Kalinsky v. LONG IS. LIGHTING CO.

• Citation: 484 F. Supp. 176
• Decision Date: 11 February 1980
• Docket Number: No. 79 C 3006.,79 C 3006.
• Parties: Howard KALINSKY, Plaintiff, v. LONG ISLAND LIGHTING COMPANY, Defendant.
• Court: U.S. District Court — Eastern District of New York

484 F. Supp. 176

Howard KALINSKY, Plaintiff, v. LONG ISLAND LIGHTING COMPANY, Defendant.

No. 79 C 3006.

United States District Court, E. D. New York.

February 11, 1980.

William F. Dudine, Jr., Darby & Darby, New York City, for plaintiff.

Edward M. Barrett, Richard A. Freedman, Mineola, N.Y., for defendant.

MEMORANDUM & ORDER

PLATT, District Judge.

This action involves plaintiff's motion for a preliminary injunction, and defendant's motions for a preliminary injunction, for an order to dismiss, and for an order designating this case a "Long Island" case under the local rules and transferring the proceedings to Westbury. Plaintiff invokes jurisdiction under 28 U.S.C. §§ 1331 and 1343.

FACTS

Some four years ago the Long Island Lighting Company ("Lilco") sold to, and installed in, the Howard Kalinsky household electrical space heating, allegedly representing to Mr. Kalinsky that electrical heating was the least expensive way to heat his home. About the same time (e. g., January 20, 1976) the Public Service Commission of the State of New York ("PSC") ordered Lilco to submit a rate proposal pricing electricity by time of use ("peak-load pricing") for residential customers consuming large quantities of electricity. According to defendant, on October 1, 1976 it notified by mail all those residential consumers that Lilco anticipated would be affected by use of peak-load pricing — including the Kalinsky family. After public hearings, an order was issued by the PSC on September 1, 1977 approving peak-load pricing¹ for residential customers whose consumption exceeded 45,000 kilowatt hours ("KWH") in a past twelve-month period. The Kalinsky household constituted such a customer. Lilco claims during the week of January 23, 1978 all customers consuming more than 45,000 KWH (including plaintiff) were notified they would be placed on peak-load pricing rates beginning in the fall of 1978.

After affirmation of rates based on peak-load pricing by the New York Court of Appeals in Council of Retail Merchants v. PSC, 45 N.Y.2d 661, 412 N.Y.S.2d 358, 384 N.E.2d 1282 (1978), Lilco mailed (on May 18, 1979) the affected consumers notice that their bills would soon reflect the new rate structure. Again, according to Lilco, Mr. Kalinsky was sent such notice. Mr. Kalinsky thereafter requested that his account be reviewed in order to confirm whether or not it qualified for inclusion in the new structure. Confirmation by Lilco that Mr. Kalinsky's account did so qualify was mailed on June 5, 1979; this letter further requested that plaintiff contact Lilco to schedule an appointment for installation of the necessary metering equipment — a request to which plaintiff failed to respond. During the summer of 1979 Lilco personnel attempted to install the new meter, but were denied entry to plaintiff's home. Another request, and another refusal, occurred on October 17 and October 23, 1979, respectively. The October 23 refusal was made by phone, and when Lilco sought to discuss the rate with plaintiff he refused to do even this.

Finally, plaintiff was notified his continued refusal to allow Lilco to install the new meter was a violation of PSC orders and would result in termination of electric service for failure to obey Lilco's tariff. Plaintiff again refused. On October 24, 1979, plaintiff was sent a final disconnect notice which gave five days written notice of Lilco's intention to disconnect plaintiff's service. Lilco so informed the PSC. Plaintiff then brought this action.

Plaintiff's complaint seeks (i) a declaratory judgment pursuant to 28 U.S.C. § 2201 declaring that plaintiff is not covered by, or is exempt from, the peak-load pricing rate structure and (ii) injunctive relief restraining defendant from disconnecting plaintiff's electrical service. The issues of law outlined in plaintiff's motion papers and defendant's papers in opposition are quite unique. In essence, plaintiff claims the constitutional rights of which he is being denied include deprivation of property without due process of law and invasion of his right to privacy. Plaintiff further asserts violations of his civil rights under 42 U.S.C. § 1983.

Defendant argues: (i) federal courts do not have jurisdiction over plaintiff's claim under the Johnson Act, 28 U.S.C. § 1342; (ii) the action should be dismissed for failure to state a claim upon which relief can be granted; (iii) the action should be dismissed for lack of a necessary party — the PSC; (iv) the action is improperly before this Court under the doctrine of primary administrative jurisdiction; (v) it does not satisfy jurisdictional requirements under 28 U.S.C. § 1331 that plaintiff anticipates defendant's answer may raise a federal question; and (vi) the action should be transferred to the Long Island Courthouse pursuant to local rule Chapter 4, Rule 1.

DISCUSSION

I

Defendant's contention that this Court does not have jurisdiction over plaintiff's claim under the Johnson Act, 28 U.S.C. § 1342, questions this Court's power to adjudicate plaintiff's claim. The Johnson Act, in full, provides:

The District Courts shall not enjoin, suspend or restrain the operation of, or compliance with, any order affecting rates chargeable by a public utility and made by a State administrative agency or a rate-making body of a State political subdivision, where:

(1) Jurisdiction is based solely on diversity of citizenship or repugnance of the order to the Federal Constitution; and,

(2) The order does not interfere with interstate commerce; and,

(3) The order has been made after reasonable notice and hearing; and,

(4) A plain, speedy and efficient remedy may be had in the courts of such State.

Courts have interpreted this law to bar adjudication on the merits of claims that come within the statute. General Investment & Service Corp. v. Wichita Water Co., 236 F.2d 464 (10th Cir. 1956); Cf. "Validity, Construction, and Application of the Johnson Act (28 U.S.C. § 1342), Prohibiting Interference By Federal District Courts with State Orders Affecting Rates Chargeable By Public Utilities," 28 A.L.R.Fed. 422, at 426-27 (1976). Moreover, it has been held that the prohibition of the Johnson Act may not be avoided by basing an action on civil rights statutes, including 42 U.S.C. § 1983. Klotz v. Consolidated Edison, 386 F.Supp. 577 (S.D.N.Y.1974); 28 A.L.R.Fed. 422, supra, at 435.

Federal courts have also held that all four requisites must be satisfied for the Act's prohibition to apply. Zucker v. Bell Tel. Co., 373 F.Supp. 748 (D.Pa.1974), aff'd without op. 3 Cir., 510 F.2d 971, cert. denied, 422 U.S. 1027, 95 S.Ct. 2621, 45 L.Ed.2d 684; DeKalb County v. Southern Bell Tel. & Tel. Co., 358 F.Supp. 498 (S.D. Ga.1972), aff'd, 5 Cir., 478 F.2d 700. The first element, jurisdictional basis, is clearly satisfied, as the complaint alleges violations of the First and Fourteenth Amendments, as required by the statute invoked, 42 U.S.C. § 1983 and its jurisdictional counterpart, 28 U.S.C. § 1343. The second element, noninterference with interstate commerce, is also satisfied as the order in question here affects only electric rates in Nassau, Suffolk, and parts of Queens counties. "The rule is undisputed that a rate issued by a proper state body does not interfere with interstate commerce within the meaning of 28 U.S.C. § 1342(2) unless it is directly burdensome or otherwise discriminatory of the (sic) interstate traffic." New York Central R. Co. v. Illinois Commerce Commission, 77 F.Supp. 520, at 522 (N.D.Ill. 1948). Cf. General Investment & Service Corp., supra, and Pudlik v. Public Service Co. of Colorado, 166 F.Supp. 921 (D.Colo. 1958). No such burden, and no such discrimination is present here. The third criteria, that the order be made pursuant to reasonable notice and hearing is satisfied as all public notices and public hearings required by The New York Public Service Law were fulfilled. See Tennyson v. Gas Service Co., 506 F.2d 1135 (10th Cir. 1975). In the case at bar, plaintiff was mailed notice on October 1, 1976 of public hearings on peak-load pricing to be held on October 12, 1976. The hearings were held on that date in the PSC offices, Two World Trade Center, New York. Finally, the requirement that a "plain, speedy, and efficient remedy may be had" in the state courts is satisfied as plaintiff could bring a complaint before the PSC, and then appeal any PSC determination to New York's state courts. Cf. Tennyson, supra; Klotz, supra.

Thus, the four requisites set out in the Johnson Act are satisfied and this Court is prohibited from enjoining operation of the order if it is determined that plaintiff here is indeed challenging the rate itself. Plaintiff contends this is not the case, and that the case at bar is indistinguishable from Memphis Light, Gas & Water Division v. Craft, 436 U.S. 1, 98 S.Ct. 1554, 56 L.Ed.2d 30 (1978), which challenged the constitutionality of utility service termination procedures.

But plaintiff's argument omits consideration of his own complaint. Paragraph 11 of the complaint challenges both the new rate and its applicability to plaintiff. "Furthermore, the proposed time of day rate discriminates against Kalinsky in violation of his constitutional rights . . ." Thus, plaintiff's challenge is to the rate itself and the rates application to his household. In Memphis Light, supra, the rate itself was not being challenged. Rather, the issue in that case was whether continued utility service constituted a "property" interest within the meaning of the due process clause, and if so, what process was due before termination was permissible. In Memphis Light termination of service had occurred five times, here it has not occurred at all; in Memphis Light the customer was "never apprised of the availability of a procedure for discussing her dispute `with management'", 98 S.Ct. at 1562, here Lilco has repeatedly sought "discussions" with plaintiff. But most importantly for purposes of the Johnson Act, the ...