East Ohio Gas Co. v. Federal Power Commission

173 F.2d 429, 84 U.S. App. D.C. 312, 1949 U.S. App. LEXIS 3819
Court of Appeals for the D.C. Circuit·Decided February 14, 1949·No. No. 9741·Published·Cited by 3 cases

Opinions

CLARK, Circuit Judge.

The case is before this court on the petition of the East Ohio Gas Company (hereinafter alternatively referred to as East Ohio or as petitioner) for review of certain orders of the Federal Power Commission (referred to hereinafter as the Commission " or the respondent). The orders. sought to be reviewed found East [430] Ohio to he a “naturál-gas company” within the meaning of the Natural Gas ■ Act of 1938, as amended,1 subject to the jurisdiction of the Commission and ordered East Ohio: (1) To comply with all previous general accounting orders of the Commission applicable to “natural-gas companies”; (2) to comply with all previous Commission orders requiring the filing of annual reports; and (3) to file with the Commission within 90 days the data, statements and- reports required by previous orders insofar as it reasonably could and to inform the -Commission when the remainder could be filed.

During all the proceedings before the Commission the effectiveness of the orders here under review was stayed by the Commission in order to preserve the status quo: Similarly, upon petition of East Ohio, and the respondent having filed consent thereto, this court granted a stay pending its decision on review.

Although the petitioner and the respondent differ radically as to the interpretation of the facts of the case and their net effect, as might be expected, there is no controversy as to the material facts themselves. East Ohio is an Ohio corporation with its principal place of business -in Cleveland, Ohio. The very heart of the instant controversy is the definition of the nature of East Ohio’s business, petitioner and the intervenors claiming that East Ohio is solely engaged in the business of direct; local distribution of natural gas in the State of Ohio, and respondent claiming that petitioner is in the business of transporting gas in interstate commerce. Postponing, for the moment, further discussion of that critical question, it is certain that all property and facilities -owned and operated by East Ohio lie within the physical boundaries of the State of Ohio, that East Ohio distributes natural gas in Ohio by means of an extensive pipeline system,2 and that none of East Ohio’s pipelines crosses state lines. Further, it is uncontroverted that petitioner makes no sales -of any kind to any other company for resale purposes- and that nofte of the gas sold by petitioner is consumed outside of. Ohio, that is, none of the gas in the pipelines of East Ohio flows out of the State-of Ohio.

Petitioner’s sources of natural gas are threefold. As of 1945,3 petitioner got 62% of its gas from the Hope Natural Gas-Company (hereinafter called Hope), 23% from the Panhandle Eastern Pine Line Company (hereinafter called Panhandle),. . and 15% from native Ohio fields.4 The gas -procured by East Ohio from Hope and from Panhandle is concededly gas-from sources outside the State of Ohio-(principally from' West Virginia, Texas,, Oklahoma -and Kansas). The gas procured from Hope first enters petitioner’s pipeline system principally at two points in Ohio known as Pipe Creek Station and Clarington Station, both on the Ohio side of the Ohio River. Panhandle gas first connects with and joins the East Ohio system at Maumee, Ohio, a point about 40 to-50 miles east of the western boundary of Ohio. The first point locally-produced gas-enters the pipelines of petitioner is a point, in Harrison County, Ohio, about 40 miles-from the Ohio-West Virginia state line. It is established by the record and found, by the Commission that East Ohio serves-more than 551,000 consumers in 69 north-' [431] eastern Ohio communities having an estimated total population of over 2,000,000 people. The total sales figure of petitioner in 1945 was 77,428 million cubic feet (Mcf).5 Much is made by the Commission of the fact that petitioner receives its gas from both Hope and Panhandle at high pressures which, in most cases, are sufficient to propel the gas through petitioner’s large trunk lines to their ultimate destination without repumping. East Ohio does not deny that this is so. On the other hand, the Commission, both in its several orders and in its brief in this case, passes rather lightly over the fact which we consider extremely important, namely, that East Ohio has long been subject to complete regulation by the Public Utilities Commission of Ohio, intervenor herein.

The Ohio Commission was created in 1911. Ever since that date it has repeatedly and continuously exercised its regulatory powers over all the business activities and property of petitioner. This regulation has included the setting of numerous rates, the supervision of acquisitions and sale of property and security issues, the control of accounting practices, inauguration and termination of service, examining service complaints, and requiring the submission of detailed reports to the Ohio Commission. Abundant state statutory authority exists for this regulation by the Ohio Commission6 and the state regulation authorized is mandatory, not permissive. As of the time of the hearings before the Commission in this case there had been a total of 258 formal regulatory proceedings before the Ohio Commission involving East Ohio. There can ■ be little doubt that petitioner is now and has been very thoroughly and completely regulated by the Ohio Commission.

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East Ohio Gas Co. v. Federal Power Commission, 173 F.2d 429, 84 U.S. App. D.C. 312, 1949 U.S. App. LEXIS 3819 (D.C. Cir. 1949).

173 F.2d 429 (East Ohio Gas Co. v. Federal Power Commission) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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