The saga of the Winter Storm Uri litigation has once again come before the Texas Supreme Court, as the last defendants left standing in the case—the investor-owned transmission and distribution utilities (TDUs)—have petitioned the Court for a writ of mandamus ordering the MDL trial court to dismiss the remaining claims brought by thousands of plaintiffs in the wake of the storm. It should be noted that everyone else in the electricity delivery system—the gas producers, power generators, retail providers, and ERCOT itself—have been absolved from liability, leaving the TDUs to face a $10 billion lawsuit alone.
Last April, the Houston [14th] Court of Appeals affirmed in part and reversed in part the MDL court’s order that, while it dismissed some of Plaintiffs’ claims under Rule 91a (tortious interference with contract and civil conspiracy), denied the TDUs’ motions to dismiss Plaintiffs’ negligence, gross negligence, and nuisance theories. In an opinion by Chief Justice Christopher, the court of appeals held that the trial court abused its discretion when it denied the TDUs’ motion with respect to the negligence claims on the basis that “Texas law does not impose on TDUs common-law negligence duties associated with emergency load shedding, ensuring adequate generation, or warning of anticipated power outages.” This immunity is derived from the TDUs’ pro forma tariff promulgated by the PUCT, which expressly bars negligence suits challenging a TDU’s performance of its authority under the tariff.
The court of appeals, however, denied the TDUs’ petition with respect to Plaintiffs’ gross negligence and intentional misconduct claims. Here the court relied an exception in the tariff that purports to make a TDU or retail customer liable for those claims and states that “this Tariff shall not preclude recovery of appropriate damages when legally due.” There is similar language in another section of the tariff pertaining to discretionary actions taken by TDUs to interrupt service in the event of emergencies that threaten the integrity of the power grid. The court cited several allegations in Plaintiffs’ pleadings alleging the elements of gross negligence and intentional misconduct as sufficient to meet the pleading requirement. Consequently, taking those allegations as true for purposes of the TDUs’ Rule 91a motion to dismiss for failure to state a claim and observing that the TDUs did not negate those claims, the court of appeals concluded that the MDL court did not abuse its discretion as to them. The court further allowed Plaintiffs’ “intentional nuisance” claims to stand, though it did kick out their negligent nuisance and strict-liability nuisance theories.
In May the TDUs filed their mandamus petition with SCOTX. In Re ONCOR Electric Delivery Co. LLC; ONCOR Electric Delivery Co. NTU LLC; AEP Texas Inc.; American Electric Power Co.; Centerpoint Energy Houston Electric, LLC; and Centerpoint Energy, Inc. (No. 24-0424). The TDUs and Real Parties in Interest have filed briefs on the merits, so SCOTX’s determination could be in the offing soon. TCJL is currently working on amicus support for the TDUs and will likely file a brief in the next 10 days or so. Stay tuned to this space for further updates.
