Supreme Court Denies Certiorari in Holbrook Case

By: Martin Bienstock

Lawyers don’t usually post about cases they’ve lost, but our case against the Tennessee Valley Authority was so fascinating, and our loss so heart-rendering, that I thought it worth sharing with colleagues and friends.

Here’s the background: As you know, the New Deal Congress created the TVA to bring low-cost electricity to the people of the Tennessee Valley. Congress also allowed TVA to sell electricity to industry, but only so that it could create profits, which would then be used to reduce rates for households.

TVA followed this mandate for more than 75 years. Then recently, TVA rescinded this policy and began to favor industry at the expense of consumers, in violation of Congress’ intentions.

It’s an article of faith at the Supreme Court that when Congress tells an agency what to do, federal courts are available to make sure that the agency complies. So, it seemed to us, courts surely could review the TVA’s decision rejection of the law in favor of its own policies. It was true that lower courts had taken to saying that “TVA rate-setting is unreviewable;” but they had never said that when TVA failed to follow Congress’ instructions. Surely courts would review an agency’s decision to renege on the very purpose for which Congress had created it!

When the federal district court dismissed our case, we were disappointed but not surprised. Lower courts often follow these rules-of-thumb, especially to dismiss difficult and complicated cases. But we were shocked at the outcome on appeal, when the appeals court kept the doors to the courthouse locked against us. It turns out that there is a particular type of conservative judge who values judicial “deference” so much that they are opposed to court review of agency decisions, even when Congress has spoken. Justice Scalia was of such a view, as is Justice Alito today. So was the author of the opinion on our appeal.

In a brilliant opinion, the circuit court reasoned that the Supreme Court’s general rule — that courts must make sure agencies follow Congress’ instructions — has been silently rejected in favor of a much more restrictive approach, that once had been expressed by Justice Scalia in dissent. Yet, while the opinion was brilliant, it was obviously wrong; Justice Scalia’s dissent was only a minority opinion, not the prevailing rule.

We had known all along that to win this case, we might need to go to the Supreme Court. TVA’s rates affect more than 10 million customers, and generate $10 billion in revenue each year. The separation-of-powers question at the heart of our case was the type of issue the Supreme Court often takes a look at. So we took one last shot, and filed a petition for review at the Supreme Court. Our arguments were compelling, and, I am told, our briefs were fantastic. (A copy is available here.) The Petition was even featured on Scotub Blog as the Petition of the Week.” But early this week, our petition was summarily denied. Sadly, we’ve hit the end of the road. For the first time in the many dozens of cases we’ve brought, our case is irretrievably lost.

When I opened our law offices almost five years ago, this case was exactly the type I envisioned: a government agency defying the law, harming millions of citizens, in a way that demanded that we bring all of our knowledge, skills and abilities to bear in order to prevail. I’m deeply disappointed we lost; but I’m also proud of the great work we did. If I had the chance I would do it all again. In the meantime, there are other clients, causes and cases to fight for. We hope to post about them soon!

Read More

We Are Eager to Hear from You.

Contact us at Bienstock PLLC. We promise to give you the attention you deserve.