Greensboro Lumber Company v. Georgia Power Company

(collectively, “Oglethorpe Group”) the are VANCE, Before HILL and Circuit scrutiny immune from under the federal *, Judges, Judge. and District PROPST antitrust laws. HILL, Judge: Circuit Greensboro first that there were Plaintiff/appellant disputed questions of fact as to whether (“Greensboro”) Company brought this suit the Rural Electrification Administration (“REA”) in “all-requirements United States District Court for the mandated the contracts,” Georgia, alleging Northern District of vio- summary so that was laws, lations of improper. all-requirements the federal antitrust viola- These con tions of obligate section 210 of the federal Public tracts the EMCs to all of Utility Regulatory power exclusively Policies Act of 16 their wholesale from (“PURPA”), year 2022, U.S.C. 824a-3 pre and state law until the thus § defendants, breach of appel- venting purchasing power contract. The EMCs court, in Georgia lees this separately are the Power from Greensboro. The district Power”), (“Georgia Municipal all-requirements court held that con (“MEAG”), Electric Authority required by tracts there were the REA and Georgia municipalities county scrutiny, rely and fore immune from antitrust (1) participate (“Partici- which ing arguments by on the United States pants”), Corporation Power as amicus curiae that the REA has a (“Oglethorpe”), the long-standing policy requiring 39 rural electric mem- such con bership cooperatives loans, security members of tracts as for are REA (“EMCs”), 1362; (2) City F.Supp. the REA Dal- at affidavits * Propst Judge designation. Honorable Robert B. for the U.S. District sitting by Northern District of Alabama supporting the United Administrator next attacks the holding of 1363; argument, (3) immunity by States’ id. at the Unit seeking antitrust to distin- rejection guish ed of an Supreme States Court’s Alabama Power. That case involved utility’s 20-year antitrust to a a loan from the REA to challenge the Alabama Elec- all-requirements (“AEC”) tric Cooperative Tampa purpose contracts Elec financing Co., a generating plant tric high- Co. Nashville Coal voltage electrical (1961), L.Ed.2d 580 distribution lines. 394 1362; (4) holding loan was this secured (as Circuit) all-requirements contracts the former Fifth between the (similar AEC to Oglethorpe case) virtually all-requirements identical con and fourteen electric coopera- distribution tracts were and entitled valid to antitrust (similar EMCs). tives Id. at immunity in 675-76. Ala Alabama Co. v. The Alabama Power Company brought Cooperative, Inc., bama Electric complaint alleging (5th all-require- Cir.), denied, cert. ments contracts violated the 488, (1968), antitrust laws. 89 L.Ed.2d S.Ct. 21 465 643 Id. at 673. The district court addressed F.Supp. at 1362. arguments issue, Greensboro’s this on 643 recognize We in reviewing grant that 1365-66, adopt and we the rea- motions, of appellees’ summary judgment soning of the district on point. court this independent this court exercises argues Greensboro next that Alabama and makes its own assessment of longer good Power nois law should be record as to there genuine whether was a overruled. On that point, we need only dispute any as to material issue of fact in beyond note that such a is decision States, the case. Mays United F.2d v. 763 power panel responsible of the for this (11th Cir.), denied, 998, 1295 474 cert. U.S. Only decision. the en banc court has the 416, (1985); 106 S.Ct. 88 L.Ed.2d 365 power prior to overrule a decision Thrasher v. Farm State Fire and Casual panel of the court. City Bonner v. ty (11th Cir.1984). Company, F.2d 637 734 of Prichard, (11th 1206, 661 F.2d 1209 Cir. standard, however, Even under this we 1981). Greensboro’s citation Erkins v. hold that the district was correct in (11th Bryan, Cir.), F.2d 785 1546 concluding all-requirements that con cert. sub denied nom. United Steelwork tracts at issue in this case required were — Erkins, U.S. —, ers America v. the REA. of that there is a (1986), 107 93 402 S.Ct. L.Ed.2d does fact, disputed pointing issue of to inconsist persuade not us otherwise. encies between the two affidavits of the REA Administrator as to of policy argued Oglethorpe It is that REA. Greensboro’s assertions suf are not entity, single EMCs constitute a and are ficient to dispute establish factual as to incapable conspiring thus with each oth whether required the REA Oglethorpe and er in violation Section One Sher EMC’s to enter the all-requirements into question “single man We this Act. whether contracts which are issue in ease. this theory” entity applicable Oglethorpe most, At have established Drug Compa and the EMCs. Royal See factual dispute about certain items Group v. Health ny, Inc. Ins. Life 1380-82 policy, REA is not (5th but that sufficient for us Co., Cir.1977), disagree with the court’s Group sub nom. & Health Ins. aff'd Life summary judgment, because is no Royal Co., there Drug Co. v. required (1979).1 substantial the REA doubt 59 L.Ed.2d 261 How ever, particular question the contracts at issue we need not be reach that case. all-require- cause of our decision subsequent history, Drug Royal 1. The further after the creation the Eleventh Circuit curred Co., Co., Group precedent Inc. v. and Health not bind- Ins. and is therefore ing treated as Life (5th Cir.1984), denied, upon, cert. the Eleventh See Bonner v. Circuit. Prichard, (11th (1985), Cir.1981). 105 S.Ct. City L.Ed.2d oc- 661 F.2d 1206 immune from antitrust “facial” contracts are attack on merits Power. scrutiny under Alabama Policy Interconnection elevates form over substance. Greensboro the District agree We also Court’s presented arguments has to the FERC. no has suffered conclusion that Greensboro See Company alleged antitrust cognizable injury from Rayle Membership Corporation, Electric by Oglethorpe and the EMCs and violations ¶ 61,283 (1987); F.E.R.C. standing to sue. therefore lacks Corporation, al., Power et 35 F.E.R.C. F.Supp. at 1367-71. ¶ 61,069 (1986), sub nom. Greens aff'd agree with the district As we boro Lumber Energy v. Federal that Greensboro advances no an- conclusion Commission, Regulatory 825 F.2d 518 to survive a motion titrust claim sufficient (D.C.Cir.1987); Corpo summary judgment, we find no merit ¶ ration, al., et 61,103 (1985), 32 F.E.R.C. injunctive relief. its claim for nom., sub Greensboro Lumber Com aff'd pany Energy v. Federal Regulatory Com PURPA AGAINST OGLE- CLAIMS mission, (D.C.Cir.1987). 825 F.2d 518 THE AND EMCS THORPE FERC has substance concluded and the EMCs have any against Ogle need not take action adopted Policy Interconnection under See 40 F.E.R.C. 11 thorpe. 61,283. Conse only Oglethorpe will elec which quently, persuaded we are not that Greens tricity only prevail boro could on either its claim for electricity to EMCs will sell Greensboro. relief, damages injunctive or its claim for this Greensboro claims that Interconnec grant and we affirm the district court’s of Policy tion violates section 210 the federal summary judgment. Utility Regulatory Policies Public Act of 1978, (“PURPA”), 16 U.S.C. 824a-3 § PENDENT utility STATE LAW BREACH requires

which each electric both to OF electricity co-generators sell such as CONTRACT CLAIM AGAINST Greensboro, electricity and to OGLETHORPE co-generators. The from district court held agree Since we with the district court’s subject jurisdiction it that lacked matter grant summary judgment Oglethorpe applied” claim, over Greensboro’s “as and and the EMCs on all of the federal claims reasoning persuasive. we find its 643 them, against agree we also with that F.Supp. at 1371-75. pendent jur- court’s decision not to exercise also that isdiction over Greensboro’s state law claim Policy Interconnection See 643 F.Supp. for breach of contract. at comply fails to with PURPA on its face. argument jurisdictional This avoids problem applied” inherent “as claims ANTITRUST CLAIMS AGAINST MEAG see PURPA, under F.Supp. at but AND THE PARTICIPANTS persuaded we are not we should re summary verse the district court’s The district court held that the actions of basis, Participants on this either. Greens MEAG are immune scrutiny boro’s “facial” attack on the Interconnec from antitrust under the state ac- as set out in Par- Policy doctrine, tion immunity asserts that the FERC tion Brown, ker v. Oglethorpe only waivers to and EMCs 317 U.S. 63 S.Ct. Town of (1943) prospectively, Oglethorpe and that and L.Ed. 315 and extended Claire, City ac Hallie v. Eau yet EMCs have to obtain the FERC’s ceptance (1985) of an amended 85 L.Ed.2d 24 and Interconnection 105 S.Ct. Motor Carriers Rate Therefore, Southern Policy. Greensboro asserts that Confer- ence, States, Inc. v. United damages is entitled to the historical (1985). noncompliance, injunction require and an 85 L.Ed.2d 36 future compliance. does not F.Supp. at 1375-83. Greensboro appeal, requisite on and we do not “clear expression” this issue raise intent pre-empt laws, it here. state territorial address service

that the Territorial Electric Service Act is consistent objective with the of sec- AND CLAIMS AGAINST MEAG PURPA Id. Greensboro’s ar- tion 210 of PURPA. THE PARTICIPANTS guments contrary persuade do not against PURPA claims us that should be re- See categories. fall into two MEAG versed. catego- F.Supp. at 1383-85. Both these Policy ries deal with Interconnection category The second of Greens Participants (collectively, MEAG against boro’s PURPA claims the MEAG Group”). Group’s The the “MEAG MEAG Group portion concerns the of the Intercon to, Policy is similar but Interconnection Policy nection which forbids Partici than, more limited that of each, pants from separately, purchasing the EMC’s discussed above.2 electricity from Ogle Greensboro. The category The first of Greensboro’s thorpe group obtained a waiver from the against Group PURPA claims the MEAG validating arrange FERC the buy/sell electricity concerns their refusal to sell ments policy. under interconnection retail to Greensboro. Greensboro claims see Greensboro Lum 1373-74; regulations promulgated the Feder Company Rayle ber v. Electric Member Energy Regulatory al under Commission ship Corporation, 40 F.E.R.C. 11 61,283 requires PURPA and the Partici MEAG (1987); Corporation, Power et pants electricity to each offer to sell al., 35 F.E.R.C. II 61,069 (1986), sub aff'd 292.303(b) Greensboro. 18 C.F.R. § nom. Company (1987).3 complains Commission, Energy Federal Regulatory Policy pre Group’s Interconnection (D.C.Cir.1987); 825 F.2d 518 electricity vents sales of MEAG to al, Corporation, et F.E.R.C. regulation. violation of nom., sub Greens 61,103 (1985), aff'd Energy boro Lumber v. Federal court concluded that Greens- Commission, Regulatory F.2d 518 standing boro lacks to raise this claim. A (D.C.Cir.1987). The district court conclud provision of the Territorial Electric the Ogle Act, 46-3-ll(b)(4) ed that decision FERC’s Service O.C.G.A. “[t]he § thorpe a (1982), the MEAG prevent selling would case validates MEAG from fortiori Group’s Policy regarding to Greensboro Interconnection even the absence the F.Supp. 1385. The dis Policy. purchases.” Interconnection at at Thus, court, according Ogle to the district trict court reasoned that “[b]ecause standing thorpe’s authority purchas Greensboro the re- power lacks because to make alleged lief it seeks would not es was redress at all levels for the EMCs affirmed Id. The district it follows a FERC, injury. rejected the that fortiori argument pre- authority Greensboro’s that PURPA MEAG’s more-limited to make empts the Georgia power purchases only higher capacity Ser- Territorial Electric Act, observing Id. vice that PURPA lacks the levels is consistent PURPA.” Group’s Policy, directly any 2. The MEAG does between Interconnection not cause difference Oglethorpe Group, specifies like that that Oglethorpe’s relationships with and MEAG’s Greensboro; only Participant may electricity sell to Greens- facility co-generation Greensboro's boro, only electricity purchase and MEAG megawatts, designed produce well is 7.5 However, Group's from Greensboro. above the 100 kilowatt threshold. Policy provides Interconnection pants, that the Partici- MEAG, designated purchasers not are the 292.303(b) provides 3. 18 that § ”[e]ach C.F.R. electricity co-generators from whose facilities utility any qualifying facili- electric shall sell designed produce are 100 kilowatts less. 292.305, energy ty, any § in accordance with contrast, In ty the EMCs do not electrici- capacity requested qualifying and facili- any co-generator. Oglethorpe from makes ty” purchases these on behalf of the EMCs from all co-generators regardless of size. This difference light subsequent that In of the argues PURPA. deci- Greensboro catego- to the second pro- as in the conclusion sions waiver erroneous. here, claims is Greens- ry PURPA ceeding and we see no reason to granted that the FERC points out boro further action on take Greensboro’s com- conditionally, only to Greensboro waiver plaint against par- MEAG and the MEAG Group’s Interconnec- the MEAG and that ticipants. provi- certain not contain Policy does tion 61,283 61,919 (footnote 40 F.E.R.C. 11 interconnection sions which the omitted). contains, and which FERC found policy Participants, EMCs, buy The like the do compliance with PURPA. necessary for electricity cogenerators, in from the same Furthermore, that they electricity. buy manner as all their showing that the burden of MEAG bears meeting electricity, their overall needs for regulations is not nec- enforcement Participants purchase most of their re- cogeneration, that encourage essary to MEAG, case-by-case quirement pur- from only on a EMCs are waivers basis, heavily requirements that the determination chase most of their and from Therefore, according to fact-specific. Oglethorpe. cogenerators Where are in- necessity for volved, buy Participants from all but a waiver demonstrates to obtain MEAG, very cogenerators through small Policy is parallel Interconnection MEAG’s buy cogenerators and the EMCs PURPA, and Greensboro is in violation of through Oglethorpe. This is the sensible for this violation since entitled to redress way Participants for the and EMCS to ac- sought nor obtained the MEAG has neither quire electricity; their it is in fact so sensi- itself. necessary waiver for appears that the to have had no ble FERC again arguments elevate approving trouble in it. substance, we affirm the form over Congress provisions enacted the it point court on this as well. While in this case it PURPA at issue because gone through has never is true that MEAG important deemed it that there be a market process, appears the formal waiver However, cogenerators’ electricity. as proceeding the result of such a would be long cogenerators opportunity as have the conclusion, foregone given electricity prices, to sell their at reasonable by the FERC. waivers to nothing Congressional indicate we find FERC, pursued, has before the organizations intent that like the Partici- Group’s challenge the MEAG Intercon- pants should have to make EMCs Policy, nection and the outcome of that changes acquiring in their means of special clearly implies the FERC sees no case electricity. MEAG/Participant significant the Inter- difference between Oglethorpe/EMC agreements give cogener- Group connection Policies of the MEAG opportunity the to sell to the Partici- ators group. dismissing In pants through MEAG and to the EMCs MEAG, against the complaint Greensboro’s through Oglethorpe. We find that suffi- FERC observed cient. complaint judi- res is not barred [t]he par- cata because MEAG and the MEAG

ticipants Ogle- parties were not OTHER ISSUES Nevertheless, thorpe proceeding. waiver deci- agree with the district court’s We 210(h) sec- under section of PURPA and Group’s motion for on the MEAG sions FPA, decline to inves- tion 306 of the we against under Fed.R. sanctions Greensboro tigate complaint to the establish remaining Civ.P. and on Greensboro’s hearing procedures. When against claims Dalton and Geor- antitrust complaint, filed its the Power, the supplement need not gia and we granted waivers had not been and it was 643 analysis. court's See unclear how the Commission and the interpret courts 210 of at 1385. would section opinion outlining discovery of the district court required the respond to to the defendants’ motions. AFFIRMED. a September At 9 status conference the

VANCE, Judge, dissenting. Circuit argument district court heard oral on all pending motions. At that time Greensboro necessarily I disagree I dissent. do not reiterated discovery its need for and re- legal the conclusions with set forth the newed its to stay motions lift the Rather, dis- majority’s opinion. my problem covery permit discovery to under its the district court’s stems proposed plan. year Almost one later on granted that the court fact 29, 1986, August the court entered its or- summary judg- defendants’ motions for der granting the defendants’ motions for allowing op- ment without Greensboro the summary judgment. The court’s order portunity discovery, to conduct a fact the made no mention of motion Greensboro’s to ignores. majority simply stay discovery 56(f)

lift the or of its Rule A. affidavit. outset, procedural

At the case’s his- B. tory mentioning. is worth complaint its filed on October 1984 and 56(f) Rule allows a deny court to a mo shortly began discovery thereafter ef- for summary judgment tion or order a con 27, however, On December forts. dis- party a tinuance when sets forth affida trict court motion defendants’ vit sufficient inability reasons for its to stay discovery. stayed to The court’s order present opposition facts to the motion. indefinitely discovery pending all the de- give designed The rule was parties to any dispositive fendants’ answers and mo- opportunity case, prepare reasonable to tions. The order if indicated that Greens- and it is frequently invoked when there has discovery respond boro needed ato mo- not opportunity been sufficient to con summary judgment tion for file an could discovery. Wright, duct 10A C. A. 56(f) along affidavit under Rule with a Kane, Miller & M. Federal Practice and discovery plan outlining discovery re- (1983). Summary judg Procedure § quired.1 rarely appropriate ment is party before the By February opposed defendants had all to the motion has had at least gather filed summary opportunity motions dismiss or for some material facts judgment. February through See, On discovery. 26 Greensboro e.g., WSB-TV v. complaint Lee, (11th Cir.1988); amended its filed a motion to stay discovery. Bennett, lift the 310-11 After de- Murrell v. (5th Cir.1980); Service, Hosp., fendants renewed their motions to dismiss Nursing summary judgment or for Employees Greensboro filed Home and Pub. Union v. Com 56(f). Servs., pursuant affidavit to Rule Property the mercial 755 F.2d Gutherie, (6th Cir.), denied, affidavit Thomas cert.

president, (1985). stated that Greensboro could not S.Ct. 88 L.Ed.2d This is cases, present necessary oppose especially the facts true in antitrust where the summary judg- likely defendants’ motions for are in the exclu material facts be given opportunity Hospital ment until to conduct sive control the defendants. discovery.2 Hosp., Along Bldg. with the affidavit Co. v. Trustees Rex 738, 746, proposed discovery plan Greensboro filed a 96 S.Ct. 48 L.Ed. 56(f) depositions 1. Rule be to taken or Federal Rules Civil Proce- obtained or be provides: dure discovery may to be had or make such other just. appear party Should it a as affidavits of order is opposing party the motion that the cannot for specific present by 2. areas in The affidavit set forth the reasons stated facts essen- affidavit justify party's opposition, discovery tial may the court in which Greensboro needed order application judgment summary judgment. refuse respond to motions for may permit a order continuance to affidavits stated, however, (1976); George Frey Ready- Circuit once in reversing 2d 338 C. a Mixed,Concrete, grant summary judgment Hill in Inc. v. Pine Concrete a somewhat (2d Cir.1977). analogous Corp., case: Mix danger This case illustrates the of found- sure, always improper To it is not be ing in favor party of one grant summary judgment prior to dis upon his own version of facts within his instance, nonmoving if covery. For knowledge sole as set forth in affidavits 56(f) party cannot demonstrate a Rule prepared parte. ex Cross-examination of discovery might affidavit that uncover evi party and a reasonable examination dispute would create a as to a dence that party of his records the other fre- fact, summary judgment appro material quently bring forth further facts which v. priate. Schaeffer, Hancock Indus. place very light upon pic- different (3d Cir.1987); 229-30 see also ture. Co., v. Brownell Pontiac-GMC Wallace (11th Cir.1983) (dis Inc., Pipe 703 F.2d Toebelman v. Missouri-Kansas Line Co., (3d Cir.1942). covery plain have been useless as 130 F.2d Ac- would cordingly, respectfully facts I tiff’s own version of the were insuffi dissent. action). Here, support the how cient to 56(f)

ever, Rule affidavit to

gether proposed discovery plan than to warrant at

was more sufficient

least continuance. affirming

In

summary judgment majority accepts all-require- that the the court’s conclusion BLALOCK, Jr., C.W. ments contracts between Plaintiff-Appellant, required by the REA. the EMCs were however, consistently has dis- puted specifically sought this fact and dis- America, UNITED STATES 56(f) covery on the issue its Rule affida- Defendant-Appellee. discovery accompanying plan. vit and No. 87-8020. allowed should have Appeals, United States Court of discovery conduct limited into the matter Eleventh Circuit. respond so that Greensboro could addition, defendants’ affidavits. May Greensboro should have been allowed limit- discovery relationship among ed into the agreements

the defendants and the various presen-

between them. Given the one-sided

tation the district court was faced with

ruling summary judg- on the motions for

ment, I do not have confidence in its con- injury

clusion that Greensboro suffered no alleged

from the defendants’ antitrust vio-

lations.

C.

I suggest do not that the result in this

case would have been different had the

district court allowed Greensboro to con- discovery.

duct It be that the dis-

covery requested would not have created a

dispute as to a Third material fact. As the

Case Details

Case Name: Greensboro Lumber Company v. Georgia Power Company

Court Name: Court of Appeals for the Eleventh Circuit

Date Published: May 18, 1988

Citation: 844 F.2d 1538

Docket Number: 86-8797

Court Abbreviation: 11th Cir.