419 U.S. 345 (1974), 73-5845, Jackson v. Metropolitan Edison Co.

Docket Nº:No. 73-5845
Citation:419 U.S. 345, 95 S.Ct. 449, 42 L.Ed.2d 477
Party Name:Jackson v. Metropolitan Edison Co.
Case Date:December 23, 1974
Court:United States Supreme Court
 
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419 U.S. 345 (1974)

95 S.Ct. 449, 42 L.Ed.2d 477

Jackson

v.

Metropolitan Edison Co.

No. 73-5845

United States Supreme Court

Dec. 23, 1974

Argued October 15, 1974

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Syllabus

Petitioner brought suit against respondent, a privately owned and operated utility corporation which holds a certificate of public convenience issued by the Pennsylvania Utility Commission, seeking damages and injunctive relief under 42 U.S.C. § 1983 for termination of her electric service allegedly before she had been afforded notice, a hearing, and an opportunity to pay any amounts found due. Petitioner claimed that, under state law she was entitled to reasonably continuous electric service, and that respondent's termination for alleged nonpayment, permitted by a provision of its general tariff filed with the Commission, was state action depriving petitioner of her property without due process of law and giving rise to a cause of action under § 1983. The Court of Appeals affirmed the District Court's dismissal of petitioner's complaint.

Held: Pennsylvania is not sufficiently connected with the challenged termination to make respondent's conduct attributable to the State for purposes of the Fourteenth Amendment, petitioner having shown no more than that respondent was a heavily regulated private utility with a partial monopoly and that it elected to terminate service in a manner that the Commission found permissible under state law. Cf. Moose Lodge No. 107 v. Irvis, 407 U.S. 163. Public Utilities Comm'n v. Pollak, 343 U.S. 451; Burton v. Wilmington Parking Authority, 365 U.S. 715, distinguished. Pp. 349-359.

483 F.2d 754, affirmed.

REHNQUIST, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, WHITE, BLACKMUN, and POWELL, JJ., joined. DOUGLAS, J., post, p. 359, BRENNAN, J., post, p. 364, and MARSHALL, J., post, p. 365, filed dissenting opinions.

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REHNQUIST, J., lead opinion

MR. JUSTICE REHNQUIST delivered the opinion of the Court.

Respondent Metropolitan Edison Co. is a privately owned and operated Pennsylvania corporation which holds a certificate of public convenience issued by the Pennsylvania Public Utility Commission empowering it to deliver electricity to a service area which includes the city of York, Pa. As a condition of holding its certificate, it is subject to extensive regulation by the Commission. Under a provision of its general tariff filed with the Commission, it has the right to discontinue service to any customer on reasonable notice of nonpayment of bills.1

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Petitioner Catherine Jackson is a resident of York, who has received electricity in the past from respondent. Until September, 1970, petitioner received electric service to her home in York under an account with respondent in her own name. When her account was terminated because of asserted delinquency in payments due for service, a new account with respondent was opened in the name of one James Dodson, another occupant of the residence, and service to the residence was resumed. There is a dispute as to whether payments due under the Dodson account for services provided during this period were ever made. In August, 1971, Dodson left the residence. Service continued thereafter, but concededly no payments were made. Petitioner [95 S.Ct. 452] states that no bills were received during this period.

On October 6, 1971, employees of Metropolitan came to the residence and inquired as to Dodson's present address. Petitioner stated that it was unknown to her. On the following day, another employee visited the residence and informed petitioner that the meter had been tampered with so as not to register amounts used. She disclaimed knowledge of this, and requested that the service account for her home be shifted from Dodson's name to that of one Robert Jackson, later identified as her 12-year-old son. Four days later, on October 11, 1971, without further notice to petitioner, Metropolitan employees disconnected her service.

Petitioner then filed suit against Metropolitan in the United States District Court for the Middle District of Pennsylvania under the Civil Rights Act of 1871, 42 U.S.C. § 1983, seeking damages for the termination and an injunction requiring Metropolitan to continue providing power to her residence until she had been afforded notice, a hearing, and an opportunity to pay any amounts found due. She urged that, under state law she had an

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entitlement to reasonably continuous electrical service to her home2 and that Metropolitan's termination of her service for alleged nonpayment, action allowed by a provision of its general tariff filed with the Commission, constituted "state action" depriving her of property in violation of the Fourteenth Amendment's guarantee of due process of law.3

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The District Court granted Metropolitan's motion to dismiss petitioner's complaint on the ground that the termination did not constitute state action, and hence was not subject to judicial scrutiny under the Fourteenth Amendment.4 On appeal, the United States Court of Appeals for the Third Circuit affirmed, also finding an absence of state action.5 We granted certiorari to review this judgment.6

[95 S.Ct. 453] The Due Process Clause of the Fourteenth Amendment provides: "[N]or shall any State deprive any person of life, liberty, or property, without due process of law." In 1883, this Court, in the Civil Rights Cases, 109 U.S. 3, affirmed the essential dichotomy set forth in that Amendment between deprivation by the State, subject to scrutiny under its provisions, and private conduct, "however discriminatory or wrongful," against which the Fourteenth Amendment offers no shield. Shelley v. Kraemer, 334 U.S. 1 (1948).

We have reiterated that distinction on more than one occasion since then. See, e.g., Evans v. Abney, 396 U.S. 435, 445 (1970); Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 171-179 (1972). While the principle that private action is immune from the restrictions of the Fourteenth Amendment is well established and easily stated, the question whether particular conduct is "private," on

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the one hand, or "state action," on the other, frequently admits of no easy answer. Burton v. Wilmington Parking Authority, 365 U.S. 715, 723 (1961); Moose Lodge No. 107 v. Irvis, supra, at 172.

Here, the action complained of was taken by a utility company which is privately owned and operated, but which, in many particulars of its business, is subject to extensive state regulation. The mere fact that a business is subject to state regulation does not, by itself, convert its action into that of the State for purposes of the Fourteenth Amendment.7 407 U.S. at 176-177. Nor does the fact that the regulation is extensive and detailed, as in the case of most public utilities, do so. Public Utilities Comm'n v. Pollak, 343 U.S. 451, 462 (1952). It may well be that

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acts of a heavily regulated utility with at least something of a governmentally protected monopoly will more readily be found to be "state" acts than will the acts of an entity lacking these characteristics. But the inquiry must be whether there is a sufficiently close nexus between the State and the challenged action of the regulated entity so that the action of the latter may be fairly treated as that of the State itself. Moose Lodge No. 107, supra, at 176. The true nature of the State's involvement may not be immediately obvious, and detailed inquiry may be required in order to determine whether [95 S.Ct. 454] the test is met. Burton v. Wilmington Parking Authority, supra.

Petitioner advances a series of contentions which, in her view, lead to the conclusion that this case should fall on the Burton side of the line drawn in the Civil Rights Cases, supra, rather than on the Moose Lodge side of that line. We find none of them persuasive.

Petitioner first argues that "state action" is present because of the monopoly status allegedly conferred upon Metropolitan by the State of Pennsylvania. As a factual matter, it may well be doubted that the State ever granted or guaranteed Metropolitan a monopoly.8 But assuming that it had, this fact is not determinative in considering

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whether Metropolitan's termination of service to petitioner was "state action" for purposes of the Fourteenth Amendment. In Pollak, supra, where the Court dealt with the activities of the District of Columbia Transit Co., a congressionally established monopoly, we expressly disclaimed reliance on the monopoly status of the transit authority. 343 U.S. at 462. Similarly, although certain monopoly aspects were presented in Moose Lodge No. 107, supra, we found that the Lodge's action was not subject to the provisions of the Fourteenth Amendment. In each of those cases, there was insufficient relationship between the challenged actions of the entities involved and their monopoly status. There is no indication of any greater connection here.

Petitioner next urges that state action is present because respondent provides an essential public service required to be supplied on a reasonably continuous basis by Pa.Stat.Ann., Tit. 66, § 1171 (1959), and hence performs a "public function." We have, of course, found state action present in the exercise by a private entity of powers traditionally exclusively reserved to the State. See, e.g., Nixon v. Condon, 286 U.S. 73 (1932) (election); Terry v. Adams, 345 U.S. 461 (1953) (election); Marsh v. Alabama, 326 U.S. 501 (1946) (company town); Evans v. Newton, 382 U.S. 296 (1966) (municipal park). If

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we were dealing with the exercise by Metropolitan of some power delegated to it by the State which is traditionally associated with sovereignty, such as eminent domain, our case would be quite a different one. But while the Pennsylvania statute imposes an obligation to furnish service on regulated...

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