Court Opinion

ID: 9448944
Source: CourtListenerOpinion
Date Created: 2023-08-03 23:50:31.399214+00
Date Added: 2024-06-11T17:31:37.358459
License: Public Domain

BROWNING, Circuit Judge
(dissenting).
As the Court states, the Federal Power Act was passed by Congress explicitly to fill the “regulatory gap” created by Public Utilities Commission v. Attleboro Steam & Electric Co.1 In Attleboro the Supreme Court interpreted its earlier decisions as sustaining state authority to regulate “the furnishing of gas to local consumers” in interstate commerce, but denying state power to regulate sales of gas “in wholesale quantities, not to consumers, but to distributing companies for resale to consumers.” 2
This, in any event, was the reading placed upon Attleboro by the Congress while considering the Act. It was repeatedly stated in the legislative proceedings that Attleboro, and the cases which it followed, had drawn the line separating federal and state constitutional authority between sales at “wholesale” or for “resale,” on the one hand, and “local” sales at “retail” or to the “consumer,” on the other.3 The language of Section 201(b) reads naturally in terms of this distinction, stating that the Act is to apply to sales “at wholesale in interstate commerce” (defined as “sales for resale”), and is not to apply “to any other sale.”
The Supreme Court has described the holding in Attleboro and its predecessors in terms of the same fiat distinction between sales for resale and sales for consumption,4 and has said that Congress so understood them in enacting the Federal Power Act. In United States v. Public Utilities Commission the Court said, “Congress interpreted that case [Attle-boro] as prohibiting state control of wholesale rates in interstate commerce for resale, and so armed the Federal Power Commission with precisely that power.” 5
The courts have uniformly read Section 201(b) as granting the federal Commission jurisdiction over all wholesales in interstate commerce, leaving control of sales at retail to the states.6 Cases under the Natural Gas Act, concededly applicable here, are to the same effect. *795As the Supreme Court said in Panhandle Eastern Pipe Line Co. v. Public Service Commission, “The line of the statute was thus clear and complete. It cut sharply and cleanly between sales for resale and direct sales for consumptive uses. No exceptions were made in either category for particular uses, quantities or otherwise.” 7 It is indisputable that sales at retail in interstate commerce were made subject to regulation by the state and are beyond the jurisdiction of the federal Commission even though conflicting state interests might be involved.8 It seems clear that a similarly unqualified grant of exclusive jurisdiction over sales at wholesale in interstate commerce was vested in the Commission.
This sharp and simple division of regulatory power was not conditioned by the declaration of Section 201(a) that federal regulation is “to extend only to those matters which are not subject to regulation by the States.” This general declaration of policy would be relevant “in resolving any ambiguity or indefiniteness in the specific provisions” of the Act, but it “cannot nullify a clear and specific grant of jurisdiction.”9 Before Congress it was “spoken of only as protecting state regulation of local affairs, including rates of intrastate and interstate-for-consumption sales.”10 “To conceive of it now as a benchmark of the Commission’s power, or an affirmation of state authority over any interstate sales for resale, would be to speculate about a congressional purpose for which there is no support.”11
Of course “literalness may strangle meaning,” 12 and a statute is to be read in the light of its purpose. But fixing a clear and certain boundary between federal and state jurisdiction to regulate interstate sales of power, so that its precise location need not be fought out case by case in litigation, is in itself an important objective of legislative policy. As has been said of the parallel provisions of the Natural Gas Act, “Congress undertook to regulate a defined class of natural gas distribution, without the necessity, where Congress has not acted, of drawing the precise line between state and federal power by the litigation of particular cases.”13
To hold that sales of power at wholesale in interstate commerce are not subject to federal Commission jurisdiction unless they involve an “interstate conflict of interest not already subject to federal regulation,” can only create troublesome problems.14 Since an exist*796ing conflict between state regulatory-agencies is not a prerequisite to jurisdiction of the federal Commission,15 it is not clear why an existing (rather than potential) conflict of state interests should be required. Further, it is not clear whether the extent of the conflict of interest is relevant: would federal jurisdiction attach to the Colton contract if Edison sold one Nevada customer a small amount of power; if not, how much more would be required ? Would it make a difference if power sold by Edison in a state other than California were also traceable to a federal generator so that the first sale was controlled by an agency of the federal government? If at some future time federal jurisdiction were to attach to the Colton contract because of sales of power by Edison in states other than California, would the federal jurisdiction over the Colton contract be dependent, upon continuance of these sales? Does the requirement of interstate conflict also apply to federal jurisdiction over interstate transmission; or is it limited to-interstate sales ?16 And if no existing conflict of interest between states is involved, is the interstate sale to be left, unregulated if the state concerned does, not undertake to regulate it?
If it is desirable that regulation of contracts like that with Colton be left to the state, the task of modifying Section 201(b) to accomplish that purpose is one for Congress. Congress could move the jurisdictional line without obscuring it; Congress could require state-by-state assumption of regulatory responsibility before federal controls were withdrawn.17

. 273 U.S. 83, 47 S.Ct. 294, 71 L.Ed. 549 (1927).

. 273 U.S. at 83-89, 47 S.Ct. at 296.

. The following are examples of these references, and also of descriptions of the statutory grant of power in the same terms: Hearings on H.R. 5423, House Comm, on Interstate and Foreign Commerce, 74th Cong., 1st Sess. (1935), pp. 96, 384, 402, 421 ff., 435, 497, 498, 518, 521 ff., 576, 1639, 1679, 2143, 2154; S. Rep. No. 621, 74th Cong., 1st Sess., pp. 17, 48; H.Rep. No. 1318, 74th Cong., 1st Sess., pp. 7, 26; 79 Cong.Rec., 74th Cong., 1st Sess. (1935), pp. 8431, 8444.

. United States v. Public Util. Comm’n, 345 U.S. 295, 303, 73 S.Ct. 706, 97 L. Ed. 1020 (1953); F. P. C. v. East Ohio Gas Co., 338 U.S. 464, 470 n. 10, 70 S.Ct. 266, 94 L.Ed. 268 (1950); Panhandle E. Pipe Line Co. v. Public Serv. Comm’n, 332 U.S. 507, 514, 68 S.Ct. 190, 92 L.Ed. 128 (1947). See also Hartford Elec. Light Co. v. F. P. C., 131 F.2d 953, 964 (2d Cir. 1942).

. United States v. Public Util. Comm’n, 345 U.S. 295, 308, 73 S.Ct. 706, 714, 97 L.Ed. 1020 (1953). See also Connecticut Light & Power Co. v. F. P. C., 324 U.S. 515, 526, 65 S.Ct. 749, 89 L.Ed. 1150 (1945). Cf. F. P. C. v. East Ohio Gas Co., 338 U.S. 464, 471-473, 70 S.Ct. 266, 94 L.Ed. 268 (1950).

. United States v. Public Util. Comm’n, 345 U.S. 295, 311, 73 S.Ct. 706, 97 L.Ed. 1020 (1953); Wisconsin v. F. P. C., 91 U.S.App.D.C. 307, 201 F.2d 183, 185 *795n. 1 (1952); Wisconsin-Michigan Power Co. v. F. P. C., 197 F.2d 472 (7th Cir. 1952).

. Panhandle E. Pipe Line Co. v. Public Serv. Comm’n, 332 U.S. 507, 517, 68 S. Ct. 190, 195, 92 L.Ed. 128 (1947). See also Phillips Petroleum Co. v. Wisconsin, 347 U.S. 672, 682-684, 74 S.Ct. 794, 98 L.Ed. 1035 (1954); Panhandle E. Pipe Line Co. v. Michigan Pub. Serv. Comm’n, 341 U.S. 329, 334, 71 S.Ct. 777, 95 L.Ed. 993 (1951); Illinois Natural Gas Co. v. Central Illinois Pub. Serv. Comm’n, 314 U.S. 498, 506-508, 62 S.Ct. 384, 86 L.Ed. 371 (1940).

. Panhandle E. Pipe Line Co. v. Michigan Pub. Serv. Comm’n, 341 U.S. 329, 71 S.Ct. 777, 95 L.Ed. 993 (1951); Panhandle E. Pipe Line Co. v. Public Serv. Comm’n, 332 U.S. 507, 68 S.Ct. 190, 92 L.Ed. 128 (1947). This, as the court points out, was true in Pennsylvania Gas Co. v. Public Serv. Comm’n, 252 U.S. 23, 40 S.Ct. 279, 64 L.Ed. 434 (1920).

. Connecticut Light & Power Co. v. F. P. C., 324 U.S. 515, 527, 65 S.Ct. 749, 754, 89 L.Ed. 1150 (1945). See also United States v. Public Util. Comm’n, 345 U.S. 295, 310, 73 S.Ct. 706, 97 L.Ed. 1020 (1953).

. United States v. Public Util. Comm’n, 345 U.S. 295, 309, 73 S.Ct. 706, 714, 97 L.Ed. 1020 (1953).

. 345 U.S. at 311, 73 S.Ct. at 715.

. Utah Junk Co. v. Porter, 328 U.S. 39, 44, 66 S.Ct. 889, 892, 90 L.Ed. 1071 (1946).

. Illinois Natural Gas Co. v. Central Illinois Pub. Serv. Comm’n, 314 U.S. 498, 506, 507-508, 62 S.Ct. 384, 3S7, 86 L.Ed. 371 (1940). See also Wisconsin v. F. P. C., 91 U.S.App.D.C. 307, 201 F.2d 183, 185 n. 1 (1952).

. In Illinois Natural Gas Co. v. Central Illinois Pub. Serv. Comm’n, 314 U.S. 498, 502, 508, 62 S.Ct. 384, 385, 388, 86 L.Ed. *796371 (1940), the Court suggests that the federal Commission’s authority extends to sales of gas for resale following other sales for resale of the same energy which are within the Commission’s jurisdiction. The same understanding of the coverage of the Act is reflected in Phillips Petroleum Co. v. Wisconsin, 347 U.S. 672, 682 n. 10, 74 S.Ct. 794, 799, 98 L.Ed. 1035 (1954), where the court refers to the comment of the General Solicitor of the National Association of Railroad and Utilities Commissioners that the purpose of certain changes ultimately included in the Act was “to make certain that the bill will apply to all intercom-pany sales of natural gas at wholesale, even though the sale be from one company to another company which will resell to another corporation before the gas in finally sold to the public.” Hearings before House Comm, on Interstate and Eoreign Commerce on H.R. 4008, 75th Cong., 1st Sess. 22.

. Only California had sought to regulate the rates involved in United States v. Public Util. Comm’n, 345 U.S. 295, 73 S.Ct. 706, 97 L.Ed. 1020 (1953). In that case as in this, Nevada withheld a potential claim to regulatory jurisdiction.

. The Court’s discussion of Illinois Nat-tural Gas Co. v. Central Illinois Pub. Serv. Comm’n, 314 U.S. 498, 62 S.Ct. 384, 86 L.Ed. 371 (1942), and F. P. C. v. East Ohio Gas Co., 338 U.S. 464, 70 S.Ct. 266, 94 L.Ed. 268 (1950), suggests as much, though it is difficult to find a basis for such a distinction in the statute itself.

. In a comparable situation the Supreme-Court adhered to the jurisdictional test of the Natural Gas Act [F.P.C. v. East Ohio Gas Co., 338 U.S. 464, 70 S.Ct. 266,. 94 L.Ed. 268 (1950) ] and Congress then enacted a clear and limited exception ini favor of “any person engaged in * * * the sale in interstate commerce for resale, of natural gas received by such person from another person within or at the boundary of a State if all the natural gas so received is ultimately consumed within such State * * * provided that the rates * * * of such persons * * * be subject to regulation by a State commission. * * * A certification from such State commission to the Federal Power Commission that such State Commission has regulatory jurisdiction over [such] rates * * * and is exercising such jurisdiction shall constitute conclusive evidence of such regulatory power or jurisdiction.” 15 U.S. C.A. § 717(c). See S.Rep. No. 817, 83d Cong., 2d Sess.