Power & Pipes

FERC, CFTC, and State Energy Law Developments

The US Court of Appeals for the Ninth Circuit dismissed a class action lawsuit claiming a California utility was liable for blackouts that were allegedly caused by inadequate electric system maintenance.

Pointing to a recent California Supreme Court decision on utility liability under state law, the Ninth Circuit dismissed the lawsuit, finding that the utility cannot be sued in tort for emergency blackouts. The ruling is consistent with the general view of most states that do not impose a general negligence standard for blackouts, although utilities can sometimes be liable under other legal theories.

In this proceeding, the plaintiffs claimed that the utility was liable because the blackouts would not have been necessary but for the utility’s improper maintenance of its power lines and failure to fully contain vegetation encroachment. However, the Ninth Circuit referred the question of tort liability to the California Supreme Court, which concluded that state law regarding the regulation of electric utilities preempts claims of negligence that arise from a utility’s public safety power shutoffs. As a result, the Ninth Circuit found that the class action’s negligence claims would have to be dismissed.