TOTAL Gas & Power North America, Inc. et al v. Federal Energy Regulatory Commission et al

Filing 78

MEMORANDUM AND ORDER (Signed by Judge Nancy F Atlas) Parties notified.(sashabranner, 4)

United States District Court
Southern District of Texas

ENTERED
September 14, 2016

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
§
§
§
§
§
§
v.
§
§
FEDERAL ENERGY REGULATORY §
COMMISSION, and CHAIRMAN
§
NORMAN C. BAY, COMMISSIONER §
CHERYL A. LAFLEUR,
§
COMMISSIONER TONY CLARK,
§
COMMISSIONER COLETTE D.
§
HONORABLE, and ACTING CHIEF §
ADMINISTRATIVE LAW JUDGE
§
CARMEN A. CINTRON, in their
§
official capacities,
§
Defendants.
§

David J. Bradley, Clerk

TOTAL GAS & POWER NORTH
AMERICA, INC., AARON TRENT
HALL, and THERESE NGUYEN
TRAN,
Plaintiffs,

CIVIL ACTION NO. 4:16-1250

MEMORANDUM AND ORDER
This declaratory judgment action is before the Court on the Motion to Alter
or Amend Judgment or for Leave to File Second Amended Complaint
(“Reconsideration Motion”) [Doc. # 73] filed by Plaintiffs Total Gas & Power
North America, Inc. (“Total”), Aaron Trent Hall (“Hall”), and Therese Nguyen
Tran (“Tran”) (collectively, “Plaintiffs”). Defendants Federal Energy Regulatory
Commission (“FERC”), its Commissioners, and its Acting Chief Administrative

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Law Judge (collectively, “Defendants”)1 filed a Response (“Reconsideration
Response”) [Doc. # 76], to which Plaintiffs replied (“Reconsideration Reply”)
[Doc. # 77].

Plaintiffs seek reconsideration of the Court’s holdings in the

Memorandum and Order issued on July 15, 2016 (“Opinion”) [Doc. # 68] that this
controversy is not justiciable, that this Court lacks subject matter jurisdiction under
the Natural Gas Act (“NGA”),2 and that the Court, in its discretion, declines to
entertain the declaratory judgment action.
After carefully considering the parties’ briefing, oral argument, all matters of
record, and the applicable legal authorities, the Court denies Plaintiffs’
Reconsideration Motion.
I.

LEGAL STANDARD
Rule 59(e) permits a litigant to file a motion to alter or amend a judgment.3

Reconsideration of a judgment is an “extraordinary remedy that should be used
sparingly.”4 A motion for reconsideration “is not the proper vehicle for rehashing
evidence, legal theories, or arguments that could have been offered or raised before

1

Chairman Norman C. Bay, Commissioners Cheryl A. LaFleur, Tony Clark, and
Colette D. Honorable, and Acting Chief Administrative Law Judge Carmen A.
Cintron, in their official capacities.

2

Natural Gas Act of 1938 (“NGA”), 15 U.S.C. § 717 et seq.

3

FED. R. CIV. P. 59(e) (“A motion to alter or amend a judgment must be filed no
later than 28 days after the entry of the judgment.”).

4

Waites v. Lee County, Miss., 498 F. App’x 401, 404 (5th Cir. Nov. 26, 2012)
(quoting Templet v. Hydrochem, Inc., 367 F.3d 473, 479 (5th Cir. 2004)).
2

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the entry of judgment.”5 Instead, Rule 59(e) serves the narrow purpose of allowing
a party to bring errors or newly discovered evidence to the Court’s attention.6
A litigant seeking relief under Rule 59(e) “must clearly establish either a
manifest error of law or fact or must present newly discovered evidence.”7 A Rule
59(e) motion “cannot be used to argue a case under a new legal theory.”8
Moreover, “an unexcused failure to present evidence available at the time of
summary judgment provides a valid basis for denying a subsequent motion for
reconsideration.”9
II.

ANALYSIS
The Court assumes familiarity with the Opinion issued in this case on July

15, 2016, which explains the relevant facts and terminology. The Court first
examines Plaintiffs’ arguments in favor of altering or amending the Opinion. The
Court concludes that these arguments lack merit.

The Court then evaluates

Plaintiffs’ request to file a second amended complaint and holds that the proposed
amendment would be futile.
Preliminarily, the Court rejects Plaintiffs’ objection that the Court relied on
arguments not asserted by Defendants. The Court is bound to scrutinize its subject
5

In re Deepwater Horizon, 785 F.3d 986, 992 (5th Cir. 2015) (quoting Templet v.
HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004)).

6

See In re Rodriguez, 695 F.3d 360, 371 (5th Cir. 2012) (citing In re Transtexas
Gas Corp., 303 F.3d 571, 581 (5th Cir. 2002)).

7

Balakrishnan v. Bd. of Supervisors of La. State Univ. & Agr. & Mech. Coll., 452
F. App’x 495, 499 (5th Cir. 2011) (citing Ross v. Marshall, 426 F.3d 745, 763 (5th
Cir. 2005) (quotation marks and citation omitted)).

8

Id. (citing Ross, 426 F.3d at 763).

9

Templet, 367 F.3d at 479 (citing Russ v. Int’l Paper Co., 943 F.2d 589, 593 (5th
Cir. 1991)); see also Tate v. Starks, 444 F. App’x 720, 729 (5th Cir. 2011).
3

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matter jurisdiction, even if the issue must be raised sua sponte.10 Plaintiffs bear the
burden of establishing subject matter jurisdiction.11 Plaintiffs have failed to do so.
Further, Plaintiffs’ additional arguments raised in their Reconsideration Motion are
unavailing. As explained below, Plaintiffs have not met their burden under Rule
59(e) to demonstrate that the Court committed a “manifest error of law” in the
Opinion.
A.

Justiciability
1.

The Court Did Not Misapply Calderon v. Ashmus

Plaintiffs argue that if the Court renders declaratory judgment in their favor
on interpretation of NGA § 24,12 the “exclusive jurisdiction” provision, then the
“entire controversy” will be resolved in this Court.13

Plaintiffs contend that

Calderon v. Ashmus does not bar this suit.14 The Court is unpersuaded. Plaintiffs’
Amended Complaint15 raises only jurisdictional and procedural issues regarding
FERC’s determination of claims of NGA violations by Plaintiffs Total, Hall, and
Nguyen. Plaintiffs seek a ruling on where and how the merits will be litigated, but

10

FW/PBS, Inc. v. Dallas, 493 U.S. 215, 230–31 (1990) (“Although neither side
raises the issue here, we are required to address the issue even if the courts below
have not passed on it, and even if the parties fail to raise the issue before us. The
federal courts are under an independent obligation to examine their own
jurisdiction . . . .” (citations omitted)).

11

Alabama-Coushatta Tribe of Tex. v. United States, 757 F.3d 484, 487 (5th Cir.
2014); Gilbert v. Donahoe, 751 F.3d 303, 307 (5th Cir. 2014).

12

15 U.S.C. § 717u.

13

Recon. Reply [Doc. # 77], at 3.

14

523 U.S. 740 (1998).

15

The Court addresses separately the Second Amended Complaint that Plaintiffs
contend will cure the jurisdictional defect under Calderon. See infra Section II.D.
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not on the merits themselves.16 Under Calderon, these issues are not the proper
subject of a declaratory judgment because they merely “govern[] certain aspects of
. . . pending or future suits.”17
The Calderon defect in Plaintiffs’ claims further underscores the Court’s
previous conclusion that Plaintiffs’ requested declaratory judgment is a request for
an advisory opinion.18 FERC has not initiated a federal court proceeding against
Plaintiffs on the merits of the charges of NGA violations or for enforcement of a
civil penalty order. Nor does Plaintiffs’ requested judgment immediately obligate
16

See Amended Complaint [Doc. # 25], at 2, ¶ 3 (“This lawsuit is brought to prevent
FERC from violating Plaintiffs’ constitutional and statutory rights to a fair hearing
when they defend themselves against FERC’s allegations. Plaintiffs do not seek to
stop FERC from conducting an investigation or otherwise exercising its lawful
authority.” (emphasis added)). The Court addresses Plaintiffs’ proposed Second
Amended Complaint in Section II.D, infra.

17

523 U.S. at 747. The Fifth Circuit’s ruling in In re El Paso Refinery, LP, 302 F.3d
343, 349 n.4 (5th Cir. 2002), is inapposite. In that case, the court rendered
declaratory judgment on the meaning of a contract relevant to the parties’ dispute.
The appellants raised an “entire controversy” argument with regard to the court’s
exercise of discretion to entertain the declaratory judgment action. Id. (“Texaco
argues that the bankruptcy court abused its discretion in not dismissing RHC’s
declaratory action, because this case will not resolve the entire controversy
between the parties.” (emphasis added)). The Fifth Circuit neither addressed
whether the limited scope of the declaratory relief created a jurisdictional issue,
nor cited Calderon. Instead, the Fifth Circuit cited a section of a treatise relating
to the discretion of a court to hear a declaratory judgment action. See id. (citing
CHARLES WRIGHT, ARTHUR R. MILLER & MARY KAY KANE, FED. PRAC. & PROC.
§ 2759 (3d ed. 1998)). The Court notes that the current edition of this section also
does not cite Calderon. See THE LATE CHARLES ALAN WRIGHT ET AL., FED.
PRAC. & PROC. § 2759 (4th ed. 2016); see also id., n.6 (citing Sherwin-Williams
Co. v. Holmes County, 343 F.3d 383 (5th Cir. 2003), for the proposition that “[t]he
Declaratory Judgment Act confers discretion on the courts rather than an absolute
right on a litigant”). In re El Paso Refinery therefore is not probative regarding
the application of Calderon to this case.

18

See Opinion [Doc. # 68], at 20–21.
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FERC to litigate in this Court.19 Plaintiffs’ claims merely seek rulings on whether
this Court would have exclusive jurisdiction at a later point in the civil penalty
dispute and on challenges to anticipated administrative procedures. These rulings
would, at best, result in a free-standing final judgment on jurisdiction or
anticipatory rulings on constitutional and statutory questions.20 Such rulings would
be incompatible with the classification of jurisdictional and procedural questions as
interlocutory issues.

Calderon prevents this result by restricting use of the

Declaratory Judgment Act to issues that resolve a full controversy.
2.

Plaintiffs’ Claims Are Not Ripe

Plaintiffs argue that the Amended Complaint’s request for a declaration on
the meaning of NGA § 24 is ripe because the challenged administrative proceeding
is underway.21 The Court held that the claim regarding NGA § 24 was not ripe
because the relief Plaintiffs request is largely anticipatory, and success in this suit
would not legally require FERC to alter its administrative procedures.22 Plaintiffs
explain they are incurring significant litigation expenses. Plaintiffs contend a
declaratory judgment adopting their interpretation of NGA § 24 would encourage
19

The Court applies its jurisdictional analysis to the proposed Second Amended
Complaint below. See infra Section II.D.

20

See 28 U.S.C. § 2201 (“Any such declaration shall have the force and effect of a
final judgment or decree and shall be reviewable as such.” (emphasis added)).

21

Plaintiffs do not seek reconsideration of the Court’s conclusions that their
constitutional and Administrative Procedure Act (“APA”) claims are speculative
and contingent upon acts Defendants have not taken. See Opinion [Doc. # 68], at
21–22.

22

See Opinion [Doc. # 68], at 20–21 (“Plaintiffs concede there is no legal basis for
this Court to require FERC to alter these intervening procedures even if FERC
must eventually prosecute its case de novo in a district court. Plaintiffs
fundamentally seek an advisory opinion on the validity of an order the
Commission has not yet issued and may never issue.” (footnotes omitted)).
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FERC to shorten the administrative proceeding and would assist Plaintiffs in
formulating responses in that proceeding.23 Even crediting this argument, Fifth
Circuit precedent is clear that a court does not have jurisdiction merely to render a
declaratory judgment in order to simplify or avoid future litigation.24
Fundamentally, Plaintiffs seek an advance ruling on a jurisdictional defense
and other procedural matters that, in their view, will bolster their position in the
agency proceedings.25 This Court does not have jurisdiction to decide issues for
that purpose.

23

See Recon. Motion [Doc. # 73], at 8–10.

24

For example, in Brown & Root, Inc. v. Big Rock Corp., 383 F.2d 662 (5th Cir.
1967), the Fifth Circuit considered and categorically rejected similar arguments
regarding a preemptive declaratory judgment. In that case, the plaintiff in district
court was aware that its antitrust lawsuit against defendants might give rise to a
subsequent suit for malicious prosecution. Along with its direct claims, the
plaintiff requested a declaration that it had probable cause to file the suit. Id., at
665. The Fifth Circuit held that the district court was without jurisdiction because
“[n]o cause of action for malicious prosecution comes into existence until the
termination of the particular judicial proceeding which is the gravamen of the
malicious prosecution action.” Id. The Fifth Circuit therefore rejected the
argument that jurisdiction existed for a declaratory judgement on the probable
cause question even though “if it be decided that probable cause existed, the long
and complex litigation would come to an end and this Court would be relieved of
the burden of considering the other phases of the appeal.” Id., at 666. This result
is consistent with the Calderon court’s disapproval of using the Declaratory
Judgment Act to resolve procedural issues to inform future litigation. See 523
U.S. at 748 (“Any risk associated with resolving the question in habeas, rather
than a pre-emptive suit, is no different from risks associated with choices
commonly faced by litigants.”).

25

See, e.g., Recon. Motion [Doc. # 73], at 9 (“Plaintiffs’ current and future responses
to the current proceeding are dictated by the fact that FERC purports to be the
judge of its own allegations.”); id. (“[T]here is a world of difference to Plaintiffs
between a hearing merely to ‘investigate’ facts . . ., on one hand, and authority
both to prosecute and adjudicate those violations in-house.”).
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B.

Jurisdiction

Plaintiffs continue to ignore the applicability of the Thunder Basin26
framework. As the Supreme Court reaffirmed in Elgin,27 the Court’s task is merely
to determine whether there is a “fairly discernible intent” to assign jurisdiction to
the agency by examining the statute’s text, structure, and purpose.28 To avoid their
burden of establishing subject matter jurisdiction under the NGA, Plaintiffs posit
that NGA § 24 creates district court jurisdiction over proceedings imposing civil
penalties under the NGA and then argue the burden falls on Defendants to show a
repeal of that provision. On reconsideration, Plaintiffs again fail to establish their
starting premise because they rely on conclusory assertions regarding the NGA that
lack basis in precedent and historical practice.
1.

Statutes with Comparable Jurisdictional Provisions

Plaintiffs object to the Court’s reliance on the absence of precedent
supporting their interpretation of NGA § 24 because, according to Plaintiffs, there
have been “few opportunities for courts to address the question presented here.”29
This argument is unavailing. Plaintiffs overlook the existing precedent regarding
this genre of jurisdictional provisions, which precedent explains that these
provisions had a purpose different from that urged by Plaintiffs. As explained in
the Court’s Opinion, these statutes govern the relationship between federal and
state courts.30
26

Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994).

27

Elgin v. Dep’t of Treasury, 132 S. Ct. 2126, 2132–33 (2012); see also Free Enter.
Fund v. PCAOB, 561 U.S. 477, 489 (2010).

28

See Opinion [Doc. # 68], at 23–26.

29

Recon. Motion [Doc. # 73], at 11.

30

See Opinion [Doc. # 68], at 28–29 n.94.
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Plaintiffs rely heavily on the presence in the Securities Exchange Act of
1934 of both an “exclusive jurisdiction” provision, § 27(a),31 and a provision
authorizing imposition of civil penalties in administrative proceedings, § 21B.32
Plaintiffs cite no authority that expresses the view that Exchange Act § 21B makes
an exception to the district courts’ “exclusive jurisdiction” under § 27 and the
Court has found none.33 As exemplified by Merrill Lynch, Pierce, Fenner & Smith
Inc. v. Manning,34 the case law interpreting Exchange Act § 27 addresses the
relationship between state and federal courts.35
The Second Circuit’s decision in Touche Ross & Co. v. SEC,36 cited by
Plaintiffs, is not to the contrary. The Second Circuit merely rejected an argument
based on the Exchange Act § 27 as irrelevant and its observations regarding district
31

15 U.S.C. § 78aa(a).

32

15 U.S.C. § 78u-2.

33

See Recon. Motion [Doc. # 73], at 11–13.

34

578 U.S. __, 136 S. Ct. 1562, 1573 (2016).

35

See, e.g., NASDAQ OMX Grp., Inc. v. UBS Sec., LLC, 770 F.3d 1010, 1030 (2d
Cir. 2014) (“Far from threatening the federal-state balance envisioned by Congress
in this area, the exercise of federal jurisdiction here comports with Congress’s
expressed preference for alleged violations of the Exchange Act, and of rules and
regulations promulgated thereunder, to be litigated in a federal forum. See 15
U.S.C. § 78aa(a) (providing federal courts with ‘exclusive jurisdiction of
violations of [Exchange Act] or the rules and regulations thereunder, and of all
suits in equity and actions at law brought to enforce any liability or duty created
by [Exchange Act] or the rules and regulations thereunder’).”); Piambino v.
Bailey, 610 F.3d 1306 (5th Cir. 1980) (“The state and federal courts have
concurrent jurisdiction to decide cases arising under the Securities Act of 1933,
and no case originally brought in a state court of competent jurisdiction under that
Act may be removed to a federal court. 15 U.S.C. § 77v. Under the Securities
Exchange Act of 1934, the federal district courts have exclusive jurisdiction to
decide cases arising under that act. 15 U.S.C. § 78aa.”).

36

570 F.2d 609 (2d Cir. 1979).
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court jurisdiction are dicta.37 Even read broadly, Touche Ross is not probative of
whether “exclusive jurisdiction of violations” applies to agency efforts to address
violations through means other than injunctive relief.38 Tellingly, Plaintiffs do not
rely on Touche Ross directly, but rather on descriptions of the decision in
individual opinions issued in a highly divided decision by the D.C. Circuit.39 The
Exchange Act provides insufficient support for the broad reading of NGA § 24
Plaintiffs advance in this action.
2.

History of the NGA

Plaintiffs state, “before 2005, FERC complied with the . . . criminal penalty,
injunctive relief, and exclusive jurisdiction provisions of the NGA (§§ 20, [21],
and 24) by ceding jurisdiction over penalties for violations to federal district
courts.”40 Plaintiffs cite no pre-2005 district court cases under the NGA where
FERC (or its predecessor, the Federal Power Commission (“FPC”)) sought
“penalties for violations,” and the Court is unaware of any.

This dearth of

37

Id., at 579–80 (upholding challenged rule based on broad authority of the
Securities and Exchange Commission (“SEC”) to adopt rules and regulations
necessary for carrying out the agency’s designated functions).

38

Decided in 1979, Touche Ross predates the enactment of the civil penalty
provisions in the Exchange Act by over a decade.38 Therefore, the Touche Ross
court only contrasted the challenged SEC rule, which concerned professional
conduct in SEC proceedings, with district courts’ jurisdiction over actions “to
enjoin what the Commission believes to be violations” of the Securities Act of
1933 and the Exchange Act of 1934. Id., at 579. The Exchange Act’s express
allocation to district courts of authority to issue injunctive relief is consistent with
NGA §§ 20(a) and 24 because NGA § 24 and Exchange Act § 27 both expressly
refer to actions for injunctive relief.

39

See Recon. Motion [Doc. # 73], at 12 (citing Checkosky v. SEC, 23 F.3d 452, 456
(D.C. Cir. 1994) (Opinion of Silberman, J.) (citing 1988 version of Exchange
Act); id., at 493 (Opinion of Reynolds, D.J.)).

40

Recon. Motion [Doc. # 73], at 13.
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examples likely is because the Commission did not have authority to seek civil
penalties under the NGA prior to 2005.41
In contrast, the NGA specifically delineates district court jurisdiction over
actions for injunctive relief and criminal prosecutions.42 There is no similarly
specific statement regarding jurisdiction over civil penalties.

Further, the

Commission has a longstanding practice of finding and remedying violations of the
NGA through administrative proceedings.
Plaintiffs’ attempts to distinguish the Commission’s historical practice of
finding violations of pre-2005 provisions of the NGA are unavailing. In support of
their interpretation of NGA § 22 (the provision added to the NGA in 2005 by the
EPAct43 authorizing civil penalties44) and § 24, Plaintiffs argued that, historically,
only district courts had the power to find violations and therefore the Commission
lacks jurisdiction to make the predicate finding of a violation necessary to assess a
civil penalty under NGA § 22. In disagreeing, the Court found instructive Fifth
Circuit cases affirming Commission findings of violations of the NGA provisions

41

See Opinion [Doc. # 68], at 33 (discussing Coastal Oil & Gas Corp. v. FERC, 782
F.2d 1249 (5th Cir. 1986)). FERC has never argued that NGA § 22, 15 U.S.C.
§ 717t-1, altered the allocation of jurisdiction over injunctive relief and criminal
prosecutions under NGA §§ 20 and 21, respectively. Historical practice under the
FPA and the NGPA is not dispositive because those statutes contain materially
different civil penalty provisions enacted decades apart from the NGA civil
penalty provision.

42

See Opinion [Doc. # 68], at 31 n.102 (explaining that “district court involvement
under the pre-2005 NGA was narrowly tailored”).

43

Energy Policy Act of 2005 (“EPAct”), Pub. L. No. 109-58, 119 Stat. 594, 685–93,
§§ 311–318.

44

15 U.S.C. § 717t-1, enacted by EPAct, § 314(b)(1)(B), 119 Stat. at 691.
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governing ratemaking (NGA § 4), abandonment (NGA § 7(b)), and certification of
certain activities (NGA § 7(c)).45
To distinguish these Fifth Circuit cases, Plaintiffs assert that “[i]t would
make no sense for parties to challenge FERC’s authority to adjudicate a statutory
violation in situations where proof of such a violation is neither necessary nor
sufficient to the lawfulness of FERC’s adjudication.”46 As explained below, this
contention ignores the fact that the Commission in these cases was not merely
reviewing proposed new rates, determining whether to approve abandonment, or
issuing a certificate of public convenience. In each instance, the Commission
acted expressly to remedy retrospectively violations of NGA provisions and
FERC’s procedures governing those issues. The Court therefore determined that
there was a “fairly discernible intent” to expand the Commission’s “toolbox” by
adding authority to assess civil penalties. The Court declines to reconsider its
interpretation of those cases for the following reasons.
Ratemaking.— Plaintiffs contend that the Commission has broad authority
to order refund payments under the portion of NGA § 4(e).

Plaintiffs quote

language authorizing the Commission “to hold ‘a hearing concerning the
lawfulness of’ any ‘rate’ charged by the company and ‘to order such natural-gas
company to refund, with interest, the portion of’ the ‘increased rates or charges by
its decision found not justified.’”47

Nothing in NGA § 4, including § 4(e)

45

See Opinion [Doc. # 68], at 32–33 & nn. 103–05.

46

Recon. Motion [Doc. # 73], at 16.

47

Reconsideration Motion [Doc. # 68], at 14 (quoting NGA § 4(e), 15 U.S.C.
§ 717c(e)) (emphasis added by Plaintiffs)). Plaintiffs take the quoted language out
of context. NGA § 4(e) authorizes the Commission to hold a hearing “concerning
the lawfulness” of a “new schedule” of rates. By statute, however, the
Commission may only suspend the new schedule for five months. The language
(continued…)
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explicitly grants the Commission jurisdiction to find the existence of a violation of
the NGA.
In Transcontinental Gas Pipe Line v. FERC, the Fifth Circuit determined
that the Commission had acted within its “equitable powers.”48 The Commission
denied a natural gas company an opportunity to recoup certain losses the company
had incurred because the company had violated the NGA. The Fifth Circuit held
the denial was an appropriate remedy based on the Commission’s findings that the
company had violated NGA §§ 4(b), 4(d), and 7. Under Plaintiffs’ interpretation
of NGA § 24, the language of NGA § 4 would not be sufficient to create an
exception to the “exclusive jurisdiction” provision in NGA § 24.

Applying

Plaintiffs’ interpretation, the Commission should have had to resort to a district
court for an adjudication of the underlying violations before it could base a remedy
on them. Transcontinental Gas Pipe Line is therefore evidence that NGA § 24 has
not been interpreted as broadly as Plaintiffs contend.
Abandonment.— Plaintiffs argue that the Commission order affirmed in
Mesa Petroleum v. FPC49 is distinguishable because it was based on the
Commission’s “adjudicatory jurisdiction” over abandonment of natural gas
facilities.

NGA § 7(b) only explicitly authorizes the Commission to grant

(continued…)
on which Plaintiffs rely concerns only implementation of such a new schedule if
the Commission has not concluded the hearing at the end of five months. The
Commission exercised this authority in Transcontinental Gas Pipe Line only to
the extent the natural gas company had already sought to recoup its losses via
implementation of the pass-through while the hearing was pending. See 998 F.2d
at 1317.
48

998 F.2d 1313, 1320 (5th Cir. 1993).

49

441 F.2d 182 (5th Cir. 1971)
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“permission and approval . . . after a due hearing.” NGA § 7(b) only expressly
references findings regarding the depletion of natural gas “to the extent that the
continuance of service is unwarranted” and regarding whether “present or future
public convenience or necessity permit such abandonment.” Nothing in NGA
§ 7(b) explicitly authorizes the Commission to find that a “violation” occurred.
Under Plaintiffs’ view of “exclusive jurisdiction” under NGA § 24, therefore, the
language of NGA § 7(b) would not support a “carve out” for the issue of whether
the abandonment prior to the institution of an NGA § 7(b) proceeding violates the
NGA and warrants retroactive relief. Nevertheless, the Fifth Circuit has affirmed
Commission orders imposing remedies for that violation in Mesa Petroleum and
Coastal Oil & Gas.50
Certification.— Plaintiffs argue that NGA § 7(c) provides authority to
adjudicate because it “authorizes FERC to hold a hearing to grant or deny natural
gas companies certificates to engage in certain activities related to the sale of
natural gas.”51 Plaintiffs rely on the Commission’s power under NGA § 7(e) “to
attach to the issuance of the certificate and to the exercise of the rights granted
50

In Mesa Petroleum, the natural gas company abandoned sale of natural gas under
certain contracts prior to filing an application with the Commission under NGA
§ 7(b). See 441 F.2d at 184. The Commission ultimately found the abandonment
improper and imposed a refund order dating back to the date of the abandonment.
The Fifth Circuit affirmed the refund order primarily relying on the Commission’s
broad remedial authority under NGA § 16. The Commission also noted that NGA
§ 7(b) had been interpreted to imply certain remedial authority. Similarly, in
Coastal Oil & Gas Corp. v. FERC, the Commission affirmed an ALJ’s finding
“that Coastal had violated § 7(b) of the Natural Gas Act by selling the gas
intrastate without first obtaining authorization from FERC to abandon interstate
service.” 782 F.2d 1249, 1251 (5th Cir. 1986). The Fifth Circuit explained that
the Commission had authority to impose equitable remedies to rectify the
violation.

51

Recon. Motion [Doc. # 73], at 15.
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thereunder such reasonable terms and conditions as the public convenience and
necessity may require.” Nowhere, however, do NGA § 7(c) or § 7(e) explicitly
state that the Commission has jurisdiction to remedy violations of the terms of the
certificate. Such a violation appears to be within Plaintiffs’ interpretation of NGA
§ 24’s term “exclusive jurisdiction of violations of this chapter, or the rules,
regulations, and orders thereunder.” In Cox v. FERC,52 however, the Fifth Circuit
affirmed the Commission’s finding that certain parties had “sold uncertificated
20% gas in interstate commerce in violation of the Natural Gas Act” and remedy of
“return[ing] diverted gas in kind to the interstate market.” Plaintiffs maintain that
the Commission was acting within its certification authority when it reopened a
certification hearing to impose this remedy. Plaintiffs fail to explain how, if their
expansive interpretation of NGA § 24 is correct, remedying a violation or
compelling compliance with NGA § 7(c) or the terms of a certificate issued
thereunder is within the Commission’s jurisdiction.
Conclusion on Historical Practice.— In sum, Congress did not expressly
create an exception to NGA § 24’s “exclusive jurisdiction” language in NGA §§ 4
and 7.

Nevertheless, the Fifth Circuit repeatedly has affirmed Commission

findings that natural gas companies “violated” the NGA. The Court of Appeals
has approved equitable remedies to rectify those violations. There is no indication
that the courts perceived NGA § 24 to have any bearing on the scope of the
Commission’s authority to find these violations. The Commission’s historical
practice and the Courts of Appeals’ endorsement directly contradicts Plaintiffs’
argument that NGA § 24 requires Congress explicitly to grant authority to the
Commission to determine the existence of “violations” of the NGA.
52

581 F.2d 449 (5th Cir. 1978).
15

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Additionally, Plaintiffs’ interpretation of NGA § 24 would create an
inefficient procedure for remedying violations of NGA §§ 4 and 7. It is clear that
the Commission may now assess civil penalties for violations of these sections of
the NGA. Even though the Commission has established authority to determine the
existence of violations of these provisions and to impose appropriate equitable
remedies, Plaintiffs request that this Court hold that the Commission would be
required to institute a separate proceeding in district court to assess civil penalties
for the same violations.

It is unlikely that Congress intended such a

counterintuitive outcome. Rather, it is “fairly discernible” that NGA § 22 should
be read as an expansion of the Commission’s remedial authority within the
administrative process. The text, structure, and purpose of the NGA, read as a
whole, demonstrate a “fairly discernible intent” to enhance, not avoid, the
administrative process.
3.

Other Arguments Regarding Text, Structure, and Purpose
of the NGA

Plaintiffs object to certain portions of the Court’s interpretation of the text,
structure, and purpose of the NGA.53

The Court finds these objections

unpersuasive.
Lack of Express Authority to Adjudicate.— Plaintiffs contend that the
Court’s comparison of NGA § 22 to Federal Deposit Insurance Act (“FDIA”)
§ 8(i)54 was error because the FDIA does not contain an “exclusive jurisdiction”
provision.

This argument misconstrues the purpose of the comparison to the

FDIA’s civil penalty provision. A fundamental premise of Plaintiffs’ interpretation
53

Plaintiffs do not move for reconsideration of the Court’s application of the
Thunder Basin factors to their constitutional and APA claims.

54

12 U.S.C. § 1818(i).
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of the NGA is that the phrase in NGA § 22 that “[t]he penalty shall be assessed by
the Commission after notice and opportunity for public hearing” does not grant the
Commission jurisdiction to determine whether the respondent violated the NGA.
Plaintiffs claim the dispute at bar presents the question:
whether Congress, when it newly provided for ‘civil’ penalties
without specifying the forum for adjudication after the agency has
assessed a proposed penalty under NGA § 22, intended to repeal NGA
§ 24’s categorical command of exclusive federal court jurisdiction of
NGA violations.55
Although a finding of a violation is a predicate to imposition of a penalty under
FDIA § 8(i), that provision, like NGA § 22, simply states that the penalty will be
“assessed” by the agency.56

In the FDIA, authority to “assess” includes

jurisdiction to “adjudicate.”57 Plaintiffs’ suggest that the Court must determine
“the forum for adjudication after the agency has assessed a proposed penalty under
NGA § 22.”58 As in the FDIA, there is no indication in the NGA that the forum for
adjudication is anything other than the forum in which the penalty is assessed.
Plaintiffs have presented no authority supporting a narrower interpretation of the
term “assess.”59

55

Recon. Reply [Doc. # 77], at 6–7.

56

FDIA § 8(i)(2)(A), 12 U.S.C. § 1818(i)(2)(A).

57

See Opinion [Doc. # 68], at 34 n.109.

58

Recon. Reply [Doc. # 77], at 6.

59

See Opinion [Doc. # 68], at 34 n.109.
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NGA §§ 14 and 16.— Plaintiffs characterize the Court’s analysis of NGA
§§ 1460 and 1661 as a holding that “FERC’s authority to ‘administer the entire
process for assessment of civil penalties’ could be inferred from its general
investigatory and regulatory authority under NGA §§ 14 and 16.”62

This

improperly oversimplifies the Court’s ruling. Instead, these provisions show that
the NGA contained a framework for administrative investigation, determination,
and remediation of violations. The Court found a “fairly discernible intent” to add
the civil penalty process to an existing administrative structure by granting the
Commission authority to “assess” penalties for violations of the statute the
Commission has administered broadly for decades since its enactment.63 There is
no basis to alter this conclusion.
Relevance of the Addition of NGA § 20(d).— Plaintiffs contest the Court’s
reasoning that the addition of NGA § 20(d)64 through the EPAct is evidence that
Congress was aware of the district court’s jurisdiction but chose not to invoke it for
NGA § 22. Plaintiffs maintain that NGA § 20(d) “used the existing framework to
60

15 U.S.C. § 717m (authorizing FERC to undertake investigations “in order to
determine whether any person has violated or is about to violate any provisions of
this chapter” (emphasis added)).

61

15 U.S.C. § 717o (“The Commission shall have power to perform any and all acts,
and to prescribe, issue, make, amend, and rescind such orders, rules, and
regulations as it may find necessary or appropriate to carry out the provisions of
[the NGA].”).

62

Recon. Motion [Doc. # 73], at 19.

63

See Opinion [Doc. # 68], at 35–36.

64

15 U.S.C. § 717s(d) (“In any proceedings under subsection (a) of this section
[§ 717s(a)], the court may prohibit . . . any individual who is engaged or has
engaged in practices constituting a violation of section 717c-1 . . . from— (1)
acting as an officer . . . of a natural gas company . . . .”); see Opinion [Doc. # 68],
at 35 & n.111.
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expand the district courts’ injunctive authority,” but “there was no existing NGA
civil penalty framework into which Congress might incorporate the civil penalty
portion of the 2005 amendments.”65

This argument ignores the structure of

comparable provisions in the Exchange Act.66
When Congress created district court jurisdiction to impose civil penalties
for violations of the Exchange Act, it did so by amending Exchange Act § 21(d),67
which is functionally identical to NGA § 20.

Both Exchange Act § 21(d) and

NGA § 20 authorize injunctive relief to enjoin acts and practices that constitute
violations of the Act68 and to prohibit certain persons from serving as officers and
directors.69 Had Congress intended to assign the NGA civil penalty process to the
65

Recon. Motion [Doc. # 73], at 20.

66

15 U.S.C. § 78u(d).

67

See Securities Enforcement Remedies and Penny Stock Reform Act of 1990, Pub.
L. No. 101-429, §§ 201–202, 104 Stat. 931, 936–38.

68

Compare Exchange Act § 20(d)(1), 15 U.S.C. § 78u(d)(1) (“Whenever it shall
appear to the Commission [SEC] that any person is engaged or about to engage in
any acts or practices which constitute or will constitute a violation of the
[Exchange Act]” the Commission may bring an action in “the proper district court
of the United States . . . to enjoin such acts . . . .”), with NGA § 20, 15 U.S.C.
§ 717s(a) (“Whenever it shall appear to the Commission [FERC] that any person
is engaged or about to engage in any acts or practices which constitute or will
constitute a violation of the [NGA]” the Commission may bring an action in “the
proper district court of the United States . . . to enjoin such acts . . . .”).

69

Compare Exchange Act § 21(d)(2), 15 U.S.C. § 78u(d)(2) (“In any proceeding
under paragraph (1) of this subsection [§ 78u(d)(1)], the court may prohibit . . .
any person who violated section 78j(b) . . . from acting as an officer or director of
any issuer that has a class of securities registered pursuant to section 78l of this
title or that is required to file reports pursuant to section 78o(d) of this title . . . .”),
with NGA § 20(d), 15 U.S.C. § 717s(d) (“In any proceedings under subsection (a)
of this section [§ 717s(a)], the court may prohibit . . . any individual who is
engaged or has engaged in practices constituting a violation of section 717c-1 . . .
from— (1) acting as an officer . . . of a natural gas company . . . .”). The similarity
(continued…)
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district courts as in the Exchange Act, Congress could have done so by amending
NGA § 20. Contrary to Plaintiffs’ assertion, NGA § 20 provided an “existing
framework” for district court jurisdiction, and Congress could have added NGA
civil penalties within that structure, parallel to the addition of civil penalties
provisions to the Exchange Act. Congress, however, did not do so. For NGA civil
penalties, Congress created a stand-alone provision. The similarity between NGA
§ 20(d) and Exchange Act § 21(d)(2) and the dissimilarity between NGA § 22 and
Exchange Act § 21(d)(3) are strong evidence that, in 2005, Congress did not intend
NGA § 22 civil penalties to be added to district courts’ jurisdiction.
Venue.— Plaintiffs argue that it was unnecessary for Congress to identify
permissible venues for civil penalty actions because “NGA § 24 already specifies
venue for enforcement actions.”

Plaintiffs apparently refer to NGA § 24’s

sentence on venue for actions to “enforce any liability or duty created” by the
NGA, as the other § 24 venue provision pertains specifically to criminal
prosecutions.70 The Exchange Act is again informative. If a defendant fails to pay
a civil penalty that has been determined by a district court in an action by the SEC,
the SEC may refer the matter to the Attorney General, who may bring a separate

(continued…)
between the Exchange Act and the NGA in this regard is evidenced by the
connection of NGA § 4A, 15 U.S.C. § 717c-1, to Exchange Act 10(b), 15 U.S.C.
§ 78j(b). See 15 U.S.C. § 717c-1 (“It shall be unlawful for any entity . . . to use or
employ, in connection with the purchase or sale of natural gas or the purchase or
sale of transportation services subject to the jurisdiction of the Commission, any
manipulative or deceptive device or contrivance (as those terms are used in section
78j(b) of this title [15 U.S.C. § 78j(b)] . . . .” (emphasis added)).
70

See Opinion [Doc. # 68], at 36 & n.114.
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suit to enforce the court’s order.71 This suit to collect is considered an action “to
enforce a liability or duty” for purposes of Exchange Act § 27’s jurisdiction and
venue provisions.72

This is consistent with the Court’s holding that an

“enforcement action” under the NGA would be to collect a civil penalty previously
assessed by the Commission in a final order, not the adjudication of the amount of
the penalty itself. There is no venue provision in the NGA to govern the latter,
which is the type of civil penalty proceeding Plaintiffs argue Congress intended to
create.73
Type of Proceeding.— Plaintiffs contend that the Court erred in relying on
the absence in the NGA of any description of the district court proceeding that
would occur under Plaintiffs’ interpretation of NGA § 24. Plaintiffs suggest that
civil penalties under the NGA would be imposed using procedures analogous to
those specified by the FPA. The FPA contains detailed provisions creating two
alternative tracks for assessment and collection of civil penalties. None of these
procedures are described in the NGA.

The Court previously considered and

71

Exchange Act § 21(d)(3)(C)(ii), 15 U.S.C. § 78u(d)(3)(C)(ii) (“If a person upon
whom such a penalty is imposed shall fail to pay such penalty within the time
prescribed in the court's order, the Commission may refer the matter to the
Attorney General who shall recover such penalty by action in the appropriate
United States district court.”).

72

15 U.S.C. § 78u(d)(3)(C)(iv) (“For purposes of section 78aa of this title, actions
under this paragraph shall be actions to enforce a liability or a duty created by this
chapter.”).

73

See Opinion [Doc. # 68], at 37 (“Defendants have argued persuasively that, after
issuance of a final penalty order, FERC may seek judicial enforcement in the
district courts through an action ‘brought to enforce’ a ‘liability’ under the NGA,
but no liability can exist until after a violation has been found by the
Commission.” (footnote omitted)).
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rejected the argument that it should imply the FPA procedures into the NGA.74
Nor does the FPA support Plaintiffs’ contention that the default forum under the
NGA is the district courts.75
Purpose.— Plaintiffs contend that the purposes of the EPAct “make[] it all
the more implausible that Congress would sharply deviate from decades of law and
practice governing FERC enforcement actions without so much as a discussion of
74

See Opinion [Doc. # 68], at 38–39 n.119. Plaintiffs argue in a footnote that “it
would be remarkable if Plaintiffs could be found liable for the hefty penalties
authorized by NGA § 22 if their only opportunity to litigate the facts was a hearing
at which FERC proposes its penalty.” Recon. Motion [Doc. # 73], at 22 n.5.
Plaintiffs do not, however, contend that the administrative procedures offer
insufficient process as a constitutional matter. Plaintiffs’ argument here appears
unrelated to their constitutional claims, nor has it been independently invoked in
support of the constitutional avoidance argument. To the extent that Plaintiffs
argue that “Congress would have at least directed a hearing ‘on the record’ under
NGA § 22 if it meant to carve out an exception to NGA § 24’s grant of exclusive
jurisdiction to federal district courts,” the Court notes that this silence equally
could be read as indication that Congress did not understand NGA § 22 to be
related to NGA § 24 at all. Indeed, NGA § 16(e) requires the Commission to keep
“appropriate records” of any hearing before the Commission.

75

Plaintiffs continue to mischaracterize the structure of the civil penalties provision
of the Federal Power Act (“FPA”). See, e.g., Recon. Reply [Doc. # 77], at 7, 11.
Under the FPA, the default procedure for assessment of civil penalties is through
the administrative process. A respondent must expressly opt out of that procedure
in favor of a proceeding in a district court. See 16 U.S.C. § 823b(d)(2) (“In the
case of the violation of a final order issued under subsection (a) of this section, or
unless an election is made within 30 calendar days after receipt of notice under
paragraph (1) to have paragraph (3) apply with respect to such penalty, the
Commission shall assess the penalty . . . .”).
Further, unlike Plaintiffs’
interpretation of NGA §§ 22 and 24, the FPA does not authorize two hearings
regarding the same violation. The absence in the NGA of the choice between the
default of an administrative proceeding and the alternative of a district court
proceeding is not evidence that Congress intended to assign the NGA civil penalty
process exclusively to the district courts. If anything, the NGA’s structure implies
the inverse: that Congress decided not to permit respondents to opt out of the
administrative process under the NGA.
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the change.”76 Plaintiffs again rely on their faulty premise of “historical practice.”
There is no evidence of the “decades of law and practice” they reference.77
Constitutional Avoidance.— Plaintiffs argue that the Court should favor
their interpretation of NGA § 24 because it avoids the constitutional issues that
form the basis of their claims for declaratory relief under the Appointments Clause
and the Fifth and Seventh Amendments.78

Plaintiffs continue to rely on

speculative assertions about the alleged lack of fairness of the FERC proceedings
and Plaintiffs’ request for a jury trial. Tellingly, Plaintiffs do not here address the
Court’s conclusion that these claims were unripe.79
Application of the canon of constitutional avoidance is premature.
Typically, the canon comes into play when constitutional issues arise that are
currently justiciable. Plaintiffs’ constitutional claims may be addressed if the
procedural violations Plaintiffs anticipate occur in the FERC proceeding and if
Plaintiffs are unsuccessful on the merits.
Further, Plaintiffs’ identification of potential defects in certain aspects of
FERC’s procedures is not a reason to interpret NGA §§ 22 and 24 to eliminate the
agency’s jurisdiction entirely.

Plaintiffs do not argue that the purported

Appointments Clause and Fifth Amendment defects arise directly out of the grant
of FERC jurisdiction; rather, they complain of specific procedures the Commission
has implemented in the exercise of that jurisdiction. Similarly, as explained in the
Opinion, even Plaintiffs’ interpretation of NGA § 24 does not guarantee them a
76

Recon. Motion [Doc. # 73], at 22.

77

See supra notes 40–42 and accompanying text.

78

Recon. Motion [Doc. # 73], at 17.

79

See Opinion [Doc. # 68], at 21–22.
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jury trial.80 NGA § 24 is not the source of the purported constitutional infirmities.
The dramatic restructuring of the civil penalty process Plaintiffs’ interpretation of
NGA § 24 would require is an overbroad and premature solution to discrete
potential procedural issues.
Conclusion on Thunder Basin Analysis.— Plaintiffs have not established
grounds for alteration of the Court’s conclusions in its Opinion that it lacks
jurisdiction over the claims asserted.
C.

Discretionary Analysis Applicable to Action Seeking Solely
Declaratory Relief

Plaintiffs argue that the Court’s holding that it would exercise its discretion
to decline to hear their declaratory judgment action was not a true alternative
holding.81 Not only is this contention contrary to the Court’s statements reiterated
several times, but it is contrary to law. The Supreme Court held in Wycoff that an
agency should be afforded an opportunity to evaluate its jurisdiction, subject to
review by the appropriate court of appeals.82 Further, the Trejo factors83 counsel
80

See id., at 22 & n.70.

81

Recon. Motion [Doc. # 73], at 23.

82

Pub. Serv. Comm’n of Utah v. Wycoff Co., 344 U.S. 237 (1952); see also Opinion
[Doc. # 68], at 51–52. Plaintiffs contend that Wycoff only applies if the Court
lacks jurisdiction under NGA § 24. Plaintiffs acknowledge that the Supreme
Court “held that the DJA procedure could not be used to ‘preempt and prejudge’
the question whether the plaintiff engaged in intrastate commerce, because that
issue was ‘committed for initial decision to an administrative body.’” Recon.
Motion [Doc. # 73], at 24. That question, however, related to the agency’s
jurisdiction, not the merits of the underlying (inchoate) administrative dispute.
See Wycoff, 344 U.S. at 239 (explaining that declaratory plaintiff sought to prevent
regulation by state agency through a declaration that it was outside its declaration
by virtue of being engaged in interstate commerce). Wycoff is therefore direct
support for this Court’s holding that it should exercise its discretion to permit the
Commission to rule on issues affecting its jurisdiction in the first instance.
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against this Court preempting the Commission’s decision on its own jurisdiction
where the same jurisdictional question has been presented to and is currently
pending before that tribunal. Plaintiffs cite no cases in which the Declaratory
Judgment Act was successfully employed to deprive an agency of authority while
an adjudicatory proceeding was pending, much less a case in which a court abused
its discretion by declining to do so.
It is inappropriate for the Court to insert itself prematurely into the dispute
between FERC and Plaintiffs. If, as Plaintiffs contend, FERC’s case is so weak
that no one but FERC itself would believe it,84 the “substantial evidence” review in
a court of appeals should be protection from overreach by the agency.85

In

contrast, Plaintiffs’ proposed court involvement in pending administrative
processes will exacerbate the complexity of those proceedings. The Court, for
these reasons, and those in the Opinion, continues to exercise its discretion to
decline to entertain Plaintiffs’ declaratory judgment action.

83

(continued…)
See St. Paul Insurance Co. v. Trejo, 39 F.3d 585, 590–91 (5th Cir. 1994).

84

See Recon. Motion [Doc. # 73], at 5 n.1 (suggesting that FERC should “drop[] its
enforcement action because it knows it would be unable to convince an audience
outside FERC that the action has merit”).

85

Even the authorities on which Plaintiffs rely support the view that Plaintiffs’
challenges should be evaluated through the existing administrative process. See,
e.g., Touche Ross, 609 F.2d at 575 (“[A]llegations of agency bias or prejudgment
based on ex parte communications are insufficient for injunctive relief and cannot
be reviewed until the agency has made an adverse determination and an appeal has
been taken raising these claims on the record as a whole . . . . Until the [SEC] has
acted and actual bias has been demonstrated, the orderly administrative procedures
of the agency should not be interrupted by judicial intervention.”); id., at 582 n.21
(noting potential statutory argument that SEC might lack jurisdiction over one
respondent in the case and recommending that the SEC “might want to consider”
the argument in the administrative proceeding).
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D.

Motion for Leave to Amend

Plaintiffs request leave to amend their Complaint again to attempt to cure the
justiciability defect under Calderon.86 Plaintiffs propose to add a request for a
declaration that they did not violate the market manipulation provisions of the
NGA. According to Plaintiffs, the addition of this claim will bring the entire
dispute to this Court. For the following reasons, the Court denies Plaintiffs leave
to amend.
Plaintiffs contend that they did not have the opportunity to address Calderon
because Defendants did not raise that case in their briefing. Calderon addresses an
issue of subject matter jurisdiction, which the Court must police sua sponte. In
Calderon, the Supreme Court raised the subject matter jurisdiction issue even
though it was not among the questions on which certiorari was granted.87 Further,
the Court deems Plaintiffs to have been on notice of Calderon because its holding
was restated in MedImmune, a case Plaintiffs repeatedly cited.
Plaintiffs’ request to amend is, in any event, futile in light of the Court’s
other rulings. Nothing in Federal Rule of Civil Procedure 15 requires a court to
exercise its discretion to permit amendment to cure a jurisdictional defect where
independent grounds exist for dismissal.

86

In their Response to the Motion to Dismiss, Plaintiffs did not request leave to
amend in the event that the Court granted the Motion to Dismiss.

87

See 523 U.S. at 745 (“We granted certiorari on both the Eleventh Amendment and
the First Amendment issues, 522 U. S. 1011 (1997), but in keeping with our
precedents, have decided that we must first address whether this action for a
declaratory judgment is the sort of ‘Article III’ ‘case or controversy’ to which
federal courts are limited.” (citing FW/PBS, Inc. v. Dallas, 493 U. S. 215, 230–31
(1990))).
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Further, even if this Court had subject matter jurisdiction over Plaintiffs’
claims, the Court concludes it is inappropriate to rule on declaratory judgment
claims pursued by Plaintiffs in connection with their pending agency proceeding.
Investigations under the NGA are often sensitive, complex, and lengthy.88 FERC’s
procedures for these investigations depend on interaction between the respondent
and the agency.

If a respondent had the option of running into court for a

declaratory judgment about agency procedures or the merits of the agency’s
enforcement staff’s preliminary contentions, the parties would be entangled in twofront litigation. Congress provided FERC the discretion to decide whether and
how to investigate and, if necessary, to prosecute an action for civil penalties.
Plaintiffs’ proposed second amendment to its Complaint is futile and leave to
amend is denied.
III.

CONCLUSION
Plaintiffs’ interpretation of NGA § 24 may have a superficial appeal.

However, once evaluated within the framework required by the Supreme Court’s
decisions in Calderon, Thunder Basin, Free Enterprise Fund, and Elgin, the
jurisdictional infirmities of Plaintiffs’ declaratory judgment action become
apparent. Plaintiffs’ Reconsideration Motion ignores this applicable framework.
Furthermore, the Court exercises its discretion to decline to rule on Plaintiffs’
declaratory judgment claims. In sum, Plaintiffs’ attempt to read one phrase in
NGA § 24 in isolation is rejected. The Court declines to alter or amend the
Opinion. It is therefore

88

See Opinion [Doc. # 68], at 8–9.
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ORDERED that Plaintiffs Total Gas & Power North America, Inc., Aaron
Trent Hall, and Therese Nguyen Tran’s Motion to Alter or Amend Judgment or for
Leave to File Second Amended Complaint [Doc. # 73] is DENIED.
SIGNED at Houston, Texas, this 14th day of September, 2016.

NAN Y F. ATLAS
SENIOR UNI
STATES DISTRICT JUDGE

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