Occidental Chemical Corp. v. Louisiana Public Service Commission
2016 U.S. App. LEXIS 10
| 5th Cir. | 2016Background
- Occidental Chemical (Occidental) operates a PURPA qualifying facility (Taft) and alleges Entergy and the Louisiana Public Service Commission (LPSC) deprived QFs of PURPA rights by integrating them into MISO.
- Occidental filed an administrative complaint against MISO with FERC (Integration Complaint) in Jan. 2013 and later petitioned FERC against the LPSC; FERC declined to initiate enforcement while reserving the right to act later.
- Occidental then sued Entergy and LPSC in federal district court seeking enforcement of PURPA rights, declaratory relief, and damages; FERC did not intervene under 16 U.S.C. § 824a‑3(h)(2)(B).
- Entergy and LPSC moved to stay the district action under the primary jurisdiction doctrine to allow FERC to resolve the Integration Complaint; the district court granted an indefinite stay pending FERC action.
- Occidental appealed; the Fifth Circuit held it had appellate jurisdiction under the “effectively out of court” doctrine (Hines/Idlewild/Cohen) because FERC had taken nearly two years with no further action, creating an indefinite delay.
- On the merits, the Fifth Circuit concluded the primary jurisdiction doctrine could apply to PURPA §210 suits but vacated the district court’s indefinite stay and remanded with instructions to impose a 180‑day stay (extendable for good cause) after which the court must proceed if FERC has not acted.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether appellate jurisdiction exists over the district court's stay | Hines rule applies; indefinite stay puts Occidental effectively out of court | Hines has been superseded by Moses H. Cone; no final order | Court: Hines remains good law; appellate jurisdiction exists under "effectively out of court" doctrine |
| Whether Mercury Motor bars primary jurisdiction where statute coordinates court/agency | Mercury Motor not controlling; §210 does not preclude district court staying case | Mercury Motor compels that coordination statutes preclude judicial primary jurisdiction | Court: Mercury Motor distinguishable; §210 does not preclude primary jurisdiction |
| Whether district court abused discretion by staying case under primary jurisdiction | Indefinite stay is improper; district court failed to weigh delay and parties' interests | FERC expertise valuable; district court properly deferred to FERC | Court: Primary jurisdiction may be appropriate, but an indefinite stay was an abuse; remand to impose 180‑day stay (extendable for good cause) |
| Whether district court had to abstain from state‑law claims against Entergy | District court should not have stayed state‑law contract claims without analysis | Defendants argued stay appropriate as FERC ruling would be helpful overall | Court: Occidental waived argument below; district court’s failure to address those claims was not preserved on appeal |
Key Cases Cited
- FERC v. Mississippi, 456 U.S. 742 (U.S. 1982) (background on PURPA and FERC/state roles)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (U.S. 1983) (abstention and finality analysis cited in jurisdictional discussion)
- Idlewild Bon Voyage Liquor Corp. v. Epstein, 370 U.S. 713 (U.S. 1962) (origin of “effectively out of court” rule)
- Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (U.S. 1949) (practical construction of finality rule)
- Hines v. D’Artois, 531 F.2d 726 (5th Cir. 1976) (Fifth Circuit’s application of "effectively out of court" finality exception)
- Wagner & Brown v. ANR Pipeline Co., 837 F.2d 199 (5th Cir. 1988) (directed limited stay to avoid indefinite delay under primary jurisdiction)
- Columbia Gas Transmission Corp. v. Allied Chem. Corp., 652 F.2d 503 (5th Cir. 1981) (distinguishing enforcement/fact‑intensive issues appropriate for agency vs. legal issues for courts)