THE U.S. Department of Justice has opposed the motion to intervene by the Commonwealth Public Utilities Commission in the federal court proceedings for the stipulated orders pertaining to the Commonwealth Utilities Corporation.
“The United States acknowledges that PUC’s jurisdiction over CUC means that actions of the parties or court in this lawsuit may affect or potentially collide with PUC’s interests. However, a lawsuit’s potential effect on a person’s interests does not automatically entitle that person to intervene as a party,” said Senior Attorney Elizabeth Loeb of the USDOJ Environmental Enforcement Section.
PUC Chairman James Sirok has requested designated federal Judge David O. Carter to allow the commission to intervene as a third party and participate in the proceedings.
In his memorandum to support the motion to intervene, Sirok said, “The PUC contends that [the] orders and actions it takes, based on the requests of the United States, [the Environmental Protection Agency] and CUC in this matter, which are related to CUC’s conduct and operations, are also related to PUC’s regulatory responsibilities over CUC including, but not limited to, (1) how it is to regulate CUC’s operations, (2) review any of CUC’s rate petitions, (3) monitor CUC’s fiscal and financial responsibilities and obligations, and (3) ensure that it is complying with various state and federal requirements including those required under Stipulated Orders One and Two entered in this matter.”
Simply stated, Sirok added, “PUC’s role as a regulator of CUC does not include advocating for CUC herein. Instead, PUC’s responsibility is to protect the interests of the agencies, organizations, businesses, and residents of the CNMI in insuring that the power, water and wastewater rates they pay to CUC are fair, just and reasonable. PUC’s ability to perform this legislatively mandated responsibility encompasses not simply a review of the finances of CUC but continued oversight and involvement in the operations, administration, capitalization, renovation, and development of CUC’s utility assets.”
According to Sirok, a former CUC legal counsel, “These assets include the power plants on Saipan, Tinian, and Rota, and the needs of the power plants in the production of electricity for those respective islands.”
“It also includes the construction, repair and replacement of water and wastewater assets, and the needs of those assets in the production of an adequate palatable water supply on all islands. It includes the ability to remove and dispose of sewer and wastewater [by-products] in a manner safe to the residents and the natural environments of all three islands,” Sirok added.
But Loeb, in her opposition, said, “PUC misses the mark because its contentions do not fit within the confines of Rule 24(b)(2). While CNMI law authorizes it to intervene in hearings related to interests under its jurisdiction, CNMI law cannot override the Federal Rules of Civil Procedure pertaining to intervention.”
“Here the United States’ claims, filed in 2008, are not based on any state law or order but rather were filed under the federal Clean Water Act and Safe Drinking Water Act, neither of which PUC administers. Moreover, the claims in the United States’ complaint are settled and there are no defenses that defendants or PUC has or are currently asserting based on any state statute or executive order administered by PUC,” Loeb said.
PUC’s motion is not timely, she added.
“CNMI is already a party in this case. Allowing its agencies to separately intervene, would create unnecessary complexity and confusion which could delay implementation of the measures in the Stipulated Orders and foster litigation over issues that the current three parties can resolve without court intervention. And PUC has not given any reason why it would be prejudiced if its motion is denied or how the Stipulated Orders prevent PUC from exercising its regulatory authority over CUC,” Loeb said.
“This lawsuit was filed in 2008 and PUC, which was established in 2006, did not seek to intervene at any time since then. PUC gives no reason for waiting fifteen years to intervene,” she added.
She said PUC’s motion also does not satisfy FRCP 24(c), which requires the proposed intervenor to state a claim or defense.
“PUC does not articulate any claims or defenses but only discusses generalized interests in prospective occurrences which is insufficient to give it intervenor status,” she said.
Moreover, PUC is a government agency of the CNMI, a defendant in this action, and the CNMI is charged with representing PUC’s and other CNMI agency interests, Loeb said.
Finally, even if PUC were entitled to a separate voice or position from the CNMI regarding a future issue, it could seek to appear as amicus curiae at that time, Loeb added.
“Indeed, this Court has previously been willing to hear non-parties views in its proceedings. On July 22, 2022, this Court issued a Minute Order inviting an outside party to submit a brief on whether it had the power to override a CNMI Superior Court’s order,” Loeb said.
CUC, through Assistant Attorney General Hunter Hunt, joined the USDOJ’s opposition to PUC’s motion to intervene.
PUC was created by CNMI Public Law 15-35 or the Commonwealth Public Utilities Commission Act of 2006. Under the Act, the PUC is an independent CNMI government regulatory agency empowered with specific legal responsibilities for regulating the operations of various entities within the CNMI. (4 CMC § 8103). CUC is one of the entities that PUC is mandated to regulate.
In November 2008, after the U.S. Environmental Protection Agency cited CUC for violating the Clean Water Act and the Safe Drinking Water Act, the federal court issued Stipulated Orders 1 and 2.
SO1 focuses on CUC’s management structure, drinking water and wastewater issues while SO2 focuses on oil issues.
