Court Opinion

ID: 2976565
Source: CourtListenerOpinion
Date Created: 2015-09-22 17:54:05.751952+00
Date Added: 2024-06-11T08:46:55.479325
License: Public Domain

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                              File Name: 08a0326n.06
                                 Filed: June 9, 2008

                                                   No. 07-5340

                               UNITED STATES COURT OF APPEALS
                                    FOR THE SIXTH CIRCUIT

In re: CLEAN EARTH KENTUCKY, LLC;                        )
CLEAN EARTH ENVIRONMENTAL                                )
GROUP, LLC,                                              )
                                                         )
         Debtors.                                        )
                                                         )
------------------------------------------------------   )
                                                         )   ON APPEAL FROM THE UNITED
ALABAMA POWER COMPANY,                                   )   STATES DISTRICT COURT FOR THE
                                                         )   EASTERN DISTRICT OF KENTUCKY
         Appellant,                                      )
                                                         )
v.                                                       )
                                                         )
CLEAN EARTH KENTUCKY, LLC; CLEAN                         )
EARTH ENVIRONMENTAL GROUP, LLC,                          )
                                                         )
         Appellees.                                      )

         Before: ROGERS, COOK, and McKEAGUE, Circuit Judges.

         PER CURIAM. Utility company Alabama Power appeals a bankruptcy court order barring

it from terminating service to Clean Earth Environmental Group, LLC. Although Clean Earth has

since ceased operations, ending its relationship with Alabama Power, the utility argues that this

controversy is not moot because it is “capable of repetition, yet evading review.” Because we find
No. 07-5340
AL Power Co. v. Clean Earth KY, et al.

this mootness exception inapplicable, we vacate the district court’s order and remand with

instructions to dismiss this case.

                                           -2-
No. 07-5340
AL Power Co. v. Clean Earth KY, et al.

                                                    I

        In January 2006, Clean Earth—a manufacturer of street sweepers—filed for protection under

Chapter 11 of the Bankruptcy Code. Immediately, the company filed several “first day motions” to

ensure continuity in its operations. One of these—the “Utility Motion”—moved the bankruptcy

court to bar Clean Earth’s utilities, including electricity provider Alabama Power, from terminating

service. In return, Clean Earth promised to prepay its utilities an “assurance payment” equal to an

average month’s bill. See 11 U.S.C. § 366(b) (“[A] utility may alter, refuse, or discontinue service

if neither the trustee nor the debtor . . . furnishes adequate assurance of payment . . . .”).

        Alabama Power objected, demanding a monthly prepay equal to a two-month bill. It argued

that the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005’s amendments to § 366

empowered it to demand more assurance. The bankruptcy court split the difference, granting Clean

Earth’s motion, but requiring an assurance payment of one and one-half month’s average use.

        Although this narrowed the amount in dispute between the two parties to only $4,998,

Alabama Power appealed to the district court. That appeal prompted Clean Earth to mail Alabama

Power a check for that amount to end the dispute. But Alabama Power returned the check uncashed.

Indeed, it persisted with its case even after Clean Earth (with the bankruptcy court’s permission)

obviated the need for any assurance payment by selling its assets to a third party and terminating its

account with Alabama Power.

                                                  -3-
No. 07-5340
AL Power Co. v. Clean Earth KY, et al.

           Before the district court, Clean Earth accused Alabama Power of pressing a moot issue

merely to obtain a favorable interpretation of the amended § 366. While the district court did not

agree that Alabama Power’s appeal was moot, it affirmed the bankruptcy court order on the merits.

Alabama Power now appeals that decision.1

                                                   II

       Article III of the United States Constitution empowers the judiciary to adjudicate only actual

cases or controversies, and not to issue advisory opinions. Deakins v. Monaghan, 484 U.S. 193, 199

(1988). Accordingly, at no stage of review may a federal court “‘give opinions upon moot questions

or abstract propositions, or . . . declare principles or rules of law which cannot affect the matter in

issue in the case before it.’” Church of Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992)

(quoting Mills v. Green, 159 U.S. 651, 653 (1895)).

       Because of this cardinal rule of federal jurisdiction, we cannot adjudicate the moot issue

presented by this appeal. Alabama Power objected to Clean Earth’s Utility Motion hoping to garner

a larger assurance payment. But because it no longer supplies electricity to Clean Earth, Alabama

Power no longer seeks any assurance payment. These circumstances prevent a court from furnishing

“any effectual relief whatever.” Mills, 159 U.S. at 653.

       1
           Clean Earth declined even to participate in this appeal.

                                                  -4-
No. 07-5340
AL Power Co. v. Clean Earth KY, et al.

        Acknowledging our inability to grant any meaningful relief, Alabama Power nonetheless

seeks an advisory opinion that it can brandish the next time a bankrupt customer attempts to secure

a similar § 366 order. Alabama Power insists that we should follow the district court’s lead and

reach the merits because the issue here is “capable of repetition, yet evading review.” See, e.g.,

Spencer v. Kemna, 523 U.S. 1, 17 (1998). This mootness exception applies in “exceptional

situations” where: (1) the challenged action is in its duration too short to be fully litigated prior to

cessation or expiration; and (2) there is a reasonable expectation that the same complaining party will

be subject to the same action again. Id. at 17 (internal citations and quotation marks omitted).

        Alabama Power cannot meet the second prong. True, Alabama Power will face similar

disputes with other bankrupt customers. But to satisfy the second prong in a commercial dispute

between two private parties, we require “the complaining party [to] show a reasonable expectation

that he would again be subjected to the same action by the same defendant.” Chirco v. Gateway

Oaks, L.L.C., 384 F.3d 307, 309 (6th Cir. 2004). Alabama Power’s inability to demonstrate such

an expectation renders the “capable of repetition, yet evading review” exception inapplicable, at least

in the context of this case.

                                                  III

        Because this appeal presents no actual case or controversy, we vacate the district court’s

order and remand with instructions to dismiss the appeal to the district court as moot.

                                                 -5-