Williston Basin Interstate Pipeline Co. v. Federal Energy Regulatory Commission

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 20, 2006 Decided December 22, 2006

No. 05-1209

WILLISTON BASIN INTERSTATE PIPELINE COMPANY,
PETITIONER

v.

FEDERAL ENERGY REGULATORY COMMISSION,
RESPONDENT

MONTANA CONSUMER COUNSEL
AND SOUTH DAKOTA PUBLIC UTILITIES COMMISSION
INTERVENORS

On Petition for Review of Orders of the
Federal Energy Regulatory Commission

Robert T. Hall, III argued the cause for petitioner. With
him on the briefs was Andrea C. Wolfman.
Michael E. Kaufmann, Attorney, Federal Energy Regulatory
Commission, argued the cause for respondent. With him on the
brief were John S. Moot, General Counsel, and Robert H.
Solomon, Solicitor.
Robert A. Jablon and Thomas C. Trauger were on the brief
for intervenors Montana Consumer Counsel and South Dakota
Public Utilities Commission.
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Before: GARLAND and BROWN, Circuit Judges, and
EDWARDS, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge
EDWARDS.
EDWARDS, Senior Circuit Judge: Williston Basin Interstate
Pipeline Co. (“petitioner”) seeks judicial review of three Federal
Energy Regulatory Commission (“FERC” or “Commission”)
orders: Williston Basin Interstate Pipeline Co., 104 F.E.R.C.
¶ 61,036 (2003) (“Initial Order”); Williston Basin Interstate
Pipeline Co., 107 F.E.R.C. ¶ 61,164 (2004) (“Rehearing
Order”); and Williston Basin Interstate Pipeline Co., 111
F.E.R.C. ¶ 61,102 (2005) (“Compliance Order”). The
Commission contends that the petition for review should be
dismissed, because this court lacks jurisdiction under section 19
of the Natural Gas Act (“NGA”), 15 U.S.C. § 717r, to consider
the merits of Williston’s claims.
Two provisions of the NGA control the disposition of this
case. First, section 19(a) provides:
Any person . . . aggrieved by an order issued by the
Commission . . . may apply for a rehearing within thirty
days after the issuance of such order. The application for
rehearing shall set forth specifically the ground or grounds
upon which such application is based. Upon such
application the Commission shall have power to grant or
deny rehearing or to abrogate or modify its order without
further hearing. Unless the Commission acts upon the
application for rehearing within thirty days after it is filed,
such application may be deemed to have been denied. No
proceeding to review any order of the Commission shall be
brought by any person unless such person shall have made
application to the Commission for a rehearing thereon.
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15 U.S.C. § 717r(a) (emphases added). Second, section 19(b)
provides:
Any party to a proceeding under this chapter aggrieved
by an order issued by the Commission . . . may obtain a
review of such order in the court of appeals . . . by filing in
such court, within sixty days after the order of the
Commission upon the application for rehearing, a written
petition praying that the order of the Commission be
modified or set aside in whole or in part. . . . Upon the
filing of such petition such court shall have jurisdiction,
which upon the filing of the record with it shall be
exclusive, to affirm, modify, or set aside such order in
whole or in part. No objection to the order of the
Commission shall be considered by the court unless such
objection shall have been urged before the Commission in
the application for rehearing unless there is reasonable
ground for failure so to do.
15 U.S.C. § 717r(b) (emphases added). In light of these
provisions, the Commission argues that
Williston’s petition for review should be dismissed for lack
of jurisdiction because, in contravention of NGA Section
19, 15 U.S.C. § 717r: (1) Williston failed to file a timely
petition for review of the Rehearing Order; (2) although it
filed a timely petition for review of the Compliance Order,
Williston was not aggrieved by that order; (3) assuming,
arguendo, that Williston was aggrieved by the Compliance
Order, it never sought rehearing of that order as required by
the NGA; and (4) Williston’s “Request for Clarification and
Reconsideration,” filed 34 days after the issuance of the
Rehearing Order, did not qualify as a timely rehearing
request under the NGA and therefore did not toll the time
for filing a timely petition for review.
FERC’s Br. at 3. We largely agree.
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Williston concedes that FERC’s May 2004 Rehearing
Order was a final, non-conditional order that was subject to
judicial review. Instead of filing a petition for review with this
court within 60 days of the Rehearing Order, however, or even
a timely petition for further rehearing by FERC within 30 days
of the Rehearing Order, petitioner filed a self-styled “Request
for Clarification and Reconsideration of the Rehearing Order”
(“RCR”). The RCR was filed 34 days after FERC’s Rehearing
Order, i.e., outside the time permitted for the filing of a request
for rehearing.
Petitioner argues that the RCR tolled the limitations period
under 15 U.S.C. § 717r(b), and contends that the clock did not
begin to run on the time limit for seeking judicial review until
FERC issued the Compliance Order on April 19, 2005. These
claims fail, however, because the agency action about which
petitioner now complains is embodied in FERC’s Rehearing
Order and petitioner did not seek timely review of that order.
We therefore dismiss Williston’s petition for want of
jurisdiction.
I. BACKGROUND
The NGA, 15 U.S.C. §§ 717-717z, regulates “matters
relating to the transportation of natural gas and the sale thereof
in interstate and foreign commerce.” 15 U.S.C. § 717(a).
“[T]he Commission may act under two different sections of the
[NGA] to effect a change in a gas company’s rates. When the
Commission reviews rate increases that a gas company has
proposed, it is subject to the requirements of section 4(e) of the
Act, 15 U.S.C. § 717c(e). Under section 4(e), the gas company
bears the burden of proving that its proposed rates are
reasonable.” Algonquin Gas Transmission Co. v. FERC, 948
F.2d 1305, 1311 (D.C. Cir. 1991). However, “when the
Commission seeks to impose its own rate determinations, rather
than accepting or rejecting a change proposed by the gas
company, it must do so in compliance with section 5(a) of the
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NGA.” Id. “Section 5 imposes the burden of proof on the
Commission to demonstrate that existing rates are unjust and
unreasonable.” Tenn. Gas Pipeline Co. v. FERC, 860 F.2d 446,
449 (D.C. Cir. 1988). “[T]he Commission must affirmatively
show that any rate it imposes in a § 4 remedial order as a
revision or modification in the filed tariff satisfies the § 5
requirement that such rate be just and reasonable.” Id. at 447
(footnote omitted).
Section 4 of the NGA states that a pipeline may not institute
a rate increase “except after thirty days’ notice to the
Commission and to the public.” 15 U.S.C. § 717c(d). “Pending
its decision under § 4, the Commission may ‘suspend the
operation . . . and defer the use’ of a proposed rate for up to five
months. Thereafter the rate ‘shall go into effect,’ but ‘the
Commission may, by order, require the natural-gas company . . .
to refund any amounts’ later found by the Commission to be
unjust and unreasonable. 15 U.S.C. § 717c(e).” ChevronTexaco
Exploration & Prod. Co. v. FERC, 387 F.3d 892, 897 (D.C. Cir.
2004); see also Nat’l Fuel Gas Supply Corp. v. FERC, 899 F.2d
1244 (D.C. Cir. 1990). No such refund authority exists when the
Commission orders a reduction in rates under section 5. See Sea
Robin Pipeline Co. v. FERC, 795 F.2d 182, 184 (D.C. Cir. 1986)
(“FERC’s remedial power under section 5 is limited to
prospective relief: the Commission cannot order a refund of
past payments made under the revoked rate.”).
_______________________
On December 1, 1999, petitioner submitted to the
Commission a general rate increase filing pursuant to section 4.
The Commission issued an order suspending the effective date
of the proposed rates until June 1, 2000, docketed the case for
hearing, and referred the matter to an Administrative Law Judge
(“ALJ”). Williston Basin Interstate Pipeline Co., 89 F.E.R.C. ¶
61,330 (1999). On May 9, 2001, following an extensive
hearing, the ALJ issued a decision taking issue with the
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depreciation methodology employed by Williston in arriving at
the increased rates. The Commission’s Initial Order, issued on
July 3, 2003, affirmed in part and reversed in part the ALJ’s
decision. The Commission rejected the proposed rates, ordered
Williston to make a compliance filing containing reasonable
rates, and ordered Williston to issue refunds once the
Commission ruled upon the compliance filing. Initial Order, 104
F.E.R.C. ¶ 61,036, at 61,112. Williston made the required
compliance filing, but also filed a timely request for rehearing
of the Initial Order, arguing that Commission-initiated rate
changes could only have prospective application. The
Commission rejected Williston’s request for rehearing on May
11, 2004. Rehearing Order, 107 F.E.R.C. ¶ 61,164. On April
19, 2005, the Commission rejected Williston’s compliance
filing, established appropriate rates, and ordered Williston to
disburse refunds within 30 days. Compliance Order, 111
F.E.R.C. ¶ 61,102.
In its brief to this court, Petitioner’s Br. at 13, and during
oral argument, Recording of Oral Argument at 4:02, petitioner
conceded that FERC’s Rehearing Order was a final order with
respect to which judicial review could have been sought. See
also Canadian Ass’n of Petroleum Producers v. FERC, 254 F.3d
289, 296 (D.C. Cir. 2001) (“[A] party that has petitioned for
rehearing and seen its petition denied without significant
modification to the order may then proceed directly to court
without filing a new petition for rehearing of the denial;
imposing an additional rehearing requirement in this situation
would lead to infinite regress and serve no useful end.”).
However, Williston failed to file a timely petition for judicial
review within 60 days. Williston also failed to file a timely
petition for further agency rehearing within 30 days. See id. at
296-97 (After a petition for rehearing has been denied by FERC,
it is “only on matters where the rehearing order introduces a new
source of complaint need the party file another rehearing
petition.”). Instead, Williston filed a document labeled “Request
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for Clarification and Reconsideration of the Rehearing Order”
34 days after the Commission issued the Rehearing Order, i.e.,
on a date that was beyond the deadline for filing a request for
further rehearing.
II. ANALYSIS
As noted above, a party aggrieved by a Commission order
“may apply for a rehearing within thirty days after the issuance
of such order.” 15 U.S.C. § 717r(a). The complaining party
then has “sixty days after the order of the Commission upon the
application for rehearing” to file a petition for review in the
appropriate court of appeals. 15 U.S.C. § 717r(b) (emphasis
added). If a party does not seek rehearing, no judicial review is
available. United Mun. Distribs. Group v. FERC, 732 F.2d 202,
205 n.2 (D.C. Cir. 1984) (“An application for rehearing is a
jurisdictional prerequisite to judicial review of Commission
orders under the NGA. 15 U.S.C. § 717r(a) (1982).”). If
rehearing is sought, judicial review is available only if a party
files within 60 days of the agency’s ruling on rehearing. The
60-day limitations provision is jurisdictional. See Nephi, Utah
v. FERC, 147 F.3d 929, 933-34 (D.C. Cir. 1998).
Williston argues that “[t]his Court has held that the filing of
a request for administrative reconsideration renders an agency
decision nonfinal and tolls the time for filing a petition for
review,” citing Clifton Power Corp. v. FERC, 294 F.3d 108
(D.C. Cir. 2002); Bellsouth Corp. v. FCC, 17 F.3d 1487 (D.C.
Cir. 1994); and Tennesee Gas Pipeline Co. v. FERC, 9 F.3d 980
(D.C. Cir. 1993) (per curiam). Petitioner’s Br. at 9, 12-13.
Thus, “[i]t does not matter,” Williston claims, “whether agency
reconsideration is sought through a petition for rehearing under
Section 19(a) of the Natural Gas Act or another form of filing
because the Court’s rulings are founded on the need to conserve
judicial resources.” Id. at 9. The problem with Williston’s
argument is that it ignores the Supreme Court’s holding in ICC
v. Brotherhood of Locomotive Engineers that only a “timely
 8

petition for administrative reconsideration stay[s] the running of
[a statutory] limitation period until the petition [for
reconsideration] had been acted upon.” 482 U.S. 270, 284
(1987) (emphasis added).
The three cases from this court upon which Williston relies
all involved timely requests for reconsideration. And all three
cases adhere to the teachings of Locomotive Engineers. In
Clifton Power Corp., we stated expressly that a “timely petition
for administrative reconsideration stay[s] the running of the . . .
limitation period.” 294 F.3d at 110 (citing Locomotive Eng’rs,
482 U.S. at 284). The decision in Bellsouth Corp. relies on
United Transportation Union v. ICC, 871 F.2d 1114 (D.C. Cir.
1989), see 17 F.3d at 1489-90, which in turn rests on
Locomotive Engineers for the proposition that a timely petition
for reconsideration stays the limitations period for judicial
review, see 871 F.2d at 1117-18. The decision in Tennessee Gas
Pipeline Co. also relies on the relevant portion of United
Transportation Union. See 9 F.3d at 981. In Tennessee Gas
Pipeline Co., after its first petition for rehearing was denied, the
petitioner filed a second request for rehearing within 30 days of
the agency’s first rehearing order; because the second petition
for rehearing was timely and still pending when judicial review
was sought, the petition for review was dismissed as premature.
In sum, none of the cases cited by petitioner holds that an
untimely request for reconsideration tolls the running of the
limitations period for judicial review. Indeed, such a holding
would fly in the face of the jurisdictional requirements of the
NGA and the Court’s decision in Locomotive Engineers.
Williston’s RCR was not a timely petition for rehearing or
reconsideration, because it was filed 34 days after FERC’s
Rehearing Order. In light of the requirements of 15 U.S.C.
§ 717r(a) – an aggrieved party “may apply for a rehearing within
thirty days after the issuance of [FERC’s] order” – and 15
U.S.C. § 717r(b) – a complaining party has “sixty days after the
 9

order of the Commission upon the application for rehearing” to
file a petition for review – the RCR could not possibly establish
a basis for judicial review of the Commission’s Rehearing
Order. As previously noted, an application for rehearing is a
jurisdictional prerequisite to judicial review of Commission
orders under the NGA, United Mun. Distribs. Group, 732 F.2d
at 205 n.2, but it cannot serve this function if it is not timely
filed under 15 U.S.C. § 717r(a). Williston readily acknowledges
that it “could have filed a petition for review within 60 days of
[the Commission’s May 2004 Rehearing Order].” See
Petitioner’s Br. at 13. Having failed to do so, it cannot now
secure the jurisdiction of this court to gain review of that order.
To avoid the obvious jurisdictional bar to its petition for
review, Williston argues that the 60-day clock for seeking
judicial review began to run only after the Commission issued
its Compliance Order. This argument is meritless. The agency
action of which Williston now seeks review is embodied in the
Commission’s Rehearing Order, and Williston never filed a
timely petition for review of that order.
Williston claims that it feared the imposition of sanctions by
this court if it filed a petition for judicial review while its RCR
was “pending.” Petitioner’s Br. at 16. This claim lacks
credence. The court’s order in Williston Basin Interstate
Pipeline Co. v. FERC, No. 99-1311 (D.C. Cir. Oct. 12, 1999),
upon which Williston grounds its fear of sanction, is plainly
inapposite. In that case, the petitioner first filed a timely request
for rehearing with the Commission and then filed a petition for
review with this court while the timely petition for rehearing
was still pending before the Commission. We concluded that
the petition was “incurably premature” and ordered the
petitioner to show cause why we should not assess sanctions.
Id.; see also Clifton Power Corp., 294 F.3d at 110 (“Our cases
make clear that a petition seeking review of such a non-final
action is not only premature but incurably so . . . .”). In this
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case, Williston never filed a timely second petition for rehearing
of the Rehearing Order. Had Williston filed a timely petition
for judicial review of the Rehearing Order, which it knew to be
a final order subject to judicial review, this court would have
been obliged to consider the petition on its merits.
The logical extension of Williston’s argument, which we
cannot accept, is that a petitioner can file a request for
reconsideration of a Commission order whenever it desires, and
that such filing tolls the 60-day statute of limitations for judicial
review. This would wreak havoc with the jurisdictional
requirements of the NGA. A party cannot be allowed to file a
self-styled request for “reconsideration” outside of the explicit
time limits for requests for rehearing in order to avoid the
jurisdictional requirements for obtaining judicial review. Were
we to endorse such a rule, we would vitiate both the statutory
requirement governing the timely filing of a request for
rehearing with the agency (a prerequisite to judicial review), and
the statutory limitation period for judicial review. We have no
authority to rewrite the statute in this way.
III. CONCLUSION
There is no doubt that the time requirements of 15 U.S.C.
§ 717r(a), (b) of the NGA establish jurisdictional requirements.
See Moreau v. FERC, 982 F.2d 556, 562-63 (D.C. Cir. 1993)
(holding that “the time requirements of the statute are as much
a part of the jurisdictional threshold as the mandate to file for a
rehearing” and that “the time limit[s] must be strictly construed
and may not be waived by FERC or evaded by the courts”)
(citations omitted). Statutory jurisdictional requirements, such
as the provisions of 15 U.S.C. § 717r, are not mere technicalities
that can be brushed aside by a court. And a petitioner cannot
escape the NGA’s jurisdictional requirements by filing an
untimely or procedurally defective request for reconsideration.
See Moreau, 982 F.2d at 563 (holding that, in a case in which
petitioners did not move for rehearing of FERC’s order until
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approximately eight months after the order issued, the court
would not “exempt from the time limit those who, like
petitioners, choose to sit on the sidelines to wait and see what
happens in FERC proceedings”). The simple point here is that
“subject-matter jurisdiction, because it involves the court’s
power to hear a case, can never be forfeited or waived.”
Arbaugh v. Y&H Corp., 126 S. Ct. 1235, 1244 (2006); see also
Avocados Plus Inc. v. Veneman, 370 F.3d 1243, 1247 (D.C. Cir.
2004) (if a statutory requirement is jurisdictional, “a court
cannot excuse it”). It is absolutely clear in this case that,
because Williston failed to satisfy the jurisdictional
requirements of the NGA, we lack jurisdiction to consider its
petition for review.