Sixth Circuit Holds that Electricity is a Commodity Under Robinson-Patman Act and Limits Applicability of the Filed Rate Doctrine

On June 4, 2012, in Williams v. Duke Energy International, Inc., No. 10- 3604, 2012 WL 1970096, the Sixth Circuit reversed the dismissal of Robinson-Patman Act claims against Duke Energy International, Inc. and Duke Energy Corp. (“Duke”). In Williams, a class of retail electricity purchaser plaintiffs alleges that Duke gave an unfair competitive advantage to some of its largest customers by paying them undisclosed and substantial electricity rebates in exchange for withdrawing objections to the rate stabilization plan Duke submitted to Ohio regulators. Plaintiffs allege that the rebates caused favored customers to pay effective rates below those approved by the regulatory agency, while plaintiffs still had to pay the higher approved rates in violation of the Robinson-Patman Act, which prohibits discrimination among different purchasers of commodities “of like grade and quality.” 15 U.S.C. § 13 et seq. Williams is noteworthy for at least two reasons: First, the Sixth Circuit held that the filed rate doctrine did not bar the district court from hearing the case. Second, the Sixth Circuit found that electricity is a commodity under the Robinson-Patman Act.

In Williams, the Sixth Circuit reversed and remanded the district court’s decision to grant Duke’s motion to dismiss under the filed-rate doctrine. The district court held that the “filed rate doctrine” deprived it of jurisdiction to hear the matter. The filed rate doctrine precludes a court from considering a challenge to the “reasonableness” of the rates of commons carriers if the rates have been approved by an appropriate regulatory agency. Duke argued, and the district court agreed, that the court was barred from hearing the plaintiffs’ claims because they required an “‘analysis of [a] filed rate.’” Williams, 2012 WL 1970096 at *5. But the Sixth Circuit reversed, finding that the filed-rate doctrine applies only to challenges to the “underlying reasonableness or setting of filed rates.” Id. The court concluded that plaintiffs’ allegations do not concern the rate set by the governing agency, but rather rebate payments made outside the approved rate scheme.