Old Dominion Electric Cooperative v. PJM Interconnection, LLC

In this case, Petitioner asks the Court to resolve lower-court confusion arising from the intersection of two Court-created principles: the “substantial federal question” doctrine and the “filed rate” doctrine. Under the substantial-federal-question doctrine, a federal court has “arising under” jurisdiction over state-law claims that necessarily depend on a substantial issue of federal law. It is an exception to the general rule that only federal claims create arising-under jurisdiction. The federal filedrate doctrine, in turn, bars state-law claims that conflict with “tariffs” on file with a federal regulatory agency to whom Congress has given exclusive ratemaking authority. It is a form of preemption, deriving its force from the Supremacy Clause. Plaintiff, an electricity generator, filed a statecourt action against Defendant, a grid operator, for breach of contract, unjust enrichment, and fraud. Defendant removed the state-court action to federal court, arguing that Plaintiff’s state-law claims were inconsistent with the tariff that Defendant had filed with FERC. The question presented is: Do state-law claims that allegedly conflict with federally filed tariffs involve a substantial federal question; or does the filed-rate doctrine merely operate as a federal preemption defense that, under the well-pleaded-complaint rule, does not confer arising-under jurisdiction?