. Code
Ann. § 23-47-50(A)); that a consumer only rarely falls
into this latter autonomous category by purchasing fractional
PRI service not delivered by a broadband connection; and,
therefore, that "Defendants should assess a PRI with
twenty-three channels no fewer than twenty-three 911 service
charges because the PRI is capable of simultaneously
connecting twenty-three separate users to the 911
system." (Dkt. No. 1 ¶¶ 33, 37-40.) Defendants
argue in part that this interpretation of Section 23-47-50(A)
is unreasonable because a consumer need not purchase
fractional PRI service not delivered by a broadband
connection in order to modify the voice transmission paths
without assistance of the service provider. (Dkt. No. 15 at
crux of Defendants' two statutory interpretation
arguments is that the 911 Act does not obligate them to
charge, collect and remit the quantity, amount or volume that
Plaintiffs claim they are required, but fail, to
But "[t]o the extent the motion to dismiss is premised
on the [ ] Complaint's lack of detail concerning the
amount of 911 charges Defendants] billed and remitted-or
should have-and the identities of customers, detailed factual
allegations are not required to survive a motion to dismiss
under Rule 12(b)(6)." Autauga Cnty. Em. Mgmt. Comm.
District v. Bellsouth Telecomms., LLC, No.
2:15-cv-0765-SGC, 2016 WL 5848854, at *4 (N.D. Ala. Oct 6,
2016) (denying motion to dismiss). Rather, accepting the facts
alleged as true, the Complaint plausibly pleads claims to the
Rule 8 or Rule 9(b) standard. The facts alleged as to counts
one through five are adequate to put Defendants on fair
notice of the allegations and their factual foundations.
See, e.g., Hamilton Cnty. Em. Comms. District v.
BellSouth Telecomms LLC,852 F.3d 521 (6th Cir. 2017)
(finding implied private right of action and reversing
district court's grant of motion to dismiss on claim for
violation of state 911 statute); Birmingham Em. Comms.
District v. TW Telecomm. Holdings, Inc., et al, No.
2:15-cv-0245-AKK (N.D. Ala. Mar. 2, 2017) (denying motion to
dismiss claims for negligence/negligence per se and breach of
fiduciary duty). Count six is also sufficiently pled in that
Plaintiffs allege Defendants knew or should have known their
monthly remittance checks misstated the appropriate amount
charged, collected and remitted to the local governments.
See, e.g., Autauga Cnty., 2016 WL 5848854, ...