United States Court of Appeals

for the Fifth Circuit

No. 21-60130

Ray C. Turnage, on behalf of themselves and all others similarly situated; 

Reverend D. Franklin Browne, on behalf of themselves and all 

others similarly situated; Dennis D. Henderson, on behalf of themselves 

and all others similarly situated; Carlos Wilson, on behalf of themselves 

and all others similarly situated; Fred Burns, on behalf of themselves and 

all others similarly situated; Charles Bartley, on behalf of themselves 

and all others similarly situated; Clarence Magee, on behalf of themselves 

and all others similarly situated; Linda Patrick-Crafton, on behalf of 

themselves and all others similarly situated; Barbara Young, on behalf of

themselves and all others similarly situated; Juanita J. Griggs, on behalf 

of themselves and all others similarly situated; Chernise Seaphus, on 

behalf of themselves and all others similarly situated; Mount Carmel 

Baptist Church; Pinebelt Community Services, 

Incorporated; Hall-Fairley Mortuary; Deborah 

Delgado, 

Plaintiffs—Appellants,

versus

Sam Britton, Mississippi Public Service Commissioner; Cecil Brown, 

Mississippi Public Service Commissioner; Brandon Presley, Mississippi 

Public Service Commissioner; Mississippi Power Company, 

Defendants—Appellees.

Appeal from the United States District Court

for the Southern District of Mississippi

USDC No. 3-18-CV-818

United States Court of Appeals

Fifth Circuit

FILED

March 21, 2022

Lyle W. Cayce

Clerk

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Before Dennis, Higginson, and Costa, Circuit Judges.

Gregg Costa, Circuit Judge:

In 2015, the Supreme Court of Mississippi ordered an electric utility

to refund the money it had collected from customers under a faulty rate 

order. In this federal sequel to that state-court lawsuit, ratepayers contend 

that an erroneous calculation of the interest on their refunds shorted them 

millions of dollars in the aggregate. 

This appeal raises two jurisdictional questions and one merits 

question. We agree with the district court that sovereign immunity bars the 

ratepayers’ claims against the Mississippi Public Service Commissioners. 

We also agree that the Johnson Act does not preclude federal jurisdiction 

over the claims against the utility. On the merits, however, we disagree with 

the accrual date the district court used in dismissing the case on limitations 

grounds. 

I.

This dispute traces back to a rate increase the Mississippi Public 

Service Commission approved almost a decade ago. To allow Mississippi 

Power Company1 to raise more than $330 million to construct a power plant 

in Kemper County, the Commission authorized the utility to increase its 

rates by 15% in 2013 and an additional 3% in 2014.

The Supreme Court of Mississippi invalidated the rate increase. In 

addition to finding that the Commission exceeded its authority in blessing the 

rate hike, it concluded that the Commission and Mississippi Power violated 

ratepayers’ due process rights. Miss. Power Co., Inc. v. Miss. Pub. Serv. 

1 Mississippi Power provides electricity to roughly 188,000 customers in 

southeastern Mississippi.

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Comm’n, 168 So. 3d 905, 912, 916 (Miss. 2015). The supreme court ordered

Mississippi Power to refund the unauthorized charges. Id. at 916. 

Under state law, the utility was required to refund the excess to 

customers “in full, including interest at the lawful rate.” Miss. Code 

Ann. § 77-3-39(12). Mississippi’s lawful interest rate is “eight percent (8%) 

per annum, calculated according to the actuarial method.” Id. § 75-17-1(1).

Mississippi Power submitted a proposed refund plan to the 

Commission on July 21, 2015, which the Commission approved on August 

6th.

Mississippi Power began issuing refund checks on November 6, 2015 

and mailed out the final batch of checks on December 4, 2015. Ratepayers 

who did not elect to receive a refund check received a credit on their utility 

bill instead. The refund program formally ended on May 27, 2016, when an 

independent auditor confirmed that all refunds had been distributed or were 

otherwise accounted for.

At some point before the checks issued, some ratepayers 

commissioned economist Mark A. Cohen to compare the interest they would 

receive under the refund plan to the interest guaranteed by statute. On 

August 13, 2016, Cohen informed them that he believed that Mississippi 

Power had shorted them more than ten million dollars. Although the plan 

purports to use an interest rate higher than the statutory 8%, Cohen contends 

that the plaintiffs received less than they were owed using either rate. This 

discrepancy may be due to how the refund plan compounded interest. 

On November 21, 2018, more than two years after receiving Cohen’s 

report, individual and institutional electricity customers filed a putative class 

action against Mississippi Power and the three Mississippi Public Service 

Commissioners in their official capacities. The ratepayers brought claims 

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under state law, as well as section 1983 claims under the Due Process Clause

and the Takings Clause. 

The district court dismissed the claims against the Commissioners 

and Mississippi Power in separate orders. It first held that sovereign 

immunity barred the ratepayers’ claims against the Commissioners. In a 

second order, the district court determined that the Johnson Act, 28 

U.S.C. § 1342, did not deprive it of subject matter jurisdiction over the 

remaining federal claims but then dismissed the federal claims against 

Mississippi Power as time-barred. Finally, the court declined to exercise 

supplemental jurisdiction over the remaining state law claims based on the 

Class Action Fairness Act’s home state exception and dismissed them 

without prejudice. The ratepayers timely appeal all of these rulings except 

the without-prejudice dismissal of the state law claims. 

II.

As we must, we first address the jurisdictional issues. Ramming v. 

United States, 281 F.3d 158, 161 (5th Cir. 2001). 

A.

Recognizing “the problems of federalism inherent in making one 

sovereign appear against its will in the courts of the other,” the Eleventh 

Amendment and general principles of sovereign immunity prohibit federal 

courts from hearing certain lawsuits against the states. Pennhurst State Sch.

& Hosp. v. Halderman, 465 U.S. 89, 100 (1984) (quoting Emps. v. Miss. Pub.

Health & Welfare Dep’t, 411 U.S. 279, 294 (1973) (Marshall, J., concurring)); 

see also Allen v. Cooper, 140 S. Ct. 994, 1000 (2020) (recognizing that although 

the text of Eleventh Amendment “applies only if the plaintiff is not a citizen 

of the defendant State,” the amendment reflects a broader immunity 

principle inherent in the federal system). Commissioners Bailey, Maxwell, 

and Presley invoke this sovereign immunity. 

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Although sovereign immunity bars most suits against states and their 

agencies in federal court, it is not absolute. City of Austin v. Paxton, 943 F.3d 

993, 997 (5th Cir. 2019). It does not apply when the state consents to suit or 

when Congress abrogates the state’s immunity. Id. Additionally, under Ex 

parte Young, 209 U.S. 123 (1908), sovereign immunity does not bar suits 

against state officers for prospective declaratory or injunctive relief because 

officers act as private persons “stripped of [their] official clothing” when 

they violate federal law. K.P. v. LeBlanc, 627 F.3d 115, 124 (5th Cir. 2010). 

Congress has not abrogated the states’ immunity from section 1983 claims

and Mississippi has not consented to suit, so federal jurisdiction over the 

Commissioners turns on Young. 

The Young exception to state sovereign immunity applies when the 

party invoking it establishes three criteria. First, the complaint “must name 

individual state officials as defendants in their official capacities.” Raj v. La. 

State Univ., 714 F.3d 322, 328 (5th Cir. 2013). Second, the complaint must

allege an ongoing violation of federal law. Verizon Md., Inc. v. Pub. Serv. 

Comm’n of Md., 535 U.S. 635, 645 (2002). And finally, the complaint must 

seek prospective relief. Id. 

The complaint easily satisfies Young’s first requirement. The Public 

Service Commissioners are state officials ordinarily shielded by sovereign 

immunity. Gulf Park Water Co., Inc. v. Miss. Dep’t of Env’tl Quality, 59 F.3d 

1241, 1241, 1995 WL 413105 (5th Cir. 1995)(unpublished). And they are sued 

in their official capacities. 

The ratepayers stumble at Young’s second requirement. Young does 

not apply when the injurious conduct occurred “at one time or over a period 

of time in the past.” Corn v. Miss. Dep’t of Pub. Safety, 954 F.3d 268, 275 (5th 

Cir. 2020) (citing Papasan v. Allain, 478 U.S. 265, 278 (1986)). When there 

is no ongoing violation of federal law, Young jurisdiction is not needed to 

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prevent state officials from “employ[ing] the Eleventh Amendment as a 

means of avoiding compliance with federal law.” P.R. Aqueduct & Sewer 

Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139, 146 (1993). 

The conduct that the ratepayers complain of is not ongoing. They 

argue that “enforcement of the Kemper Refund Plan and its improper 

[interest calculation method]” deprives them of their rights under the 

Takings and Due Process Clauses. But as the district court correctly pointed 

out, neither the Commission nor Mississippi Power have taken any action to 

administer or enforce the refund plan in years. Mississippi Power issued the 

final batch of refund checks to customers in December 2015 and the refund 

program formally ended after the May 2016 audit. Just last year, we found 

no continuing illegality when the investigation and administrative 

proceedings “forming the basis of the allegations . . . [we]re completed.” 

Spec’s Fam. Partners, Ltd. v. Nettles, 972 F.3d 671, 681 (5th Cir. 2020). 

Likewise here, the relief sought “focuses on past behavior”—the conduct of 

government officials during a now-concluded adjudicatory process. Id.

Young requires the ratepayers to “allege that the defendant is violating

federal law, not simply that the defendant has done so.” NiGen Biotech, 

L.L.C. v. Paxton, 804 F.3d 389, 394 (5th Cir. 2015). Because the ratepayers 

failed to identify an ongoing violation of federal law, the district court 

properly dismissed the claims against the Commissioners for lack of 

jurisdiction.2

2 The district court also held that any relief would be retrospective, contrary to 

Young’s third requirement. We do not need to reach this issue because Young jurisdiction 

fails for lack of an ongoing violation of federal law. 

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B.

Mississippi Power also challenges federal jurisdiction. The utility 

contends that the Johnson Act, 28 U.S.C. § 1342, makes state court the only 

proper forum for this suit.

1. 

The Johnson Act divests federal courts of subject matter jurisdiction 

over certain disputes involving state rate orders. It states that district courts 

may not “enjoin, suspend or restrain . . . any order affecting rates chargeable 

by a public utility” when four criteria are met: 

(1) Jurisdiction is based solely on diversity of citizenship or 

repugnance of the order to the Federal Constitution; and,

(2) The order does not interfere with interstate commerce; and,

(3) The order has been made after reasonable notice and hearing; 

and,

(4) A plain, speedy and efficient remedy may be had in the courts of 

such State.

28 U.S.C. § 1342. 

The Johnson Act resulted from early twentieth century tension over 

federal court intervention in state rate regulation. Supreme Court decisions

like Ex parte Young, 209 U.S. 123 (1908), and Home Telephone & Telegraph Co. 

v. City of Los Angeles, 227 U.S. 278 (1913), had expanded the ability of federal 

courts to intervene in the work of state agencies. Clinton A. Vince & John S. 

Moot, Energy Federalism, 42 Admin. L. Rev. 323, 358 (1990). Regulated 

industries used this new-found federal jurisdiction to challenge state

regulatory actions in federal court. Id. Some utilities so desired federal 

jurisdiction to challenge state ratemaking that they changed their state of 

incorporation to manufacture diversity jurisdiction. 78 Cong. Rec. 2031 

(1934) (statement of Sen. Norris) (describing how a Nebraska utility 

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reincorporated in Maine, where it did not have any business, to create 

diversity jurisdiction to sue Nebraska regulators).

A backlash ensued against federal courts’ issuance of rate injunctions. 

See Edward A. Purcell, Jr., Brandeis and the Progressive 

Constitution 23–26 (2000). Progressives believed that “federal 

jurisdiction enabled companies to delay and often defeat administrative 

orders regardless of the merits involved.” Id. at 24 (quoting New York 

Mayor Fiorello LaGuardia’s comments that these lawsuits were a “flagrant 

misuse of the Federal courts” and “used for the purpose of legalizing the 

exploitation of these greedy corporations”); 78 Cong. Rec. 8335 (1934) 

(statement of Sen. Johnson) (worrying that public utilities sued in federal 

court not in search of a neutral forum for legitimate claims, but instead “to 

delay, hinder, and impede the states in their regulatory actions”). Statesrights advocates lamented federal intrusion into the states’ traditional 

ratemaking prerogative. Purcell, supra, at 24–26; 78 Cong. Rec. at 8324 

(statement of Rep. Mapes) (states should be able to “perform their proper 

functions in the supervision and fixing of rates, without interference of 

Federal law.”). 

Progressives and advocates for states’ rights united in 1934 to pass the 

Johnson Act, see Purcell, supra, at 26, which took the extraordinary step of 

restricting federal jurisdiction, see Burford v. Sun Oil, 319 U.S. 315, 337 (1943) 

(Frankfurter, J., dissenting) (“Aside from the Johnson Act . . . the many 

powerful and persistent legislative efforts to abolish or restrict diversity 

jurisdiction have ever since the Civil War been rejected by Congress.”). The 

Act aimed to “channel normal rate litigation into the state courts.” Gulf 

Water Benefaction Co. v. Pub. Util. Comm’n, 674 F.2d 462, 468 (5th Cir. 

1982); see also Tennyson v. Gas Serv. Co., 506 F.2d 1135, 1138 (10th Cir. 1974) 

(explaining that the Act “was intended to keep constitutional challenges to 

orders affecting rates out of the federal courts ‘lock, stock, and barrel.’”).

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Congress largely succeeded. Today, courts routinely deny federal 

jurisdiction over utilities’ constitutional challenges to state and local 

regulators’ rejection of rate hikes. See, e.g., People’s Nat’l Util. Co. v. City of 

Houston, 837 F.2d 1366, 1367–68 (5th Cir. 1988) (applying the Johnson Act 

to utility’s claim that city’s failure to approve its request for a rate increase 

constituted an uncompensated taking); U.S. West, Inc. v. Tristani, 182 F.3d 

1202, 1206, 1211 (10th Cir. 1999) (applying the Johnson Act to utility’s claim 

that state’s consideration of subsidiary’s advertising revenue in rate 

calculation violated the utility’s freedom of expression and constituted an 

uncompensated taking).3

 With this foundation in mind, we address whether

the Johnson Act bars federal jurisdiction over this class action. 

2.

This case comes to us in a posture that the Johnson Act’s supporters

may not have foreseen. Instead of the utility seeking a federal forum, it is the 

ratepayers who prefer to have this suit in federal court. Despite this oddity, 

we proceed to apply the Act as written. 

The Johnson Act deprives a federal court of jurisdiction over 

challenges to “order[s] affecting rates” only when all four of its conditions 

are met.4 28 U.S.C. § 1342. As the party arguing that the Act displaces 

3 Preemption claims are the exception. In the 1980s, several courts held the 

Johnson Act inapplicable to preemption cases because preemption is not “solely” based on 

claims of unconstitutionality but on a combination of the Supremacy Clause and federal 

statutory law. Vince & Moot, supra, at 359–60. New Orleans Pub. Serv., Inc. v. City of New 

Orleans is typical. 782 F.2d 1236, 1242 (5th Cir. 1986), withdrawn in part, 798 F.2d 858 (5th 

Cir. 1986).

4 As a threshold matter, ratepayers briefly argue that the Johnson Act is 

inapplicable before even reaching the four factors because their suit does not involve an 

“order affecting rates.” The 2015 refund order impacts rates because the amount 

ratepayers ultimately paid for service in 2013 and 2014 “would necessarily be less as a result 

of the order.” Hill v. Kan. Gas Serv. Co., 323 F.3d 858, 864 (10th Cir. 2003).

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federal question jurisdiction that otherwise exists, Mississippi Power bears 

the burden of proving the Act’s elements. Williams v. Pro. Transp., Inc., 294 

F.3d 607, 612 (4th Cir. 2002). The ratepayers concede that three are 

satisfied: jurisdiction is based solely on federal constitutional questions (due 

process and takings claims); the challenged order affects only Mississippi; 

and Mississippi courts provide a remedy for “[a]ny party aggrieved by any

final finding, order or judgment of the commission in any utility rate 

proceedings,” Miss. Code Ann. § 77-3-72(1).

So federal jurisdiction depends on the Johnson Act’s third criteria: 

whether the Commission’s 2015 order approving the refund plan was made 

“after reasonable notice and hearing.” 28 U.S.C. § 1342(3). This 

requirement recognizes a greater justification for federal review of 

ratemaking when state agency procedures lack the basic hallmarks of due 

process. See Nucor Corp. v. Neb. Pub. Power Dist., 891 F.2d 1343, 1348 (8th 

Cir. 1989) (recognizing that the Act’s process requirement “had been 

interpreted as requiring that the minimum standards of due process be 

met.”). 

Notice is reasonable “if it is transmitted in a manner which, at a 

minimum, has a reasonable certainty of resulting in actual notice.” Id. This 

is a fact-specific standard with little caselaw providing on-point help. The 

notice factor is a close call, but we ultimately agree with the district court that 

the 2015 refund order was not issued after “reasonable” process. 

Mississippi Power and the Commission did not notify ratepayers of 

the 2015 refund proceedings. The Commission only notified the six parties 

who intervened in the 2013 rate increase proceeding before it approved the 

utility’s 2015 refund proposal. In re Notice of Intent of Miss. Power Co. for a 

Change in Rates Related to the Kemper Cnty. IGCC Project, 2015 WL 4880634, 

at *1 (Miss. P.S.C. Aug. 6, 2015). It gave those parties a week to respond or 

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object. Id. The utility and the Commission did not provide similar notice to 

nonparty customers like the plaintiffs. 

It does not matter that the ratepayers could have sought leave to 

intervene in the refund proceedings. The Johnson Act imposes no such 

requirement on customers; it places the burden of notice on the utility. The 

utility further points to its “extensive public notice campaign” publicizing 

the details of the refund plan. This is also irrelevant because the Johnson Act

requires prior notice—after all, only that enables a timely objection—and the 

public education campaign occurred after the Commission issued the refund 

order. See 28 U.S.C. § 1342(3). 

Given the absence of process specific to the 2015 refund order, 

Mississippi Power relies on the process it provided in the initial 2013 

ratemaking. The utility maintains that its 2013 notice met state law 

requirements for all the subsequent hearings and that its compliance should

be per se reasonable. Before it raised its rates in 2013, Mississippi Power 

mailed notice of the proposed rate increase to affected customers, published 

a notice in the Clarion Ledger, and notified all parties of record in the last 

proceeding in which the company sought a major rate change, In re Notice of 

Intent of Miss. Power Co. for a Change in Rates Related to the Kemper Cnty.

IGCC Project, 2013 WL 871246, at *2 (Miss. P.S.C. Mar. 5, 2013). The 

Commission then held a public hearing on the rate increase, at which it

allowed six intervenors to participate by submitting prewritten testimony, 

presenting their own evidence, and cross-examining all witnesses. Id. at *2–

3.5

 State law did not require the utility to provide any additional notice to 

5 The district court concluded that the 2013 process was not reasonable, finding 

that the state supreme court’s prior determination to that effect was preclusive. This was 

an error because the supreme court’s holding did not relate to the 2013 order approving the 

rate increase but to a prior proceeding approving construction of the new plant. See Miss. 

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ratepayers before the refund proceeding two years later because it was 

considered part of the same matter. See Miss. Code Ann. § 77-3-39 

(contemplating refunds following judicial invalidation of rate orders but 

requiring notice and hearing only upon utility’s initial filing of notice of intent 

to change rates). 

In the context of a refund hearing to remedy an illegal rate, Mississippi 

Power’s compliance with state law was not enough to satisfy the Johnson 

Act’s reasonable process requirement. One court of appeals has held that 

giving notice in the form required by state law satisfies the Johnson Act. 

Brooks v. Sulphur Springs Valley Elec. Co-op, 951 F.2d 1050, 1054 (9th Cir. 

1991). But see Nucor Corp., 891 F.2d at 1348 (rejecting idea that compliance 

with state law is a safe harbor). But no federal court has held that state law 

controls when Johnson Act notice is due in the first place. And we have 

explained that it is the court’s duty to define reasonable process. City of 

Meridian v. Miss. Valley Gas. Co., 214 F.2d 525, 526 (5th Cir. 1954) (finding it 

“plain” that the court, not the ratemaking body, defines reasonableness 

under the Johnson Act).

Understanding that the Johnson Act’s procedural requirements

reflect due process principles, Nucor Corp., 891 F.2d at 1348, we do not see 

how notice of the 2013 rate hearing gave ratepayers meaningful notice of the 

refund hearing two years later. The Johnson Act’s requirement of both 

“notice and hearing,” seemingly ties one component of process to the other. 

After all, the right to be heard “has little reality or worth unless one is 

informed that the matter is pending.” Mullane v. Cent. Hanover Bank & Tr. 

Co., 339 U.S. 306, 314 (1950). And requiring notice for both a rate hike 

Power Co., 168 So. 3d at 914–15. The state court opinion recognizes that the ratepayers did

receive notice of the rate increase in 2013. Id. at 914 (“Ratepayers first received notice of 

MPC’s intent to increase rates after entry of the April 24, 2012, Order . . .”). 

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hearing and a refund hearing held years later is consistent with due process 

law in other areas. Cf. Cleveland Bd. of Ed. v. Loudermill, 470 U.S. 532, 546–

47 (1985) (requiring notice of both pre- and post-deprivation hearings in 

challenge to termination of public employment). 

To be sure, a hypervigilant customer could have followed the full 

history of the rate increase as it wound its way through the state agency and 

state courts only to end up back in a 2015 agency hearing to determine the 

amount of the refund. But it is not reasonable to expect that level of diligence 

from a utility customer not following administrative and court dockets as a 

lawyer might. As reasonableness is the touchstone of the Johnson Act’s 

notice requirement, independent notice had to be provided for the 2015 

refund hearing in order to insulate it from federal court scrutiny.6 Because 

such notice was not provided, this case is properly in federal court.

III.

With the jurisdictional questions decided, we turn to Mississippi 

Power’s substantive dismissal motion. Mississippi Power contends that the 

ratepayers’ federal claims are time-barred. Failure to file within the statute 

of limitations justifies dismissal under Rule of Civil Procedure 12(b)(6) when 

“it is evident from the plaintiff’s pleadings that the action is barred and the 

pleadings fail to raise some basis for tolling or the like.” Jones v. Alcoa, Inc., 

339 F.3d 359, 366 (5th Cir. 2003). But the timeliness of a claim can depend 

on evidence obtained in discovery or even require a factfinder to resolve 

disputed issues. See Margolies v. Deason, 464 F.3d 547, 554–55 (5th Cir. 

6 We do not hold that every separate rate hearing requires separate notice to satisfy 

the third Johnson Act element. But here the hearings occurred two years apart and 

addressed substantially different questions. A ratepayer who received notice in 2013 of a 

possible rate hike might not have desired to comment on that common occurrence but 

might have been quite interested in commenting on the refund for an illegal rate.

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2006). We review dismissal for failure to state a claim de novo. Raj, 714 F.3d 

at 329–30. 

In Mississippi, the limitations period for section 1983 claims is three 

years. Cuvillier v. Taylor, 503 F.3d 397, 401–02 (5th Cir. 2007)(incorporating 

Miss. Code Ann. § 15-1-49, Mississippi’s general personal injury 

limitations period). The ratepayers filed this action on November 21, 2018,

so their federal claims are timely if they accrued on or after that date in 2015.

Although state law provides the limitations period for a section 1983 

claim, federal law determines when the claim accrues. Wallace v. Kato, 549 

U.S. 384, 388 (2007). A claim accrues when the would-be plaintiff “knows 

or has reason to know . . . that he has been hurt and who has inflicted the 

injury.” Gartrell v. Gaylor, 981 F.2d 254, 257 (5th Cir. 1993) (per curiam)

(quotation omitted). Plaintiffs have reason to know of their cause of action 

when they have “notice of facts which, in the exercise of due diligence, would 

have led to actual knowledge” of injury and causation. Roe v. United States, 

839 F. App’x 836, 843 (5th Cir. 2020) (quotation omitted). If plaintiffs have 

access to facts that they do not understand themselves, due diligence can 

require them to “seek professional advice” about their potential claims. 

Harrison v. United States, 708 F.2d 1023, 1027 (5th Cir. 1983). In short, the 

limitations period begins when “the circumstances would lead a reasonable 

person to investigate further.” Piotrowski v. City of Houston, 51 F.3d 512, 516 

(5th Cir. 1995).

Recall that the ratepayers’ claims challenge the interest calculation 

used in determining their refunds. The district court concluded these claims 

accrued on August 6, 2015, when the Commission approved the refund plan 

proposed by Mississippi Power. The plan’s main text does not mention 

interest or explain how interest would be calculated on the refunds, but a

footnote—at the end of a sentence detailing the amount the utility collected 

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unlawfully—clarifiesthat “carrying costs . . . will be calculated using the 2015 

cost of capital filed in the Company’s 2015 ECO filing, adjusted for income 

taxes, with annual compounding of interest.” From this, the district court 

concluded, a reasonable person would have sought professional advice to 

confirm that the plan provided for lawful interest. 

Even assuming that the ratepayers had access to the refund plan on 

the day the Commission approved it, the plan’s language did not put them 

on notice of facts that would cause a reasonable person to further investigate 

the interest issue. The footnoted sentence is not about interest; it merely 

catalogues the total amount of money that Mississippi Power collected under 

the faulty rate order.7 The footnote is not obviously about interest either; it 

explains how the utility intended to calculate “carrying costs,” or the costs a 

business incurs to hold stock inventory. See Will Kenton, Carrying Costs, 

INVESTOPEDIA (2020), https://www.investopedia.com/terms/c/carryingcosts.asp (defining carrying costs). Nowhere does the plan say what the

interest rate is or the method of calculating it. And, of course, the plan does 

not tell ratepayers the amount of individual refunds. It is asking a lot of a

reasonable person to recognize from the plan’s obtuse and technical 

references that it uses a method to calculate interest different from the one 

required by law. The ratepayers’ claims did not accrue on August 6, 2015.8

7 In full, the above-the-line sentence preceding the footnote reads: “As of June 30, 

2015, [Mississippi Power] had collected approximately $331 million pursuant to the Mirror 

CWIP Order and accrued an additional $22 million of carrying costs.” 

8 The district court also noted that the ratepayers actually did retain an expert to 

advise them on the interest calculation issue sometime before November 2015. When a 

plaintiff has actual knowledge of causation and injury, it is unnecessary to consider what a 

“reasonable person” would know. See Smith v. Reg’l Transit Auth., 827 F.3d 412, 421 (5th 

Cir. 2016). But the record does not reflect who hired Cohen or when. And while those

who retained Cohen developed actual knowledge of their injury at some point, we do not 

know when Cohen first realized they were underpaid.

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Nor did their claims accrue on August 16, 2016, when Cohen issued 

his report finding that Mississippi Power miscalculated interest on the 

refunds. Using this late date is at odds with the accrual standard. Our cases 

ask when a would-be plaintiff should seek professional advice, not when they

actually receive it. See Harrison, 708 F.2d at 1027. To hold otherwise would 

allow litigants to evade the statute of limitations by delaying expert opinions 

for months or even years.

Other possible accrual dates remain. One possibility is that the claims 

accrued when Mississippi Power explained on the FAQ page of its website 

that it would pay interest at its “after tax WACC (weighted average cost of 

capital) rate of 9.5% . . . over the entire refund period (March 2013 – July 

2015) and up to Nov. 7 when we begin issuing the refunds.”9 The interest 

described in the FAQ differs from the interest guaranteed by statute in 

several aspects. For one, the FAQ promises 9.5% interest rather than the 8% 

guaranteed by law. See Miss. Code Ann. § 75-17-1. Additionally, the

FAQ indicates that Mississippi Power intended to calculate interest “over 

the entire refund period” rather than “per annum” and “according to the 

actuarial method,” as the statute requires. See id. These discrepancies, 

combined with the fact that the FAQ (unlike the refund plan footnote) 

explicitly mentions interest, may have led a reasonable person to “investigate 

further.” Piotrowski, 51 F.3d at 516. 

It could be, however, that the ratepayers could not have ascertained

their injury from the FAQ, because it was not clear at that time that they 

would be underpaid. Cohen calculated that, compounded annually,

Mississippi Power would have owed customers $40.7 million in interest at 

9 We do not know the exact date that Mississippi Power published the FAQ. It was 

certainly posted by November 1, 2015, when Cohen accessed it online. 

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the statutory rate and $48.2 million in interest at the 9.5% WACC rate. Either 

method would result in a payout higher than the $30 million that Mississippi 

Power’s FAQ anticipated the company would pay in total interest. Further 

complicating the calculation, it is not clear whether Mississippi Power would 

compound interest annually, as alluded to in the plan footnote, or “over the 

entire refund period,” as stated in the FAQ, a distinction that could be the 

difference between overpayment and underpayment.

Another possibility is that the ratepayers’ claims accrued upon the 

receipt of their refunds. Citing cases from the tax refund context, the 

ratepayers contend that an underpayment-based injury cannot occur until the 

injured party receives their deficient check, because before that point, the 

government could alter the amount to be refunded. See, e.g., United States v. 

Wurts, 303 U.S. 414, 417 (1938) (concluding that IRS’s wrongful refund 

claim accrued when a taxpayer received the erroneous refund, not when the 

IRS Commissioner approved it). On this theory, only some of the ratepayers 

would be barred from suing. Mississippi Power issued refund checksin seven 

batches between November 6 and December 4, 2015. Only those ratepayers 

who received their checks after November 21st could continue this action. It 

is unclear from the record if any of the named plaintiffs fall into the latter 

category.10

The ratepayers’ claims did not accrue on August 6, 2015, when the 

Commission approved the refund plan, or on August 16, 2016, when Cohen

concluded that Mississippi Power shorted them. Given the uncertainties in 

the record that we have noted, and the possible benefit of limited discovery 

on the limitations issue, we remand for the district court to decide in the first 

10 Some ratepayers received their refunds as a credit on their utility bills instead of 

a check. We do not know if any named plaintiffs chose the credit option, and if so, when 

that credit was posted to their accounts. 

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instance which of the remaining options outlined above is the correct accrual 

date.11 

* * *

We AFFIRM the dismissal of the claims against the Commissioners

but VACATE the district court’s dismissal of the claims against Mississippi 

Power on limitations grounds. We REMAND for further proceedings 

consistent with this opinion.

11 It may be, however, that the district court need not reach the limitations issue. 

Mississippi Power raised two additional arguments for dismissal: first, that it is not a state 

actor subject to suit under section 1983, and second, that the ratepayers do not have a 

property interest in the refund protected by the Due Process Clause. Mississippi Power 

asks us to affirm on those alternative grounds, but the district court should consider those 

issues in the first instance. We do not intimate what decisions it should reach on those 

questions. 

Case: 21-60130 Document: 00516246998 Page: 18 Date Filed: 03/21/2022