Amicus Curiae Brief — City Gas Co. v. Consolidated Gas Co. of Florida

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No. 90-953 PRY cer

in the

Supreme Court

of the

United States

October Term, 1990

CITY GAS COMPANY OF FLORIDA,

Petitioner,

VS.

CONSOLIDATED GAS COMPANY OF FLORIDA,

INC.,

Respondent.

THE STATE OF FLORIDA AS AMICUS CURIAE

IN SUPPORT OF PETITION FOR A WRIT OF

CERTIORARI TO THE UNITED STATES COURT OF

APPEALS FOR THE ELEVENTH CIRCUIT

Robert A. Butterworth,

Attorney General,

Jerome W. Hoffman,

Assistant Attorney General,

Chief, Antitrust Division,

Patricia A. Conners, *

Assistant Attorney General

Office of Attorney General

The State of Florida

The Capitol

Tallahassee, FL 32399-1050

Telephone: (904) 488-9105

* Counsel of Record On

Behalf of Amicus State

TABLE OF CONTENTS

Page

TARR OE FRE ov tector cccesenes ii

PS hs od vn cob 60 oes ewd ita eee 1

INTEREST OF AMICUS STATE ............. 1

STATEMENT OF THE CASE ............... 2

ARGUMENT

ISSUE (RESTATED): IN REJECTING CITY

GAS’ STATE ACTION DEFENSE, THE

COURT OF APPEALS IN EFFECT

OVERRULED A HOLDING OF THE STATE

SUPREME COURT INTERPRETING A

FLORIDA STATUTE AND, IN DOING SO,

RULED CONTRARY TO THE

ESTABLISHED PRECEDENTS OF THIS

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TABLE OF AUTHORITIES

Cases Page(s)

Aero Mayflower Transit Co. v. Bd. of R.R.

Comm’ers,

SUMMMM CDOS) 2... .......2..0500.

Albertson v. Millard,

LE

California Retail Liquor Dealers Ass’n v. Midcal

Aluminum, Inc.,

445 US. 87 (1980) ................06.

City Gas Co. v. Peoples Gas Sys., Inc.,

oe

Consolidated Gas Company of Florida, Inc. v. City

Gas Co. of Fla.,

Sou F.20 297 (11th Cir. 1969) ...........

Cramp v. Bd. of Public Instruction,

Serre

Enterprise Irrigation Dist. v. Farmers Mut. Canal Co.,

ream ae7IMID) .........-........-

Gamer v. Louisiana,

Meee 057 (1961) ................00%

Griffin v. Wisconsin,

483 U.S. 868 (1987) ........... eee eee.

il

Hebert v. Louisiana,

ee ek Se ED 6 48 ba OCR Mee OOS

Hortonville Jr. School Dis. No. 1 v. Hortonville Ed.,

en Se ee SA es Sao e Nae

Kingsiey Int. Pic. Corp. v. Regents of N.Y.U.,

Pe ee I ook ka 0 o-0 0 0s aw ke

Landmark Communications, Inc. v. Virginia,

ee a EE os 85 oe dee won cee

Morehead v. People of New York ex rel. Tipaldo,

Ss SOE in honk oka S So eRe ees

NAACP v. Button,

oe Be re eer ere

O’Bnen v. Skinner,

og ek eee

Schad v. Borough of Mt. Ephraim,

Ge A ee ED ob ko 4s ba wkaeet ees eae

Supreme Lodge v. Meyer,

De Sth 8 6b wee ven veh oe hee

United States v. Burnison,

er

Winters v. New York,

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Statutes and Rules

15 U.S.C. § 2

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See hs Gass Was nek xR URES eee Rees

iv

No. 90-953

in the

Supreme Court

of the

United States

October Term, 1990

CITY GAS COMPANY OF FLORIDA,

Petitioner,

VS.

CONSOLIDATED GAS COMPANY OF FLORIDA,

INC.,

Respondent.

THE STATE OF FLORIDA AS AMICUS CURIAE

IN SUPPORT OF PETITION FOR A WRIT OF

CERTIORARI TO THE UNITED STATES COURT OF

APPEALS FOR THE ELEVENTH CIRCUIT

INTRODUCTION

The State of Florida files this amicus brief in

support of Petitioner City Gas Company of Florida’s ("City

Gas") Petition for Writ of Certiorari.

INTEREST OF AMICUS STATE

By essentially overruling the Supreme Court of

Florida’s interpretation of a state statute, the Eleventh

Circuit’s decision below raises an issue of grave concern to

1

the State of Florida. That issue, upon which resolution of

many of the other issues in this case rests, is whether a

federal appellate court may ignore a state supreme court’s

interpretation of a state statute and conduct its own

independent review of that statute’s applicability. This

Court on countless occasions has ruled that the meaning

given a state statute by a state’s highest court must be

accepted by federal courts, whether or not those courts

agree with the state court’s interpretation. Yet, by its

decision below the Eleventh Circuit has seen fit to

undermine established United States Supreme Court

precedents and disregard the principles of federalism upon

which those precedents were founded. To allow such a

contrary holding is to deny the State of Florida its

sovereignty.

Accordingly, the State of Florida submits this

amicus brief in support of the Petition for Writ of

Certiorari filed with this Court by the Petitioner City Gas

and urges this Court to accept certiorari review in this case

so that the State of Florida as well as all states may be

assured that the established principles of federalism

remain intact.

STATEMENT OF THE CASE

For purposes of this amicus brief, the State of

Florida adopts the statement of the case set forth by

Petitioner City Gas at pages 2 through 6 of its Petition for

Writ of Certiorari.

ISSUE (RESTATED): IN REJECTING

CITY GAS’ STATE ACTION DEFENSE,

THE COURT OF APPEALS IN EFFECT

OVERRULED A HOLDING OF THE

STATE SUPREME COURT

INTERPRETING A FLORIDA STATUTE

AND, IN DOING SO, RULED

CONTRARY TO THE ESTABLISHED

PRECEDENTS OF THIS COURT.

In concluding that City Gas had violated Section 2

of the Sherman Act, 15 U.S.C. § 2, the Eleventh Circuit

found, inter alia, that the 1960 territorial agreement

between City Gas and Peoples Gas System was not

entitled to state action immunity because of the absence

of a clearly articulated state policy, thus failing to meet the

first prong of the state action test set forth in California

Retail Liquor Dealers Ass’n v. Midcal Aluminum, Inc., 445

U.S. 87 (1980).

In reaching that conclusion, the Eleventh Circuit

acknowledged that the Supreme Court of Florida had

validated the precise territorial agreement at issue here in

a 1965 opinion wherein the Court found that the

predecessor to the Public Service Commission had the

implied authority under the state’s public utilities

regulatory act, Ch. 366, Fla. Stat., to approve territorial

agreements between natural gas utilities, City Gas Co. v.

Peoples Gas Sys., Inc., 182 So.2d 429 (Fla. 1965). Despite

the state supreme court’s holding, the Court of Appeals

below concluded that the decision was not controlling for

purposes of the Eleventh Circuit’s analysis under the

federal antitrust laws. Consolidated Gas Company of

Florida, Inc. v. City Gas Co. of Fla., 880 F.2d 297, 303

(11th Cir. 1989). The Court then went on to conduct an

independent review of Ch. 366, Fla. Stat., to determine for

3

itself whether the Florida Public Service Commission had

the authority to approve territorial agreements between

natural gas companies and, thus, whether such agreements

were part of a clearly articulated state policy to displace

competition.

Through its independent review, the Court of

Appeals found that because Ch. 366, Fla. Stat., did not

expressly convey upon thé Public Service Commission the

authority to approve territorial agreements between

natural gas companies, the Florida legislature had not

intended natural gas utilities to enjoy such exclusive

territorial agreements, despite the Supreme Court of

Florida’s conclusion to the contrary. 880 F.2d at 302.

This holding by the Court of Appeals is plainly at

odds with years of established precedent from this Court.

While the Eleveith Circuit was correct in stating that the

issue of "clear articulation" under Midcal was "ultimately

a question of federal antitrust law," 880 F.2d at 303, it

does not follow that, in applying the Midcal test to the

facts before it, a Court of Appeals may blatantly ignore a

state supreme court’s interpretation of a state statute and

then interpret the state statute to the contrary.

The deference to be given by the federal courts to

a state supreme court’s interpretation of a state statute is

likewise a legal principle well established in federal law.

This Court has ruled countless times that federal courts

must not construe state statutes contrary to the

construction given them by the highest court of a state.’

Yet, that is precisely what the Eleventh Circuit did below

when it in essence overruled the holding in City Gas Co.

v. Peoples Gas Sys., Inc.

The Supreme Court of Florida’s exact ruling in that

case as it pertained to the specific territorial agreement at

issue here was that Florida Public Service Commission,

then known as the Florida Public Utilities Commission,

"has adequate implied authority under Ch. 366, Fla. Stat.

to validate such agreements as the one before it." 182

So.2d at 436. Such a forthright statement can be

reasonably construed only one way. As Petitioner City

Gas states in its Petition for Writ of Certiorari, in holding

as it did, the Supreme Court of Florida "put[] these words

in the statute as definitely as if it had been so amended by

the legislature." [City Gas Petition at 17, citing Winters v.

New York, 333 U.S. 507, 514 (1948)]. Because the

Eleventh Circuit’s opinion is clearly at odds with at least

a century of U.S. Supreme Court decisions as well as the

numerous circuit courts of appeals opinions which, as

'See, e.g., Griffin v. Wisconsin, 483 U.S. 868, 875 (1987); Schad

v. Borough of Mt. Ephraim, 452 U.S. 61, 65 (1981); Landmark

Communications, Inc. v. Virginia, 435 U.S. 829, 837 n.9 (1978);

Hortonville Jr. School Dis. No. 1 v. Hortonville Ed., 426 U.S. 482,

488 (19/6); O'Brien v. Skinner, 414 U.S. 524, 531 (1974); NAACP v.

Button, 371 U.S. 415, 432 (1963); Cramp v. Bd. of Public Instruction,

368 U.S. 278, 285 (1961); Garner v. Louisiana, 368 U.S. 157, 166

(1961); Kingsley Int. Pic. Corp. v. Regents of N.Y.U., 360 U.S. 684,

688 (1959); Albertson v. Millard, 345 U.S. 242, 244 (1953); United

States v. Burnison, 339 U.S. 87, 90 (1950); Aero Mayflower Transit

Co. v. Bd. of R.R. Comm’ers, 332 US. 495, 499-500 (1947);

Morehead v. People of New York ex rel. Tipaldo, 298 U.S. 587, 609

(1936); Hebert v. Louisiana, 272 U.S. 312, 316-17 (1926); Supreme

Lodge v. Meyer, 265 U.S. 30, 32 (1924); Enterprise Irrigation Dist. v.

Farmers Mut. Canal Co., 243 U.S. 157, 166 (1916).

5

petitioner notes, have addressed this issue in the context

of the state action doctrine (see note 17 of City Gas

Petition at 17), the State of Florida urges this Court to

grant certiorari in this case so that the State of Florida, as

well as all states, may be assured that the principles of

federalism and state sovereignty remain whole.

CONCLUSION |

Based on the foregoing, the State of Florida

submits that this Court should grant Petitioner City Gas’

Petition for Writ of Certiorari.

Dated: January 15, 1991

Respectfully submitted,

Robert A. Butterworth

Attorney General

Jerome W. Hoffman

Assistant Attorney General

Chief, Antitrust Division

Patricia A. Conners*

Assistant Attorney General

Office of Attorney General

The State of Florida

The Capitol

Tallahassee, FL 32399-1050

Telephone: (904) 488-9105

* Counsel of Record On

Behalf of Amicus State