Bloosurf, LLC, a provider of internet and phone services on the Delmarva Peninsula, sued T-Mobile USA, Inc. and its subsidiary in federal district court. Bloosurf alleged that T-Mobile caused persistent signal interference through three methods: transmitting outside its allotted frequency band, broadcasting at excessive volume, and deploying 5G signals on infrastructure that disrupted Bloosurf's 4G transmissions. Bloosurf claimed this interference was an attempt to eliminate it as a rival. Before filing suit, Bloosurf had filed an informal complaint with the Federal Communications Commission (FCC) regarding the same interference and requested that the FCC require T-Mobile to pay for network upgrades. The FCC dismissed the complaint. Bloosurf then filed a federal lawsuit containing four counts: a claim under the Communications Act for network interference, and three state-law tort claims regarding the interference, plus a claim for tortious interference with its business relationships with university licensees. The district court granted T-Mobile's motion to dismiss all counts, and Bloosurf appealed to the Fourth Circuit.
The Fourth Circuit addressed three distinct legal barriers to Bloosurf's claims. First, regarding the Communications Act claim, the court applied the election-of-remedies provision found in 47 U.S.C. § 207. This statute allows an injured party to either file a complaint with the FCC or bring a suit for damages in federal court, but explicitly states they 'shall not have the right to pursue both such remedies.' The court held that Bloosurf's informal FCC complaint triggered this provision, barring its subsequent federal lawsuit because it sought to litigate the same issues in a different forum. The court rejected Bloosurf's argument that seeking different remedies (damages in court vs. network upgrades from the FCC) mattered, noting the statute focuses on the forum of resolution, not the specific relief sought. Second, the court addressed the state-law tort claims under the doctrine of federal preemption. Section 332(c)(3)(A) of the Communications Act expressly preempts state laws that regulate the entry of or rates charged by commercial mobile services. The court reasoned that state tort duties requiring T-Mobile to operate its network differently would burden its ability to provide wireless service coverage, effectively regulating market entry. This preemption applies even if the state law mirrors federal requirements, as the Act prohibits states from imposing any such duties. Finally, the court addressed the claim for tortious interference with business relationships. The district court had dismissed this claim under a specific Maryland legal test for interfering with economic relationships. On appeal, Bloosurf argued the court should have used a different test for interfering with existing contracts. The court found this argument forfeited because Bloosurf had not raised it in the district court and had actually urged the court to use the test it now claimed was wrong. Since Bloosurf failed to meet the high bar for fundamental error, the dismissal stood.
The decision reinforces the strict election-of-remedies rule in telecommunications disputes, preventing plaintiffs from pursuing parallel proceedings in the FCC and federal courts for the same interference issues. It clarifies that state tort laws cannot be used to regulate the operational conduct of wireless providers, even if those regulations align with federal standards, thereby limiting the scope of state-law liability in the telecommunications sector. Additionally, the ruling serves as a reminder to litigants that arguments not raised in the district court are generally forfeited on appeal, preventing parties from changing legal theories to secure a reversal.
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