Ineos U.S. LLC v. Fed. Energy Regulatory Comm'n
| Decision Date | 18 October 2019 |
| Docket Number | C/w 18-1200,No. 18-1081,18-1081 |
| Citation | 940 F.3d 1326 |
| Parties | INEOS USA LLC, Petitioner v. FEDERAL ENERGY REGULATORY COMMISSION and United States of America, Respondents Leveret Pipeline Company, LLC and Mid-America Pipeline Company, LLC, Intervenors |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Richard B. Phillips Jr., Dallas, TX, argued the cause for petitioner. On the brief were Victoria M. Lauterbach and Wendy B. Warren. Sidney Fowler, Washington, DC, entered an appearance.
Robert M. Kennedy Jr., Senior Attorney, Federal Energy Regulatory Commission, argued the cause for respondents. With him on the brief were Michael F. Murray, Deputy Assistant Attorney General, U.S. Department of Justice, Robert B. Nicholson, Washington, DC, and Robert J. Wiggers, Attorneys, James P. Danly, General Counsel, Federal Energy Regulatory Commission, and Robert H. Solomon, Solicitor.
Charles F. Caldwell and Elizabeth B. Kohlhausen were on the brief for intervenors Leveret Pipeline Company, LLC, et al. in support of respondents.
Before: Rogers and Wilkins, Circuit Judges, and Randolph, Senior Circuit Judge.
INEOS USA LLC ("INEOS"), a chemical producer, petitions for review of the decision of the Federal Energy Regulatory Commission to accept tariff filings without an investigation pursuant to Section 15(7) of the Interstate Commerce Act ("ICA"), 49 U.S.C. app. § 15(7) (1988). INEOS wishes to connect its fractionator to the South Eddy Lateral, a natural gas liquids pipeline. Ownership of the South Eddy Lateral recently changed hands from Mid-America Pipeline Company, LLC ("Mid-America"), to Leveret Pipeline Company LLC ("Leveret"), both subsidiaries of Enterprise Products Partners L.P. ("Enterprise"). Mid-America and Leveret filed tariffs with the Commission reflecting the transfer of ownership. INEOS protested the tariff filings and argued that the transfer was intended to deny INEOS’ access to the South Eddy Lateral and, more generally, to unduly discriminate in favor of Enterprise affiliates at the expense of third-party shippers. INEOS requested the Commission reject the filings or, alternatively, suspend them and investigate the ownership change. The Commission denied INEOS’ protest and accepted the tariff filings without investigation. INEOS now seeks judicial review, and the Commission responds that the court lacks jurisdiction. Because INEOS failed to establish Article III standing, we dismiss the petitions for lack of jurisdiction.
In March 2017, INEOS sent Mid-America a written request to connect its fractionator to the South Eddy Lateral, which Mid-America then owned. While the connection request was pending, Leveret gained ownership of the South Eddy Lateral, and Mid-America and Leveret filed with the Commission cancellation and adoption tariffs, respectively.
INEOS protested the tariff filings, arguing that the transfer of ownership was intended to thwart its pending connection request. INEOS requested the Commission summarily reject the filings or suspend them for the maximum statutory seven-month period and hold a hearing. Leveret and Mid-America filed a joint answer to the protest, arguing that INEOS lacked standing as to abandonment of one route and the Commission lacked jurisdiction of the transfer of ownership. Leveret and Mid-America also denied that the transfer was intended to limit access to the South Eddy Lateral and stated that Leveret was still considering INEOS’ connection request.
At the time of the tariff filings and protest, the Commission lacked a quorum and had delegated authority to Commission staff. Pursuant to this authority, Commission staff accepted Leveret and Mid-America’s proposed tariffs for filing, subject to refund and further Commission order. Leveret Pipeline Co. LLC, Order Accepting and Suspending Filings, Subject to Refund, and Further Commission Order ("Staff Order "), 160 FERC ¶ 62,020, at P 5 (2017). INEOS petitioned for rehearing. Having regained its quorum, the Commission then denied INEOS’ rehearing request and accepted Leveret and Mid-America’s tariff filings, to become effective on their proposed effective dates. Leveret Pipeline Co. LLC, Order on Tariff Filings and Denying Rehearing ("Commission Order I "), 162 FERC ¶ 61,038, at PP 4-5 (2018). The Commission stated that it lacked jurisdiction of pipeline service abandonments and therefore could not grant INEOS’ request to suspend the cancellation tariffs. Id. at P 14 (citing ARCO Pipe Line Co. , 55 FERC ¶ 61,420 (1991) ); see also Farmers Union Cent. Exch. v. FERC , 734 F.2d 1486, 1509 n.51 (D.C. Cir. 1984). It also stated that the adoption tariffs involved purely administrative exercises, because Leveret would offer the same transportation service at the same rates as Mid-America previously offered. Commission Order I at P 15. Therefore, the Commission declined to suspend the tariffs and order a hearing. Id. at P 17.
INEOS again petitioned for rehearing. The Commission denied the petition, which it found procedurally improper as a successive petition. Leveret Pipeline Co. LLC, Order Denying Rehearing ("Commission Order II "), 163 FERC ¶ 61,180, at PP 13-15 (2018). The Commission also stated that even if the petition were procedurally proper, there was no reason to suspend the tariffs and order a hearing, because the Commission had found "no evidence that Mid-America and Leveret’s actions were unduly beneficial to affiliates." Id. at PP 23, 30.
INEOS petitioned this court for review of the Staff Order, Commission Order I, and Commission Order II, and the Commission filed a motion to dismiss on the ground that the court lacks jurisdiction. A special panel of the court referred the motion to a merits panel. Per Curiam Order, INEOS USA LLC v. FERC , Nos. 18-1081, 18-1200 (D.C. Cir. Nov. 14, 2018).
In petitioning for review, INEOS chiefly contends that the court has jurisdiction to review the Commission’s determination that it lacked jurisdiction of Mid-America’s abandonment of service. The Commission responds that the court lacks jurisdiction to address INEOS’ petitions for three reasons: its acceptance of the protested tariff filings without an investigation is not subject to judicial review; INEOS lacks standing to challenge the acceptance of the filings; and INEOS’ petitions are untimely.
Federal courts are courts of limited jurisdiction and "possess only the power authorized by the Constitution and by statute." Jarkesy v. SEC , 803 F.3d 9, 15 (D.C. Cir. 2015) (citing Kokkonen v. Guardian Life Ins. Co. of Am. , 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994) ). As the party seeking review, INEOS bears the burden of establishing it has Article III standing. See NO Gas Pipeline v. FERC , 756 F.3d 764, 767 (D.C. Cir. 2014). The "irreducible constitutional minimum" of standing requires INEOS to show that it has suffered an injury in fact, caused by the Commission’s challenged decision, which a favorable decision of the court is likely to redress. See Lujan v. Defs. of Wildlife , 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). The injury must be concrete and particularized, and actual or imminent, as opposed to merely conjectural or hypothetical. Id . at 560, 112 S.Ct. 2130. "[W]hen the plaintiff is not ... the object of the government action or inaction [the plaintiff] challenges," as is true here, "standing is not precluded, but it is ordinarily ‘substantially more difficult’ to establish." Id. at 562, 112 S.Ct. 2130.
On the record before the court, it appears INEOS has not established Article III standing. See Kansas Corp. Comm’n v. FERC , 881 F.3d 924, 929–31 (D.C. Cir. 2018). Although the court must assume the truth of INEOS’ factual allegations regarding standing, see City of Boston Delegation v. FERC , 897 F.3d 241, 250 (D.C. Cir. 2018), "allegations that are really predictions" may be rejected as overly speculative, see Arpaio v. Obama , 797 F.3d 11, 21 (D.C. Cir. 2015). Even affording a generous interpretation to its allegations, INEOS fails to show that it has suffered an injury in fact that is fairly traceable to the challenged Commission decision. See Kansas Corp. Comm’n , 881 F.3d at 929–31.
INEOS’ claim of competitive injury from denial of access to the South Eddy Lateral is too speculative to support standing. As INEOS acknowledges, Leveret has not yet accepted or denied its connection request. Therefore, INEOS’ allegation of injury from denial of access is a mere "prediction[ ]" that Leveret ultimately will deny its pending request. See Arpaio , 797 F.3d at 21.
INEOS also alleges that it has suffered "delay" in access to the South Eddy Lateral as a result of the transfer of ownership from Mid-America to Leveret. Pet’r’s Reply Br. 4–5. But INEOS failed to make this argument in its Opening Brief, and arguments made for the first time in a Reply Brief are generally forfeited. See, e.g. , United States v. Wilson , 605 F.3d 985, 1035 (D.C. Cir. 2010). Even if this allegation were properly before the court, INEOS has not established that it would have received access to the South Eddy Lateral more quickly absent the transfer of ownership. Leveret stated it is investigating operational and engineering issues related to the connection request, and INEOS did not rebut this with evidence or argument.
For similar reasons, INEOS also fails to demonstrate that the harm it has allegedly suffered is fairly traceable to the Commission’s acceptance of the protested tariff filings. It is undisputed that the Commission lacks authority over INEOS’ request to connect its fractionator to Leveret’s pipeline, and INEOS has stated that its petition for review challenges solely "the cancellation of Mid-America’s service from South Eddy and Leveret’s adoption of that service." Pet’r’s Reply Br. 13. Therefore, to establish causation, INEOS must demonstrate that the transfer of ownership caused harm it has...
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...links which are predictions of future events." Arpaio v. Obama , 797 F.3d 11, 21 (D.C. Cir. 2015) ; see Ineos USA v. Fed. Energy Reg. Comm. , 940 F.3d 1326, 1329 (D.C. Cir. 2019). "Federal courts consistently deny standing when claimed anticipated injury has not been shown to be more than u......