Court Opinion

ID: 9430857
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:30:45.157701+00
Date Added: 2024-06-11T17:23:26.183121
License: Public Domain

Justice Powell,
with whom Justice O’Connor joins, concurring.
I join the Court’s opinion, and write only to state generally my understanding as to the scope of judicial review of rates determined by an administrative agency. I agree that the FCC regulatory order challenged in these cases does not effect *255an unconstitutional taking of property. In the Court’s brief discussion of “traditional Fifth Amendment standards,” it quotes a single sentence from the Permian Basin Area Rate Cases, 390 U. S. 747 (1968), to the effect that regulation of maximum rates “may, consistently with the Constitution, limit stringently the return recovered on investment, for investors’ interests provide only one of the variables in the constitutional calculus of reasonableness,” id., at 769.
The inquiry mandated by the Constitution is considerably more complex than this simple statement reflects. Justice Harlan’s opinion for the Court in that case is some 74 pages long. In addition, Justice Douglas wrote an interesting, and relevant, dissenting opinion. The one sentence included in today’s opinion in no way accurately portrays the full rationale of judicial review of ratemaking by administrative tribunals. Other portions of the Permian opinion could be quoted to indicate that the standard gives governments far less leeway. Indeed, on the next page in Permian the Court identifies the relevant standard of review under the Natural Gas Act as “just and reasonable,” id., at 770, and the opinion goes on to suggest that the Commission’s rates must be selected “from the broad zone of reasonableness.” Ibid. A second rate case in which several Justices carefully considered the role courts should play in reviewing administrative rate-making orders is FPC v. Hope Natural Gas Co., 320 U. S. 591 (1944). Justice Douglas, writing for the Court, stated that the “just and reasonable” standard required that “the return to the equity owner should be commensurate with returns on investments in other enterprises having corresponding risks.” Id., at 603.
I do not suggest that this isolated sentence from Hope Natural Gas is any more to be viewed as the appropriate standard than the sentence from Permian Basin the Court quotes today. My point is only that judicial review of rates challenged as taking property without just compensation involves careful consideration of the relevant statute, the action of the *256regulatory commission, and a complex of other factors. The rates before us clearly comport with the Constitution. In my view no purpose is served by selecting for quotation a single sentence that, standing alone, is meaningless at best.