ENERGY MICHIGAN, INC.; ASSOCIATION OF BUSINESSES ADVOCATING TARIFF EQUITY (ABATE) v. MICHIGAN PUBLIC SERVICE COMMISSION,DANIEL C. SCRIPPS; ALESSANDRA CARREON; KATHERINE L. PERETICK, CONSUMERS ENERGY COMPANY - Articles

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ENERGY MICHIGAN, INC.; ASSOCIATION OF BUSINESSES ADVOCATING TARIFF EQUITY (ABATE) v. MICHIGAN PUBLIC SERVICE COMMISSION,DANIEL C. SCRIPPS; ALESSANDRA CARREON; KATHERINE L. PERETICK, CONSUMERS ENERGY COMPANY

Posted by: Azya Thornton on Jan 16, 2025

Court: 6th Circuit Court (Published Opinions)

Attorneys 1: ARGUED: Brion B. Doyle, VARNUM LLP, Grand Rapids, Michigan, for Energy Michigan, Inc. Zachary C. Larsen, CLARK HILL PLC, Lansing, Michigan, for ABATE. Nicholas Q. Taylor, OFFICE OF THE MICHIGAN ATTORNEY GENERAL, Lansing, Michigan, for Michigan Public Service Commissioners.

Attorneys 2: ARGUED: Spencer A. Sattler, CONSUMERS ENERGY COMPANY, Jackson, Michigan, for Consumers Energy Company.

Attorneys 3: ON BRIEF: Brion B. Doyle, VARNUM LLP, Grand Rapids, Michigan, Zachary C. Larsen, CLARK HILL PLC, Lansing, Michigan, for Energy Michigan, Inc. and ABATE.

Attorneys 4: ON BRIEF: Nicholas Q. Taylor, Steven D. Hughey, OFFICE OF THE MICHIGAN ATTORNEY GENERAL, Lansing, Michigan, for Michigan Public Service Commissioners.

Attorneys 5: ON BRIEF: Spencer A. Sattler, Kelly M. Hall, CONSUMERS ENERGY COMPANY, Jackson, Michigan, for Consumers Energy Company.

Judge(s): BOGGS, SUHRHEINRICH, and READLER, Circuit Judges

Court Appealed: United States District Court for the Eastern District of Michigan at Detroit

HAD A. READLER, Circuit Judge. This appeal does not lack for challenging features. The factual backdrop is the complex market for electricity generation, transmission, and distribution in the United States. And the chief legal doctrine at play, the so-called dormant or negative Commerce Clause, has been unflatteringly described as a “quagmire,” Nw. States Portland Cement Co. v. Minnesota, 358 U.S. 450, 458 (1959), “hopelessly confused,” Kassel v. Consol. Freightways Corp. of Del., 450 U.S. 662, 706 (1981) (Rehnquist, J., dissenting), and “inherently unpredictable,” Am. Trucking Ass’ns, Inc. v. Smith, 496 U.S. 167, 203 (1990) (Scalia, J., concurring in the judgment).

But in practice, today’s case turns on some relatively basic questions. Can the State of Michigan require someone selling a product in Michigan to procure that product from the state? Or, phrased in the language of the coin’s other side, can Michigan bar in-state retailers from obtaining their merchandise from outside the state? On these issues, negative Commerce Clause jurisprudence is straightforward. Whether the product at issue is milk, see Dean Milk Co. v. City of Madison, 340 U.S. 349, 352 (1951), or coal-based electricity, see Wyoming v. Oklahoma, 502 U.S. 437, 440 (1992), the Commerce Clause prohibits such state restrictions unless they clear strict scrutiny’s high bar, see Maine v. Taylor, 477 U.S. 131, 138 (1986). At issue here are Michigan electricity market regulations that expressly restrict where Michigan’s electricity retailers may procure their capacity. Accordingly, that regulatory regime must be evaluated through the lens of strict scrutiny. To allow the district court to engage in that analysis with the benefit of our views here, we reverse and remand.

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