Justia Class Action Opinion Summaries

Three Ohio natural-gas producers filed a class-action lawsuit in the Summit County Court of Common Pleas against East Ohio Gas Company (Dominion Energy Ohio). They alleged that Dominion Energy sold or used natural gas delivered into its pipeline system without properly compensating them, despite tariff provisions requiring reconciliation of delivered gas volumes. The plaintiffs claimed conversion, unjust enrichment, and violations of statutory provisions related to damages from criminal acts and theft. The class consisted of Ohio natural-gas producers participating in the Energy Choice Program whose wells were connected to Dominion Energy’s pipeline system.Judge Christine Croce partly granted Dominion Energy’s motion to dismiss by dismissing the conversion claim but allowed other claims to proceed. Dominion Energy appealed, but the Ninth District Court of Appeals dismissed the appeal, finding that Judge Croce’s order was not a final, appealable order. Subsequently, Dominion Energy sought a writ of prohibition in the Ninth District against Judge Croce, arguing that the Public Utilities Commission of Ohio (PUCO) has exclusive jurisdiction over the subject matter of the class-action claims. The natural-gas producers intervened in the prohibition action.The Ninth District Court of Appeals applied the test from Allstate Insurance Co. v. Cleveland Electric Illuminating Co. and concluded that PUCO has exclusive subject-matter jurisdiction over the claims because the resolution of the dispute depended on the interpretation and application of PUCO-approved tariffs and practices normally authorized by public utilities. The court granted summary judgment for Dominion Energy and issued a writ of prohibition ordering Judge Croce to cease jurisdiction over the class action and vacate her prior orders.On appeal, the Supreme Court of Ohio affirmed the Ninth District’s judgment. The court held that PUCO has exclusive jurisdiction over the claims asserted by the natural-gas producers, and the common pleas court patently and unambiguously lacks subject-matter jurisdiction over those claims. View "E. Ohio Gas Co v. Croce" on Justia Law

A group of single-family residential (SFR) water customers challenged the City of San Diego’s tiered water rate structure, which imposed higher rates for increased water usage, arguing that these rates exceeded the proportional cost of service attributable to their parcels as required by California Constitution article XIII D, section 6(b)(3) (enacted by Proposition 218). The City’s water system serves a large population and divides customers into several classes, but only SFR customers were subject to tiered rates; other classes paid uniform rates. The City’s rates were based on cost-of-service studies using industry-standard methodologies, including “base-extra capacity” and “peaking factors,” but the plaintiffs contended these methods did not accurately reflect the actual cost of providing water at higher usage tiers.The Superior Court of San Diego County certified the case as a class action and held a bifurcated trial. In the first phase, the court found that the City failed to demonstrate, with substantial evidence, that its tiered rates for SFR customers complied with section 6(b)(3), concluding the rates were not based on the actual cost of service at each tier but rather on usage budgets and conservation goals. The court also found the City lacked sufficient data to justify its allocation of costs to higher tiers and that the rate structure discriminated against SFR customers compared to other classes. In the second phase, the court awarded the class a refund for overcharges, offset by undercharges, and ordered the City to implement new, compliant rates.On appeal, the California Court of Appeal, Fourth Appellate District, Division Two, affirmed the trial court’s judgment with directions. The appellate court held that the City bore the burden of proving its rates did not exceed the proportional cost of service and that the applicable standard was not mere reasonableness but actual cost proportionality, subject to independent judicial review. The court found substantial evidence supported the trial court’s findings that the City’s tiered rates were not cost-based and thus violated section 6(b)(3). The court also upheld class certification and the method for calculating the refund, and directed the trial court to amend the judgment to comply with newly enacted Government Code section 53758.5, which affects the manner of refunding overcharges. View "Patz v. City of San Diego" on Justia Law

San Francisco operates a combined sewer system that collects and treats both wastewater and stormwater. In 1996, California voters approved Proposition 218, which added provisions to the California Constitution requiring voter approval for property-related charges, except for "sewer, water, and refuse collection services." Plaintiffs Robert Gluck and Adam Hertz filed a class action against the City and County of San Francisco, challenging the constitutionality of the City's sewer charges related to stormwater services. They argued that stormwater services funded by the City's sewer charges were not "sewer" services covered by the exception to Proposition 218's voter approval requirement and that the charges failed the proportionality requirement.The trial court sustained the City's demurrer without leave to amend, concluding that the City's combined sewer system provides "sewer" services falling within the voter approval exception of article XIII D, section 6(c). The court also found that the plaintiffs' fourth cause of action failed because it was based on the premise that stormwater management is not a "sewer service."The California Court of Appeal, First Appellate District, Division Three, reviewed the case. The court affirmed the trial court's judgment regarding the first three causes of action, agreeing that the City's combined sewer system provides "sewer" services exempt from the voter approval requirement. However, the court reversed the judgment regarding the fourth and fifth causes of action, concluding that the City did not establish that the plaintiffs' allegations regarding the City's reliance on wastewater factors to support charges for stormwater services were insufficient as a matter of law to establish a violation of the proportionality requirement of article XIII D, section 6(b)(3). The case was remanded for further proceedings on these claims. View "Gluck v. City and County of San Francisco" on Justia Law

The Coachella Valley Water District (Water District) appealed a judgment finding that the rates it charged for Coachella Canal water violated Article XIII C of the California Constitution. The Water District argued that the rates were lawful and that no refund remedy was authorized. The court rejected both arguments, finding the rates unlawful and that a refund remedy was constitutionally mandated.In the lower court, the Superior Court of Riverside County ruled that the Water District's Canal Water rates and the Irrigation Water Availability Assessment (IWAA) violated Proposition 218. The court found that the Water District's historical priority argument was not persuasive and that the Water District had made no attempt to show that the rates complied with the California Constitution. The court deferred ruling on remedies and later awarded Class 2 customers approximately $17.5 million in refunds and interest for invalid charges from March 2018 through June 2022.The California Court of Appeal, Fourth Appellate District, Division Two, reviewed the case. The court held that Howard Jarvis Taxpayers Association (Howard Jarvis) had standing to challenge the Class 2 rates because domestic customers paid the rates indirectly. The court found that the Class 2 rates were taxes under Article XIII C and did not fall under any exceptions. The court rejected the Water District's arguments that the rates were justified based on historical priority and that they were expenditures of funds. The court also found that the IWAA was an assessment under Proposition 218 and that the Water District failed to show it was proportional to the benefits conferred on the properties.The court affirmed the lower court's ruling on liability and the amount of refund relief awarded. However, the court found that the injunction in the judgment was overbroad and modified the judgment to strike the paragraph enjoining the Water District from imposing any future Canal Water rates and charges that did not comply with Proposition 218. As modified, the judgment was affirmed, and Howard Jarvis was awarded its costs on appeal. View "Howard Jarvis Taxpayers Assn. v. Coachella Valley Water Dist." on Justia Law

The City of Gridley operates an electric utility and approved reduced electric rates for residential users in September 2020. Plaintiffs, residential ratepayers, challenged these rates, alleging they resulted in charges exceeding the reasonable cost of providing electric service, thus constituting a tax without voter approval in violation of article XIII C of the California Constitution. They also claimed the rates violated the state and federal takings clauses under the unconstitutional conditions doctrine. Plaintiffs sought a writ of mandate and class action complaint, alleging the City set rates higher than necessary and transferred excess revenues to its general fund.The Superior Court of Butte County denied the City’s motion for summary judgment, finding triable issues of fact regarding whether the rates resulted in excessive charges and whether plaintiffs had a property interest in continued electric service. The court rejected the City’s argument that article XIII C was inapplicable because the City did not impose, extend, or increase a tax when it approved reduced rates. The court also found that the unconstitutional conditions doctrine could apply to plaintiffs' takings claim.The California Court of Appeal, Third Appellate District, reviewed the case and concluded that the City was entitled to relief. The court found article XIII C inapplicable because the City did not impose, extend, or increase any tax by reducing its electric rates. The court also found the unconstitutional conditions doctrine inapplicable, as it applies only in the land-use permitting context, not to user fees like the electric rates in question. Consequently, the court directed the trial court to set aside its order denying the City’s motion for summary judgment and to enter a new order granting the motion. The City’s motion for summary judgment was granted, and the stay of proceedings in the trial court was vacated. View "City of Gridley v. Super. Ct." on Justia Law

In this dispute, two renewable-energy generating companies, Tyngsboro Sports II Solar, LLC and 201 Oak Pembroke Solar LLC, appealed to the United States Court of Appeals for the First Circuit after their class-action lawsuit was dismissed by the District Court for the District of Massachusetts due to lack of subject-matter jurisdiction. The plaintiffs had a longstanding disagreement with defendants, utility companies National Grid USA Service Company, Inc. and Massachusetts Electric Company, over certain tax-related fees charged to them. The plaintiffs sought redress in federal court after unsuccessful petitions to state authorities.The plaintiffs argued that the district court had jurisdiction due to the case's connection to federal tax law, however, the appellate court disagreed, stating that the plaintiffs' complaint did not bring any claim that arose under federal law. The plaintiffs had brought forth four claims against National Grid, including a request for declaratory relief, a state-law claim for a breach of the covenant of good faith and fair dealing, a state-law claim for restitution and unjust enrichment, and a state-law claim for violating a statutory requirement that public utilities assess only just and reasonable charges.The appellate court affirmed the district court's dismissal of the case, finding that the plaintiffs could not establish federal-question jurisdiction simply by asserting a state-law claim to which there was a federal defense. The court noted that the state-law claims did not necessarily raise a federal issue, and to the extent that one did, the issue was not substantial. As such, the court concluded that the district court lacked jurisdiction over the claims. View "Tyngsboro Sports II Solar, LLC v. National Grid USA Service Co., Inc." on Justia Law

The Supreme Court affirmed the judgment of the district court granting summary judgment for Defendants and denying relief in this class action, holding that the district court did not err.In 2014, over two-thirds of the members of the Try County Telephone Association, Inc., a Wyoming cooperative utility providing telecommunication services on a non-profit basis, voted to sell the Cooperative, including its for-profit subsidiaries, to entities owned by Neil Schlenker. Schlenker converted the Cooperative into a for-profit corporation (TCT). After the sale, Class Representatives filed a class action lawsuit against TCT, Schlenker and his entities, and others, alleging fraud conversion and other claims and requesting that the sale be set aside. The district court granted summary judgment in favor of Defendants. The Supreme Court affirmed, holding that the district court did nor err in granting summary judgment on all claims. View "Campbell v. Davidson" on Justia Law

In this dispute over a "Water/Sewer Base Fee" that Landlords billed tenants each month to recover certain amounts it had paid the municipal utility district the Supreme Court affirmed the trial court's grant of partial summary judgment in Tenant's favor and the court of appeals' judgment affirming the trial court's order certifying a class under Rule 24 of the Texas Rules of Civil Procedure, holding that there was no error.Tenant brought suit against Landlords challenging a fee that included not only each apartment's allocated portion of the utility's customer service charge for water and sewer service but also an undisclosed amount equivalent to a portion of the utility's charges for non-water emergency services. Tenant sued under the Water Code on behalf of a tenant class. The trial court granted Landlords' motion for partial summary judgment on liability and certified a class. The Supreme Court affirmed, holding that the trial court (1) did not err in granting partial summary judgment; and (2) did not abuse its discretion in certifying the class. View "Mosaic Baybrook One, L.P. v. Simien" on Justia Law

The Supreme Court affirmed in part and dismissed in part the order of the circuit court certifying the City of Gurdon's class-action lawsuit alleging that Suddenlink Communications unlawfully charged Gurdon and other cities in the state three fees for the cities' use of Suddenlink's services, holding that there was no error.Suddenlink, which provided telephone, internet, and cable services to Gurdon, assessed a 911 fee, an Arkansas High-Cost Fund Fee, and a franchise fee. Gurdon brought this action alleging that the imposition of the fees against the City was unlawful. Gurdon then filed a motion for class certification. The circuit court granted the motion. Suddenlink appealed the certification as well as the circuit court's refusal to first address Suddenlink's pending motion to compel arbitration before certifying the class. The Supreme Court dismissed in part and affirmed in part, holding (1) the arbitration issue was not appealable on an interlocutory basis; and (2) the circuit court did not abuse its discretion by certifying the class. View "Altic USA, Inc. v. City of Gurdon ex rel. Honorable Kelley" on Justia Law

Appellants Raymond and Michelle Plata were property owners in the City of San Jose and customers of Muni Water. Muni Water’s annual budget was reflected each year in a document called a source and use of funds statement, which was part of the City’s annual operating budget. In 2013, the Platas filed with the City a claim pursuant to Government Code sections 910 and 910.2, accusing Muni Water of violating Proposition 218 ab initio by collecting money from customers and illegally transferring it to the City’s own general fund. The City rejected the claim, so in early 2014, the Platas brought a class action lawsuit seeking declaratory and injunctive relief against the City under Proposition 218, as well as recovery of the amounts overpaid. After a lengthy bench trial, the trial court issued a statement of decision finding: (1) the late fees charged by Muni Water were not a fee or charge covered by Proposition 218; (2) any claims accruing prior to November 4, 2012 were time-barred because of the statute of limitations provided under Government Code section 911.2, and there was no basis for applying any equitable tolling doctrine; (3) as for tiered water rates, the discussion of high rates in the Platas’ government claims adequate to gave notice to the City that its rate structure was being questioned; and (4) “[a] more significant complication” raised by the City in its class decertification motion. The tiered rate structure would impact different class members differently from month to month, thus making it potentially “impossible” to draw a “line between ‘winners’ and ‘losers’ based on monthly water consumption[.]” The court granted the City’s motion to decertify the class, and refused to grant the Platas any relief as to their tiered rate argument. The Platas appealed. The Court of Appeal reversed judgment only as to the trial court’s findings on the tiered rate structure. In all other respects, it was affirmed. View "Plata v. City of San Jose" on Justia Law