# SEN. CIT. CLUBS OF WINSTON-SALEM, ETC. v. Duke Power Co. > District Court, W.D. North Carolina · October 5, 1976 · 425 F. Supp. 411 URL: https://www.frixlaw.com/law-library/cases/9644782 ## Case - **Full name:** SENIOR CITIZENS CLUBS OF WINSTON-SALEM, NORTH CAROLINA, Et Al., Plaintiffs, v. DUKE POWER COMPANY Et Al., Defendants - **Court:** District Court, W.D. North Carolina - **Decided:** October 5, 1976 - **Citations:** 425 F. Supp. 411; 1976 U.S. Dist. LEXIS 12893; 1975 WL 350895 - **Precedential status:** Published - **Opinion:** Concurrence by McMILLAN - **Judges:** Haynsworth, McMillan, Ward - **Cited by:** 3 later opinions in the Frix Law Library ## Citator (automated) - No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases. - Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9644782 ## Opinion text McMILLAN, District Judge, concurring in result only: State action, I believe, is involved. On this question I agree with the reasoning of Holt v. Yonce, 370 F.Supp. 374 (Three-Judge Court, District of South Carolina 1973), affirmed without opinion 415 U.S. 969 , 94 S.Ct. 1553 , 39 L.Ed.2d 867 (1974), which held (page 376) that a South Carolina power company, in setting temporary power rates under a similar statute, “clearly acted under color of state law, and the rights contended to be infringed are among those secured by the Constitution . . . ” and that a suit like this one is validly constituted under 42 U.S.C. § 1983 . Sellers v. Iowa Power and Light Co., 372 F.Supp. 1169 (S.D.Iowa 1974); cf. North Carolina ex rel. Utilities Commission v. Virginia Electric and Power Company, 285 N.C. 398 , 206 S.E.2d 283 (1974). The majority rejects the “state action” holding of Holt but cites its “due process” holding as a controlling precedent because of the Supreme Court’s summary affirmance. If Holt controls anything, it should control the state action issue as well as the due process issue. It seems more likely, however, that the true stature of the Holt case is that described by Chief Justice Burger, concurring, in Fusari v. Steinberg, 419 U.S. 379, 391 , 95 S.Ct. 533, 541 , 42 L.Ed.2d 521 (1975): “. . . When we summarily affirm, without opinion, the judgment of a three-judge District Court we affirm the judgment but not necessarily the reasoning by which it was reached. An unexplicated summary affirmance settles the issues for the parties, and is not to be read as a renunciation by this Court of doctrines previously announced in our opinions after full argument. Indeed, upon fuller consideration of an issue under plenary review, the Court has not hesitated to discard a rule which a line of summary affirmances may appear to have established. E.q., Edelman v. Jordan, supra, 415 U.S. [651] at 671 [ 94 S.Ct. 1347 at 1359 , 39 L.Ed.2d 662 ]; Sniadach v. Family Finance Corp., 395 U.S. 337, 343-344 [ 89 S.Ct. 1820, 1823 , 23 L.Ed.2d 349 ] (Harlan, J., concurring); id., at 350 [ 89 S.Ct. 1820 at 1827 ] (Black, J., dissenting); Reynolds v. Sims, 377 U.S. 533, 614 [ 84 S.Ct. 1362, 1408 , 12 L.Ed.2d 506 ] (1964) (Harlan, J., dissenting).” (Emphasis added.) (Footnote omitted.) Jackson v. Metropolitan Edison Company, 419 U.S. 345 , 95 S.Ct. 449 , 42 L.Ed.2d 477 (1974), does not require a different view. In Jackson the Supreme Court decided only that state action was not involved when the power company cut off electric service for nonpayment of a bill, under the authority of a tariff filed with, but not formally considered and approved by, the regulatory agency. The Court went to great lengths to point out that whether state action is present must be determined not by simple definition of the entity involved, but by analysis of the particular conduct under challenge; “detailed inquiry may be required in order to determine” whether the utility is doing the state’s work. Jackson also relied upon the lack of proof that the Pennsylvania Public Utilities Commission had ever approved or even formally considered the tariff authorizing utilities to cut off power, and upon the fact that the state took no part in cutting off power and had specified no procedures which had to be followed to do it. *416 Jackson is a far cry from this case. Rate making in North Carolina as opposed to circuit breaking in Pennsylvania is totally controlled by statute and regulation. Moreover, shutting off service for nonpayment of bills by defaulting customers has strong equity in its favor. By contrast, the plaintiffs in this case are in default on nothing, and making utility rates is a process in which the Commission is required by statute to be deeply involved. Rate making is judicial in nature, controversial in public aspect, and technical in detail. Because Jackson does not require, and the Supreme Court should not rule, that rate making is not state action, I would face and decide the due process question on its merits. Next, I would find that, although their individual rights are small in dollars, plaintiffs as low income customers have a property right deserving of protection which triggers off due process requirements, and that these rights are of constitutional stature equal to the more imposing demands of future users for power. Holt v. Yonce, supra; cf. Goldberg v. Kelly, 397 U.S. 254 , 90 S.Ct. 1011 , 25 L.Ed.2d 287 (1970). Compare North Georgia Finishing Inc. v. DiChem, Inc., 419 U.S. 601 , 95 S.Ct. 719 , 42 L.Ed.2d 751 (1975) with Mitchell v. W. T. Grant Co., 416 U.S. 600 , 94 S.Ct. 1895 , 40 L.Ed.2d 406 (1974) and Fuentes v. Shevin, 407 U.S. 67 , 92 S.Ct. 1983 , 32 L.Ed.2d 556 (1972) and Sniadach v. Family Finance Corp., 395 U.S. 337 , 89 S.Ct. 1820 , 23 L.Ed.2d 349 (1969). As to due process itself, the statutory scheme does not pass muster. The setting of. higher power rates, temporary or otherwise, without notice or opportunity to be heard, which the statute authorizes, is not due process of law. With all due respect, I would not subordinate the present rights of present customers to the theoretical rights of future customers whose identity and rights are not yet known. The provisions for bond and refund are cold comfort to those whose property has thus been appropriated, Fuentes v. Shevin, 407 U.S. 67, 82 , 92 S.Ct. 1983 , 32 L.Ed.2d 556 (1972). I would hold that the statutory scheme, as of the time this suit was filed, does not provide due process of law. Nevertheless, since, and possibly because, this suit was filed, the 1975 North Carolina General Assembly has passed laws (1975 Session Laws Chapters 45,184, 243, 510 and 867), which, among other things: (a) enlarge the Utilities Commission from five to seven members; (b) authorize rate hearings and final decisions by panels of three instead of by the full commission; (c) eliminate the time-consuming “future test” period; (d) authorize the Commission to suspend decision on a rate request indefinitely until the utility has filed all information needed for a decision; (e) allow the Commission to accelerate arguments, dispense with briefs, and decide on the record and the oral arguments. These changes, now implemented, have equipped the Commission to do its job in timely fashion; and because of these changes it is unlikely that rate increases in the future will take place without action of the Utilities Commission. Because, therefore, of the de facto mootness of the issue, though unable to share the majority’s views of the law, I concur in the result. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9644782. Public record. Not legal advice.