William Ellis v. Salt River Project

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

WILLIAM ELLIS; ROBERT DILL; Nos. 20-15301

EDWARD RUPPRECHT; ROBERT 20-15476

GUSTAVIS, individually and on

behalf of all others similarly situated, D.C. No.

Plaintiffs-Appellants/ 2:19-cv-01228-

Cross-Appellees, SMB

v.

OPINION

SALT RIVER PROJECT AGRICULTURAL

IMPROVEMENT AND POWER

DISTRICT,

Defendant-Appellee/Cross-

Appellant.

Appeal from the United States District Court

for the District of Arizona

Susan M. Brnovich, District Judge, Presiding

Argued and Submitted February 2, 2021

Phoenix, Arizona

Filed January 31, 2022

2 ELLIS V. SALT RIVER PROJECT

Before: William A. Fletcher, Eric D. Miller, and

Danielle J. Forrest, * Circuit Judges.

Opinion by Judge Miller

SUMMARY **

Antitrust

The panel affirmed in part and reversed in part the

district court’s dismissal of an action alleging that a price

plan adopted by Salt River Project Agricultural

Improvement and Power District (“SRP”), a power and

water utility, unlawfully discriminated against customers

with solar-energy systems and was designed to stifle

competition in the electricity market.

Affirming in part, the panel held applicable in federal

court Arizona’s notice-of-claim statute, which provides that

persons who have claims against a public entity, such as

SRP, must file with the entity a claim containing a specific

amount for which the claim can be settled. The panel held

that the Arizona statute did not conflict with Federal Rule of

Civil Procedure 23 by imposing an extra barrier to class

certification, and it was not a state procedural rule

inapplicable in federal court under the Erie doctrine. The

panel held that plaintiffs failed to comply with the notice-of-

claim statute, and it therefore barred their state-law claims.

*

Formerly known as Danielle J. Hunsaker.

**

This summary constitutes no part of the opinion of the court. It

has been prepared by court staff for the convenience of the reader.

ELLIS V. SALT RIVER PROJECT 3

Reversing and remanding in part, the panel held that the

district court erred in dismissing plaintiffs’ equal protection

claim as barred by Arizona’s two-year statute of limitations

for personal-injury claims. The panel held that, under

federal law, the claim did not accrue when SRP approved the

price plan, but rather when plaintiffs received a bill under the

new rate structure. The panel held that because three

plaintiffs sued within two years of first being charged under

the price plan, their claims were timely as to all charges

incurred. A fourth plaintiff did not sue within two years of

becoming subject to the price plan, but he was charged under

it within the limitations period. His claims, therefore, were

timely only as to charges incurred within two years of suing.

The panel held that what plaintiffs alleged was not a

continuing violation, but rather a series of repeated

violations, each of which gave rise to a new cause of action

and thereby began a new statute of limitations period as to

that particular event.

Addressing plaintiffs’ claims for monopolization and

attempted monopolization under the Sherman Act, the panel

affirmed the district court’s rulings that the claims were not

barred by the filed-rate doctrine and state-action immunity

and that the Local Government Antitrust Act shielded SRP

from federal antitrust damages. The panel reversed the

district court’s holding that plaintiffs failed sufficiently to

allege antitrust injury.

The panel held that antitrust injury requires (1) unlawful

conduct, (2) causing an injury to the plaintiff, (3) that flows

from that which makes the conduct unlawful, and (4) that is

of the type the antitrust laws were intended to prevent. The

panel held that the district court erred in concluding that

plaintiffs failed to adequately allege antitrust injury based on

the court’s finding that the price plan actually encouraged

4 ELLIS V. SALT RIVER PROJECT

competition in alternative energy investment. The panel

rejected SRP’s arguments that plaintiffs’ allegations were

insufficient because they paid the higher rate before SRP

could succeed in fully displacing competition or because

they could not claim to have been injured by the

exclusionary conduct because they had attempted to use the

market alternatives that they claimed SRP tried to make

uneconomical.

The panel held that the filed-rate doctrine, prohibiting

individuals from asserting civil antitrust challenges to an

entity’s agency-approved rates, did not apply because SRP

did not file its rates with anyone other than itself.

The panel held that SRP was not entitled to state-action

immunity because the State of Arizona had not articulated a

policy to displace competition, but rather had clearly

expressed a policy preference for competition in electricity

generation and supply.

The panel held that the Local Government Antitrust Act

shielded SRP from antitrust damages because SRP is a

special functioning governmental unit established by

Arizona law, but the Act did not bar declaratory or injunctive

relief.

ELLIS V. SALT RIVER PROJECT 5

COUNSEL

Hart L. Robinovitch (argued), Zimmerman Reed LLP,

Scottsdale, Arizona; David M. Cialkowski and Alia M.

Abdi, Zimmerman Reed LLP, Minneapolis, Minnesota;

Daniel E. Gustafson, Daniel C. Hedlund and Daniel J.

Nordin, Gustafson Gluek PLLC, Minneapolis, Minnesota;

for Plaintiffs-Appellants/Cross-Appellees.

Daniel S. Volchok (argued), Christopher E. Babbitt, and

David Gringer, Wilmer Cutler Pickering Hale and Dorr LLP,

Washington, D.C.; Elizabeth Bewley, Wilmer Cutler

Pickering Hale and Dorr LLP, Boston, Massachusetts; Eric

Dell Gere, Jennings Strouss & Salmon PLC, Phoenix,

Arizona; for Defendants-Appellees/Cross-Appellants.

Matthew C. Mandelberg (argued), Daniel E. Haar, and

Steven J. Mintz, Attorneys; Andrew J. Robinson, Counsel to

the Assistant Attorney General; Michael F. Murray, Deputy

Assistant Attorney General; Makan Delrahim, Assistant

Attorney General; United States Department of Justice,

Antitrust Division, Washington, D.C.; for Amicus Curiae

United States of America.

Howard M. Crystal and Anchun Jean Su, Center for

Biological Diversity, Washington, D.C., for Amici Curiae

Center for Biological Diversity, Food and Water Watch,

Friends of the Earth Inc., Institute for Local Self-Reliance,

and N.C. Warn Inc.

6 ELLIS V. SALT RIVER PROJECT

OPINION

MILLER, Circuit Judge:

Salt River Project Agricultural Improvement and Power

District (SRP) is a power and water utility that services most

of the Phoenix metropolitan area. In 2015, SRP increased

prices for customers with solar-energy systems. Plaintiffs

William Ellis, Robert Dill, Edward Rupprecht, and Robert

Gustavis (collectively, “Ellis”) sued SRP under federal and

state law, alleging that the new price plan unlawfully

discriminates against customers with solar-energy systems

and was designed to stifle competition in the electricity

market. The district court dismissed the complaint in its

entirety. Ellis appeals the dismissal of his claims, and SRP

cross-appeals the district court’s rejection of certain of its

affirmative defenses. We affirm the district court’s dismissal

of Ellis’s state-law claims but reverse the dismissal of the

federal claims and remand for further proceedings.

I

Because the district court resolved this case on a motion

to dismiss, we assume the truth of the facts as set out in the

complaint. Wojciechowski v. Kohlberg Ventures, LLC,

923 F.3d 685, 688 n.2 (9th Cir. 2019).

SRP is a political subdivision of the State of Arizona.

Ariz. Rev. Stat. Ann. § 48-2302. It controls the electrical

grid and has authority to set prices for the sale and

distribution of electricity to the approximately one million

retail customers in its service territory. It supplies more than

95 percent of the electricity used by those customers.

Some of SRP’s customers have chosen to install solar-

energy systems, such as rooftop solar panels, thereby

ELLIS V. SALT RIVER PROJECT 7

reducing the amount of electricity they need to purchase

from SRP. But solar energy is not always available, and

customers with solar installations must still rely on SRP

when their solar-energy systems do not produce electricity

or produce less electricity than they need.

In the past, SRP encouraged the use of solar-energy

systems. For example, its net metering program gave

customers credit on their bill for generating excess

electricity, which was transmitted through the grid and

purchased at retail rates by other customers. SRP also

attempted to enter the solar-energy market itself, but when

that effort faltered, it eliminated incentives to install solar-

energy systems. Even so, SRP’s service territory has one of

the highest rates of solar installation in the nation.

In 2014, SRP announced a new pricing scheme that

included various “Standard Electric Price Plans.” One of

those plans, the E-27 price plan, established separate rates

for customers who generate their own electricity through

solar-energy systems. The E-27 plan applies only to

customers who installed solar panels after December 8,

2014; those who had already installed solar panels were

grandfathered into the previous pricing scheme. Under the

E-27 plan, solar customers can be charged up to 65 percent

more for SRP electricity than under prior plans for solar

customers.

In February 2015, the SRP board of directors approved

the new pricing scheme. At the same time, it adopted a rate

increase for its non-solar customers of only about

3.9 percent. After adopting the new pricing scheme, SRP

undertook a $1.7 million advertising campaign to promote

its increased rates for solar customers. Not surprisingly,

applications for solar-energy systems in SRP territory

decreased by between 50 and 96 percent.

8 ELLIS V. SALT RIVER PROJECT

Ellis is an SRP customer who is subject to the new E-27

price plan. He sued SRP in federal court on behalf of a

putative class of similarly situated customers. In his first

amended complaint (the operative pleading here), he

asserted claims under the Sherman Act, 15 U.S.C. § 2;

various Arizona consumer protection, antitrust, and price

discrimination laws; and the equal protection clauses of the

United States and Arizona constitutions. Ellis alleged that

the E-27 price plan “discriminates against customers that use

solar energy systems and disincentivizes further purchases

and use of solar energy systems” by eliminating “the

economic value in investing in solar energy systems to self-

generate electricity,” leading customers “to obtain their

electrical power needs exclusively from SRP.” According to

Ellis, “[t]he E-27 price plan makes it impossible for solar

customers to obtain any viable return on a solar energy

system investment, thereby eliminating any competition

from solar energy.”

The district court dismissed the complaint in its entirety.

First, the district court held that the state-law claims were

barred because Ellis did not comply with Arizona’s notice-

of-claim statute by filing an appropriate claim with SRP

before bringing suit. See Ariz. Rev. Stat. Ann. § 12-821.01.

Second, it dismissed the federal equal protection claim as

untimely. Third, although it held inapplicable the filed-rate

and state-action-immunity doctrines, it dismissed the federal

antitrust claims for failure to allege antitrust injury. It also

concluded that the Local Government Antitrust Act

(LGAA), 15 U.S.C. §§ 34–36, shields SRP from federal

antitrust damages.

Ellis appeals. Because the district court granted Ellis

leave to amend his federal antitrust claims, SRP cross-

appeals the district court’s rejection of its alternative grounds

ELLIS V. SALT RIVER PROJECT 9

for dismissal, which, if accepted, would have resulted in a

dismissal with prejudice. But Ellis did not file an amended

complaint within the time allotted by the district court, and

the district court subsequently entered an order terminating

the case. Because that order did not specify otherwise, it

“operates as an adjudication upon the merits,” or in other

words as a dismissal with prejudice. Stewart v. U.S.

Bancorp, 297 F.3d 953, 956 (9th Cir. 2002) (quoting Fed. R.

Civ. P. 41(b)). Thus, SRP has already obtained the judgment

it now seeks through its cross-appeal. An appellee must

cross-appeal to obtain “relief more extensive than [that]

received from the district court,” Dodd v. Hood River

County, 59 F.3d 852, 864 (9th Cir. 1995), but it should not

cross-appeal if all it wishes to do is present alternative

grounds for affirming the judgment, Spencer v. Peters,

857 F.3d 789, 797 n.3 (9th Cir. 2017); see, e.g., El Paso Nat.

Gas Co. v. Neztsosie, 526 U.S. 473, 479 (1999). SRP’s cross-

appeal is therefore unnecessary; the arguments SRP

advances in the cross-appeal should simply have been

asserted as alternative grounds for affirmance in SRP’s

appellee’s brief. But we may affirm on any ground supported

by the record, so we will proceed to consider the issues

raised in both appeals. See Spencer, 857 F.3d at 797 n.3.

II

We first consider whether Arizona’s notice-of-claim

statute applies in federal court and, if so, whether Ellis

satisfied it. We hold that the statute applies and that Ellis did

not comply with its terms, so it bars his state-law claims.

Under Arizona law, “[p]ersons who have claims against

a public entity” such as SRP must file a claim with the entity

“within [180] days after the cause of action accrues . . .

contain[ing] a specific amount for which the claim can be

settled.” Ariz. Rev. Stat. Ann. § 12-821.01(A). A claim that

10 ELLIS V. SALT RIVER PROJECT

is not so filed “is barred and no action may be maintained

thereon.” Id.; see Deer Valley Unified Sch. Dist. No. 97 v.

Houser, 152 P.3d 490, 492 (Ariz. 2007).

The statute poses a dilemma for those seeking to bring a

class action: “Persons filing a claim with a public entity do

not yet represent a class,” so they “have authority to settle

only their individual claims.” City of Phoenix v. Fields,

201 P.3d 529, 533 (Ariz. 2009). That means that those

seeking to assert a class claim are unable to “set forth a

‘specific amount’ for which the claim of the entire class ‘can

be settled.’” Id. (quoting Ariz. Rev. Stat. Ann. § 12-

821.01(A)). To resolve that dilemma, the Arizona Supreme

Court has interpreted section 12-821.01(A) to allow a

would-be class representative to “include in his notice of

claim a ‘specific amount’ for which his individual claim can

be settled,” together with “a statement that, if litigation

ensues, the representative intends to seek certification of a

plaintiff class.” Id. at 534. “If a class is later certified, the

notice of claim will serve as a representative notice for other

class members.” Id.

Ellis argues that section 12-821.01(A) allows public-

entity defendants to “pick off” class representatives by

forcing settlement of their individual claims before a class

can be certified, thereby preventing them from representing

a class. This, he says, conflicts with Federal Rule of Civil

Procedure 23 by imposing an extra barrier to class

certification. Alternatively, Ellis contends that section 12-

821.01(A) is a state procedural rule that does not apply in

federal court under Erie Railroad Co. v. Tompkins, 304 U.S.

64 (1938).

ELLIS V. SALT RIVER PROJECT 11

A

To determine whether Rule 23 displaces Arizona’s

notice-of-claim statute, we “must first determine whether

Rule 23 answers the question in dispute.” Shady Grove

Orthopedic Assocs., P.A. v. Allstate Ins. Co., 559 U.S. 393,

398 (2010). We ask “whether, when fairly construed, the

scope of Federal Rule [23] is ‘sufficiently broad’ to cause a

‘direct collision’ with the state law or, implicitly, to ‘control

the issue’ before the court, thereby leaving no room for the

operation of that law.” Burlington N. R.R. Co. v. Woods,

480 U.S. 1, 4–5 (1987) (quoting Walker v. Armco Steel

Corp., 446 U.S. 740, 749–50 & n.9 (1980)). If so, then the

federal rule controls “unless it exceeds statutory

authorization or Congress’s rulemaking power.” Shady

Grove, 559 U.S. at 398.

In Shady Grove, the Supreme Court considered a New

York statute providing that “an action to recover a penalty

. . . imposed by statute may not be maintained as a class

action.” 559 U.S. at 396 n.1 (quoting N.Y. C.P.L.R. 901(b)).

The Court emphasized that both Rule 23 and the state law

addressed the same question: “whether a class action may

proceed for a given suit.” Id. at 401. Because Rule 23

“creates a categorical rule entitling a plaintiff whose suit

meets the specified criteria to pursue his claim as a class

action,” and the state law “attempt[ed] to answer the same

question” by dictating that the same suit “may not be

maintained as a class action,” the provisions conflicted. Id.

at 398–99 (emphasis omitted) (quoting N.Y. C.P.L.R.

901(b)).

But unlike the statute considered in Shady Grove, which

specifically foreclosed class treatment of otherwise valid

claims, section 12-821.01(A) does not so much as mention

class actions. It merely requires that a potential class

12 ELLIS V. SALT RIVER PROJECT

representative, like any other plaintiff, file a notice of claim

before filing suit; noncompliance bars individual and class

claims alike. If section 12-821.01(A) prevents a claim from

ripening into a viable class action, it is not because Arizona

has “impose[d] additional requirements” beyond what Rule

23 demands. Shady Grove, 559 U.S. at 401. It is because the

plaintiff has failed to satisfy a prerequisite to asserting any

claim against a public entity under Arizona law.

Ellis attempts to identify a direct conflict between the

state law and the federal rule by emphasizing that federal

courts interpret Rule 23 to allow “a would-be class

representative with a live claim of her own . . . a fair

opportunity to show that certification is warranted.”

Campbell-Ewald Co. v. Gomez, 577 U.S. 153, 165 (2016).

We have held that “when a defendant consents to judgment

affording complete relief on a named plaintiff’s individual

claims before certification, but fails to offer complete relief

on the plaintiff’s class claims, a court should not enter

judgment on the individual claims, over the plaintiff’s

objection, before the plaintiff has had a fair opportunity to

move for class certification.” Chen v. Allstate Ins. Co.,

819 F.3d 1136, 1147 (9th Cir. 2016). Thus, forcing the

settlement of the class representative’s claims prevents the

representative from “fairly and adequately protect[ing] the

interests of the class” and obtaining a class-wide settlement.

Fed. R. Civ. P. 23(a)(4), 23(e).

But neither the class representative’s duty to represent

the class’s interests nor the representative’s interest in

certifying a class exist at the time the pre-suit notice of claim

is filed. Fields, 201 P.3d at 533. And as soon as the public

entity rejects the settlement offer, the claim may proceed

unencumbered. See id. Because a claim under Arizona law

asserted against a public entity does not become “live” until

ELLIS V. SALT RIVER PROJECT 13

the notice of claim is filed, Campbell-Ewald, 577 U.S.

at 165, section 12-821.01(A) does not impinge on a class

representative’s duties and rights under Rule 23. The

provisions “can exist side by side . . . , each controlling its

own intended sphere of coverage without conflict.” Walker,

446 U.S. at 752.

B

Because there is no conflict between the state law and

the federal rule, we proceed to determine whether the state

law applies in federal court under the Erie doctrine. See

Shady Grove, 559 U.S. at 398.

“[F]ederal courts sitting in diversity apply state

substantive law and federal procedural law.” Gasperini v.

Center for Humanities, Inc., 518 U.S. 415, 427 (1996).

Distinguishing between substantive legal rules and the

procedures for enforcing those rules is not always easy. See

Hanna v. Plumer, 380 U.S. 460, 471 (1965). The Supreme

Court has held that for purposes of Erie, the line between

substance and procedure must be drawn so as to ensure that

“the outcome of the litigation in the federal court should be

substantially the same, so far as legal rules determine the

outcome of a litigation, as it would be if tried in a State

court.” Felder v. Casey, 487 U.S. 131, 151 (1988) (quoting

Guaranty Tr. Co. v. York, 326 U.S. 99, 109 (1945)). This

“‘outcome-determination’ test must not be applied

mechanically” but instead “must be guided by ‘the twin aims

of the Erie rule: discouragement of forum-shopping and

avoidance of inequitable administration of the laws.’”

Gasperini, 518 U.S. at 428 (quoting Hanna, 380 U.S.

at 468).

The Supreme Court has demonstrated how this test

applies to a statute like section 12-821.01(A). In Felder, the

14 ELLIS V. SALT RIVER PROJECT

Court held that a similar notice-of-claim statute under

Wisconsin law does not apply to federal civil-rights claims.

487 U.S. at 134. In reaching that conclusion, the Court

explained that a “state notice-of-claim statute is more than a

mere rule of procedure: . . . [It] is a substantive condition on

the right to sue governmental officials and entities, and the

federal courts have therefore correctly recognized that [such

a] notice statute governs the adjudication of state-law claims

in diversity actions.” Id. at 152. So although such a statute

does not apply to claims arising under federal law, “federal

courts entertaining state-law claims against [state]

municipalities are obligated to apply the notice-of-claim

provision.” Id. at 151 (emphasis added); see also Woods v.

Interstate Realty Co., 337 U.S. 535, 537 (1949) (“[T]he

policy of [Erie] preclude[s] maintenance in . . . federal court

. . . of suits to which the State ha[s] closed its courts.”).

Like the statute at issue in Felder, section 12-821.01(A)

advances the substantive state interests of “allow[ing] the

public entity to investigate and assess liability,” encouraging

“settlement prior to litigation,” and “assist[ing] the public

entity in financial planning and budgeting.” Deer Valley,

152 P.3d at 492 (quoting Falcon ex rel. Sandoval v.

Maricopa County, 144 P.3d 1254, 1256 (Ariz. 2006)). It also

reflects the State’s sovereign interest in placing conditions

on claims asserted against state entities. See Banner Univ.

Med. Ctr. Tucson Campus, LLC v. Gordon ex. rel. County of

Pima, 467 P.3d 257, 262 (Ariz. Ct. App. 2020) (“[T]he

notice-of-claim statute is, fundamentally, a codification of

sovereign immunity.”). Declining to apply section 12-

821.01(A) would lead plaintiffs to shop for a federal forum

free from Arizona’s notice-of-claim requirement, producing

disparate outcomes between federal and state litigants. See

Gasperini, 518 U.S. at 430–31. We conclude that the statute

applies in federal court. See Felder, 487 U.S. at 151–52.

ELLIS V. SALT RIVER PROJECT 15

C

Having determined that section 12-821.01(A) applies,

we consider whether Ellis satisfied it. Before filing suit, Ellis

submitted a notice stating that his claims could be settled

under the following conditions: the court’s awarding of

injunctive and declaratory relief to the class; “monetary

relief equal to no less than $1.64 per day . . . per individual”

for each day the individual “was charged the discriminatory

rates, . . . through and inclusive of the date the injunctive and

declaratory relief . . . are fully and finally implemented”; and

“attorneys’ fees and costs.”

That notice was deficient because it did not state “a

specific amount for which the claim[s] can be settled.” Ariz.

Rev. Stat. Ann. § 12-821.01(A). The statute “instructs

claimants to include a particular and certain amount of

money that, if agreed to by the government entity, will settle

the claim.” Deer Valley, 152 P.3d at 493. Ellis’s claim did

not do that. Instead, it conditioned settlement on two

demands that are impermissible under section 12-821.01(A).

First, it stated that Ellis would not settle even his individual

monetary claim without a grant of injunctive relief to the

entire class. It therefore did not specify how Ellis’s

“individual claim [could] be settled.” Fields, 201 P.3d at 534

(emphasis added). Second, the requested monetary relief

was not “a particular and certain amount of money” but

instead an amount “no less than” the amount to be calculated

using a formula that depended on the not-yet-specified

number of class members and the not-yet-determined date

on which injunctive and declaratory relief might be awarded.

Deer Valley, 152 P.3d at 493; see id. at 494 (plaintiff may

not demand an “estimated value”).

Ellis argues that section 12-821.01(A) does not apply to

his claims for declaratory and injunctive relief. He did not

16 ELLIS V. SALT RIVER PROJECT

raise that argument below, so we decline to consider it now.

See Doe v. CVS Pharmacy, Inc., 982 F.3d 1204, 1213 (9th

Cir. 2020) (arguments raised “for the first time on appeal”

are forfeited).

III

We turn next to the federal equal protection claim.

Because Ellis brought that claim under 42 U.S.C. § 1983, it

is subject to the limitations period for personal-injury claims

under state law, which in Arizona is two years. Wilson v.

Garcia, 471 U.S. 261, 276 (1985); Ariz. Rev. Stat. Ann.

§ 12-542. The period starts to run when the claim accrues.

Flynt v. Shimazu, 940 F.3d 457, 462 (9th Cir. 2019). Federal

law governs the accrual of a section 1983 claim, and a cause

of action accrues “when the plaintiff knows or has reason to

know of the actual injury” that is the basis for the action.

Lukovsky v. City & Cnty. of S.F., 535 F.3d 1044, 1051 (9th

Cir. 2008); accord Belanus v. Clark, 796 F.3d 1021, 1025

(9th Cir. 2015).

The district court held that Ellis’s claim was untimely

because the claim accrued—and thus the statute of

limitations began to run—when SRP approved the E-27 plan

in February 2015. But at that point, the plan had not yet

caused Ellis any injury, so he could not have “know[n] or

ha[d] reason to know of the actual injury.” Lukovsky,

535 F.3d at 1051. The injury occurred only when Ellis

received a bill under the new rate structure. Indeed, Ellis

suffered a new injury with each monthly bill, which means

that a new claim arose each month. See Flynt, 940 F.3d

at 462.

In concluding that all of the claims were untimely, the

district court relied on RK Ventures, Inc. v. City of Seattle,

307 F.3d 1045, 1058 (9th Cir. 2002), in which we held that

ELLIS V. SALT RIVER PROJECT 17

the statute of limitations runs from the “‘operative decision’”

and not from its “inevitable consequences that are not

separately actionable.” Id. (quoting Chardon v. Fernandez,

454 U.S. 6, 8 (1981)). That case involved a challenge to an

abatement proceeding brought by a city; although the

commencement of the action was outside the statute of

limitations, the plaintiff argued that later events in the

proceeding, such as holding a hearing, had restarted the

limitations period. Id. We rejected that argument because

those later events, although injurious, were not themselves

actionable. Id. For example, holding a hearing in a

proceeding that had already begun “was not a separately

unconstitutional act.” Id. The cases on which SRP relies are

similar: They involved challenges not to new wrongful acts,

but rather to the inevitable—and not independently

unlawful—consequences of the operative, time-barred

decision. See Knox v. Davis, 260 F.3d 1009, 1013 (9th Cir.

2001) (holding that subsequent denials of client visits based

on the permanent suspension of attorney’s visitation rights

did not restart the limitations period); Pace Indus., Inc. v.

Three Phoenix Co., 813 F.2d 234, 239 (9th Cir. 1987)

(holding that each phase of a single enforcement action does

not give rise to new, actionable overt acts).

Our analysis of the limitations issue here parallels that of

courts in Title VII cases. See Cherosky v. Henderson,

330 F.3d 1243, 1246 n.3 (9th Cir. 2003) (explaining that

precedent governing the Title VII statute of limitations

“applies with equal force . . . to actions arising under”

section 1983); RK Ventures, 307 F.3d at 1059. In Bazemore

v. Friday, 478 U.S. 385 (1986), for example, the Supreme

Court held that each paycheck issued under a racially

discriminatory pay structure is an independent violation of

Title VII that supports an independent claim and starts the

running of the limitations period for that claim. Id. at 395–

18 ELLIS V. SALT RIVER PROJECT

96 (Brennan, J., joined by all other Members of the Court,

concurring in part). As the Court later explained, an

employer “can surely be regarded as intending to

discriminate on the basis of race as long as the [facially

discriminatory] structure is used,” so “the employer

engage[d] in intentional discrimination whenever it issue[d]

a check to one of these disfavored employees.” Ledbetter v.

Goodyear Tire & Rubber Co., Inc., 550 U.S. 618, 634

(2007), superseded by statute, Lilly Ledbetter Fair Pay Act

of 2009, Pub. L. No. 111-2, 123 Stat. 5.

Applying that principle to the facts of this case requires

us to distinguish among the individual named plaintiffs,

whose circumstances vary somewhat. Ellis’s claim is that the

difference in rates between solar customers and other

customers violates the Equal Protection Clause; on that

theory, it is charging the rates—not merely announcing

them—that constitutes the constitutional violation. Thus, the

dates on which customers were charged rates under the plan

are significant in determining the timeliness of their claims.

Ellis, Dill, and Gustavis all sued within two years of first

being charged under the E-27 price plan, so their claims are

timely as to all charges incurred. Rupprecht, however, did

not sue within two years of becoming subject to the E-27

plan, but he was charged under it within the limitations

period. His claims, therefore, are timely only as to charges

incurred within two years of suing.

Ellis suggests that all of the named plaintiffs’ claims are

timely because SRP’s conduct constituted a “continuing

violation.” As we have explained in prior cases, however,

that term can be somewhat misleading. What Ellis alleges is

not “one on-going violation,” but instead “a series of

repeated violations,” each of which “gives rise to a new

cause of action” and thereby “begins a new statute of

ELLIS V. SALT RIVER PROJECT 19

limitations period as to that particular event.” Flynt, 940 F.3d

at 462 n.3 (quoting Knight v. Columbus, 19 F.3d 579, 582

(11th Cir. 1994)). In the past, we recognized a broader

“continuing violations doctrine” under which a plaintiff

alleging a series of related acts, some of which occurred

within the limitations period, could recover for all of the acts,

including those that occurred before the limitations period.

See Cherosky, 330 F.3d at 1246. But the Supreme Court

largely eliminated that doctrine when it held in National

Railroad Passenger Corp. v. Morgan, 536 U.S. 101 (2002),

that “discrete discriminatory acts are not actionable if time

barred, even when they are related to acts alleged in timely

filed charges.” Id. at 113; see Bird v. Department of Hum.

Servs., 935 F.3d 738, 746–48 (9th Cir. 2019). Where, as

here, a plaintiff alleges “claims based on discrete acts,” the

claims “are only timely where such acts occurred within the

limitations period.” Cherosky, 330 F.3d at 1246.

We emphasize that it remains disputed whether the bills

issued to Ellis are in fact unlawful. SRP urges us to affirm

the dismissal of the equal protection claim on the alternative

ground that the distinctions drawn by the E-27 plan are

supported by a rational basis and are therefore permissible.

But the district court did not address that theory, and we

decline to do so in the first instance. Instead, we leave it to

the district court to consider on remand.

IV

That leaves the federal antitrust claims. Ellis asserts

claims for monopolization and attempted monopolization in

violation of the Sherman Act, 15 U.S.C. § 2. The district

court dismissed those claims for failure to allege antitrust

injury. Along the way, the district court also concluded that

the filed-rate doctrine and state-action immunity do not bar

Ellis’s claims and that the Local Government Antitrust Act

20 ELLIS V. SALT RIVER PROJECT

shields SRP from federal antitrust damages. We reverse the

district court’s holding on antitrust injury and affirm its other

rulings.

A

A private antitrust plaintiff “must prove the existence of

‘antitrust injury, which is to say injury of the type the

antitrust laws were intended to prevent and that flows from

that which makes defendants’ acts unlawful.’” Atlantic

Richfield Co. v. USA Petroleum Co., 495 U.S. 328, 334

(1990) (quoting Brunswick Corp. v. Pueblo Bowl-O-Mat,

Inc., 429 U.S. 477, 489 (1977)). We have identified “four

requirements for antitrust injury: (1) unlawful conduct, (2)

causing an injury to the plaintiff, (3) that flows from that

which makes the conduct unlawful, and (4) that is of the type

the antitrust laws were intended to prevent.” American Ad

Mgmt., Inc. v. General Tel. Co. of Cal., 190 F.3d 1051, 1055

(9th Cir. 1999).

The district court believed that Ellis did not adequately

allege antitrust injury. In its view, the E-27 price plan

actually “encourages competition in alternative energy

investment by allowing for new market entrants with its

higher prices.” Emphasizing that “solar energy systems are

still uneconomical,” the district court concluded that SRP’s

“alleged anticompetitive conduct . . . did not cause [Ellis’s]

injury because [he] would have been harmed anyway from

using an uneconomical product.”

The district court’s findings that SRP’s price plan

promotes competition and that Ellis cannot establish

causation are inconsistent with its uncontested conclusion

that Ellis adequately alleged exclusionary conduct designed

“to (1) deter the competitive threat of solar energy systems;

(2) penalize solar energy investments to fortify [SRP’s]

ELLIS V. SALT RIVER PROJECT 21

monopoly; (3) and force consumers to exclusively purchase

electricity from [SRP] by making solar energy system

installation uneconomical.” By the district court’s own logic,

solar-energy systems are uneconomical, at least in part,

because of SRP’s exclusionary conduct.

On appeal, SRP does not attempt to defend the district

court’s reasoning. Instead, it argues that Ellis has not

adequately alleged antitrust injury because he paid the higher

rate before SRP could succeed in fully displacing

competition. SRP also contends that Ellis cannot claim to

have been injured by exclusionary conduct because he has

attempted to use the market alternative that he claims SRP

tried to make uneconomical.

Both of those theories are flawed because “[c]oercive

activity that prevents its victims from making free choices

between market alternatives” gives rise to antitrust injury.

Glen Holly Entm’t, Inc. v. Tektronix, Inc., 352 F.3d 367, 374

(9th Cir. 2003) (quoting Amarel v. Connell, 102 F.3d 1494,

1509 (9th Cir. 1996)). To adequately plead antitrust injury,

a plaintiff need not allege that the exclusionary conduct has

succeeded in displacing all competition. See id. at 376; cf.

Brunswick, 429 U.S. at 489 n.14 (“[C]ompetitors may be

able to prove antitrust injury before they actually are driven

from the market and competition is thereby lessened.”).

Rather, the plaintiff need only “show that diminished

consumer choices and increased prices are the result of a less

competitive market due to either artificial restraints or

predatory and exclusionary conduct.” FTC v. Qualcomm,

Inc., 969 F.3d 974, 990 (9th Cir. 2020). That is precisely

what Ellis alleges: He was “directly and economically hurt

by” SRP’s exclusionary pricing scheme, which is aimed at

suppressing competition by discouraging customers from

installing solar-energy systems. Glen Holly, 352 F.3d at 376.

22 ELLIS V. SALT RIVER PROJECT

Ellis’s injury was caused by a scheme “inten[ded] to harm

competition by increasing prices,” and his injury “flows

from that which makes [the conduct] unlawful.” American

Ad Mgmt., 190 F.3d at 1056.

The Supreme Court’s decision in Blue Shield of Virginia

v. McCready, 457 U.S. 465 (1982), is instructive. That case

involved a challenge to “a group health plan’s practice of

refusing to reimburse subscribers for psychotherapy

performed by psychologists, while providing reimbursement

for comparable treatment by psychiatrists,” in order to

“restrain competition in the psychotherapy market.” Id.

at 467. The plaintiff, McCready, “did not yield” to that

“coercive pressure” and paid out-of-pocket for treatment

from a psychologist. Id. at 483. Much like SRP, Blue Shield

argued that McCready could not establish antitrust injury

because her injury was not a direct consequence of “the

competitive advantage” that Blue Shield bestowed on

psychiatrists, and she did not “claim that her psychologists’

bills [were] higher than they would have been had the

conspiracy not existed.” Id. at 481. The Supreme Court

rejected that argument because McCready’s injury was

“inextricably intertwined with the injury the conspirators

sought to inflict on psychologists and the psychotherapy

market.” Id. at 484. The Court therefore held that the injury

“‘flows from that which makes defendants’ acts unlawful’

within the meaning of Brunswick.” Id.

So too here. The increased prices that SRP imposed on

solar customers are “inextricably intertwined with”—indeed

they are the means of—SRP’s allegedly unlawful scheme to

reduce solar-energy competition. McCready, 457 U.S.

at 484. SRP cannot escape liability by portraying Ellis’s

injury as mere collateral damage of its exclusionary conduct.

Ellis alleges “a purposefully anticompetitive scheme” and

ELLIS V. SALT RIVER PROJECT 23

“seeks to recover as damages the sums lost to [him] as the

consequence of [SRP’s] attempt to pursue that scheme.” Id.

at 483 (emphasis omitted). He adequately alleges antitrust

injury.

B

SRP asserts several common-law and statutory defenses.

We begin with the filed-rate doctrine, which “is a judicially

created rule that prohibits individuals from asserting civil

antitrust challenges to an entity’s agency-approved rates.”

Wortman v. All Nippon Airways, 854 F.3d 606, 610 (9th Cir.

2017). The filed-rate doctrine can bar federal antitrust claims

based on rates approved by state agencies. Knevelbaard

Dairies v. Kraft Foods, Inc., 232 F.3d 979, 992 (9th Cir.

2000); see also Wegoland Ltd. v. NYNEX Corp., 27 F.3d 17,

20 (2d Cir. 1994) (“[C]ourts have uniformly held . . . that the

rationales underlying the filed rate doctrine apply equally

strongly to regulation by state agencies.”).

The problem for SRP, however, is that it does not file its

rates with anyone other than itself. SRP’s board of directors

sets rates unilaterally; unlike other Arizona utilities, SRP is

not regulated by the Arizona Corporation Commission.

While it is true that “[w]e have previously applied the filed

rate doctrine to circumstances in which the relevant rates

were not literally filed,” we have nevertheless required that

some agency—not merely the entity charging the rates—

“engage[] in sufficient regulation through other means to

satisfy the purposes of the doctrine.” Wortman, 854 F.3d

at 614. But no agency regulates SRP.

SRP focuses on the fact that its unilateral ratemaking

authority, granted to it by the State, allows it to set rates that

are “just and reasonable,” Ariz. Rev. Stat. Ann. § 30-

805(A)(1); see id. §§ 48-2334, 30-802. In this respect, SRP

24 ELLIS V. SALT RIVER PROJECT

argues, its authority is comparable to that of the Federal

Energy Regulatory Commission, which has authority to

ensure that rates for the sale of electricity and natural gas

within its jurisdiction are just and reasonable. See 15 U.S.C.

§ 717c (natural gas); 16 U.S.C. § 824d (electricity). Rates

approved by the Commission are subject to the filed-rate

doctrine. See Entergy La., Inc. v. Louisiana Pub. Serv.

Comm’n, 539 U.S. 39, 47 (2003); Arkansas La. Gas Co. v.

Hall, 453 U.S. 571, 577 (1981). But SRP’s analogy is flawed

because FERC regulates the rates charged by market

participants, while SRP is a market participant itself, and as

we have explained, no agency regulator is tasked with

ensuring that SRP follows Arizona’s statutory directive.

The filed-rate doctrine presumes at least some degree of

independent oversight: It applies only so long as an agency

“continues to engage in regulatory activity and has not

effectively abdicated its rate-making authority.” E. & J.

Gallo Winery v. EnCana Corp., 503 F.3d 1027, 1040 (9th

Cir. 2007) (internal quotation marks omitted). For example,

although the doctrine applies to FERC-authorized market-

based rates—which are not literally “filed” with FERC—

that is because FERC grants market-based-rate authorization

only after reviewing the market and determining it to be

competitive, and FERC retains authority to exercise

“ongoing oversight of the market.” Id. at 1042.

We have never extended the filed-rate doctrine to

unilateral, unsupervised rate-setting by a market participant.

In that context, there is no reason to presume that “rates are

just and reasonable as a matter of law” and should be

immune from collateral challenge. E. & J. Gallo Winery,

503 F.3d at 1040. We decline to extend the doctrine here.

ELLIS V. SALT RIVER PROJECT 25

C

We also reject SRP’s claim that it is entitled to state-

action immunity. The doctrine of state-action immunity

recognizes that “‘nothing in the language of the Sherman Act

or in its history’ suggested that Congress intended to restrict

the sovereign capacity of the States to regulate their

economies,” so “the Act should not be read to bar States

from imposing market restraints ‘as an act of government.’”

FTC v. Phoebe Putney Health Sys., Inc., 568 U.S. 216, 224

(2013) (quoting Parker v. Brown, 317 U.S. 341, 350, 352

(1943)). The doctrine is “disfavored,” however, and applies

“only when it is clear that the challenged anticompetitive

conduct is undertaken pursuant to a regulatory scheme that

‘is the State’s own.’” Id. at 225 (first quoting FTC v. Ticor

Title Ins. Co., 504 U.S. 621, 636 (1992); and then quoting id.

at 635). Where, as here, the “allegedly anticompetitive

conduct [is] undertaken by a substate governmental entity,”

then immunity applies only if the challenged conduct is

“undertaken pursuant to a ‘clearly articulated and

affirmatively expressed’ state policy to displace

competition.” Id. at 225–26 (quoting Community Commc’ns

Co. v. Boulder, 455 U.S. 40, 52 (1982)). “[T]he ultimate

requirement [is] that the State must have affirmatively

contemplated the displacement of competition such that the

challenged anticompetitive effects can be attributed to the

‘state itself.’” Id. at 229 (quoting Parker, 317 U.S. at 352);

accord Chamber of Com. of the U.S. v. City of Seattle,

890 F.3d 769, 781 (9th Cir. 2018).

State-action immunity is inapplicable here because the

State of Arizona has not articulated a “policy to displace

competition.” Phoebe Putney, 568 U.S. at 226. To the

contrary, the district court correctly observed that Arizona’s

“statutes signal a shift by [the] legislature to promote

26 ELLIS V. SALT RIVER PROJECT

competition in the retail electricity market,” not to curtail it.

For example, Arizona has declared “that the most effective

manner of establishing just and reasonable rates for

electricity is to permit electric generation service prices to be

established in a competitive market.” Ariz. Rev. Stat. Ann.

§ 40-202(D). The State requires public power entities to

“open their entire service territories to competition to

electricity suppliers certificated by the [Arizona Corporation

Commission],” id. § 30-803(A), and prohibits them from

charging their competitors discriminatory rates to use their

facilities, id. § 30-805(E). It requires public power entities to

“adopt a code of conduct to prevent anticompetitive

activities,” id. § 30-803(F), and to establish “terms and

conditions for competition in the retail sale of electric

generation service,” id. § 30-802(B)(1)(a). It prohibits

public power entities from calculating rates so as to offset

“[a]ny reduction in electricity purchases . . . resulting from

self-generation.” Id. § 30-805(D). And it subjects providers

of “competitive electric generation service” to its antitrust

laws. Id. § 30-813. As SRP concedes, this statutory

framework expresses a general policy favoring competition.

Nevertheless, SRP claims that the displacement of

competition is a natural consequence of its authority to set

“just and reasonable” rates. But “state-law authority to act is

insufficient to establish state-action immunity; the substate

governmental entity must also show that it has been

delegated authority to act or regulate anticompetitively.”

Phoebe Putney, 568 U.S. at 228, 234. SRP responds that

rate-setting is “inherently anticompetitive.” Arizona

specified just the opposite, however, when it declared “that

the most effective manner of establishing just and reasonable

rates for electricity” is not for SRP to set them

anticompetitively but instead for them “to be established in

a competitive market.” Ariz. Rev. Stat. Ann. § 40-202(D).

ELLIS V. SALT RIVER PROJECT 27

SRP further argues that despite section 30-803(A)’s call

for public power entities to “open their entire service

territories to competition,” the Arizona Corporation

Commission has yet to certify any competitors, suggesting

that Arizona left it to the regulator’s discretion whether to

allow competition and the regulator simply decided not to do

so. Cf. California CNG, Inc. v. Southern Cal. Gas Co.,

96 F.3d 1193, 1197, 1200 (9th Cir. 1996). But Arizona did

not leave it to the Commission to determine “the need for

th[e] market to develop into a competitive one.” Id. at 1197.

It provided that power entities “shall open their entire

service territories to competition.” Ariz. Rev. Stat. Ann.

§ 30-803(A) (emphasis added). The Commission is merely

tasked with certifying prospective suppliers. Id. Even if

“[t]he sort of competition [Arizona law] envisions has yet to

emerge on the scale the legislature hoped,” Arizona has

clearly “expresse[d] a policy preference for competition in

electricity generation and supply.” Kay Elec. Coop. v. City

of Newkirk, 647 F.3d 1039, 1045 (10th Cir. 2011) (Gorsuch,

J.). That state policy prevents SRP from invoking state-

action immunity.

D

Finally, we consider whether the Local Government

Antitrust Act shields SRP from antitrust damages. The

LGAA precludes the recovery of antitrust damages “from

any local government, or official or employee thereof acting

in an official capacity.” 15 U.S.C. § 35(a). A “local

government” includes “a school district, sanitary district, or

any other special function governmental unit established by

State law in one or more States.” Id. § 34(1)(B) (emphasis

added). SRP was established by Arizona law as an

“agricultural improvement district” and is “a public,

political, taxing subdivision of the state.” Ariz. Rev. Stat.

28 ELLIS V. SALT RIVER PROJECT

Ann. § 48-2302. As such, it is a “special function

governmental unit” that is exempt from antitrust damages.

15 U.S.C. § 34(1)(B).

In resisting this conclusion, Ellis relies exclusively on

the LGAA’s legislative history. First, he notes that electric

utilities are not listed in a committee report among other

“special purpose political subdivisions” including “planning

districts, water districts, sewer districts, irrigation districts,

drainage districts, road districts, and mosquito control

districts.” H.R. Rep. No. 98-965, at 19–20 (1984). But “[i]f

the text is clear, it needs no repetition in the legislative

history,” and therefore “silence in the legislative history . . .

cannot defeat the better reading of the text.” Encino

Motorcars, LLC v. Navarro, 138 S. Ct. 1134, 1143 (2018).

In any event, water utilities are referenced in the report, and

SRP provides both water and electric service.

Second, relying on the same report, Ellis contends that

Congress intended to prevent “payment of any antitrust

judgment . . . from the ‘general revenues,’ thus shifting the

burden . . . to the ‘innocent’ taxpayers,” and that no such

concern exists here. H.R. Rep. No. 98-965, at 11. Even if that

was the principal concern motivating the enactment of the

LGAA, the text does not limit the statute’s scope to contexts

in which that concern is present. “[S]tatutory prohibitions

often go beyond the principal evil to cover reasonably

comparable evils, and it is ultimately the provisions of our

laws rather than the principal concerns of our legislators by

which we are governed.” Oncale v. Sundowner Offshore

Servs., Inc., 523 U.S. 75, 79 (1998).

We conclude that the LGAA shields SRP from federal

antitrust damages. Because Ellis also seeks declaratory and

injunctive relief, and the LGAA does not bar those forms of

ELLIS V. SALT RIVER PROJECT 29

relief, we remand to the district court for further

proceedings.

The parties shall bear their own costs on appeal.

AFFIRMED in part, REVERSED in part, and

REMANDED.