Opinion ID: 184897
Heading Depth: 2
Heading Rank: 2

Heading: Aggrievement and Ripeness

Text: 23 FERC argues that Rio Grande is not aggrieved by the disputed orders, and that, even if it is aggrieved, the orders are not ripe for review. The Commission is wrong on both counts. 24 A party seeking review of a final Commission order must demonstrate that it has been aggrieved by the order. See 28 U.S.C. § 2344 (1994). 25 Like all parties seeking access to the federal courts, petitioners are held to the constitutional requirement of standing. Common to both these thresholds is the requirement that petitioners establish, at a minimum, injury in fact to a protected interest. To demonstrate injury in fact, petitioners must identify an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical. 26 Shell Oil Co. v. FERC, 47 F.3d 1186, 1200 (D.C.Cir.1995) (citations and internal quotation marks omitted). 27 In this case, FERC argues that Rio Grande has not been injured, because Rio Grande may charge the rate it sought to charge pursuant to § 342.2(b). However, this conclusion misses the point. Rio Grande filed its petition for a declaratory order specifically because it sought the security of a rate approval under § 342.2(a). FERC's refusal to approve Rio Grande's rate under § 342.2(a) means that the current rate may be rendered ineffective if any party files a protest. Rio Grande argues that this affects both its present economic behavior--investment plans and creditworthiness--and its future business relationships. In particular, Rio Grande asserts that the orders have had a profoundly negative effect on the active marketing of [this] project to new potential users, have made existing and potential investors extremely skeptical over further investment in the project, and have negatively impact[ed] both [Rio Grande's] ability to raise debt capital and its general creditworthiness. Brief of Rio Grande at 19-20. FERC does not dispute these contentions. 28 On the record at hand, there can be no serious doubt over Rio Grande's aggrievement by virtue of FERC's orders. As indicated, Rio Grande is suffering present economic injury as a result of the orders. See, e.g., Great Lakes Gas Transmission Ltd. Partnership v. FERC, 984 F.2d 426, 430 (D.C.Cir.1993) (holding that showing of present injurious effect on [a petitioner's] business decisions and competitive posture within the industry is sufficient to prove that petitioner is aggrieved). There can also be no doubt that Rio Grande satisfies the remaining Article III standing requirements, because its injury flows from the FERC orders under review and may be redressed if this court grants its petition for review. It therefore has standing to petition for review of the FERC orders at issue here. 29 FERC also claims that, even if Rio Grande has been aggrieved and has standing to contest the disputed orders, the case should nonetheless be dismissed as unripe. On this score, FERC contends that Rio Grande's petition is unfit for review, because Rio Grande has not shown that the contested orders have had any immediate impact on its daily affairs, and that FERC has not applied its pronouncements on original cost to any of [Rio Grande's] actual rates. Brief for FERC at 20-21. This is a mangled view of the ripeness doctrine, and we reject it. 30 As we noted in Mississippi Valley Gas Co. v. FERC, 68 F.3d 503, 508 (D.C.Cir.1995), in applying the ripeness doctrine, 31 we are to consider the nature of the challenged issue and inquire whether the agency action is sufficiently final for review. When a petitioner raises a purely legal question, we assume that issue is suitable for judicial review. However, our assessment of the finality of the agency action also includes consideration of whether the agency or the court will benefit from deferring review until the agency's policies have crystallized and the question arises in some more concrete and final form. 32 (citations and internal quotation marks omitted). In other words, a case is ripe when it presents a concrete legal dispute [and] no further factual development is essential to clarify the issues ... [and] there is no doubt whatever that the challenged [agency] practice has 'crystallized' sufficiently for purposes of judicial review. Payne Enters., Inc. v. United States, 837 F.2d 486, 492-93 (D.C.Cir.1988). The Commission is quite wrong in its implicit suggestion that Rio Grande's petition must be dismissed absent a showing of hardship, for, under the ripeness doctrine, the hardship prong of the [Abbott Laboratories v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967) ] test is not an independent requirement divorced from the consideration of the institutional interests of the court and agency. Id. at 493; accord City of Houston v. HUD, 24 F.3d 1421, 1431 n. 9 (D.C.Cir.1994). Under these well-established principles, the Commission's claim that this case is unripe for review must be rejected. 33 The record here shows conclusively that this case presents a concrete legal dispute and that FERC's policy is crystallized. In Rio Grande I, the Commission stated: 34 In this case, whether or not Rio Grande satisfies the two prong test, we must deny its request. That test presupposes a write-up that would be permissible if the test were satisfied. That is not the case here. In this instance, the seller of the acquired line, Navajo, has an equity position in Rio Grande through an affiliate, Navajo Southern, one of the partners of Rio Grande. Rio Grande argues that in this case Navajo Southern's equity interest should not be a bar to the write-up, because it was essential to structuring an agreement acceptable to Navajo so that the project could go forward. The general rule, however, is that the depreciated cost of an acquired asset must be used in cost-of-service calculations where the former owner not only receives the higher price but also has an equity interest in the acquiring company. This is so because otherwise the seller might benefit from the higher cost of service on the line, which it cannot do as the owner of a regulated asset at this time. Thus, we must deny Rio Grande's request for a write-up. 35 78 F.E.R.C. at 61,082 (quoting Longhorn I, 73 F.E.R.C. at 62,113). In Rio Grande II, the Commission reaffirmed its position: 36 Here, we have a regulated entity allegedly changing its service and requesting a write-up of the assets dedicated to the new service....In the absence of Navajo's equity interest, this case might fall within one of the recognized exceptions to the general rule. However, we need not address this issue because in this case a company is selling the asset to itself. To allow the write-up in this situation would open the door to circumvention of the purpose of the original cost concept....Accordingly, we will deny rehearing. 37 82 F.E.R.C. at 61,548. It is clear here that the Commission has decided that the benefits exception cannot be used where a selling entity acquires an equity interest in the purchaser as a result of the transaction, and has applied this new rule by denying Rio Grande's request for approval of its cost-justified rates. Thus, because FERC's orders raise a concrete legal dispute regarding a policy that has crystallized to its final form, the orders are ripe for review.