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IN THE COURT OF COMMON PLEAS
DELAWARE COUNTY, OHIO
SUBURBAN NATURAL GAS COMPANY
Plaintiff Case No. 17-CVH-100585
¥. Judge Everett H. Krueger
COLUMBIA GAS OF OHIO, INC.,
Defendant.
PLAINTIFF’S MEMORANDUM IN OPPOSITION TO MOTION TO DISMISS
Stephen D. Martin (0010851)
MANOS, MARTIN & PERGRAM CO, LPA
50 North Sandusky Street
Delaware, Ohio 43015
740.362.1313
740.362.3288 (fax)
smartin@mmpdlaw.com
Mark A. Whitt (0067996)
WHITT STURTEVANT LLP
KeyBank Building
88 E. Broad St., Suite 1590
Columbus, Ohio 43215
614.224.3911
whitt@whitt-sturtevant.com
30:
Attorneys for Plaintiff
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November 22, 2017TABLE OF CONTENTS
T. INTRODUCTION .....eecesescessesssesseessessuessvessressessuesssessscssessnessuessnessscenecasesscsnsesecsnecsueessenssecsnenss 3
TI. FACTS wivsseeessssecssssesseecsssessssecsssecssneesssscenscssssessasesssscessscessscsssvessssesssseesseessecesssesesesesssessnsssseesses 6
TIL. ARGUMENT ..v...sscsssscssesssssscsssecsssesssssessusesssesssvesssseessnecssnscssssessvesssssesssecssavessuresseesssnesesnessanentse 8
A. Columbia’s jurisdictional arguments fail the Allstate test. ......csssssceseeeseesesesseeeeseesesseese 9
1. PUCO administrative expertise is not necessary. 9
2. Utility interconnections are not a practice normally authorized by Columbia............. 12
B. R.C. 4903.12 does not prevent this Court’s exercise of jurisdiction. .........scsseseceeseeee 13
C. The Court does not need to address rate or service Matters.........ceeseseseeseesseeeneeeeeeee 15
D. The PUCO lacks authority to grant an adequate remedy...........eeeceeseeseeseeseeesseeseeneeneenees 16
E. Columbia’s request for sanctions is unwarranted. ...........0.cessessesseesseestesseesseessesseentesneess 18
IV. CONCLUSION...I. INTRODUCTION
Columbia Gas of Ohio, Inc. signed an agreement giving Suburban Natural Gas Company
the right to interconnect to the Northern Loop pipeline. Columbia argues that this Court has no
jurisdiction to “review, interpret, and enforce” this agreement and, moreover, lacks the
“administrative expertise” necessary to do so. Left unsaid by Columbia is what exactly the
PUCO would or could do if Suburban had filed its case there. The PUCO “has no power to
determine legal rights and liabilities with regard to contract rights or property rights, even though
a public utility is involved.” Mktg. Research Servs., Inc. v. Pub. Util. Comm., 34 Ohio St. 3d 52,
56 (1987). The agreement manifestly creates a contractual right. This Court has authority to
declare and enforce this right. The PUCO does not.
The Ohio Supreme Court has instructed lower courts to apply a two-part test to resolve
jurisdictional challenges. “First, is PUCO's administrative expertise required to resolve the issue
in dispute? Second, does the act complained of constitute a practice normally authorized by the
utility?” Allstate Ins. Co. v. Cleveland Elec. Ilum. Co., 119 Ohio St. 33d 301, 303-04, 2008-
Ohio-3917, 12 (2008). “If the answer to either question is in the negative, the claim is not
within PUCO's exclusive jurisdiction.” Id. § 13. See also DiFranco v. FirstEnergy Corp., 134
Ohio St. 3d 144, 150, 2012-Ohio-5445, ¥ 28 (“If the answer to either question is “No,” the claim
is not within the PUCO's exclusive jurisdiction.”)
Here, the answer to both prongs of Allstate is negative. The PUCO’s administrative
expertise is not required to resolve the issue in dispute—either legally or practically. And the
PUCO does not regulate, nor do Columbia’s tariffs address, pipeline interconnections by other
gas distribution utilities. Columbia’s denial of Suburban’s interconnection request represents the
breach of a contractual duty, and bear no relation to any “practice normally authorized” byColumbia.
Columbia raised Allstate in its third argument, and that argument fails. Columbia raises
two additional arguments, and these also fail.
’ Columbia’s first argument—that a PUCO order “approving” the agreement conclusively
resolves jurisdiction because it includes language reserving continuing jurisdiction—can be
dismissed out of hand. Subject matter jurisdiction refers to.a court or agency’s power to hear and
decide a case on the merits. State ex rel. Jones v. Suster, 84 Ohio St. 3d 70, 75, 1998-Ohio-275.
The PUCO’s jurisdiction is statutory. Penn Cent. Transp. Co. v. Pub. Util. Comm., 35 Ohio St.
2d 97, syllabus (1973) (‘The [PUCO] is a creature of the General Assembly and may exercise no
jurisdiction beyond that conferred by statute.”). Even if the PUCO did have jurisdiction here (and
it does not), it would not be because the PUCO said so. The PUCO has no more authority to
conclusively resolve questions about its own jurisdiction than does this Court. Allstate, 2008-
Ohio-3917, {11(‘Trial courts determine their own jurisdiction. Their determinations, however,
can be challenged[.]”) (citation omitted). Moreover, anything the PUCO purported to say about
its own jurisdiction cannot diminish this Court’s jurisdiction.
Columbia’s second argument is actually a hodge-podge of several arguments, most of
which revolve around R.C. 4903.12—or at least Columbia’s version of this statute. Columbia
says that to address Suburban’s contractual right, this Court would necessarily have to “review,
interpret, and enforce” a PUCO order, which the statute prohibits. Motion at 1; Memorandum in
Support (Mem. Supp.) at 14, 17. But this is not what the statute says. R.C. 4903.12 uses the
terms “review, suspend, or delay” to describe the prohibited actions (emphasis added). Suburban
is not asking the Court to “suspend” or “delay” any PUCO order. Suburban merely seeks to settlea contractual right. A contractual right does not lose its character as such merely because the
right is mentioned in a PUCO settlement.
A critical flaw permeating all of Columbia’s arguments is its failure to distinguish terms
of the agreement that required PUCO approval from the terms that did not. The terms requiring
the exchange of customers and facilities, as well as the terms requiring the filing of new tariffs,
required PUCO approval under R.C. 4905.48 and R.C. 4909.18. These terms are discussed at
length in the approval order. See Motion, Ex. A, Order. The term reflecting Columbia’s
agreement to allow an interconnection to Northern Loop did not require approval, and the
approval order does not discuss this term at all. The latter term was included in the agreement
simply to confirm that “[{nJothing in this Stipulation shall be construed as preventing” Columbia
from building the Northern Loop pipeline. Jd., Stipulation, Sec. A J 10. Whatever ongoing
jurisdiction the PUCO has to police terms that required approval cannot extend to a term that did
not.
Suburban is not asking this Court to decide the “appropriate rate and service conditions”
for gas supplied through the Northern Loop pipeline. See Mem. Supp. at 14-15. Suburban seeks a
declaration that it is entitled to connect to this pipeline, and that Columbia is in breach by
refusing the connection. The “appropriate rate and service conditions” for the receipt of gas from
the interconnection is not an issue; no such service exists because Columbia will not allow
Suburban to interconnect. Only this Court, not the PUCO, has the authority to award substitute
performance for the interconnection; i.e., a declaratory judgment and damages.
This Court has subject matter jurisdiction over Suburban’s claims. Columbia’s motion to
dismiss should be denied. Denying Columbia’s motion will also resolve its claim for sanctions,
which is unsupported in any event.I. FACTS
Columbia’s fact statement says both too much and too little.! Below are the relevant
facts.
The agreement at issue is contained in a joint petition, application, and stipulation
executed in PUCO Case No. 93-1569-GA-SLF et al. (the “Stipulation”).? See Motion, Exhibit A,
Stipulation. In the years leading up to that proceeding, competition between Columbia and
Suburban resulted in a patchwork of overlapping, duplicative pipelines and facilities.? See id. at
2. The goal of the stipulation was not to end competition per se, but the “rationalization” of the
companies’ distribution systems. Jd. The parties agreed to exchange certain customers and
facilities, as well as modify their tariffs to eliminate discounts and other giveaways that
Columbia had been offering to lure customers away from Suburban. Jd., Section A J 1-9;
Section B. ff 1-4. Approval for the transactions was required under R.C. 4905.48, and approval
to file revised tariffs was required by R.C. 4909.18. Motion, Ex. A, Order 4.
Section A, Paragraph 10 of the Stipulation does not address the exchange of customers or
facilities, or the approval of tariffs. It addresses a different matter entirely. Here, the parties
' The section labelled “Suburban’s PUCO Filings” wastes five-and-a-half pages detailing Suburban’s
litigation history with Columbia at the PUCO. Mem. Supp. at 5-9. The purpose of this discussion,
apparently, is to try to show that because Suburban’s previous complaints against Columbia were filed at
the PUCO, this Complaint should have been filed there, too. What this discussion actually shows is that
Suburban has invoked the PUCO’s jurisdiction where appropriate, including the present case, Case No.
17-2168-GA-CSS. Only one of the six counts of that complaint arises from the Stipulation, and it is a
completely different section of the Stipulation than the section involved here.
2 A “stipulation” represents the signatory parties’ recommended resolution to the PUCO. See Ohio
Consumers’ Counsel, 2007-Ohio-4276 {f 7, 8. Stipulations are binding on the signatory parties, but they
are-not binding on the PUCO. “[T]he commission may change or modify earlier orders as long as it
justifies any changes.” Jd. As between signatory parties, however, a stipulation is a contract. See
Monongahela Power Co. v. Pub. Util. Comm., 104 Ohio St.3d 571, 2004-Ohio-6896, § 3; Infinite Sec.
Sols., L.L.C. v. Karam Properties, If, Ltd., 143 Ohio St. 3d 346, 2015-Ohio-1101 | 16
(“A settlement agreement is a contract[.]”).
3 Unlike electric utilities, gas utilities do not have geographically-defined service territories where there is
both the rexclusive ight and obligation to serve. See R.C. 4933.83.confirmed that “[nJothing in this Stipulation shall be construed as preventing Columbia from
installing, in any of the areas described, a high-pressure natural gas pipeline... .” Id.,
Stipulation, Sec. A § 10. Columbia did not commit to building the pipeline, nor did the order
approving the Stipulation require Columbia to build it. But if Columbia proceeded to build the
pipeline, it “shall also be available, subject to appropriate rate and services conditions, as a
supply source for Suburban’s system.” Id.
The PUCO adopted the Stipulation in a November 9, 1995 Order. Motion, Ex. A, Order.
The order summarizes the history of the proceedings and the terms of the transactions requiring
approval. Id. ff] 4-11. The order does not say one word about Section A, Paragraph 10.
The PUCO enforces a general duty to provide “adequate service.” See R.C. 4905.22.
How this duty is fulfilled is generally left to utility management. The PUCO does not dictate
when and where facilities should be built, how they should be operated, or who is allowed to use
them. See Ohio Bell Tel. Co. v. Pub. Util. Comm, 14 Ohio St. 3d 49, 50 (1984)(“? Inadequate
service’ is not defined in R.C. Title 49, that determination being left to the commission and
dependent upon the facts of each case.”). Certain “major utility facilities,” however, must be
approved by the Ohio Power Siting Board (OPSB). See R.C. 4906.01(B)(1)(c) (defining gas
pipelines that constitute a major utility facility). Columbia filed an application to construct the
Northern Loop pipeline in October 2004, received OPSB approval in August 2005, and placed
the facility in service in June 2006. See Mem. Supp. at 3-4. Suburban requested an
interconnection to the Northern Loop pipeline in July 2017, which Columbia denied.
There is nothing “remarkabl[e]” in the fact that the same Stipulation is at issue in both
this case and in a case pending at the PUCO. Mem. Supp. at 5. The Stipulation does not address
one discreet issue; it addresses several. One of the counts in the pending PUCO case involvesColumbia’s decision to resurrect builder incentive programs that Section B of the Stipulation and
the mutual releases was intended to end. Motion, Ex. E fj 26-30. The other five counts are based
on statutes and prior PUCO orders, and have nothing to do with the Stipulation. Jd. ff] 31-58. The
claims at issue arise here arise from a single paragraph in a different section (Section A) and
relate to a different subject. Suburban has filed claims that must be heard by the PUCO with the
PUCO, and claims that must be heard by a court with this Court.
Il. ARGUMENT
“Subject matter jurisdiction is a court’s power to hear and decide a case on the merits.”
State ex rel. Jones v. Suster, 84 Ohio St. 3d 70, 75, 1998-Ohio-275. “When ruling on a Civ.R.
12(B)(1) motion to dismiss for lack of subject-matter jurisdiction, trial courts must determine
whether a claim raises any action cognizable in that court.” Dargart v. Ohio Dep't of Transp.,
171 Ohio App. 3d 439, 443 (6th Dist.), 2006-Ohio-6179, ¥ 12.
Count I of the Complaint seeks a declaratory judgment establishing Suburban’s right to
connect to the Northern Loop pipeline. Count II alleges breach of contract. This Court
unquestionably has subject matter jurisdiction to hear and decide declaratory judgment and
breach of contract claims. R.C. 2305.01 (“{T]he court of common pleas has original jurisdiction
in all civil cases in which the sum or matter in dispute exceeds the exclusive original jurisdiction
of county courts ....”); R.C. 2721.02 (“[C]ourts of record may declare rights, status, and other
legal relations whether or not further relief is or could be claimed.”)
Conversely, the PUCO has no authority to adjudicate contract disputes. “The Public
Utilities commission is in no sense a court. It has no power to judicially ascertain and determine
legal rights and liabilities, or adjudicate controversies between parties as to contract rights or
property rights.” Village of New Bremen v. Pub. Util. Comm., 103 Ohio St. 23, 30-31(1921).This is so “even though a public utility is involved.” Mktg. Research Servs., Inc. v. Pub. Util.
Comm., 34 Ohio St. 3d 52, 56 (1987). Where a “duty sought to be enforced was not one exacted
by the [PUCO],” the PUCO has no jurisdiction to enforce the duty or remedy its breach. See
Southgate Dev. Corp. v. Columbia Gas Transmission Corp., 48 Ohio St.2d 211, 214-15 (1976).
Columbia disputes this Court’s jurisdiction, arguing that the contract claims are a back-
door attempt to enforce a PUCO order. Columbia’s arguments implicate the Allstate test, and
Columbia fails this test. Columbia’s remaining arguments also fail.
A. Columbia’s jurisdictional arguments fail the Allstate test.
“T]he [Allstate] test was adopted to guide courts in evaluating claims that present a close
question on whether the claims are utility-service related or claims constituting a tort or breach
of contract.” Saks v. E. Ohio Gas Co., 971 N.E.2d 498, 502, 2012-Ohio-2637, { 15. Whether
Columbia’s arguments present a “close question” is debatable, but the outcome of the test is not.
L. PUCO administrative expertise is not necessary.
The question under the first prong of Allstate is whether “PUCO's administrative
expertise required to resolve the issue in dispute.” Allstate, 2008-Ohio-3917 12; see also 15
(rejecting claim that an internal “guideline” constitutes a practice normally authorized). The
issue in dispute is whether Suburban has the right connect to the Northern Loop pipeline. This
Court is perfectly capable of making this determination without the PUCO’s administrative
expertise.
The PUCO’s administrative expertise is most apparent in rate-related issues. In
DiFranco, the plaintiffs sued for fraud after an electric company withdrew a discounted “all
electric” rate that had been offered for many years. 134 Ohio St. 3d 144, 2012-Ohio-5445, 4] 6-
7. In applying the first prong of Allstate, the Court cited a half dozen PUCO cases, spanning four
decades, where the PUCO had addressed this discount and authorized the utility to withdraw it.Id. at {J 4-8. “[T]he commission is the fact-finder best suited to review and analyze various
charged rates, rate designs, tariff schedules, and commission orders. We therefore conclude that
the commission's expertise is required to resolve the fraud claim.” Jd. at ] 34.
In attempting to show the PUCO’s administrative expertise, Columbia points to PUCO
filings describing the cases underlying the Stipulation as “important” and “complex,” the
PUCO’s “active[] supervis[ion]” in resolving the cases, and the reservation of jurisdiction for
compliance purposes. Mem. Supp. at 20-21. But Columbia makes no effort to tie any of these
factors to the specific claim at issue; i.e., whether Suburban has a right to interconnect. Likewise,
Columbia fails to explain why Suburban’s filing of previous cases at the PUCO dictates the
PUCO’s jurisdiction here. See id. at 21. Jurisdiction in each case must be judged on its own
merits.
That a different provision of the Stipulation is at issue in a pending PUCO case does not
establish PUCO jurisdiction here, either. See id. at 4-5. This would not be the first case where a
dispute over the same general subject spawned claims that were bifurcated between the PUCO
and a court. See, e.g., State ex rel. The Illuminating Co. v. Cuyahoga Cty. Court of Common
Pleas, 97 Ohio St. 3d 69, 75, 2002-Ohio-5312, {J 31-33 (granting writ of prohibition to prevent
exercise of jurisdiction over claims alleging violations of statutes administered by PUCO;
denying writ as to parallel claims for declaratory judgment); State ex rel. Ohio Edison Co. v.
Parrott, 73 Ohio St. 3d 705, 708-09 (1995) (granting writ of prohibition to prevent trial court
from enjoining construction of OPSB-approved electric transmission line; denying writ as to
parallel breach of contract claim). Suburban has filed PUCO claims with the PUCO, and its civil
claim with this Court. These are entirely different claims, involving different provisions of the
Stipulation and seeking different remedies.
10Although decided before Allstate, the case of Cleveland v. Cleveland Elec. Illum. Co.,
115 Ohio App. 3d 1 (8th Dist.1996), recognizes that administrative agencies do not have special
expertise in interpreting contracts. The case involved a municipal utility’s claims for injunctive
and declaratory relief against an investor-owned utility for failure to deliver energy under a
contract approved by the Federal Energy Regulatory Commission (FERC). The trial court
dismissed for lack of jurisdiction, but was reserved. “Generally, state courts have concurrent
jurisdiction with FERC regarding the interpretation of contracts on file with FERC.” Jd. at 8.
FERC’s “jurisdiction to settle disputes over the meaning of rate schedules does not as a matter of
law preclude state courts from entertaining contract litigation . . . .” Jd. FERC itself has
recognized that it “has no special expertise in applying relevant contract law.” Jd. at 11 (citation
omitted). As for the trial court’s jurisdiction, “Ohio courts have jurisdiction over contract
disputes even if the case involves a public utility.” Id., citing Marketing Research, 34 Ohio St.3d
at 56.
Admittedly, the concept of concurrent state/FERC jurisdiction over wholesale power
contracts is partially a function of federal law and FERC policy. And this case does not involve a
FERC contract. But the principle explained in Cleveland applies with equal force here: courts are
just as capable as administrative agencies in interpreting and enforcing contracts between public
utilities. This is especially so where, as here, the dispute “is not about rates or technical matters.”
Id. at 9. Indeed, with the exception of R.C. 4905.48 and R.C. 4905.31, public utilities are not
required to seek PUCO approval of contracts, or even disclose contracts to the PUCO. There is
only a general duty to “file” contracts “when and as required” by the PUCO. R.C. 4905.16. The
PUCO has no special expertise in interpreting contracts.
112 Utility interconnections are not a practice normally authorized by
Columbia.
Whether a practice is “normally authorized” is a question of whether the conduct or
practice is specifically authorized by statute. DiFranco, 2012-Ohio-5445 36. Thus, the
transactions that required approval under R.C. 4905.48, and the tariff filings approved under
R.C. 4909.18, represent practices normally authorized by Columbia. Columbia’s obligation to
permit an interconnection does not represent such a practice.
In DiFranco, the Court cited R.C. 4905.31, 4905.33, and 4905.35 as statutes specifically
authorizing “different and unequal rates” among customers. Jd. 37. Thus, “because the offering
of special or discount rates is a practice normally engaged in by public utilities and authorized by
the commission, it follows that the commission is best suited to adjudicate any claims regarding
the reasonableness and lawfulness of the companies' offer.” Jd. Columbia tries to show that it is
similarly-situated by citing R.C. 4905.48 and claiming: “not only is a natural gas public utility’s
interconnection to another natural gas public utility’s pipelines a normally authorized practice; it
statutorily requires the PUCO’s consent and approval.” Mem. Supp. at 21. Elsewhere it claims:
“PUCO approval of Section A, including Paragraph 10 thereto, was required under R.C.
4905.58.” Id. at 13 (emphasis added). Columbia is mistaken.
R.C. 4905.48 lists four types of transactions that require PUCO approval, three of which
are plainly irrelevant here See R.C. 4905.48(B)-(D) (sales or leases between public utilities and
stock purchases). Subsection (A) covers transactions to allow two or more utilities to “operate
their lines or plants in connection with each other,” and it was this section that applied to the
transactions described in Section A, paragraphs 1-9 of the Stipulation. The statute did not and
could not have applied to paragraph 10. No transaction was proposed and none was approved.
And there will be no such transaction given Columbia’s breach.
12Even if Columbia had honored its commitment and permitted the interconnection, no
approvals would have been required under R.C. 4905.48. The statute does not require approval
for every joint undertaking between utilities. See Stebbins v. Pub. Util. Comm., 62 Ohio St. 2d
431, 433-34 (1980) (agreements among six utilities to jointly construct nuclear generation
facilities not subject to PUCO approval). The exchange of customers and facilities was intended
to eliminate parallel and intersecting lines, and otherwise rationalize the companies’ systems.
These transactions undoubtedly required approval under R.C. 4905.48. A request to connect to
Columbia’s system decades later simply does not.*
The PUCO does not regulate whether or under what conditions other gas companies may
connect to Columbia’s lines. Columbia decides who will connect and who will not. Whether any
specific past or future transaction is or was subject to approval under R.C. 4905.48 does not
change this fact. Columbia’s refusal here to permit an interconnection does not relate to a
statutorily-required, normally authorized practice.
If the answer to either Alistate factor is “No,” then this Court has jurisdiction. Allstate J
13. Given that the answer to both questions is “No” under the circumstances here, Columbia’s
jurisdictional challenge fails.
B. R.C. 4903.12 does not prevent this Court’s exercise of jurisdiction.
Columbia argues that that any attempt to “review, interpret, or enforce” the order
approving the Stipulation would violate R.C. 4903.12. Mem. Supp. at 13. Columbia’s
interpretation and application of the statute are highly flawed.
* On certain occasions, Suburban and Columbia have sought joint approval of contracts that included
provisions about interconnections, but also included rate or service conditions requiring approval under
R.C. 4905.31. See, e.g., PUCO Case Nos. 02-1239-GA-AEC (April 13, 2005) (available at
http://dis.puc.state.oh.us/TifffoPDf/G_U$VISSQNLMKAAY. pdf.) That an interconnection is mentioned
to give context to the overall arrangement does not establish that the interconnections are subject to
PUCO jurisdiction.
13For starters, R.C. 4903.12 reserves to the Supreme Court of Ohio the power to “review,
suspend, or delay any order made” by the PUCO, or otherwise “enjoin, restrain, or interfere
with” the PUCO. The intent of the statute is obvious: appellate review of PUCO orders resides
with the Court, not the intermediate appellate courts or trial courts. [cite] A lower court may not
interfere with the performance of activities undertaken pursuant to a lawful PUCO order. The
statute does not say that lower courts may not “interpret” or “enforce” PUCO orders, and the
term “review” as used in the statute plainly implies appellate review, not review for purposes of
understanding the order.
Then there is the issue of what the PUCO’s approval order actually says. The order
describes the history of the proceedings and the transactions approved in the order; namely, the
exchange of customers and facilities, and the terms of the revised tariffs. Motion, Ex. A, Order
4 4-11. The order says nothing about the interconnection right granted under Section A,
paragraph 10. If approval was needed for this obligation to become effective, the order would
have mentioned it. It does not.
The order approving the Stipulation must be read in context with the Stipulation itself.
The paragraph at issue begins, “[nJothing in this Stipulation shall be construed as preventing,”
and then goes on to explain Columbia’s right to build the Northern Loop pipeline, Suburban’s
tight to connect to the pipeline, and the receipt of service from the pipeline under “appropriate
rate and service conditions.” Id., Stipulation, Sec. A 10. The generic request for approval of the
Stipulation as a whole does not confer continuing jurisdiction over a term that did not require
approval and was not specifically approved. “Parties may not, by stipulation or agreement,
confer subject-matter jurisdiction on a court or administrative body where such jurisdiction does
not otherwise exist.” In re Kerry Ford, Inc., 106 Ohio App. 3d 643, 651 (10th Dist. 1995). The
14PUCO does not have subject matter jurisdiction “[b]y the parties’ express agreement in the
Stipulation.” Mem. Supp. at 10.
Columbia reads word into R.C. 4903.12 that are not there, and reads far too much into
words that are. The Complaint does not ask this Court to “suspend,” “delay,” or otherwise
“enjoin, restrain, or interfere” with the PUCO order approving the stipulation. R.C. 4903.12. The
Complaint seeks “review” of the stipulation not to overtum or interfere with its performance, but
to declare the parties’ rights. “[C]ourts of record may declare rights, status, and other legal
relations whether or not further relief is or could be claimed.” R.C. 2721.02. The Court may
exercise jurisdiction consistent with both R.C. 4903.12 and 2721.02.
Cc The Court does not need to address rate or service matters.
Columbia argues that the interconnection is “subject to appropriate rate and service
conditions,” thereby implicating PUCO jurisdiction. Mem. Supp. at 14-15. This argument
misreads the Stipulation. Columbia is denying the interconnection, which renders rates and
service through any interconnection irrelevant.
There was and is no provision of Columbia’s tariff addressing interconnections to
Columbia’s facilities by other gas distribution companies. Thus, the Stipulation required
language conveying a positive, unambiguous obligation on Columbia’s part to permit an
interconnection. Columbia “shall” make an interconnection available. With respect to service
through the interconnection—the transportation of natural gas—it was sufficient to refer to
“appropriate rate and service conditions” because these matters were and are subject to
Columbia’s tariff. Rates and conditions of “service” are not at issue in this case.
R.C. 4905.38 is of no moment. See Mem. Supp. at 15. The PUCO has made no order, and
Suburban has requested no order, directing that “repairs, improvements, or additions to the plant
or equipment” of Columbia be made. R.C. 4905.38. Columbia agreed to permit an
15interconnection not for the “convenience or welfare of the public,” but as part of an overall
resolution of litigation. See id. The Northern Loop pipeline is an “addition” to Columbia’s plant
made many years ago. The issue now is Suburban’s right to connect to this addition, and R.C.
4905.38 is inrelevant to this issue.
R.C. 4905.61 is also irrelevant. See Mem. Supp. at 18. “[T]he statute was intended to
penalize public utilities for failing to comply with their statutory obligations.”
Cleveland Mobile Radio Sales, Inc. v. Verizon Wireless, 113 Ohio St. 3d 394, 399, 2007-Ohio-
2203, { 19. If Columbia wishes to stipulate to a statutory violation, Suburban would reconsider
its strategy. Absent such a stipulation or admission, Suburban’s claims are purely contractual.
Columbia cites Hull v. Columbia Gas of Ohio, Inc. as authority for its claim that
Suburban has invited the Court to wade into rate issues. The case does not support Columbia’s
argument. “The PUCO has always had exclusive jurisdiction to adjudicate rate disputes
involving public utilities like Columbia. And here, the entirety of Hull's complaint against
Columbia is the rate he believes he should have been charged for his natural gas service. This
matter falls squarely within the PUCO's exclusive jurisdiction, subject to review only by this
court.” 110 Ohio St. 3d 96, 102-03, 2006-Ohio-3666, 38. Plainly and simply, adjudicating
Suburban’s rights does not implicate any rate—PUCO approved or otherwise.
Columbia’s wrongful act of denying the interconnection request renders any issue about
rates and services irrelevant. The issue before this Court is whether Suburban has a right to
interconnect that has been breached. The Court has jurisdiction to hear and decide this issue.
D. — The PUCO lacks authority to grant an adequate remedy.
Columbia does not explain how the Commission could or would enforce Section A,
paragraph 10 of the Stipulation. Columbia seemingly assumes that whatever remedies the Court
16could provide may also be provided by the PUCO, but this is simply not the case. Asking the
PUCO to enforce a right to interconnect would be futile, and any remedy inadequate.
Although the PUCO retained jurisdiction to enforce the Stipulation, the PUCO’s
enforcement tools are limited. “The [PUCO] is a creature of the General Assembly and may
exercise no jurisdiction beyond that conferred by statute.” Penn Cent. Transp. Co. v. Pub. Util.
Comm., 35 Ohio St. 2d 97, syllabus (1973) (citations omitted). The PUCO has no statutory
authority to award damages for breach of contract—a point Columbia acknowledges here and
has repeatedly reminded the PUCO. See, e.g., Wenzowski v. Columbia Gas of Ohio, Inc., Case
No. 06-568-GA-CSS (Order, Sept. 27, 2006) at ¥ 4 (“Columbia contended that the Commission
lacks both jurisdiction and the authority to award monetary damages in this matter.” Motion to
dismiss granted).> The PUCO does not have the ability to grant the same remedies as this Court.
It is questionable whether the PUCO even has the authority to decide whether the
Stipulation represents a legally binding contract, let alone declare a breach of the contract. Mtg.
Research Servs., 34 Ohio St. 3d at 56 (PUCO “has no power to determine legal rights and
liabilities with regard to contract rights or property rights, even though a public utility is
involved.”). Even if the PUCO accepted jurisdiction of the claims alleged here, the most it could
be expected to do is issue an order directing Columbia to perform its contract—something
Columbia has already refused to do. The PUCO cannot even unilaterally enforce an order
directing performance; it must enlist the Ohio Attorney General to enforce orders on its behalf.
See R.C. 4905.57; R.C. 4905.59; R.C. 4905.60. Seeking a remedy through the PUCO would be
“wasteful and futile.” Al/state, 2008-Ohio-3917, J 16. Pursuing its claims at the PUCO would
5 The PUCO order is available at http://dis.puc.state.oh.us/TifffoPDf/ZIUTHV @SECP_1I412.pdf
17simply deny Suburban a remedy for untold months or years, and likely end up back in this Court
in any event.
E. Columbia’s request for sanctions is unwarranted.
Columbia asks the Court to impose sanctions under R.C. 2323.51 and Civil Rule 11. “The
decision to award sanctions pursuant to Civ. R. 11 or R.C. 2323.51 is within the discretion of the
trial court and will not be reversed absent an abuse of discretion.” Thompson v. Cooper, 2017-
Ohio-5549, $29 (5 Dist.).
Columbia has failed to support its motion. The motion merely characterizes the
Complaint as “improperly filed.” Motion at 2; Mem. Supp. at 22. That is literally all Columbia
says. It has not explained what conduct was allegedly frivolous, or why. Nor can it. For all of the
reasons just explained, Suburban’s claims are properly before this Court. Even if the Court grants
Columbia’s jurisdictional motion (it should not), that alone would not justify sanctions. “[T]he
mere fact that the claims were unsuccessful is not enough to warrant sanctions.” Reddy v. Plain
Dealer Publishing Co., 991 N.E.2d 1158, 2013-Ohio-2329, § 39 (8 Dist.).
There is probably a case somewhere which says an improperly filed motion for sanctions
is itself sanctionable. Suburban has not looked for such a case because it does not wish to belabor
the point. Professionalism means sometimes agreeing to disagree, without being disagreeable.
IV. CONCLUSION
Suburban has filed a case for declaratory judgment and breach of contract. That the
contract is between two public utilities does not divest this Court of jurisdiction to hear and
decide the issues raised. The PUCO is not a Court, and cannot grant adequate relief. Columbia’s
jurisdictional motion and motion for sanctions should be denied.
18Date: November 22, 2017
19
Respectfully Submitted,
Sfejlel|), Be D. Martin (01 0851) hit,
MANOS, MARTIN & PERGRAM CO, LPA
50 North Sandusky Street
Delaware, Ohio 43015
740.362.1313
740.362.3288 (fax)
smartin@mmpdlaw.com
Mark A. Whitt (0067996)
WHITT STURTEVANT LLP
KeyBank Building
88 E. Broad St., Suite 1590
Columbus, Ohio 43215
614.224.3911
whitt@whitt-sturtevant.com
Attorneys for PlaintiffCERTIFICATE OF SERVICE
A copy of the foregoing Plaintiff's Memoraridum in Opposition to Motion to Dismiss
was served by electronic mail to the following on November 22, 2017:
Matthew R. Rechner
Adam C. Smith
McDonald Hopkins LLC
600 Superior Ave. Suite 2100
Cleveland, Ohio 44114
mrechner@medonaldhopkins.com
acsmith@mcdonaldhopkins.com
Anthony M. Heald
125 North Sandusky St.
Delaware, OH 43015
tonyheald@heald-law.com
puP
An Attorney for Plaintiff
20