Justia U.S. 9th Circuit Court of Appeals Opinion Summaries

Articles Posted in Energy, Oil & Gas Law

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Petitioners seek review of FERC's determination that various energy companies committed tariff violations in California during the summer of 2000. As part of a deregulation program, California created two nonprofit entities: the California Power Exchange Corporation (“CalPX”) and the California Independent System Operator Corporation (“Cal-ISO”). Both entities were subject to FERC jurisdiction, with CalPX operating pursuant to a FERC-approved tariff and wholesale rate schedule. The Cal-ISO tariff comprehensively regulated California’s power markets, and incorporated the Market Monitoring and Information Protocol (“MMIP”), which set forth rules for identifying and protecting against abuses of market power. The court concluded that FERC’s determination that Shell, MPS, and Illinova (“sellers”) violated the Cal-ISO tariff and MMIP during the Summer Period was not arbitrary, capricious, or an abuse of discretion. In this case, FERC reasonably interpreted the Cal-ISO tariff and the MMIP according to the plain text of those documents. Therefore, the court rejected the sellers’ claims that the tariff and MMIP did not proscribe the practices identified by the agency. Furthermore, FERC’s interpretation of the Cal-ISO tariff and the MMIP finds support not only in text, but in policy as well. The court concluded that FERC reasonably interpreted the Cal-ISO tariff and the MMIP to prohibit the practices of False Export, False Load Scheduling and Anomalous Bidding. In addition, the agency reasonably concluded that the tariff and MMIP sufficed to put sellers on notice that such practices were not permitted. The court also concluded that FERC reasonably concluded that the sellers engaged during the Summer Period in the practices deemed tariff violations by the orders on review. Finally, the court concluded that FERC’s Summer Period determinations regarding APX and BP were not arbitrary, capricious, or an abuse of discretion. Accordingly, the court denied the petitions for review in part and dismissed in part. View "MPS Merchant Serv. v. FERC" on Justia Law

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Plaintiff filed suit against his former employer, Energy Northwest, alleging claims of retaliation in violation of the Energy Reorganization Act, 42 U.S.C. 5851. The whistleblower retaliation provision of the Act protects energy workers who report or otherwise act upon safety concerns. In this case, plaintiff's single expression of a difference of opinion about the “Charlie” designation of one existing internal condition report lacks a sufficient nexus to a concrete, ongoing safety concern. Therefore, the court concluded that the district court properly granted summary judgment for Energy Northwest because plaintiff's conduct falls outside the scope of the Act's protection. Accordingly, the court affirmed the judgment. View "Sanders v. Energy Northwest" on Justia Law

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Petitioners challenged several FERC orders that were issued following the court's remand in Port of Seattle v. FERC. The key issue on appeal is the applicability of the Mobile-Sierra doctrine, which requires FERC to “presume that the rate set out in a freely negotiated wholesale-energy contract meets the ‘just and reasonable’ requirement” imposed by law. The court concluded that it has jurisdiction only as to the issue of whether FERC erred by invoking the Mobile-Sierra doctrine and that it lacks jurisdiction to review FERC’s evidentiary orders. The court held that FERC reasonably applied Mobile-Sierra to the class of contracts at issue and that FERC's interpretation is reasonable. In this case, FERC’s baseline assumption that the presumption applies to the contracts at issue is not unreasonable in light of Morgan Stanley Capital Grp., Inc. v. Pub. Util. Dist. No. 1. Accordingly, the court denied the petition with respect to petitioners' claim that the Mobile-Sierra presumption cannot apply to the spot sales at issue and dismissed the evidentiary challenges for lack of jurisdiction. View "State of California v. FERC" on Justia Law

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IDACORP submitted proposed settlements to FERC involving the FERC proceeding related to electricity sales in the Pacific Northwest in 2000 and 2001. At issue was whether FERC abused its discretion in considering these proposed settlements. The court concluded that the agency departed from its rules and precedent without explanation when it treated the first proposed settlement as uncontested. In this case, FERC abused its discretion by foregoing the Trailblazer Pipeline Co. analysis and merits analysis dictated by FERC’s regulations. The court granted both petitions for review and remanded for further proceedings because the settlements and petitions are inextricably intertwined. View "Idaho Power Co. v. FERC" on Justia Law

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Petitioners, wholesale electricity customers, challenged FERC's orders requiring the Bonneville Power Administration to provide transmission services on terms "not unduly discriminatory or preferential." Petitioners are wholesale electricity customers of Bonneville. The court concluded that petitioners have Article III standing by demonstrating that they have an injury in fact, causation, and redressability. The court concluded, however, that petitioners failed to demonstrate statutory standing, which requires them to be "aggrieved" within the meaning of the Federal Power Act section 313(b) (FPA), 16 U.S.C. 8251(b), and the Administrative Procedure Act section 10, 5 U.S.C. 702. In this case, the zone-of-interests test was not satisfied where petitioners' interests are not arguably protected by section 211A of the FPA. Accordingly, the court denied the petitions for review. View "NRU V. FERC" on Justia Law

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After PG&E's natural gas pipeline ruptured in San Bruno, killing and injuring several people, San Francisco filed suit against the Agency, alleging that the Agency failed to comply with the Natural Gas Pipeline Safety Act of 1968, 49 U.S.C. 60101 et seq. The court concluded that the plain statutory language, the statutory structure, the legislative history, the structure of similar federal statutes, and interpretations of similar statutory provisions by the Supreme Court and its sister circuits lead to the conclusion that the Pipeline Safety Act does not authorize mandamus-type citizen suits against the Agency. The court also concluded that San Francisco's claims that the Agency violated the Administrative Procedures Act (APA), 5 U.S.C. 701(a)(2), by unlawfully withholding the action of deciding whether the CPUC adequately enforces federal pipeline safety standards, and arbitrarily and capriciously approving the CPUC’s certification and providing federal funding to the CPUC, were not cognizable under the APA. Accordingly, the court affirmed the district court's dismissal of the suit. View "City & Cnty. of San Francisco v. U.S. D.O.T." on Justia Law

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In 2004, the Ninth Circuit decided California ex rel. Lockyer v. FERC, which held that FERC may authorize market-based energy tariffs so long as that regulatory framework incorporates both an ex ante market power analysis and enforceable post-approval transaction reporting. In the instant case, Petitioners, the people of the state of California and related parties, sought review of a series of orders issued by the Federal Energy Regulatory Commission (FERC) on remand following the Court’s decision in Lockyer, arguing that FERC failed to follow Lockyer and violated the Federal Power Act by requiring proof of excessive market share as a necessary condition for relief for transaction reporting violations. The Ninth Circuit granted the petition for judicial review, holding that FERC structured the remand proceedings in a manner contrary to the terms of the Lockyer decision. Remanded to FERC for further proceedings. View "People of State of Cal. v. FERC" on Justia Law

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The U.S. Department of Energy (DOE) led the effort to clean up nuclear waste at the Hanford Nuclear Site in Washington state. URS Energy & Construction, Inc. (“URS Energy”), a wholly-owned subsidiary of URS Corporation, worked as a subcontractor on the project. An employee of URS Energy brought this action alleging violations of the Energy Reorganization Act (“ERA”) whistleblower protection provision concerning the cleanup efforts. The district court dismissed the DOE from the suit and granted summary judgment in favor of URS Corp. and URS Energy. The Ninth Circuit affirmed in part and reversed in part, holding (1) the DOE and URS Corp. were correctly dismissed for lack of administrative exhaustion, but administrative exhaustion was sufficient as to URS Energy; and (2) the employee introduced sufficient evidence to create a triable issue as to whether his whistleblowing activity was a contributing factor in the adverse employment action URS Energy took against him, and there were other existing genuine issues of fact that precluded summary judgment to URS Energy. Remanded. View "Tamosaitis v. URS Inc." on Justia Law

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Plaintiff filed suit against his employer (URS) and the DOE, alleging violations of the Energy Reorganization Act (ERA), 42 U.S.C. 5851(b)(4), whistleblower protection provision, and requested a jury trial. The district court partially dismissed the complaint, denied a jury trial, and granted summary judgment against plaintiff. The court held that before an employee may opt out of the agency process and bring a retaliation suit against a respondent in federal court, that respondent must have had notice of, and an opportunity to participate in, the agency action for one year. In this case, plaintiff's claim against DOE failed for lack of administrative exhaustion. The court concluded that the administrative exhaustion was sufficient as to URS E&C. The court affirmed the district court's dismissal of URS Corp. for lack of administrative exhaustion. The court also concluded that, since plaintiff has shown that his protected activity was a "contributing factor" in the adverse employment action he suffered, he has met his burden for establishing a prima facie case of retaliation under the ERA. Further, the evidence created a genuine issue of fact as to whether plaintiff's compensation, terms, conditions, or privileges of employment were affected by his transfer. The court reversed the grant of summary judgment to URS E&C for ERA whistleblower retaliation. Finally, the court held that plaintiff has a constitutional right to a jury trial for his claims seeking money damages against URS E&C and the court reversed the district court's ruling. View "Tomosaitis v. URS Inc." on Justia Law

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In consolidated appeals, two groups challenged the BPA's decision to forgo refunds after the court invalidated three sets of contractual arrangements in which BPA agreed to subsidize certain longtime industrial customers rather than sell them power directly. The court held that these subsidy arrangements were unreasonable and were contrary to BPA's authority. The court remanded to BPA regarding whether it could or should seek refunds of the improper subsidies. BPA concluded that it was contractually barred from seeking refunds as to some of the invalidated contracts; it had no legal or equitable basis for seeking refunds as to the others; and if it did pursue recovery of the subsidies, it might become mired in counterproductive, protracted litigation. Petitioners' core argument is that their power costs have been impermissibly raised by BPA's decision because, if BPA did seek refunds of the subsidies, it could pass the recovered funds to its customers as lower rates. The court rejected petitioners' contention that BPA has a duty, under either the Constitution's Appropriations Clause or BPA's governing statutes, to seek all refunds to which it may be entitled. The court concluded that BPA's decisions in most respects sufficiently and reasonably balanced its competing obligations to merit the court's deference, except in one respect. The court denied the petition for review with regard to the decision not to seek refunds with respect to the 2007 Block Contracts and the Port Townsend Contract. The court granted the petition and remanded to BPA for further proceedings with regard to recovery of subsidies paid under the Alcoa Amendment.View "ICNU v. BPA" on Justia Law