982 A.2d 691 (D.C. 2009), 08-AA-148, Washington Gas Light Co. v. Public Service Com'n of Dist. of Columbia

Docket Nº:08-AA-148, 08-AA-17.
Citation:982 A.2d 691
Opinion Judge:GLICKMAN, Associate Judge.
Party Name:WASHINGTON GAS LIGHT COMPANY, Petitioner, v. PUBLIC SERVICE COMMISSION OF the DISTRICT OF COLUMBIA, Respondent. Office of the People's Counsel, Intervenor.
Attorney:Ketanji Brown Jackson, Washington, with whom Sherri N. Blount, Christopher George, Beth S. Brinkmann, Beverly J. Burke, Bernice K. McIntyre and Cathy Thurston-Seignious were on the briefs, for petitioner. Christopher Lipscombe, with whom Richard A. Beverly, General Counsel of the District of Colu...
Judge Panel:Before GLICKMAN and KRAMER, Associate Judges, and FARRELL, Senior Judge.[*] Concurring opinion by Senior Judge FARRELL at page 50. FARRELL, Senior Judge, concurring:
Case Date:October 08, 2009
Court:Court of Appeals of Columbia District
 
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982 A.2d 691 (D.C. 2009)

WASHINGTON GAS LIGHT COMPANY, Petitioner,

v.

PUBLIC SERVICE COMMISSION OF the DISTRICT OF COLUMBIA, Respondent.

Office of the People's Counsel, Intervenor.

Nos. 08-AA-148, 08-AA-17.

Court of Appeals of Columbia District.

October 8, 2009

Argued Sept. 29, 2008.

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Ketanji Brown Jackson, Washington, with whom Sherri N. Blount, Christopher George, Beth S. Brinkmann, Beverly J. Burke, Bernice K. McIntyre and Cathy Thurston-Seignious were on the briefs, for petitioner.

Christopher Lipscombe, with whom Richard A. Beverly, General Counsel of the District of Columbia Public Service Commission, was on the briefs, for respondent.

Jennifer L. Weberski, Assistant People's Counsel, with whom Elizabeth A. No el, People's Counsel, Sandra Mattavous-Frye, Deputy People's Counsel, Laurence C. Daniels, Assistant People's Counsel, and Robert C. McDiarmid, Scott H. Strauss and Larissa A. Shamraj were on the briefs, for intervenor.

Before GLICKMAN and KRAMER, Associate Judges, and FARRELL, Senior Judge.[*]

GLICKMAN, Associate Judge.

This appeal concerns a $350,000 forfeiture levied by the D.C. Public Service Commission against Washington Gas Light Company (WGLC). On July 20, 2007, the Commission ordered WGLC to produce to it a copy of a contract WGLC had signed with a third party. When, in the opinion of the Commission, WGLC willfully and " egregious[ly]" failed to submit an unredacted copy of the contract, the Commission imposed the forfeiture, citing D.C.Code § 34-706(a) (2009 Supp.) as its primary source of authority to do so. WGLC applied for reconsideration. When its application was denied, the utility appealed, arguing that the Commission had acted arbitrarily and capriciously and denied it due process of law.

Following oral argument, we ordered the parties to submit supplemental briefs addressing several important legal issues. The first three questions we asked were substantive: (1) whether the Commission was constrained to use statutes that address discovery and disclosure failures more specifically than § 34-706(a) does; (2) whether § 34-706(a) creates a criminal or a civil penalty; and (3) whether the Commission may impose a § 34-706(a) forfeiture itself or must maintain an action in Superior Court to enforce the provision. Our fourth question was whether we are foreclosed from considering the first three, given the exhaustion requirements of D.C.Code § 34-604(b) (2001).

We address the last, threshold issue first. We hold that § 34-604(b) contains both jurisdictional and non-jurisdictional exhaustion requirements. In order for us to have subject-matter jurisdiction, the party petitioning for review of the Commission's order first must have filed an application for reconsideration. That done, we have jurisdiction to consider every issue the petitioner presents to us, regardless of whether it was raised before the Commission. The statute does, though, codify the judicial doctrine requiring parties to exhaust administrative remedies with respect to every issue. Therefore, we will not examine unexhausted

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issues unless extraordinary circumstances compel us to do so. In this case, we find that extraordinary circumstances would exist if, as WGLC argues, the Commission lacked the adjudicatory authority to impose the forfeiture.

Turning to the merits of that question, D.C.Code § 34-706(a) establishes a forfeiture penalty for certain violations of the Public Utilities Act or Commission or court orders. Our examination of the language, history and statutory context of that provision convinces us that the Commission lacks the authority to adjudicate those violations and impose the forfeiture penalty itself. Rather, the Commission is obliged to maintain an action in Superior Court in order to enforce § 34-706(a) and recover a forfeiture penalty. Because we conclude that the Commission was without authority to impose the $350,000 forfeiture on WGLC in this case, we reverse its order.

I. Factual Background

In late 2006, WGLC applied to the Commission for permission to raise its rates to District of Columbia consumers. While the rate proceeding was pending in the summer of 2007, WGLC entered into an agreement with Accenture LLP to " provide business process outsourcing and service and technology enhancements." In exchange, WGLC agreed to pay Accenture $350 million. The contract between WGLC and Accenture was nominally 75 pages long, but appendices and exhibits stretched its length to 600 pages. The D.C. Office of People's Counsel (OPC), which represents ratepayers and is an intervenor in this appeal, sought a copy of the contract. So did the Office and Professional Employees International Union Local 2 (OPEIU), which represents some of WGLC's employees. And one week before the rate making hearing was to be held, the Commission filed its Data Request No. 4, which sought " a copy of the executed agreement" between WGLC and Accenture.

WGLC, however, permitted OPC and OPEIU to view only a portion of the contract. It held back certain attachments or exhibits, explaining to the Commission that:

[t]he Accenture contract includes proprietary Service Provider information for which Washington Gas has a mutual Non-Disclosure Agreement in place. In addition due to public disclosure requirements the Company is unable to allow copies of the document. However, [Commission] Staff may view the information at Washington Gas's ... offices, or the Company is willing to bring the documents to the Commission for viewing.

OPC filed a motion to compel immediate production of the entire contract, citing the impending rate making hearing.

On the Friday before the Monday on which the rate making hearing was to take place, the Commission entered two orders. Order No. 14,383 " direct[ed] [WGLC] to file its responses to the Commission's Data Request ... No. 4 by 9:00 a.m., Monday, July 23, 2007." The Order also warned WGLC that the Commission was " concerned with [WGLC's] failure to provide information to the Commission and the parties as requested in the discovery phase of this proceeding. Accordingly, any subsequent failure by [WGLC] to comply with the lawful directives of the Commission may result in a show cause order and or fine." The second order, No. 14,384, granted in part OPC's motion to compel, finding it in general " well founded." Nevertheless, it acknowledged WGLC's claims of privilege as to certain portions of the Accenture contract and so gave the utility a choice-" to produce its records to OPC

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or deliver them to the Commission Secretary's Office, for in camera inspection by 12 noon on Saturday, July 21, 2007."

WGLC chose the latter path. On July 21, it submitted a copy of " the Confidential Master Services Agreement between Accenture and Washington Gas that contains the critical features of the relationship between the parties (75 pages)." It also submitted two exhibits, A.1 and A.6. Finally, it stated that " [t]here are other exhibits and attachments to the [contract] that are not related to the significant issues in this case.... If however, the Commission wishes to review in camera exhibits and appendices referred to in the [contract], Washington Gas will make those documents available to the Commission." Apparently to justify its withholding of some documents, WGLC insisted that Securities and Exchange Commission Fair Disclosure regulations prevented it from " making selective disclosures" of the contract. It also claimed that " it is not appropriate-and not necessary to the vigorous airing of the issues in the rate case-to provide the parties with actual copies of the documents." WGLC did not submit any further documents on Monday, July 23.

On that Monday, just before the rate making hearing began, the Commission entered Order No. 14,385, granting in part and denying in part OPC's and OPEIU's motions to compel. The Commission determined that WGLC's reasons for withholding the contract were insufficient, and so ordered that " [t]he whole [contract], including all of its Appendices ... must be produced in discovery by WGL for the Commission, OPC and OPEIU." It continued to issue " a protective order ... intended to ensure the confidentiality of the [contract]." Therefore, WGLC was required to " submit these records to OPC, OPEIU, and the Commission Secretary's Office by 5:00 p.m. today, Monday, July 23, 2007."

The rate making hearing did not go forward. After briefly reviewing the Commission's new order during a recess, WGLC contended that there was no basis for OPC's argument that the contract affected the rate change it sought. The chair of the Commission interjected: " [T]he Commission also asked for a copy of the contract. It's just not OPC. It's OPC, it is the Commission, and it is the order." WGLC's counsel responded, " I understand that," but continued to argue that the contract was irrelevant and its disclosure was barred by the SEC fair disclosure regulations. WGLC then announced its intent to move for reconsideration of Order No. 14,385. In response, OPC orally moved for a stay of the rate case, arguing that WGLC's foot-dragging was a deliberate litigation strategy. OPC also orally requested sanctions against WGLC, though it did not specify what type of sanctions it thought should be imposed. The Commission heard a response from WGLC, then indefinitely adjourned the hearing. Just before doing so, however, it also ordered the company to show cause why the rate case should not be dismissed for failure to produce the Accenture contract.

Rather than submit the complete contract, WGLC moved to reconsider Order No. 14,385...

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