Court Opinion

ID: 4439428
Source: CourtListenerOpinion
Date Created: 2019-09-18 20:00:15.883072+00
Date Added: 2024-06-11T14:52:06.900076
License: Public Domain

United States Court of Appeals
                     For the First Circuit

No. 18-1995

  SCOTT BREIDING; AMY POLLUTRO; MIKAELA ORTSTEIN-OTERO; BENJAMIN
   ROSE; MARGARET LEWIS; RICHARD LEWIS; ERIC LONG; PETER STEERS;
     BRADFORD KEITH; JOHN ODUM; DAVID LEIGHTON; DONNA CORDEIRO;
    JANICE ANGELILLO; ANNA MARIA FORNINO; MICHELE CASSETTA; JUDY
 CENNAMI, on behalf of themselves and others similarly situated,

                     Plaintiffs, Appellants,

      ERIK ALLEN; NICHOLAS CORREIA; JANICE BRADY; OPAL ASH;
                   ROBERTO PRATS; MARK LEJEUNE,

                           Plaintiffs,

                               v.

    EVERSOURCE ENERGY, a Massachusetts voluntary association;
             AVANGRID, INC., a New York corporation,

                     Defendants, Appellees.

          APPEAL FROM THE UNITED STATES DISTRICT COURT
                FOR THE DISTRICT OF MASSACHUSETTS

          [Hon. Denise J. Casper, U.S. District Judge]

                             Before

                 Torruella, Selya, and Kayatta,
                         Circuit Judges.

     Thomas M. Sobol, with whom Kristie A. LaSalle, Bradley
Vettraino, Steve W. Berman, Hagens Berman Sobol Shapiro LLP, David
F. Sorensen, Michael Dell'Angelo, Glen L. Abramson, and Berger
Montague PC were on brief, for appellants.
     Whitney E. Street, Block & Leviton LLP, Sandeep Vaheesan, and
Open Markets Institute on brief for Open Markets Institute as
amicus curiae.
     Richard P. Bress and John D. Donovan, Jr., with whom Shannen
W. Coffin, Douglas G. Green, Steptoe & Johnson LLP, Chong S. Park,
Ropes & Gray LLP, Marguerite M. Sullivan, Allyson M. Maltas,
Caroline A. Flynn, and Latham & Watkins LLP were on brief, for
appellees.

                       September 18, 2019
              KAYATTA, Circuit Judge.          Eversource Energy and Avangrid,

Inc.    ("the    defendants")     are    two     large   energy    companies      that

purchase natural gas directly from producers and then resell that

gas to retail natural gas consumers throughout New England.                        In

order to transport the natural gas that the defendants purchase

from far-away producers to their own, localized system of pipeline

infrastructure for delivery to their customers, the defendants

reserve transportation capacity along the interstate Algonquin Gas

pipeline.       The plaintiffs, a putative class of retail electricity

customers in New England, allege that the defendants strategically

reserved excess capacity along the Algonquin Gas pipeline without

using    or     reselling   it.        This    conduct,     they   claim,    unduly

constrained the volume of natural gas flowing through New England,

thereby   raising      wholesale       natural    gas    prices,   which    in    turn

resulted in higher retail electricity rates paid by New England

electricity consumers.

              The plaintiffs brought this lawsuit in the U.S. District

Court   for     the   District    of    Massachusetts,      asserting      that   the

defendants' conduct violated section 2 of the Sherman Act, 15

U.S.C. § 2, and various state antitrust and consumer-protection

laws. The district court dismissed the plaintiffs' claims as being

barred by the filed-rate doctrine and, alternatively, for lack of

antitrust standing and the plaintiffs' failure to plausibly allege

a monopolization claim under the Sherman Act.                        Although our

                                        - 3 -
reasoning differs from that of the district court in several

respects,    we   agree   that    the    filed-rate    doctrine      presents   an

insurmountable hurdle for the plaintiffs' federal and state-law

claims.     We therefore find no need to reach the district court's

alternative grounds for dismissal.

                                         I.

            Because the district court disposed of the plaintiffs'

claims on a motion to dismiss for failure to state a claim, Fed.

R. Civ. P. 12(b)(6), "we take as true all well-pleaded facts in

[their] complaint[], scrutinize them in the light most hospitable

to [their] theory of liability, and draw all reasonable inferences

therefrom in [their] favor."             Fothergill v. United States, 566

F.3d 248, 251 (1st Cir. 2009).           In so doing, we may also consider

"facts subject to judicial notice, implications from documents

incorporated      into    the     complaint,     and   concessions       in     the

complainant's response to the motion to dismiss."                 Arturet-Vélez

v. R.J. Reynolds Tobacco Co., 429 F.3d 10, 13 n.2 (1st Cir. 2005).

            We first trace the regulatory contours of the relevant

markets for natural gas and electricity before turning to the

details   of   the   plaintiffs'        antitrust   and     unfair   competition

claims.

                                         A.

            "Wellhead" sales comprise the first step in the chain of

market    transactions     that    readies      extracted    natural    gas     for

                                        - 4 -
consumption in the form of retail electricity.          At this initial

stage, natural gas producers sell natural gas to direct purchasers

through gas futures contracts, in which the producer agrees to

sell a specific quantity of natural gas at some fixed time in the

future   to    the   direct   purchaser.    Load-distribution   companies

(LDCs) -- those entities that locally distribute natural gas,

primarily to retail consumers who use the gas for heating and

cooking -- have a relatively predictable need for natural gas and,

thus, often make use of this type of contract.1          Consumers with

more variable demand for natural gas, such as power generators,

often purchase gas on the secondary wholesale "spot market."         The

spot market for natural gas allows direct purchasers that find

themselves with rights to excess, unneeded natural gas to resell

those rights in the immediate or near future.

              The Federal Energy Regulatory Commission (FERC) is the

agency charged with implementing and executing the Natural Gas Act

(NGA), "a comprehensive scheme of federal regulation of 'all

wholesales of natural gas in interstate commerce.'" N. Nat. Gas

Co. v. State Corp. Comm'n, 372 U.S. 84, 91 (1963) (quoting Phillips

Petroleum Co. v. Wisconsin, 347 U.S. 672, 682 (1954)); see also 15

U.S.C. § 717c(a) (tasking FERC with ensuring that rates charged

     1 The defendants nevertheless point out that LDCs operating
in New England do face some variability in demand for natural gas
due to rapidly changing weather conditions in the region.

                                    - 5 -
for sales of natural gas within FERC's jurisdiction are "just and

reasonable").         Notwithstanding            the   comprehensiveness          of    this

regulatory scheme, Congress also exempted wellhead sales from

FERC's regulatory jurisdiction.                  See 15 U.S.C. § 3431(a)(1)(A).

Accordingly, market forces dictate the wellhead price of natural

gas.    Id. § 3431(b)(1)(A) ("[A]ny amount paid in any first sale of

natural gas shall be deemed to be just and reasonable.").                                And

while the NGA grants FERC regulatory authority over "sale[s] . . .

for resale" in the spot market for natural gas, see 15 U.S.C.

§ 717(b),     FERC    has    issued     a    "blanket       certificate      of    public

convenience     and       necessity"    that       allows    such     transactions        to

proceed at market rates, see 18 C.F.R. § 284.402.

             Direct       purchasers    of       natural    gas     also   pay    for    the

transmission of natural gas from the wellhead.                       The Algonquin Gas

pipeline serves as the primary interstate artery through which

natural gas is transported in New England.                        Direct purchasers in

New England must reserve transmission capacity -- that is, the

physical space in the pipeline needed to transport the natural gas

purchased     from    the    producer       --    along     the    Algonquin     pipeline

commensurate with their transportation needs.                             FERC also has

"exclusive jurisdiction over the transportation . . . of natural

gas    in   interstate      commerce    for       resale"     and    is    charged      with

"determin[ing]        a     'just      and       reasonable'        rate     for       [its]

transportation."          Schneidewind v. ANR Pipeline Co., 485 U.S. 293,

                                        - 6 -
300–01 (1988). Pursuant to this exclusive authority, FERC requires

interstate pipeline operators like Algonquin to allow LDCs to

purchase capacity using "no-notice" contracts.           See Order No. 636,

57 Fed. Reg. 13,267 (Apr. 16, 1992).          Such contracts allow LDCs to

adjust capacity reservations downward or upward (up to their daily

"firm entitlements") at any time without incurring penalties.              Id.

at 13,286.      Importantly, FERC regulations allow, but do not

require, LDCs to resell unneeded transportation capacity to other

natural gas purchasers when they downwardly adjust their capacity

reservations.    See 18 C.F.R. § 284.8; Tenn. Gas Pipeline Co., 102

FERC ¶ 61,075, 61,119 (2003) ("[N]othing requires a shipper to

release its capacity:       it does so by choice.").

            In the wholesale market for electricity, load-serving

entities (LSEs) that sell and deliver electricity to consumers for

retail consumption purchase electricity from power generators.

The Federal Power Act (FPA) charges FERC with regulating these

wholesale sales2 of electricity in interstate commerce and ensuring

that rates in that market are "just and reasonable." See 16 U.S.C.

§§ 824(b)(1),    824d(a).        In   executing   that   charge,   FERC    has

delegated     authority     to    nonprofit      organizations,    including

independent    system     operators    (ISOs),    to   manage   auctions   for

wholesale electricity in the various regional markets across the

     2 A "[s]ale of electric energy at wholesale" is a "sale of
electric energy to any person for resale." 16 U.S.C. § 824(d).

                                      - 7 -
country.   Hughes v. Talen Energy Mktg., LLC, 136 S. Ct. 1288, 1292

(2016).      ISO   New     England    (ISO-NE)      oversees    the    markets   for

wholesale electricity in the New England region and administers

two auctions for wholesale electricity that are relevant to this

appeal: a same-day auction and a next-day auction to satisfy LSEs'

short-term and near-term demand for electricity. In both auctions,

ISO-NE accepts orders from LSEs designating the amount of energy

they need at a given time.             Power generators then submit bids

indicating the amount of electricity they can produce at those

times and the price they are willing to charge for it.                      ISO-NE

accepts    those    bids    from     lowest    to   highest    until    demand   is

satisfied.     The price of the last accepted bid is the "clearing

price," which sets the price paid to all the generators whose bids

were accepted.

             Approximately     half     of    New   England's    electricity     is

generated from natural gas power plants.               As a result, bids from

natural gas generators usually set the clearing price for wholesale

electricity, which then drives the retail prices charged by LSEs

to retail consumers.         FERC does not oversee the retail sale of

electricity.       See FERC v. Elec. Power Supply Ass'n, 136 S. Ct.

760, 766 (2016) ("[T]he law places beyond FERC's power, and leaves

to the States alone, the regulation of 'any other sale' -- most

notably, any retail sale -- of electricity." (citing 16 U.S.C.

§ 824(b)).

                                       - 8 -
                                    B.

           Defendants Eversource Energy and Avangrid, Inc. are

energy companies that own two of the eight largest natural gas

LDCs in New England.       They also own multiple retail electricity

LSEs in the region.        The plaintiffs allege that the defendants

violated   the   Sherman    Act   and    state   consumer-protection   and

antitrust laws by artificially restricting the supply of natural

gas in the New England transmission market.         This restriction, in

turn, increased the cost of natural gas in the spot market, and

led to higher wholesale electricity prices and, ultimately, higher

retail electricity prices paid by consumers.

           According to the plaintiffs, the defendants accomplished

this scheme by manipulating their no-notice contracts for pipeline

transmission capacity.      By consistently reserving in advance and

then cancelling at the end of each day significant amounts of

transmission capacity without reselling that excess capacity to

other LDCs or power generators, the defendants' collective conduct

reduced the daily effective capacity along the Algonquin Gas

pipeline by 14%, raising natural gas prices by 38% in the natural

gas spot market, and increasing retail electricity prices by 20%.

The defendants, who hold significant stakes in non-natural gas

power-generating facilities, benefited from this practice because

it artificially increased the demand for and value of these non-

natural gas resources.      It also enabled the defendants to advocate

                                   - 9 -
for the construction of costly (and allegedly unnecessary) energy

infrastructure projects throughout New England.

            The district court dismissed the plaintiffs' claims,

holding    that     the   filed-rate      doctrine   barred     their   federal

antitrust and derivative state suits.                Breiding v. Eversource

Energy, 344 F. Supp. 3d 433, 451 (D. Mass. 2018).              The "filed rate"

upon which the district court primarily relied was FERC's approval

of market-based rates in the electricity market administered by

ISO-NE.    Id. at 447–48.     The court held, in the alternative, that

plaintiffs failed to show antitrust standing and failed to plead

a plausible claim of antitrust monopolization.             Id. at 456, 458.

Unsatisfied with the district court's disposition of their claims,

the plaintiffs filed this timely appeal.

                                       II.

            At oral argument, counsel for the plaintiffs conceded

that the plaintiffs do not have antitrust standing to bring their

federal antitrust damages claim.              Nevertheless, the plaintiffs

continue    to    press   their    state-law    claims   and    their   federal

antitrust claim for injunctive relief on appeal.               Accordingly, we

consider    those    claims   on    the    merits,   addressing     first   the

plaintiffs' remaining federal antitrust challenge before turning

to the district court's disposition of the plaintiffs' state-law

claims.    Our review is de novo.         See Abdallah v. Bain Capital LLC,

752 F.3d 114, 119 (1st Cir. 2014).

                                     - 10 -
                                    A.

           The filed-rate doctrine is "a set of rules that have

evolved over time but revolve around the notion that . . . utility

filings with the regulatory agency prevail over . . . other claims

seeking different rates or terms than those reflected in the

filings with the agency."       Town of Norwood v. FERC, 217 F.3d 24,

28 (1st Cir. 2000).     "[O]nce filed, a rate may not be collaterally

attacked in the courts."       Phillip E. Areeda & Herbert Hovenkamp,

Antitrust Law:     An Analysis of Antitrust Principles and Their

Application ¶ 247 (4th ed. 2019).           This rule applies with equal

force to challenges brought "under state law and federal antitrust

laws to rates set by federal agencies."            E. & J. Gallo Winery v.

EnCana Corp., 503 F.3d 1027, 1033 (9th Cir. 2007).               Accordingly,

the   doctrine   can   be   understood   as   "a   form    of   deference   and

preemption, which precludes interference with the rate setting

authority of an administrative agency, like FERC."               Wah Chang v.

Duke Energy Trading & Mktg., LLC, 507 F.3d 1222, 1225 (9th Cir.

2007).     The    filed-rate     doctrine     does   not    apply    only    to

"traditional" rates for service; rather, it "sweeps more broadly

and governs ancillary conditions and terms included in [a FERC-

approved] tariff" as well.      Town of Norwood v. New Eng. Power Co.,

202 F.3d 408, 416 (1st Cir. 2000).

           Importantly, the doctrine prohibits antitrust challenges

to agency-approved tariffs even in energy markets in which FERC

                                  - 11 -
has eschewed traditional ratemaking.      See, e.g., id. at 419

(rejecting the argument that the doctrine does not apply when

regulated rates are left to the "free market," and observing that

"[i]t is the filing of the tariffs, and not any affirmative

approval or scrutiny by the agency, that triggers the filed rate

doctrine"); Pub. Util. Dist. No. 1 of Snohomish Cty. v. Dynegy

Power Mktg., Inc., 384 F.3d 756, 760 (9th Cir. 2004) (applying the

doctrine to alleged anticompetitive behavior in the wholesale

electricity market).     But cf. Town of Norwood, 202 F.3d at 419

("Of course, if [the defendant's] rates were truly left to the

market, with no filing requirement or FERC supervision at all, the

filed rate doctrine would by its terms no longer operate.").    In

short, just as FERC might approve a specified rate as just and

reasonable, it might also determine that rates produced in a

competitive market that it oversees are just and reasonable.   The

filed-rate doctrine applies just the same, so long as a FERC-

approved tariff governs those market transactions.

          The plaintiffs maintained below, and argue on appeal,

that the filed-rate doctrine should not bar their claims because

they challenge the defendants' anticompetitive conduct in the spot

market for natural gas, a market in which "FERC has abdicated its

regulatory oversight."   The district court rejected that argument,

reasoning that the plaintiffs' requested relief would require it

to determine "the reasonableness of wholesale electricity prices

                               - 12 -
exclusively    regulated    by    FERC"   and   "the   difference   between

wholesale     electricity    rates     during    the    class   period   and

hypothetical rates that would have been charged but for [the

defendants'] purported anticompetitive conduct" -- "exactly the

analysis," according to the district court, that "the filed rate

doctrine prohibits."      Breiding, 344 F. Supp. 3d at 447.

             We agree with the plaintiffs that the district court's

reasoning is in some tension with our previous opinion in Town of

Norwood.      In   that   case,   we   deemed   the    filed-rate   doctrine

inapplicable to an antitrust challenge that alleged that a power

generator sold its non-nuclear generating assets in order to reduce

the supply of wholesale electricity in the New England market and

"exert upward pressure" on wholesale electricity prices.            202 F.3d

at 422–23.    In doing so, we found that a FERC-issued tariff in the

wholesale electricity market did not bar a challenge to a merger

of generators merely because the merger affected wholesale energy

rates.     See id. at 422.        And in reaching that conclusion, we

observed that though "it is not clear in all cases where the

boundary lies between the filed rate doctrine and the default rule

retaining antitrust liability," FERC did not have the "explicit

power to immunize approved mergers."            Id.; see also id. (noting

that though "[d]irect antitrust attacks on federally regulated

rates" and "attacks on other regulated matters underlying rates"

"have . . . been limited by the filed rate doctrine," there is "no

                                   - 13 -
across-the-board      antitrust       immunity       for        agency-approved

transactions" (citing California v. Fed. Power Comm'n, 369 U.S.

482 (1962)).     Our decision in Town of Norwood comports with the

weight of the case law, which generally deems the filed-rate

doctrine    inapplicable      to      challenges     to         upstream,    non-

jurisdictional activity that indirectly affects downstream FERC-

approved tariffs.     See, e.g., Sierra Pac. Res. v. El Paso Corp.,

250 F. App'x 776, 777–78 (9th Cir. 2007) (finding the filed-rate

doctrine   inapplicable      to      plaintiffs'     challenges        to   non-

jurisdictional     "first   sales"    of   natural   gas);        E. & J.   Gallo

Winery, 503 F.3d at 1046–48 (same); cf. Brown v. Ticor Title Ins.

Co., 982 F.2d 386, 394 (9th Cir. 1992) ("[I]f those rates were the

product of unlawful activity prior to their being filed and were

not subjected to meaningful review by the state, then the fact

that they were filed does not render them immune from challenge.").

But see Dynegy Power Mktg., 384 F.3d at 759 (finding the filed-

rate doctrine applicable when the defendant "withheld supply,

waited until emergency conditions were declared and prices rose,

and then offered the[] supply at [a] higher price").

           The district court's invocation of the FERC-approved

ISO-NE   tariff,    which   governs    transactions        in    the   wholesale

electricity market, to bar the plaintiffs' challenge to upstream

conduct affecting the spot market for natural gas implicates

analogous, difficult questions concerning the precise reach of the

                                   - 14 -
filed-rate doctrine.             As we explain, however, the instant appeal

does not require that we endorse or reject the broad application

of the filed-rate doctrine espoused by the district court. Rather,

we train our attention on a different FERC tariff that is directly

implicated by plaintiffs' claims:                  the tariff approved for sales

and purchases of natural gas transmission capacity.

             All of the conduct that the plaintiffs say violates

federal and state law occurred in the natural gas transmission

market.     Distilled to its essence, the plaintiffs' description of

that conduct is as follows:            (1) "Eversource and Avangrid possess

a   large    number        of    'no-notice'        contracts      for   natural      gas

transmission     capacity          along     the     Algonquin       Pipeline";       and

(2) "Eversource and Avangrid regularly reserved more pipeline

capacity than they knew they needed and then, at the last minute,

cancelled portions of their reservations" without "releas[ing]

that   capacity,      so    that    others     could    take      advantage    of    it."

Accordingly,     if    there       exists     any    tension      between     what    the

plaintiffs    say     is    wrongful       conduct    and   any    agency-sanctioned

tariff, it is most clearly and most directly with the FERC-approved

tariffs in the natural gas transmission market.                     So, to determine

whether the filed-rate doctrine bars the plaintiffs' claims, we

start -- and ultimately end -- our inquiry there.

             Pursuant       to    FERC's    exclusive       authority    to    regulate

natural gas transmission, FERC mandates that natural gas companies

                                        - 15 -
file     "schedules   showing     all    rates   and    charges    for    any

[jurisdictional] transportation or sale of natural gas." 18 C.F.R.

§ 154.1(b).     In addition, FERC requires operators of interstate

natural gas pipelines like the Algonquin Gas pipeline to provide

"'no-notice' transportation service" to ensure that LDCs are able

to meet unexpected demand.        Order No. 636, 57 Fed. Reg. at 13,286.

            In accordance with these mandates, the FERC-approved

tariff    for   the   Algonquin    Gas   pipeline    includes    Algonquin's

statement of rates and rate schedule for transportation services

along the pipeline.      See Algonquin Gas Transmission, LLC Tariff,

pts. 4–5    [hereinafter    Algonquin     Tariff].      The     tariff   also

addresses no-notice contracts and provides, in relevant part:

            Notwithstanding the quantities nominated by
            Customer and scheduled by Algonquin hereunder,
            Customer shall be entitled to increase its
            deliveries up to the [Maximum Daily Delivery
            Obligation] at any Primary Point(s) of
            Delivery,   up   to    the   [Maximum    Hourly
            Transportation Quantity] during any Hour, and
            up to the [Maximum Daily Transportation
            Quantity], or to decrease its deliveries.
            Provided   that   all   of   the   operational
            conditions specified in Section 5 of this rate
            schedule (the "Section 5 Conditions") are met,
            Algonquin shall consent to such increase or
            decrease in deliveries, thereby nullifying any
            daily scheduling or hourly scheduling penalty
            that would otherwise be applicable pursuant to
            Section 23   of   the    General   Terms    and
            Conditions.

Algonquin Tariff, pt. 5, Rate Schedule AFT-E, § 4.3.            Furthermore,

that tariff, consonant with FERC's regulations, see 18 C.F.R.

                                   - 16 -
§ 284.8, permits an LDC to resell its excess reserved capacity:

"A Customer under any firm rate schedule under Part 284 may release

all   or     a     part     of   its    capacity      under   an    Existing   Service

Agreement . . . ."               Algonquin Tariff, pt. 6, Capacity Release,

§ 14.2.      But the tariff says nothing that would require an LDC to

release excess capacity along the Algonquin pipeline to other

users.

                 In the plaintiffs' amended complaint, neither defendant

is alleged to have engaged in any conduct other than that allowed

by Algonquin's detailed and reasonably comprehensive FERC-approved

tariff.      FERC, in conformity with its broader regulatory scheme,

expressly declined to require direct purchasers to release excess

capacity in recognition of the fact that direct purchasers facing

variable demand for natural gas might need to retain that capacity

to ensure reliability.              See, e.g., Order No. 636, 57 Fed. Reg. at

13,269     ("[T]he          Commission       is   providing      for    a   'no-notice'

transportation service in response to those who have expressed a

particular concern about reliability during peak periods.").                         The

filed-rate doctrine prohibits us from questioning that reasoned

judgment in this lawsuit.

                 All of the defendants' alleged misconduct, we might add,

was   done       in   the    open      and   in   plain   view     of   Algonquin,   the

defendants' competitors, and FERC.                    Furthermore, maintaining the

efficient use of limited transmission capacity falls squarely

                                             - 17 -
within the bull's-eye of FERC's regulatory aims.                    See, e.g., id.

("The Commission's primary aim in adopting the instant regulations

is to improve the competitive structure of the natural gas industry

and at the same time maintain an adequate and reliable service.").

And Congress has given FERC the tools to police anticompetitive

conduct in the market for transmission capacity.                The NGA makes it

"unlawful for any entity, directly or indirectly, to use or employ,

in connection with . . . the purchase or sale of transportation

services subject to the jurisdiction of [FERC], any manipulative

or deceptive device or contrivance . . . in contravention of such

rules    and    regulations    as   [FERC]    may   prescribe."         15   U.S.C.

§ 717c-1.      All parties acknowledge that this provision and FERC's

implementing regulation, see 18 C.F.R. § 1c.1(a), "prohibit[] the

anticompetitive abuse of no-notice contracts" in the market for

natural gas transmission.           Moreover, Congress empowered FERC to

investigate and bring civil enforcement actions against willful

and knowing violators of the NGA and FERC's regulations.                     See 15

U.S.C. § 717t-1; see also Enf't of Statutes, Orders, Rules, &

Regulations, 132 FERC ¶ 61,216, 62,149 (2010) (explaining that

FERC     also     requires     disgorgement         of      "profits     illegally

obtained . . . to those who were harmed by the violations").                    And,

in fact, FERC did investigate the defendants' alleged manipulation

of     their    no-notice     contracts      but    found     "no    evidence     of

anticompetitive withholding of natural gas pipeline capacity."

                                     - 18 -
News Release:     FERC Staff Inquiry Finds No Withholding of Pipeline

Capacity in New England Markets, Fed. Energy Regulatory Comm'n (Feb. 27,

2018), https://www.ferc.gov/media/news-releases/2018/2018-1/02-27-18.pdf.

              On appeal, the plaintiffs acknowledge that challenges to

"practices      over   which      FERC    ha[s]   jurisdiction        and   actually

regulate[s]" are barred pursuant to the filed-rate doctrine.                       As

a general matter, we agree (at least in so far as those practices

are included in a FERC-approved tariff as an exercise of FERC's

ratemaking authority, see Town of Norwood, 202 F.3d at 416).                      For

this reason, it seems quite clear that the filed-rate doctrine

precludes the plaintiffs' claims in this suit.

              The plaintiffs' principal rejoinder to this conclusion

rests on the fact that they now seek only injunctive relief.                     They

point to the Supreme Court's decision in Georgia v. Pa. R.R. Co.,

324    U.S.    439,    455   (1945)      (finding   the    filed-rate       doctrine

inapplicable to an equitable claim that was not "a matter subject

to    the   jurisdiction     of    the    [agency],"      did   not    request   "an

injunction against the continuance of any tariff," and did not

"seek to have any tariff provision cancelled").                   But in Town of

Norwood, we explained that injunctive relief that "would require

the alteration of [a] tariff[]" that FERC "actually scrutinized"

is incompatible with the doctrine's purpose of "protect[ing] the

exclusive authority of the agency to accept or challenge such

tariffs."      202 F.3d at 420.          To rule against the defendants and

                                         - 19 -
grant the plaintiffs' requested "order[,] enjoining defendants

from further engaging in the unlawful conduct described in th[e]

Complaint," a judge would need to direct, in substance and effect,

that the defendants not hold on to excess, unused capacity without

reselling it.      Of course, one might argue that such an order would

not directly conflict with the tariff because the tariff does not

actually prohibit the resale of capacity.                FERC's regulation of

transmission       along   the      Algonquin   Gas    pipeline,    though,   is

sufficiently comprehensive and detailed such that a judge-mandated

elimination of the purchaser's freedom to choose whether to resell

excess capacity would effectively overrule, or at least qualify,

FERC's    decision    that    the    LDC's    "may"   release   their   reserved

capacity.    Accordingly, the plaintiffs' federal antitrust claim

fails.

                                         B.

            That     leaves   the     plaintiffs'     state-law    claims.    As

already explained, the filed-rate doctrine applies with equal

force to state-law challenges.           See E. & J. Gallo Winery, 503 F.3d

at 1033.    Nor do the plaintiffs argue otherwise in their brief on

appeal.     So, it would seem to follow from the foregoing analysis

that dismissal of the plaintiffs' state claims is also warranted.

We nevertheless hesitate because it is not immediately clear from

the district court's opinion whether the court dismissed the

plaintiffs' state claims for the same reasons that it deemed the

                                       - 20 -
federal claims non-cognizable or whether the court declined to

exercise supplemental jurisdiction over those state claims upon

determining that the plaintiffs could not proceed with their

federal claims, thereby leaving open the possibility that the

plaintiffs might pursue their state claims in a separate action in

state court.

            On the one hand, the district court made clear that the

filed-rate doctrine barred both the plaintiffs' federal and state-

law claims, see Breiding, 344 F. Supp. 3d at 451 ("[T]he Court

holds that the doctrine bars the federal and state law claims in

the   amended     complaint."),   and   went   on   to   conclude   that   the

plaintiffs' alleged injuries were "too remote to satisfy the

causation prongs of the various state law claims," id. at 459.              On

the other hand, the district court concluded its opinion with the

following statement:       "[T]he Court, for the reasons previously

mentioned, has dismissed all of Plaintiffs' federal claims and

declines to exercise jurisdiction over the remaining state law

claims."    Id.    The district court then entered an order dismissing

the plaintiffs' complaint without mentioning whether the dismissal

was with prejudice or not. The district court also made no mention

of    the   plaintiffs'   alternative       invocation    of   federal-court

jurisdiction under the Class Action Fairness Act (CAFA), 28 U.S.C.

§ 1332(d)(2) (creating original jurisdiction over class actions

                                   - 21 -
with     minimal   diversity    and   aggregate   damages   that   exceed

$5,000,000).

             We construe the district court's opinion as dismissing

the plaintiffs' state-law claims on the merits, notwithstanding

the court's mixed signals, for the following reasons.         First, the

district court, in "declin[ing] to exercise jurisdiction over the

remaining state law claims," appeared to do so as an alternative

basis for dismissing those challenges, perhaps in contemplation of

the possibility that we might disagree with its application of the

filed-rate doctrine to the plaintiffs' claims.          See id. at 458

("Although the filed rate doctrine applies with equal force to

Plaintiffs' state law claims, the Court concludes that Plaintiffs'

state law claims also fail for the reasons stated below." (citation

omitted)).      Having concluded that the filed-rate doctrine does,

indeed, bar all the plaintiffs' claims, we have no need to reach

the district court's alternative bases for dismissal.

             Second, it would have made little sense to decline to

exercise supplemental jurisdiction over the residual state-law

claims    for   purposes   of   dismissing   them   after   finding   the

plaintiffs' federal claims non-cognizable due to the filed-rate

doctrine.    To be sure, normally "the unfavorable disposition of a

plaintiff's federal claims at the early stages of a suit . . .

will trigger the dismissal without prejudice of any supplemental

state-law claims."     Rodriguez v. Doral Mortg. Corp., 57 F.3d 1168,

                                  - 22 -
1177 (1st Cir. 1995).              But "[i]n an appropriate situation, a

federal    court       may    retain    jurisdiction        over    state-law          claims

notwithstanding         the    early    demise      of   all    foundational          federal

claims."        Id.     In deciding whether to do so, federal courts

consider       "the      interests       of      fairness,        judicial         economy,

convenience, and comity."              Camelio v. Am. Fed'n, 137 F.3d 666, 672

(1st Cir. 1998).              Here, the interests of fairness, judicial

economy,       and    convenience       all     support     retaining         jurisdiction

because the survival of the plaintiffs' state and federal claims

hinges    on    an    application       of    the   filed-rate      doctrine          to    the

plaintiffs' complaint. That the doctrine applies with equal effect

and   vigor     to    the     plaintiffs'       state-law      claims,        in   turn,     is

effectively undisputed. Furthermore, in order to affirm a decision

to decline supplemental jurisdiction, we would first need to

determine      whether       original    jurisdiction          exists    under      CAFA,    a

matter not briefed by the parties. Finally, retaining jurisdiction

to dismiss the state-law claims would raise no comity concerns

because    the       dismissal   of     those    claims     would       not    turn    on    an

application of state law.

               Having so construed the district court's opinion, we

find that the plaintiffs' state-law challenges are also barred by

the filed-rate doctrine for the reasons described above.

                                         - 23 -
                                 III.

           Because we find that all of the plaintiffs' claims are

defeated by application of the filed-rate doctrine, we affirm the

district court's dismissal of the plaintiffs' federal antitrust

and   state-law   claims.   Nothing     in   this   holding   approves   or

disapproves of any of the defendants' conduct.           We simply hold

that the plaintiffs' allegations, assuming their truth, describe

an issue for FERC to address.

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