Vertis Group, Inc. v. Pennsylvania Public Utility Commission

840 A.2d 390, 2003 Pa. Commw. LEXIS 862
CourtCommonwealth Court of Pennsylvania
DecidedDecember 5, 2003
StatusPublished
Cited by5 cases

This text of 840 A.2d 390 (Vertis Group, Inc. v. Pennsylvania Public Utility Commission) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vertis Group, Inc. v. Pennsylvania Public Utility Commission, 840 A.2d 390, 2003 Pa. Commw. LEXIS 862 (Pa. Ct. App. 2003).

Opinions

OPINION BY

Senior Judge McCLOSKEY.

The Vertis Group, Inc., Crain/Hallas Corporation, Lawrence Crain, Joyce Hal-las Crain, Mark Crain and Brian Crain, individuals and successors-in-interest to Crain/Hallas Corporation (hereafter collectively referred to as the Vertis Group)1 petition for review of an order of the Pennsylvania Public Utility Commission (the PUC), granting in part and denying in part the exceptions filed by the Vertis Group in response to a decision from an administrative law judge (ALJ). Further, the PUC order followed the recommendation of the ALJ and dismissed a complaint filed by the Vertis Group against Du-quesne Light Company (Duquesne Light).

The Vertis Group operated a business at 846 Fourth Avenue, Coraopolis, Pennsylvania, from 1994 to 1997. This business performed two types of service. The first was a scheduling service providing qualified physicians to conduct independent medical examinations with respect to claims for workers’ compensation benefits and claims under other insurance policies. The second was medical bill re-pricing services with explanation of benefits statements to ensure compliance with workers’ compensation and other pricing guidelines. In providing these services, the Vertis Group was heavily dependent on computer equipment and a specially-designed scheduling software program.2 The Vertis [392]*392Group utilized this equipment and software in conjunction with data-entry clerks. Duquesne Light provided the Vertís Group with commercial electric service at its facility in Coraopolis.

The Vertís Group immediately began experiencing hardware and software problems such as data scrambling, hardware malfunctions and “blow-outs” at its facility. The Vertís Group alleged that it also experienced power surges, power drops and harmonic distortions at its facility, which in turn caused physical damage to computer equipment, deletion of data and, ultimately, a loss of customers. The Vertís Group notified Duquesne Light of its problems and a technician was dispatched to the location on May 16, 1995, to check the connections on the nearest transformer and to measure the incoming voltage. The voltage measured within the range required by PUC regulations and Duquesne Light’s tariffs. On the same day, the technician installed a circular voltage chart at the facility to monitor incoming voltage. The chart remained at the facility until May 24, 1995. Upon reviewing the chart, however, the recorded voltage again measured within the range required by the aforementioned regulations and tariff.

Nevertheless, on May 18, 1995, the Ver-tís Group again complained to Duquesne Light and another technician was sent to the facility. This technician also found the voltage to be within the required range. Despite this finding, Duquesne Light arranged to replace all of the connections at the transformer servicing the facility and offered to test the voltage with a BMI Power Quality Analyzer (BMI)3 if the problems persisted. These connections were indeed changed the next day, May 19, 1995. On June 5, 1995, the Vertís Group informed Duquesne Light that it had again experienced voltage problems and equipment damage. On June 8, 1995, the parties met to discuss the problems and a Duquesne Light engineer, Timothy Bray (Bray), installed a BMI device at the facility. Numerous investigations were conducted at the facility through August 2, 1995, and numerous conversations were held between representatives of the Vertís Group and Duquesne Light, including Bray and Clifford Blashford (Blashford), another Duquesne Light engineer and account representative.

During the course of the investigation, the BMI device recorded and later measured a number of transient voltage spikes at the facility.4 On June 13, 1995, Blash-ford and Bray met with representatives of the Vertís Group, who had shut off the air conditioning and electric hot water tanks for study purposes. During the time that these systems were shut down, the BMI only recorded one disturbance overnight. Blashford and Bray informed the Vertís Group that even common office equipment, such as a refrigerator or water cooler, could cause the transients. Further, due to the fact that these transients contained extremely small amounts of energy and lasted only microseconds, Blashford and Bray indicated that the transients were insufficient to damage computer equipment. They recommended that the Vertís Group install three levels of surge suppression, including an uninterruptible power supply (UPS) to protect their equipment and computer system. The Vertís Group installed the levels of surge sup[393]*393pression but did not utilize UPS equipment.

Contrary to these indications, however, and in order to satisfy the concerns of the Vertís Group’s customers, Blashford provided the Vertís Group with a letter dated June 13, 1995, noting that the facility was experiencing “800-500V voltage transients,” which he described as “an abnormal condition” and which were “sufficient to damage sensitive data processing equipment such as computers, and network servers.” 5 (R.R. at 1715a).

Duquesne Light thereafter investigated the entire circuit serving the facility but found no evidence of any problems. All of the tests revealed voltages within PUC regulations and evidenced no problems with the Duquesne Light distribution system. Additionally, Duquesne Light noted no other customer on the same circuit as the Vertís Group as having similar complaints of voltage problems. Nonetheless, the problems at the Vertís Group continued and eventually it ceased operations.

The Vertís Group then sold the building in Coraopolis to an engineering company, Lennon Smith Souleret Engineering (LSSE), during which sale the Vertís Group never disclosed to the buyer any electrical problems. Upon occupation of the building, LSSE experienced data corruption problems which it attributed to a computer network that was substandard and improperly wired and not to any electrical problems at the site.6 LSSE thereafter fixed the networking problems and experienced no further data corruption problems.

The Vertís Group proceeded to initiate a civil action against Duquesne Light in the Court of Common Pleas of Allegheny County (trial court) with the filing of a complaint alleging breach of contract, breach of implied and express warranties and negligence. The complaint was filed in November of 1997. Duquesne Light filed an answer essentially denying the allegations of the complaint. The Vertís Group demanded a jury trial. The case was placed at issue by Duquesne Light in January of 1998 and was scheduled for trial in late January 1999.

However, on January 12, 1999, Du-quesne Light filed a motion to bifurcate and transfer to the PUC for a determination of liability. In its motion, Duquesne Light indicated that the complex and technical claims relating to the reasonableness, adequacy and sufficiency of its electric service needed the expertise of the PUC. Duquesne Light further indicated that the PUC had exclusive jurisdiction over such issues as compliance with its tariff. The Vertís Group filed an answer asking the trial court to deny the motion and both parties briefed the issue.

In the meantime, on January 25, 1999, the Vertís Group filed an amended complaint adding a count of strict liability against Duquesne Light.

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Vertis Group, Inc. v. Pennsylvania Public Utility Commission
840 A.2d 390 (Commonwealth Court of Pennsylvania, 2003)

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Bluebook (online)
840 A.2d 390, 2003 Pa. Commw. LEXIS 862, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vertis-group-inc-v-pennsylvania-public-utility-commission-pacommwct-2003.