Source: http://ny.findacase.com/research/wfrmDocViewer.aspx/xq/fac.19760719_0040199.C02.htm/qx
Timestamp: 2016-10-22 09:05:08
Document Index: 232588192

Matched Legal Cases: ['§ 824', '§ 313', '§ 313', '§ 10', '§ 704', '§ 206', '§ 201', '§ 824', '§ 205', '§ 824', '§ 205', '§ 206', '§ 313']

| Niagara Mohawk Power Corp. v. Federal Power Commission
NIAGARA MOHAWK POWER CORPORATION, PETITIONER,v.FEDERAL POWER COMMISSION, RESPONDENT, TOWN OF MASSENA, NEW YORK, INTERVENOR
Petition for review of two orders of the Federal Power Commission in which the Commission denied Petitioner Niagara Mohawk Power Corporation's motion to dismiss a then pending investigation of Niagara's alleged anticompetitive practices, and denied Niagara's subsequent application for a rehearing. Petition dismissed.
On May 5, 1975, the Town of Massena, New York, filed with the Commission a protest and petition to intervene, together with a motion to reject the rate schedule filing, or, in the alternative, if the schedule be filed, to suspend its operation for five months and to order a hearing. Massena currently purchases electric power directly from Niagara. On May 30, 1974, a referendum had been held in that municipality and a majority of the Massena voters had approved the establishment of a municipal electric system. Establishment of the municipally-owned system required that Massena acquire the electric distribution facilities of Niagara in the municipality and that it enter into an agreement with Niagara for the transmission of power from the Power Authority of the State of New York ("PASNY") to Massena over existing Niagara transmission lines. To that end, Massena commenced a condemnation proceeding in the New York State courts on March 14, 1975.*fn1 Additionally, Massena had been unsuccessfully attempting to contract with Niagara for the wheeling of power from PASNY to Massena. It was after Niagara repeatedly failed to accept Massena's offer that an agreement between them be entered into that the municipality sought to intervene in the Niagara-Con Ed rate filing proceeding before the FPC. Massena contended, inter alia, that Niagara had refused to enter into meaningful contractual negotiations for the transmission of power, and that the proposed agreement between Niagara and Con Ed was "an integral part of an interstate program and combination to unlawfully monopolize the electric utility industry." The municipality claimed that the revenues generated by the filing, if accepted, would be unlawfully used by Niagara to strengthen its monopolistic position in the Massena area and unlawfully used to frustrate the establishment by municipalities such as Massena of consumer-owned electric systems.
By order issued July 23, 1975, the FPC granted Massena's application for rehearing, and, as suggested by Massena in its rehearing-clarification application, ordered the institution of an investigation to commence December 16, 1975, under section 206(a) of the Act, 16 U.S.C. § 824e(a),*fn2 in Docket No. E-9379, to examine the merits of Massena's allegations of discriminatory treatment by Niagara. Three weeks later, Niagara filed a motion to dismiss the investigation, maintaining, inter alia, the irrelevance of its alleged anticompetitive practices to rate schedule filings, and also claiming that the Commission lacked jurisdiction under section 206 to either order an investigation or to compel Niagara to wheel power to Massena.
We agree with the FPC that its orders of September 25, 1975, denying Niagara's motion to dismiss the investigation, and November 13, 1975, denying Niagara's motion for a rehearing of the September order, are unreviewable, interlocutory orders, and that Niagara's petition to this court to review them must be dismissed. Section 313 of the Act provides that a party aggrieved by an order issued by the Commission may apply for a rehearing within thirty days after the order's issuance; and that, upon denial of such an application, the party may seek review of that order in the Court of Appeals. Concededly, the statute by its own terms, § 313(b), contains no requirement of finality: "Any party to a proceeding under this chapter aggrieved by an order issued by the Commission in such proceeding may obtain a review of such order in the United States Court of Appeals . . .." Therefore all Commission orders would seem to fall within its purview. However, in the interest of discouraging repeated delays in administrative proceedings and the circumvention of the requirement of exhaustion of administrative remedies, the courts have declined review of interlocutory orders except where such an order is definitive in impact, and where judicial abstention would result in a party's irreparable injury. Greene County Planning Bd. v. F.P.C., 455 F.2d 412, 425-26 (2d Cir.), cert. denied, 409 U.S. 849, 93 S. Ct. 56, 34 L. Ed. 2d 90 (1972).
The orders here clearly do not meet the criteria for review. All that the Commission ordered on September 25 was the institution of an investigation into Niagara's alleged anticompetitive practices. It rejected Niagara's motion to dismiss that investigation for the stated reason that greater exploration of the factual underpinnings of Massena's allegations would be required before a final Commission decision could issue. No investigation has as yet commenced; the Commission has taken no evidence, and has made no findings. As the Supreme Court stated:
The statute [§ 313(b)] contemplates a case in which the Commission has taken evidence and made findings. . . . The provision for review thus relates to orders of a definite character dealing with the merits of a proceeding before the Commission and resulting from a hearing upon evidence and supported by findings appropriate to the case.
F.P.C. v. Metropolitan Edison Co., 304 U.S. 375, 384, 82 L. Ed. 1408, 58 S. Ct. 963 (1938). See also Greene County Planning Bd. v. F.P.C., 490 F.2d 256 (2d Cir. 1973). In addition to the lack of any definitive administrative action such that would render these orders fit for judicial review, Niagara does not show that it would suffer any substantial hardship from the withholding of review at this time. The mere expense and inconvenience of a prospective administrative hearing do not, without more, constitute irreparable injury. Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, 51-52, 82 L. Ed. 638, 58 S. Ct. 459 (1938). Thus, this would seem to be a case where "the issues raised could be disposed of in review of a final Commission order without serious detriment to the rights of the parties." Greene County Planning Bd. v. F.P.C., 455 F.2d at 425.
Niagara argues, however, that the order instituting an investigation is in fact "final" under the standard articulated in PepsiCo., Inc. v. F.T.C., 472 F.2d 179 (2d Cir. 1972), cert. denied, 414 U.S. 876, 94 S. Ct. 44, 38 L. Ed. 2d 122 (1973), because the FPC has no jurisdiction over utilities' decisions to make or not to make agreements to wheel power and even if the Commission found that Niagara had engaged in discriminatory, anticompetitive practices it could not order Niagara to contract with Massena. In PepsiCo we were faced with the question, inter alia, of whether an FTC order denying plaintiff's motion to dismiss a complaint for failure of the Commission to join certain indispensable parties was an appealable order under § 10(c) of the Administrative Procedure Act, 5 U.S.C. § 704. That section provides for an appeal of "final agency action for which there is no other adequate remedy in a court." In attempting to define which order fell within that category, we stated that one can find such final agency action "if an agency refuses to dismiss a proceeding that is plainly beyond its jurisdiction as a matter of law or is being conducted in a manner that cannot result in a valid order." 472 F.2d at 187 [emphasis added].*fn3
This finality argument is predicated on Niagara's contention that Massena has requested the investigation in the interest, ultimately, of securing a Commission order requiring Niagara to wheel power to the municipality. As the Supreme Court made clear in Otter Tail Power Co. v. United States, 410 U.S. 366, 93 S. Ct. 1022, 35 L. Ed. 2d 359 (1973), that the Commission has no such power under the Federal Power Act, it is Niagara's position that no valid Commission order could be entered at the conclusion of the investigation even if Niagara were found to have unlawfully discriminated.
The major flaw in this argument, however, is that the Commission has indicated no intention to compel wheeling, and an order directing Niagara to transmit power need not be the necessary outcome of a Commission investigation. The FPC is charged in § 206(a) of the Act with the responsibility for investigating, via a hearing had upon its own motion or upon complaint, whether rules, regulations or practices affecting rates filed with the Commission are "unjust, unreasonable, unduly discriminatory or preferential." That section, combined with § 201(b), 16 U.S.C. § 824(b), conferring jurisdiction on the Commission with respect to the sale of electric energy at wholesale in interstate commerce, and § 205, 16 U.S.C. § 824d(b), prohibiting discriminatory or preferential rates, establish a jurisdictional foundation for the agency's investigation of alleged anticompetitive behavior. As the Court recently stated in F.P.C. v. Conway Corp., 426 U.S. 271, 96 S. Ct. 1999, 48 L. Ed. 2d 626, 44 U.S.L.W. 4777, 4779 (1976), quoting from Gulf States Utilities Co. v. F.P.C., 411 U.S. 747, 758-59, 93 S. Ct. 1870, 36 L. Ed. 2d 635 (1973):
The exercise by the Commission of powers otherwise within its jurisdiction "clearly carries with it the responsibility to consider, in appropriate circumstances, the anticompetitive effects of regulated aspects of interstate utility operations pursuant to . . . directives contained in §§ 205, 206 . . .."
See also Northern Natural Gas Co. v. F.P.C., 130 U.S. App. D.C. 220, 399 F.2d 953, 958 (1968); Indiana & Michigan Electric Co., 49 F.P.C. 1232 (1973).
The fact that the rate schedule filed by Niagara in Docket No. E-9379 was approved by the Commission as a just and reasonable rate, and the fact that the order instituting the investigation was thereafter entered, need not negate the Commission's investigative jurisdiction under § 206. That section speaks more broadly to the FPC's power to conduct an investigation into any practice affecting any rate or charge which is unjust or unduly discriminatory, and is not limited by its terms to rates filed subject to approval at the time the investigation is ordered. See F.P.C. v. Sierra Pacific Power Co., 350 U.S. 348, 353, 100 L. Ed. 388, 76 S. Ct. 368 (1956).
Massena has alleged that in fact Niagara is engaging in discriminatory practices which affect rates within the Commission's jurisdiction by refusing to fully utilize its transmission lines, thereby lowering its revenues and creating higher rates for its jurisdictional customers, and by barring a competitor's entry into the electric utility industry. Consideration of these issues of anticompetitive practices by the Commission can "[serve] the important function of establishing a first line of defense against those anticompetitive practices that might later be the subject of antitrust proceedings [in the federal district court]." Gulf States Utilities Co., supra, 411 U.S. at 760. And Commission Staff Counsel contend that a determination by the Commission that, due to the discriminatory practices Massena alleges, Niagara's rates are inordinately high will have a salutary, prospective effect on Niagara's future rate filings.
Having concluded that the appeal must be dismissed on the grounds stated in the Commission's first motion to dismiss, we need only say a brief word about its second asserted ground for dismissal, mootness. On April 8, 1976, the Commission dismissed the investigation it had ordered on July 23, 1975, and, forthwith, on April 8, moved in this court to dismiss the petition for review on the ground that this Commission dismissal had rendered a court review moot. However, Niagara had timely filed its petition for review on December 2, 1975, and the FPC had served its Certificate of Record in Lieu of Record on February 3, 1976. Under § 313 of the Act, pursuant to which Niagara's appeal was filed, all FPC jurisdiction regarding matters posed for review by this court terminates with the filing of the record. See Alabama Power Co. v. F.P.C., 167 U.S. App. D.C. 145, 511 F.2d 383, 388 (1974). The order issued by the Commission subsequent to the filing of the Certificate of Record in this court thus had no effect on the status of Niagara's petition before us.