*2 Before JOHN R. GIBSON and WOLLMAN, Judges, Circuit HEANEY, Senior Judge. Circuit GIBSON, Judge. JOHN R. Circuit Nebraska appeals Public Power District from judgment Corpo- favor of Nucor ration on a against breach of contract claim Nebraska Power based on electric rate overcharges. panel A of this court heard argument and then remanded for additional findings on the issue of whether the John- Act, (1982), son U.S.C. 1342 us to hold that the district court lacked jurisdiction to entertain this action. The district court1 tried the issue and certified findings its to this court. We affirm the district court’s determination that the John- son Act did deprive jurisdiction, and we affirm on the merits. public corporation Power is a provides wholesale and retail electric throughout service Nebraska. It owns and operates generation, electric transmission, and distribution facilities. Nebraska Pow- largest customer, er’s as measured elec- usage, Nucor, trical corpora- Delaware principal tion with its place of business Charlotte, North operates Carolina. Nucor Norfolk, a steel mill Nebraska, near uses electric arc scrap furnaces to melt metal. Nebraska Power and Nu- cor entered into a contract for Nebraska Power to fulfill Nucor’s electrical needs at plant. Norfolk The contract contained schedule, a rate designated HTS-2, which is only available to industrial or man- ufacturing customers which meet minimum requirements demand and receive service directly high from voltage facilities. Nu- cor is the qualify customer to for the HTS-2 rate.
Nebraska Power establishes its electric through rates resolutions enacted board directors. No state administrative agency in Nebraska is authorized to review Strom, Lyle The Honorable E. Judge United States District for the District of Nebraska. Nucor s Nucor, to show the extent rather, rates; rates Power’s Ne- instructed that damage. in state review judicial subject to direct 70-655, law, section as embodied in requires that law court. Nebraska directors to estab- authorized the board and nondiscrimi- rates such rates be required that (Reissue lish 70-655 natory. Neb.Rev.Stat. § *3 nondiscriminatory. reasonable, and a contained 1986).2 in issue The contract that this sec- jury also instructed The was required also provision which review rate statutes should be fair, reasonable, non- tion of the Nebraska and the rate be that contract part of the between pro- considered further discriminatory. The contract Special inter- “sufficient, Power. Nucor and Nebraska but the rate must be vided jury, the and rogatories submitted to sufficient, expense the and only collect year rate for each jury found that the the requirements associ- net revenue estimated fair, rea- through 1986 was not from 1974 Primary Power Large Industrial with ated sonable, nondiscriminatory. jury The and year During 1973 and at two Service.” damages sus- specified the amount of thereafter, also Power was intervals year, an amount study by tained Nucor for each prepare a by the contract to required $7,492,340. court entered totalling The expenses and estimated operating of occurring service, damages after judgment for for this requirements revenue net $4,403,- August determined to be based on rates were and 546.70, of it found that the statute because the studies. of results applicable to contracts written limitations against Ne- brought action damages recovery for before barred claiming Pow- that Nebraska Power braska date. agree- continuously had breached er unreasonable, appealed unfair, Nebraska Power by charging ment ratemaking is a court, arguing that using by discriminatory to Nucor rates and exer- which cannot be legislative function methods to incorrect, improper, and unfair courts, district court by the that the costs; for cised failing grant credits allocate in the legislative power vested usurped the failing to follow power; and hydroelectric directors, and of Power board consultant of own recommendations provision nei- rate the contract review prayed It charged Nucor. action of cause of the nature re- ther alters injunctive damages and appropriate for damages. Ne- award of permits nor lief. further asserts dis- on a trial, instructed jury At permitting erred trict court theory required contract which of breach statutory and contractual construe the by preponderance a establish Nucor to admitting evidence. certain terms and had that Nebraska evidence heard this of this court panel obligations When of its one or more breached be- jurisdiction arose question of appeal, a provision, review the rate under Act3 that the Johnson concern damage to cause of caused proximately breaches the business of operation and conduct able provides: The statute the district. any orga- district board of The directors 70-655. Neb.Rev.Stat. subject Chapter article under or nized fix, power and be have the shall establish, provides: Act 3. The Johnson rates, tolls, adequate collect and suspend enjoin, shall not rents, energy, district courts charges electrical for and other of, compliance operation or service, any storage, or for and restrain water water by with, chargeable ethanol, affecting commodities, any order including ser- other all by adminis- furnished, utility a State sold, public and made vices, supplied or or facilities ratemaking body rents, a State rates, tolls, agency district, or a trative political by the subdivision, where: charges nondiscrimi- shall be diversity solely (1) on is based eq- Jurisdiction adjusted natory, as in a fair and and so repugnance the order to citizenship or confer and distribute manner to uitable Constitution; and, the Federal among consumers of commodi- the users and with inter- not order does interfere by or sold ties and services furnished and, commerce; profit- state of a district the benefits successful applied. prohibits The Johnson Act lyzed requirement the fourth of the John- interfering courts from ratemaking Act, plain, speedy, son that there exists a public if utilities the four criteria of the Act and efficient in the state courts. are met. The was then case remanded to The court found that the state court reme- the district court for findings additional on which, dy, cases, in most would be to re- jurisdictional issue. The district court mand to the board of directors to establish began by noting that Nebraska Power is a rates, inadequate. Accordingly, new publicly-owned utility regulates it- the court determined that the Johnson Act self, ratemaking and that its decisions are deprive did not jurisdic- federal courts of subject any independent review case, tion in this findings certified its regulatory body. Although the court ex- to this court. pressed serious reservations about whether *4 applied Johnson Act in such circum- stances, it did not resolve the issue. I. Assuming that the Act apply, did the We first consider issue of federal recognized court statutory that all four cri jurisdiction. It is well-settled that teria must in be satisfied order to bar fed plaintiff bears the establishing burden of jurisdiction, citing
eral our decision in Ar subject jurisdiction. matter Nebraska Light kansas Power & Co. v. Missouri Power asserts that the district court erred Commission, Public Service 829 F.2d by improperly requiring it to bear the bur- (8th Cir.1987). subject Since den of establishing jurisdiction that federal jurisdiction matter federal court is based lacking was rather than requiring Nucor to solely upon diversity citizenship, par establish jurisdiction that present. ties conceded that the first element had reading record, Our however, re- element, been satisfied. As to the second veals that properly placed the court requiring that the order not interfere with Nucor, burden establish jur- federal commerce, interstate the court noted that Furthermore, isdiction. we believe the parties had not addressed this issue but fully record supports the court’s conclusion nevertheless concluded that the order could the Johnson preclude Act does not potentially interfere with interstate com jurisdiction federal in this case. merce. This conclusion was based on evi dence that Nebraska Power sold Nucor court, The district in its order determin- electricity generated states, in other ing that the Act Johnson did not bar its products distributed in other jurisdiction, expressed serious doubts that states, corporate and that Nucor’s head the Act preclude intended federal quarters were located outside of Nebraska. jurisdiction one, in cases as this where rates are public established utility not
The court then turned to the third re- regulated by independent quirement agency. state Act, of the Johnson which re- Nebraska quires argues that since rate order be made after applies Johnson Act ratemaking to all hearing. notice and a bod- political subdivisions, ies of examined process both the due this necessarily clause of statutes, the Constitution and includes the board Nebraska of directors of the Ne- and found that Nebraska Power did not Public Power District. As the dis- provide reasonable notice to trict Nucor under court did not rest decision on this either standard. Finally, the ground, court ana- it is not necessary that we do so.4 (3) Also, The order charged by has been made after public reason- during utilities. discus- and, hearing; able notice and bill, sponsor, sion of the son, the bill’s Senator John- plain, speedy A efficient independent regulation referred to the may be had in the courts of such State. public importance utilities and the of the bill to 28 U.S.C. 1342. every public state that has a service commis- (1934). Cong.Rec. sion. 28 legislative history passed, of the Act as version, previous well as specifically express that of a We serious as to reservations whether referred to the apply existence of state commissions Act was intended to in this situation. authorized to review and only determine rates argument Nebraska Power's about a issue, dents, agreement pursuant to an jurisdictional may resolve the We however, addition, holding that the Johnson Nebraska Power has without towns. inapplicable here we are given proposed Act is because rate increases to notice of correctly the district court satisfied that approximately 200 retail towns as an infor- requirements are determined that the Act’s courtesy. mational federal courts are not not met and thus monthly billing Nebraska Power mailed jurisdiction by the Act. deprived of has never statements to all customers but require We turn first to the notice meetings with these included notices recite the ment of the Johnson Act and has, however, mailings. findings is court’s of fact on this advertising occasionally included inserts single sue. Nucor was Nebraska Power’s billing with the statements. Advertise- cus largest retail customer and routinely placed many ments are also under the qualified tomer to receive service newspapers. rate schedule. Nebraska Power’s HTS-2 Nebraska Power makes no effort to ar- utility by adopt of directors set board findings by gue that these the district court during meetings ing rate resolutions board Rather, clearly argues it erroneous. general Power’s office Co at Nebraska rates in is irrelevant view Nucor’s lumbus, approxi Columbus is Nebraska. vacuum, a factual or to hold that Nucor Norfolk, *5 mately miles from which is 45 special just entitled to notice was because steel mill. Advance notice close to Nucor’s other customers in other situations have in meeting published was of each board received individualized notice. Nebraska has a cir Telegram which The Columbios inquired neither Power stresses that Nucor 10,000 12,000 Nor of readers. culation anticipated future costs or rate about coverage Telegram’s not within the folk is changes, requested specific no- nor advance Nucor nor its officers sub area. Neither Furthermore, tice. each time there was a fact, and, in Telegram, scribed change, rates and rate Nebraska Power’s in newspaper had one subscriber Stan manager gener- met with Nucor’s contracts county Nucor’s steel mill is lo ton where manager change and an- al to review Nucor officials testified that cated. Nucor questions. swer rate received advance notice of had never increases, knowledge no of their and had points out that the Ne- Nebraska Power hearings inquire right appear at about Law, Meetings Public Neb.Rev.Stat. braska rate increases. (Reissue 1987),does not 84-1408 to -1414 § notice, publication of specify a method for situations, notice of In certain additional requires “reasonable advance but instead changes giv- meetings and rate board place of notice of the time and publicized Every Power customers. en to Nebraska designated by meeting by a method each conducted a years, two Nebraska Power In com- public body.” Id. 84-1411. each § by mail study and notified wholesale rate mandate, Power this Nebraska pliance with right to customers of their all 97 wholesale adopted a resolution that notice would had hearing changes. Ne- request a on Telegram, in as- published held or six rate Power has five notify any mem- secretary would sistant hearings and between 50 since requesting media notifica- of the news bers meeting. people have attended each agenda of board tion, a current and that Also, given routinely has Nebraska Power public kept available for meetings would be “retail proposed rate action to notice of office. towns,” inspection at its Columbus electricity to their resi- which sell regulatory As 2,096 by commission. a state publicly-owned utili- reviewed electric third of by subject regulation of set the board in the United States are us were ties by before Power, agencies light danger not on the state does shed there is no of Nebraska directors Congress passing the Johnson Act. intent of in regulatory independent interfering with primary Act is We believe that the thrust of the such agency's rates because no review of these public having prevent utilities from access to agency exists here. previously a federal forum to redetermine rates duty Power asserts that its commerce. Nebraska Nebraska Power asserts that provide hearing finding notice and a is to be deter- the district court erred in in- law, terference only by mined reference to state because Nucor failed to estab- directly lish that the rate process a due standard. The district burdensome discriminatory. recognize or rejected argument, recognizing We the tenta- comments, tive nature of the hearing requirement court’s but the notice nevertheless conclude interpreted requiring the Act the court did had been not err. minimum There was evidence that process that the standards of due Nebras- wrongfully ka deprived be met. The court examined Nucor of Western Area Power case to determine constitutes Administration bene- law what fits and that required by pro- approximately notice” as this resulted in “reasonable due million overcharges cess in $7 and noted that “notice can be con- Nucor. Nucor presented adequate only testimony sidered if it is in transmitted affected the which, minimum, goods cost of a manner at a for sale in ‘has a interstate certainty resulting’ Considering commerce. reasonable in actual this and the other Waara, notice.” Gruenewald v. court, factors identified the district we believe (quot- 428 N.W.2d that the court did not err assess- (Second) ing ing impact on Judgments Restatement interstate commerce. 2(l)(b), (1982)). at 34 We conclude that the district court did not err in fully supports determining The evidence the district that the Johnson Act finding given deprive jurisdiction court’s did not notice to consider did not the merits of certainty giv- have this case. ing publication Nucor actual notice. The appears suggest Telegram, The Columbus newspaper that abstention under v. Sun Oil Burford very limited city circulation of Co., 319 U.S. 63 S.Ct. 87 L.Ed. *6 Norfolk, did not fulfill Nebraska Power’s (1943), appropriate would be in this obligation. The notice did not state that case. We believe that the justifying facts ratemaking purpose was the of the board abstention in that case lacking here. meetings, but stated little more than that Burford, In authority the for the chal agenda general an was available at the lenged decisionmaking had delegated been Further, regular- office. Nebraska Power independent commission, to an and the
ly performed analyses cost for wholesale developed state had a scheme to centralize rates and based yearly Nucor’s rate in- direct review of the commission’s decisions creases, in part, analyses. on these in state single courts of a Texas county. wholesale given customers were notice of us, In however, the case before the chal changes the analyses based on the lenges are not directed at the decisions of Nucor, customer, while a retail not. independent regulatory commission, nor The district court did not err in its determi- is there a judicial centralized state review nation that notice lacking place. addition, scheme in In the fact that here. Nebraska Power delayed has raising the abstention issue until after a full trial on
It is well-established that all four the merits shows a respect lack of for the criteria of the Johnson Act must be satis comity considerations of underlying Bur- preclude fied jurisdiction, to federal the failure satisfy require the notice ford. ment is sufficient to end our examination. II. Light
Arkansas Power & Co. v. Missouri Comm’n, Pub. Serv. 829 F.2d The essence of Nucor’s breach of con- (8th Cir.1987). satisfied, however, areWe tract claim is that Nebraska Power failed that correctly the district court determined to fulfill its obligations contractual that another criterion is not met here ei charge reasonable, and nondiscrimina- ther. requires rates, The Johnson Act tory that perform and to study cost rate order not interfere with every years. interstate Specifically, two Nucor ar- that this tion, for the fact not proper- were it failed to gues that Nebraska the contract language present both is regularly costs and ly demand allocate require rates to be Both and the service statute. fully-allocated cost of perform a nondiscriminatory,” “fair, Nucor, caused According study. this that section jury was instructed and the disproportionate share pay a Nucor to part considered a 70-655 was power dis- costs of demand-related Thus, to determine order through 1986. contract. during years 1974 trict Power had breached whether Nebraska various undisclosed argues also Nucor contract, to determine determining jury had wheth- mishandled charges were fair, reasonable, and (1) allocating carrying, er Nucor’s rates rate: nondiscriminatory. The court’s instruc- charges associ- and maintenance operation, line; jury were not erroneous in transmission tions a 230 kilovolts ated with regard. allotment of (2) of its full depriving bene- Power Administration Area
Western
support
arguments,
of its
production
incorrect
fits;
using an
certain
Supreme
Power identifies
factor for Nucor.
adjustment
cost
decisions, particularly McGinley v.
Court
District, 214
Belt Public
Wheat
argu
substantive
Nebraska Power’s
(1983),and York
case in This mischaracterizes testimony, erence to this and to receive us, the nature of the suit before which is a testimony concerning evidence and overcharges claim to recover based on a making methodology. McGinley
breach of contract. dealt with The crux of Nebraska ar charged the difference in rates Power’s customers gument similar circumstances. The that the court should have de focus here is “fair,” charged only customer, jury the rate one fined for the the terms “rea Moreover, jury sonable,” Nucor. verdict and the “non-discriminatory,” rather entered the court did not permitting de- than experts testify as to termine what rates Nebraska Power must meanings instructing their jury charge future, rather, in the merely but experts’ that it could consider the defini past determined the amount of over- tions. These terms are not technical in charges.5 nature, argues, Nebraska Power and thus expert testimony necessary. is not It relies Nebraska Power asserts that the district Club, Inc., on Marx & Co. v. Diners’ 550 permitting court erred in the jury to con- (2d Cir.), denied, F.2d 505 cert. 434 U.S. strue the terms of the contract and the 861, (1977), 98 S.Ct. 134 L.Ed.2d issue, 70-655, statute in Neb.Rev.Stat. § which the court improper held that it was because the terms in issue ambig- were not expert to allow a testify securities as to uous. We believe there was no error. The meaning of the term “best efforts” in a contract, incorporated language dispute. contract at Id. 508-09. statute, of the used words that were am- biguous in they the sense that were of a We believe the court did not err in admit- sufficiently technical nature to be the sub- ting expert testimony. Courts have ject expert testimony. parties Both frequently recognized expert the value of presented expert testimony which offered testimony defining terms of a technical na- jury differing views terminology. of the ture and testifying as to whether such circumstances, Under the proper for acquired terms have well-recognized jury, by expert aided testimony, to con- meaning in the industry. business or See terminology sider the in issue here. The Energy Co., Oils v. Montana Power role jury in such circumstances has (9th Cir.1980). F.2d 736-37 We note recognized by been Nebraska cases. Olds experts that Nebraska Power also testified Jamison, 388, 392, 195 Neb. 238 N.W.2d as to meanings of terms of art and (1976); Ely Constr. Co. v. S & S whether Nebraska ratemaking Power’s Corp., 184 Neb. 165 N.W.2d methods were used elsewhere in the indus- (1969). parties raise numerous try. Finally, we observe that the admis- points in arguments their which we believe sion of largely evidence is left to the discre- lack justify sufficient merit to further dis- tion of the trial court. We conclude that cussion of this issue. there was no abuse of discretion in admit- ting testimony and no error of law in III. instructing as to the use of such *8 Nebraska Power asserts error in the dis- testimony. trict court’s resolution of certain evidentia- ry argues issues. It that it improper erred, was The court according also for the court to testimony Power, receive from admitting Nebraska in an exhibit Nucor's experts regarding prepared terms of art and by Nucor which utilized a four- standards, industry permit jury the peak to month coincident cost allocation meth construe the contract and statute with parties ref- od. Both vigorously argue, in ex- argues allocation, accept above, The dissent that we Nucor’s cost of cost par- outlined that the fair, reasonable, only allocation method as the charged reasonable, ticular rate was not nondiscriminatory and, and method. nondiscriminatory, This mischar- upon being holding. simply acterizes our presented specific We hold that a evidence of individual find, jury properly could damages, based properly evidence could determine the amount of Nebraska Power's past overcharges. treatment of several items of
1351 (1) Power theory: that detail, this evi- ment whether technical haustive acts of fraudulent committed affirmative properly admitted. dence was concealment, inducing Nu- which included court that the persuaded not We are area with aware- cor to locate its service that first observe respect. We erred parties’ the disparity between ness an exhibit also introduced ratemaking methodology, knowledge of computa- of cost demonstrating a method studies, com- withholding cost various case revolves importantly, this More tion. regarding municating incorrect information resulting from overcharges alleged around allocation; if there that even cost allocation, and resolution of improper cost of fraudulent not affirmative acts determining whether issues these concealment, fiduciary relation- there is a and nondis- rates were parties such that mere ship between this exhibit criminatory. believe that We con- part on the of Nebraska Power silence essence, to such issues. was relevant will stitutes fraudulent concealment simple attempt parties escalate the statute of toll limitations. into admissibility of an exhibit question to address opportunity additional Ne Addressing first the claim that this case. merits affirmative acts braska Power committed argument Nebraska Power's final concealment which warrant of fraudulent sup not judgment are the verdict that limitations, we are not tolling the statute of argument This ported by the evidence. court erred in that persuaded dam amount of addressed to the primarily jury. issue to the refusing to submit this awarded, that an assertion ages based on of fraudu recognize issues we While relationship no jury award bears total relating to a statute concealment lent damages. This is Nucor’s evidence normally questions defense are limitations proven it has been merit. Where without Arendt, 119 jury, Vrbsky v. fact for the sustained, and the damage has been 337, (1930), 448-49, 443, 339 229 N.W. Neb. exact uncertainty concerns only room for a no the evidence leaves when evidence from amount, need there opinion, the dis difference of ascer damages can be the amount of mat the issue as a may resolve trict certainty. Nebras with reasonable tained Chemical, Inc. v. X of law. Trace ter Power, 773 v. Austin Pub. Power Dist. ka 261, Indus., Ltd., F.2d 265 738 Canadian Laier, Delp v. Cir.1985); (8th F.2d 969 denied, Cir.1984), 469 U.S. cert. (8th 269-70 288 N.W.2d (1985). More 911, L.Ed.2d 925 105 S.Ct. Daniel, Stephen expert, (1980). Nucor’s is insuf over, evidence mere scintilla of “a cross-examined, testi vigorously who jury.” question for present a ficient overcharges the total amount fied Shoemaker, 763 F.2d Indus. J.E.K. $15,744,844. there is suffi We believe Cir.1985). (8th jury’s deter support cient evidence court did mination. We also believe refusing to submit err in IV. relationship fiduciary claim that Ne parties between court erred existed argues that Nucor disclose, and duty to had a damages only for sus- entering judgment fraudulent its silence constituted 1986, excluding therefore years in the tained Supreme The Nebraska by the statute concealment. years as barred earlier decide had occasion has not that it was Court of limitations. contends *9 fiduciary rela of a existence of whether whether to a determination entitled from of action a tionship prevents cause by Ne- fraudulent concealment there was if limitations of by the statute being barred conduct whether acts no affirmative commits defendant of limi- operation the statute of defeats Nor merely silent. is but argu- concealment two of essentially offers tations. ruled Supreme Court the Nebraska conceal- has support of its fraudulent ments 1352 public utility obligations permit integrated approach a owes of to rate fiduciary In Moreover, customers. the ab regulation. power of a Ne- guiding precedent,
sence of
“we accord
determining only
braska court is limited to
to the
substantial deference
district court’s
question
whether the rate schedule in
interpretation of state law.” Kansas State
fair,
nondiscriminatory.
reasonable and
Bank in Holton v. Citizens Bank
See, e.g., McGinley
of
v. Wheat Belt Public
1490,
Windsor,
(8th
F.2d
1496
737
Cir.
District,
178,
214
Neb.
332 N.W.2d
1984).
(1983).
915
Finally,
argu
we address Nucor’s
Fixing
compensation
public
ser-
failing
ment that the district court erred in
corporations may charge
vice
for servic-
prejudgment
to award
interest. Nucor’s
es to
by
legislating;
be rendered
them is
argument is without merit. The court cor
lawmaking.
power
it
that,
rectly recognized
under Nebraska
declaring
courts is limited to
what the
law, prejudgment
may only
interest
re
is,
they
precluded by
law
are
liquidated.
covered on claims
functions;
legislative
Constitution from
acknowledged
design
The court
of
...
know of no court which has
[W]e
rates is not an exact science and concluded
authority
ever claimed it had the
to de-
liquidated.
that Nucor’s claim was not
It
compensation
termine what
would
abe
possible
compute
was not
the amount of
reasonable one
per-
for a service to be
damages here with exactness without re
by
corporation.
formed
such a
upon opinion
liance
or discretion. See Hill
State,
Telephone
Co. v.
55 Neb.
Lincoln,
221
City
v.
Neb.
380
627,
171,
(1898).
also,
76 N.W.
174
See
(1986).
N.W.2d
Metropolitan
City
Utilities Dist. v.
sum,
require-
In
we hold that because the
Omaha,
171 Neb.
fect of cases, validity paid
both of amount
questionable. Federal Power Com See Texaco, Inc.,
mission v. 417 U.S. charged receiving McGinley customers service before 6. involved different rates included all energy exactly Rate Class 76 included consumers who used the same a certain date 1975. they signed receiving service after that date in manner but for the date on as cus- all customers tomers of the Power District. Rate Class 75