Articles Posted in Utilities Law

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The Swecker farm in Iowa has a wind generator and is a qualifying power production facility certified by the Federal Energy Regulatory Commission (FERC). The Sweckers sell surplus electric energy to Midland Power Cooperative at a rate established by the Iowa Utilities Board (IUB), implementing FERC rules and regulations, 16 U.S.C. 824a-3(f). For many years, the Sweckers and Midland have litigated rate disputes. The district court dismissed their current suit against Midland and its primary supplier, Central Iowa Power Cooperative (CIPCO), seeking declaratory and injunctive relief requiring Midland “to purchase available energy from plaintiffs . . . at Midland’s full avoided cost, rather than CIPCO’s avoided cost.” The Eighth Circuit affirmed. FERC’s interpretation is controlling and forecloses the contrary interpretation of 18 C.F.R. 292.303(d) urged by the Sweckers. View "Swecker v. Midland Power Coop." on Justia Law

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Under the Telecommunications Act of 1996, local exchange carriers such as Windstream must connect calls made to their customers by the customers of national telecommunications companies such as Sprint. Until 2009, Sprint paid Windstream state access charges for connecting non-nomadic intrastate long-distance VoIP calls-- made by cable telephone customers over the Internet in Iowa, delivered to Sprint for format conversion, and transferred to Windstream for delivery to its Iowa telephone customers. Beginning in 2009, Sprint withheld state access charges for these calls, claiming that VoIP calls were “information services” and that payment should be governed by a reciprocal compensation agreement, not by state access charges. In 2011, the Iowa Utilities Board found that the calls were telecommunications services subject to state regulation, not information services. Sprint sought state court review and filed a federal action, seeking to enjoin the Board’s decision. The district court abstained because of the parallel state proceedings. The Eighth Circuit affirmed, but the Supreme Court reversed. By the time the case returned to the district court, the state court had upheld the Board’s decision. The district court dismissed Sprint’s complaint, holding that issue preclusion barred Sprint from raising the same arguments in federal court. The Eighth Circuit reversed, reasoning that Congress did not intend that issue-preclusion principles bar federal-court review of the issue of whether the non-nomadic intrastate long-distance VoIP calls at issue are information services, payment for which should be governed by a reciprocal compensation agreement, or telecommunications services subject to state access charges. View "Sprint Commc'ns Co. v. Jacobs" on Justia Law

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This dispute involved the rights of the County and the rights of a public utility, Laclede, in shared easements. On appeal, the County challenged the district court's grant of Laclede's motion for preliminary injunction. The order enjoined the County from, among other things, constructing any additional portion of retaining wall on top of gas lines on the Pitman easement; removing, or hiring another entity to remove any portion of the Pitman Hill Road gas lines located on the Pitman easement; and removing any portion of the gas lines from the Ehlmann Road easement. The court concluded that the district court had jurisdiction under the Pipeline Safety Act, 49 U.S.C. 60101-60137, a federal statute that specifically authorized the district court to enjoin threats to damaged pipelines. The issuance of a preliminary injunction in those circumstances was not error. Accordingly, the court affirmed the judgment. View "Laclede Gas Co. v. St. Charles County" on Justia Law

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The Minnesota Public Utilities Commission entered an order requiring Qwest Corporation, a successor Bell operating company, to submit for review and approval a price list and supporting rationale for certain telecommunication network facilities Qwest was required to provide to its Minnesota competitors under 47 U.S.C. 271. Qwest sought judicial review and declaratory relief in the district court, arguing the Commission's order was preempted by the Telecommunications Act of 1996. The district court concluded federal law and regulations did not preempt the Commission's order. The Eighth Circuit Court of Appeals reversed, holding (1) the Commission's order impermissibly intruded on federal authority to regulate rates for elements required under section 271 and interfered with the purpose and objectives of Congress and the FCC; and (2) therefore, the order was preempted by the Act and the FCC's implementing regulations and rulings.

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Plaintiff, in these related appeals, was the Trustee in the Chapter 7 bankruptcy cases of LGI Energy Solutions, Inc. and LGI Data Solutions Company, LLC, which were in the business of providing utility-management and billing services to restaurants and other customers. These consolidated appeals involved seven adversary proceedings by the Trustee to avoid payments made by LGI Energy to defendant utilities prior to the bankruptcy. The Trustee contended that such payments were preferential and/or fraudulent transfers under the Bankruptcy Code and applicable state law. The Bankruptcy Court granted summary judgment in favor of defendants based on its conclusion that the payments they received for the utilities were not an asset of either debtor. The court held that the bankruptcy court's ruling was inconsistent with Minnesota law and Eighth Circuit precedent. If a trust or agency relationship was intended to be created by the agreements between LGI Energy and its customers, then defendants were nevertheless required to prove that LGI Energy honored that relationship and treated the funds accordingly. Therefore, the court reversed and remanded.

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The Sierra Club and several related parties brought this action against the U.S. Army Corps of Engineers (the Corps) seeking to set aside a Clean Water Act, 33 U.S.C. 1251 et seq., permit (the section 404 permit) the Corps had issued to the Southwestern Electric Power Company (SWEPCO) which planned to construct a new power plant. SWEPCO subsequently appealed the preliminary injunctions ordered by the district court, arguing that the district court lacked subject matter jurisdiction and that the district court abused its discretion in granting the preliminary injunction. The court held that the district court did not err in concluding that the Sierra Club and Hunting Club had Article III standing. The court also held that plaintiffs have shown a likelihood of success where there was ample evidence in the record to show that plaintiffs were likely to succeed on at least three of their claims; that there was a likelihood of irreparable harm; that the balance of harms weighed in favor of an injunction; and that the public interest that might be injured by a preliminary injunction did not outweigh the public interest that would be served by the injunction. Accordingly, the court affirmed the preliminary injunction.

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St. Charles Tower, Inc. (St. Charles) filed suit against defendants after they declined to issue St. Charles a conditional use permit necessary to construct a proposed cell-phone tower in Franklin County. After the district court entered a consent judgment, trustees of a homeowner's association that opposed construction of the tower (Intervenors) sought to intervene in the litigation in order to challenge the consent judgment on the grounds that it violated state law. The district court granted their motion to intervene but denied their motion to alter, amend, or vacate the consent judgment and intervenors appealed. The court held that the consent judgment impermissibly circumvented sections 32 and 81 of the Land Use Regulations. Therefore, the court held that the district court erred in holding that the consent judgment did not violate state law and that any violation was justified as a necessary remedy for a violation of the Telecommunications Act of 1996, 47 U.S.C. 332(c)(7)(B)(v). Accordingly, the court reversed the denial of intervenors' motion and remanded for further proceedings.