John Orange v. Starion Energy PA Inc, 711 F. App'x 681

In October 2013 John Orange signed a variable-rate electricity supply contract with Starion Energy PA, LLC after Pennsylvania deregulated energy markets.
The contract’s variability clause stated the Variable Rate would be calculated monthly based on Starion’s variable price methodology and could change in response to market conditions in any or all of the PJM, NEISO, NYISO, and MISO territories, accounting for factors "as determined in Starion’s discretion."
Orange alleges Starion’s monthly rates rose substantially after the first month, eventually nearly triple the local utility rate, and he terminated service in April 2014.
Orange sued as a putative class, alleging breach of contract (and initially other claims), and amended to assert only the breach claim; Starion moved to dismiss under Rule 12(b)(6).
The District Court dismissed the amended complaint with prejudice for failure to state a claim; the Third Circuit affirmed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Orange pleaded a plausible breach of contract by alleging Starion charged rates "arbitrarily" and far above the local utility	Orange: the substantial disparity between Starion’s rate and the local utility rate supports inference Starion did not follow the contract’s market-factor methodology	Starion: the contract expressly permitted use of market conditions across multiple regional territories and factors "as determined in Starion’s discretion," so comparison to the local utility rate alone cannot show breach	Court: Dismissed — plaintiff’s allegation was conclusory; lone allegation of higher rates vs. local utility insufficient to plausibly infer breach given the contract’s broad discretion language
Whether purported judicial notice of geographic meanings of acronyms and related appellate-jurisdictional contentions required reversal	Orange: district court improperly took judicial notice of geographic definitions and the sua sponte dismissal order implication is appealable	Starion: appeal does not encompass the sua sponte dismissal details; even if considered, definitions are harmless and plaintiff failed to plead rates in other territories	Court: Did not find a reversible error; jurisdictional/appeal arguments unavailing and any judicial-notice issue would be harmless on 12(b)(6) review

Fleisher v. Standard Ins. Co., 679 F.3d 116 (3d Cir. 2012) (standard of review for Rule 12(b)(6) dismissal)
Phillips v. County of Allegheny, 515 F.3d 224 (3d Cir. 2008) (construe complaint in plaintiff’s favor on motion to dismiss)
Pinker v. Roche Holdings Ltd., 292 F.3d 361 (3d Cir. 2002) (pleading-construction principles at dismissal stage)
Connelly v. Lane Construction Corp., 809 F.3d 780 (3d Cir. 2016) (plausibility standard under Iqbal/Twombly)
Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (conclusory allegations insufficient to state a plausible claim)
Ware v. Rodale Press, Inc., 322 F.3d 218 (3d Cir. 2003) (elements of breach of contract under Pennsylvania law)
In re NAHC, Inc. Securities Litigation, 306 F.3d 1314 (3d Cir. 2002) (harmless error doctrine in appellate review)