On June 3, 2019, the Ninth Circuit issued an unpublished Decision Memorandum in Bear Gulch, LLC et. al. v. Montana Public Service Commission, in which it found that the federal district court erred by not finding that certain arguments related to Montana’s generally applicable legally enforceable obligation (LEO) standard was moot. The Ninth Circuit found that the arguments raised by Bear Gulch Solar, LLC and other qualifying facilities developed by Cypress Creek Renewables (QFs) were mooted because the Montana Commission subsequently enacted a new LEO rule.
Mootness precludes a court from determining a party’s rights when there is no existing controversy or dispute on which a court could provide relief. There are certain exceptions from the “mootness” doctrine, however, even when there is no existing controversy or dispute between parties, such as where a party can show that the challenged behavior is capable of repetition. In this case, the Court reviewed those exceptions, but found them inapplicable, because there was no sufficient showing that the Montana Public Service Commission would return to its prior unlawful view, which it had modified through a subsequently enacted rule.
In this case the QFs had asserted that it formed a LEO before June 16, 2016 (giving it an entitlement to the avoided cost rates in effect at that time) and that the Montana Commission had erroneously found that no LEO was formed because of its application of an unlawful test imposed by the Commission (the Whitehall Wind test). The federal district court agreed with the QFs that the Montana Commission had adopted an unlawful LEO test, but the court did not order any practical relief or remedy for the renewable energy projects. A finding that QFs had a LEO would normally have resulted in an obligation for NorthWestern to purchase their power at a favorable price.
The unusual result with this case, is that the newly adopted LEO test, which the Ninth Circuit found had caused the case to be moot, is prospective only, meaning that it would likely not apply to QFs like the Plaintiffs in this case that could have formed LEOs in the past under an invalid test. The end result is that the Ninth Circuit essentially reversed the district’s court’s finding that the Whitehall Wind test was an invalid implementation of PURPA, through finding moot the challenges against the rule that were initiated in the past.
The Ninth Circuit also affirmed the district court’s finding that it cannot order the Montana Commission to take any particular action because doing so would violate the 11th Amendment of the U. S. Constitution. The 11th Amendment bars retroactive relief against states. The lower court’s opinion on this topic was unusual because the QFs sought what could be characterized as prospective relief, asking for the right to sell power at the rates they would have been entitled to if the LEO had been recognized by the Montana Public Service Commission. But the lower court, and the Ninth Circuit’s opinion reasoned that because the case concerned a test applied in the past about what conduct was necessary to establish a LEO, that the case involved retroactive relief, and there was no allegation of a continuing harm to the QF.
Sanger Thompson filed an amicus brief in this case on behalf of the Northwest and Intermountain Power Producers Coalition, Vote Solar, Institute for Local Self Resilience, joined by Renewable Northwest, the Solar Energy Industries Association, and Richardson Adams on behalf of the Community Renewable Energy Association
Disclaimer
These materials are intended to as informational and are not to be considered legal advice or legal opinion, nor do they create a lawyer-client relationship. Information included about previous case results does not assure a similar future result.
