## Facts

- The Communications Act of 1934 required common carriers to file tariffs with the FCC showing charges and related practices.
- A separate provision authorized the FCC to “modify any requirement” made by or under the tariff section.
- As competition increased in long-distance service, the FCC adopted “permissive detariffing,” allowing nondominant long-distance carriers to choose not to file tariffs.
- AT&T challenged MCI’s failure to file tariffs as violating the statutory “shall file” command.
- The FCC dismissed AT&T’s complaint, treating MCI as compliant under the permissive detariffing policy.
- The D.C. Circuit held the FCC lacked statutory authority to make tariff filing optional, and later summarily reversed a renewed FCC order reaffirming permissive detariffing.
- The Supreme Court granted certiorari and consolidated the case with a related petition involving the United States and the FCC.

## Issues

1. Whether the FCC’s power to “modify any requirement” of the tariff-filing provisions authorized it to make tariff filing optional for a broad class of carriers despite a statutory “shall file” command.
2. Whether the FCC’s interpretation of “modify” was entitled to administrative deference.

## Decision

- The Supreme Court affirmed the D.C. Circuit and held the FCC’s permissive detariffing policy invalid.
- The Court interpreted “modify” to mean change in a limited or moderate way, not to eliminate a statutory requirement for an entire category of carriers.
- The Court concluded the tariff-filing obligation was central to the statutory scheme, and the FCC’s policy effected a fundamental alteration rather than a permissible modification.
- The Court rejected deference to the FCC because the agency’s interpretation exceeded the meaning the statutory text could bear.
- A dissent would have read “modify” more broadly and deferred to the FCC’s judgment in light of market changes.

## Legal Principles

- Statutory authority to “modify” a requirement ordinarily permits limited adjustments, not the near-total repeal of a central statutory command.
- An agency interpretation that effectively rewrites or nullifies a core statutory requirement is not saved by administrative deference when it exceeds the statute’s textual limits.
- Statutory context and structure may confirm that a delegation is aimed at minor regulatory adjustments rather than major restructuring.

## Conclusion

The Court held that the FCC could not use its power to “modify” tariff requirements to make tariff filing optional for nondominant carriers, because that reading would effectively remove a central statutory obligation and exceeded the authority Congress conferred.


MCI Telecomms. Corp. v. AT&T Co., 512 U.S. 218 (1994)