On June 30, 2020, the U.S. Courtroom of Appeals for the District of Columbia Circuit (D.C. Circuit), sitting en banc, issued a call that would radically disrupt and essentially alter the way in which the Federal Power Regulatory Fee (FERC) handles challenges to its orders.
The courtroom held that the Pure Fuel Act (NGA) doesn’t authorize FERC to challenge “tolling orders” solely to forestall the expiration of the 30-day statutory interval for FERC to behave on requests for rehearing, which beneath the NGA ends in the request for rehearing being “deemed denied.” The courtroom left open the chance that FERC may grant rehearing for the aim of substantively contemplating a previous choice by way of the usage of additional record-building pleadings or proceedings. As a result of the Federal Energy Act (FPA) comprises an similar provision requiring FERC to behave on rehearing requests inside 30 days, the choice has necessary implications throughout FERC-regulated industries.
Petitioners in Allegheny Protection Venture v. FERC challenged FERC’s use of a tolling order in response to a request for rehearing of an order issuing a certificates of public comfort and necessity to Transcontinental Fuel Pipe Line Firm for the Atlantic Dawn Venture. The rehearing requirement, which is current beneath each the NGA and the FPA, requires any aggrieved celebration searching for to problem a FERC order on enchantment to first file a request for rehearing with the company. Whereas that request is pending, the requesting celebration might not file an enchantment in courtroom till FERC points a ultimate choice. If FERC fails to reply inside the 30-day statutory time interval, the rehearing request is deemed denied.
As a result of rehearing requests typically embody quite a few, complicated arguments, FERC developed a follow over at the least the final 50 years of issuing “tolling orders” inside 30 days of the submitting of requests for rehearing. Tolling orders are wholly procedural, granting rehearing for the only real goal of additional consideration, thereby successfully prolonging the 30-day statutory deadline for substantive motion on rehearing requests. Below prior D.C. Circuit precedent, FERC’s issuance of tolling orders had been held to foreclose petitions for judicial evaluation till FERC issued a call on the deserves of a rehearing request.
In Allegheny Protection Venture, FERC issued a tolling order with respect to the petitioner landowners’ requests for rehearing of the order issuing a certificates. Whereas their rehearing requests had been pending, a district courtroom licensed condemnation of the landowners’ property, and building of the mission commenced. It’s because as soon as FERC points a certificates of public comfort and necessity for a pure gasoline pipeline, the NGA mechanically grants the holder of the certificates the ability of eminent area to sentence personal property inside the mission’s proper of approach. In follow, which means that FERC might challenge a tolling order, because it did within the Atlantic Dawn continuing, that forestalls a celebration from searching for judicial evaluation even whereas pipeline building and the condemnation of personal property proceed. Because the courtroom famous in its opinion, by the point a celebration is allowed to hunt judicial evaluation earlier than a courtroom, the mission could also be accomplished and operational.
The courtroom’s en banc choice follows a call final August, by which a three-judge panel relied on circuit precedent to affirm FERC’s use of tolling orders, however which included a strong concurring opinion from Choose Millett, who described FERC’s use of tolling orders as a “bureaucratic purgatory” and strongly urged a “re-assessment” at D.C. Circuit precedent.
The D.C. Circuit sitting en banc held that FERC’s routine use of tolling orders is opposite to the plain language of the NGA and prevents aggrieved events from acquiring well timed judicial evaluation. In keeping with the courtroom, a “grant” of rehearing requires some substantive response. The courtroom concluded that tolling orders don’t represent a grant of rehearing—moderately they impermissibly “kick the can down the street.” The courtroom mentioned that FERC “has no authority to erase and change the statutorily prescribed jurisdictional penalties of its inaction.”
The choice signifies that the courtroom’s issues weren’t assuaged by FERC’s just lately issued rule (Order No. 871), by which FERC amended its laws to preclude the issuance of notices to proceed with building for newly licensed pure gasoline pipeline and liquefied pure gasoline initiatives till (i) the 30-day deadline for submitting a request for rehearing has lapsed with no request being filed; or (ii) FERC has acted upon the deserves of any timely-filed rehearing request. Order No. 871 got here on the heels of an earlier dedication to expedite responses to rehearing requests introduced by landowners. Issued as an Prompt Remaining Rule with out discover and remark, Order No. 871 doesn’t take impact till 30 days after publication within the Federal Register, which up to now has not occurred.
Though the courtroom invalidated the usage of tolling orders to keep away from the “deemed-denied” provision, the courtroom clarified that it was not requiring FERC to resolve on points raised on rehearing inside a 30-day window in all circumstances, and declined to rule on a situation by which FERC grants rehearing for the aim of substantively reconsidering a previous choice by way of the usage of extra pleadings, hearings or different record-building proceedings. The courtroom additionally famous that even when FERC takes no motion on a rehearing request inside 30 days, it retains the authority to change or put aside an order till the executive document is filed with the courtroom of appeals, sometimes inside 40 days of the submitting of a petition for evaluation. A courtroom might prolong that deadline for submission of the executive document, upon FERC’s request.
A direct query arising out of the courtroom’s choice is the therapy of events with pending rehearing requests earlier than FERC, for which tolling orders have been issued and for which the statutory interval for submitting petitions for judicial evaluation has expired. Successfully, this might apply to any events which have sought rehearing of a FERC order inside the final 60 days, and for which a tolling order has been issued. However the truth that different circuits observe the norms that the D.C. Circuit simply eradicated means that at the least some evaluation petitions will discover their option to these different circuits. A parallel query arises in regards to the many circumstances now being held in abeyance or that are the topic of motions to carry in abeyance within the D.C. Circuit whereas FERC considers rehearing requests in associated circumstances. Presumably, the courtroom will apply the precepts of its choice and start to maneuver these circumstances alongside to the following procedural stage.
The courtroom’s choice additionally strongly means that FERC may nicely set up procedures to contemplate requests for rehearing in a extra rigorous method. No matter else is likely to be mentioned about FERC’s tolling order routine, it afforded FERC and its employees extra time to contemplate complicated points and to handle a burdensome case load. If FERC elects to make use of the procedures recommended by the courtroom’s choice, pure gasoline mission builders can anticipate that it’s going to take considerably longer to acquire a ultimate order authorizing their initiatives. And, when mixed with Order No. 871, it could take even longer for FERC to authorize building. Whereas extra procedures will surely add expense for all events, placing FERC orders on a brand new basis by obviating a number of the foundation for challenges within the courts to FERC orders seems to be a possible consequence of the D.C. Circuit choice. Alternatively, until FERC is ready to act on the deserves of rehearing requests inside the statutory 30 days, FERC will not be capable to use its rehearing orders as a option to bolster its preliminary orders and people issued by FERC employees beneath delegated authority, probably making FERC orders extra susceptible within the courts.
It’s too early to know whether or not what’s now a cut up between the D.C. Circuit and different circuits that had adopted the D.C. Circuit’s prior acceptance of tolling orders will assist a petition for a writ of certiorari.