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FOR IMMEDIATE NEW S RELEASE NEW S RELEASE # 14 FROM: CLERK OF SUPREM E COURT OF LOUISIANA The Opinions handed down on the 2nd day of M arch, 2005 , are as follows:

BY TRAYLOR, J .: 2004-CA-1190

LAKE CHARLES PILOTS, INC. v. LOUISIANA PUBLIC SERVICE COMMISSION (Parish of E. Baton Rouge) CONSOLIDATED WITH: CITGO PETROLEUM CORPORATION AND CONOCO, INC. v. LOUISIANA PUBLIC SERVICE COMMISSION (Parish of E. Baton Rouge) The writs in 2004-CD-0914 and 2004-CD-0917 are denied. The motion to dismiss appeals filed by CITGO and Conoco is also denied. Furthermore, pursuant to Act 902 of the 2004 Regular Legislative Session, which amended La. R.S. 34:1121, this matter is remanded to the Pilotage Fee Commission for a determination of the fees and tariffs at issue.

2004-CA-1191 C/W 2004-CA-1192

03/02/2005

SUPREME COURT OF LOUISIANA
CITGO PETROLEUM CO., ET AL vs. LOUISIANA PUBLIC SERVICE COMMISSION No. 2004-CD-0914 c/w No. 2004-CD-0917 c/w On Writ of Certiorari to the Nineteenth Judicial District Court, For the Parish of East Baton Rouge Honorable Timothy E. Kelly c/w LAKES CHARLES PILOTS, INC. vs. LOUISIANA PUBLIC SERVICE COMMISSION No. 2004-CA-1190 c/w CITGO PETROLEUM CORPORATION AND CONOCO, INC. vs. LOUISIANA PUBLIC SERVICE COMMISSION No. 2004-CA-1191 c/w No. 2004-CA-1192 On Appeal from the Nineteenth Judicial District Court, For the Parish of East Baton Rouge Honorable Timothy E. Kelly TRAYLOR, J. The Louisiana Public Service Commission (hereinafter "LPSC") and the Lake

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Charles Pilots, Inc. (hereinafter "Pilots") filed three separate appeals and two applications for supervisory writs in this court. These matters were consolidated for purposes of this opinion. Prior to our consideration of the issues raised therein, the legislature enacted legislation which we believed might affect our consideration of these matters. Consequently, based upon the enactment of La. Act No. 902 of the 2004 Regular Legislative Session, this court issued an order directing the parties to address the following: (1) whether this court should exercise its appellate and/or supervisory jurisdiction and (2) if such jurisdiction exists, whether a justiciable controversy remains in light of the enactment Act No. 902 of the 2004 Regular Legislative Session. Based upon our analysis of this matter, we find that the issues which form the basis of the lower court's judgment are now rendered moot due to the enactment of Act 902. FACTS AND PROCEDURAL HISTORY The underlying facts of this case were previously before this court in CITGO Petroleum Corp. v. Louisiana Public Service Comm., 01-1902 (La. 3/15/02), 815 So. 2d 19 ("CITGO I"). In order to place in perspective the current procedural posture of this case, a brief recitation of those facts is necessary. CITGO I CITGO I arose from a proceeding to determine pilotage fees and rates filed on September 17, 1998, by the Pilots with the LPSC.1 The fees and rates charged by the pilots for pilotage service are set by the Fee Commission, or in this case, the LPSC. The LPSC initially approved an interim tariff filed by the Pilots and issued a final

Such fees and rates are usually considered by the Associated Branch Pilots of the Port of Lake Charles Fee Commission ("Fee Commission"). However, a majority of the Fee Commission was unable to decide the issue. Pursuant to La. R.S. 34:1122(D)(1), when a majority of the Fee Commission is unable to decide an issue, its members can certify the issue to the LPSC for expedited adjudication, and the LPSC's decision on the issue shall constitute the decision of the Fee Commission. 2

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order adopting the tariff on November 9, 1999. The tariff addressed only the "inner bar," as the LPSC concluded it lacked jurisdiction over the "outer bar."2 CITGO Petroleum Company ("CITGO") and Conoco Phillips ("Conoco"), intervenors in the LPSC proceeding in CITGO I, filed a petition for judicial review of the LPSC's November 9, 1999 order in the Nineteenth Judicial District Court. In their appeal to the district court, CITGO and Conoco alleged that the LPSC lacked jurisdiction over the subject matter of the action because the conditions precedent to the LPSC's jurisdiction were not met. Alternatively, CITGO and Conoco alleged that the interim and final orders were arbitrary and capricious on the ground that the LPSC's failure to regulate pilotage fees and rates in the outer bar was unlawful. On April 3, 2001, the district court denied the exception to the LPSC's jurisdiction filed by CITGO and Conoco. After a hearing on the merits of the petitions for judicial review, the district court vacated the LPSC's orders and remanded the matter to the LPSC for further proceedings. CITGO and Conoco appealed to this court. The issue before this court in CITGO I was two fold: (1) Whether the LPSC had subject matter jurisdiction over the matter and (2) whether the LPSC could regulate the outer bar. In CITGO I, we first noted that former La. R.S. 34:11213 grants the LPSC the authority to consider the

The terms "inner and outer bar" are terms of art. The area colloquially known as the "inner bar" is that portion of the Calcasieu Ship Channel which is located within three geographical miles of the Louisiana coastline. Conversely, the term "outer bar" relates to that portion of the channel seaward of three geographical miles beyond the Louisiana coastline.
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At the time of CITGO I, La. R.S. 34:1121(D) provided:

A decision by a majority of the members of the commission shall constitute the decision of the commission. Whenever negotiation of an issue has been requested, in writing, by any two members and a majority of the commission is unable to decide the issue within ninety days of the request for negotiation, any member may certify and file, in writing, the issue with the Louisiana Public Service Commission for expedited adjudication. Upon such filing, as is provided by R.S. 34:1121(C), the Louisiana Public Service Commission shall constitute the commission. (continued...) 3

matter as all the conditions necessary for the case to be allotted to the LPSC had been satisfied.4 Second, we agreed with the LPSC that it is traditionally within the authority of the state to regulate the outer bar. However, since the state opted not to regulate the area, the language of La. R.S. 34:1073 provided the LPSC with the authority to regulate the outer bar.5 Hence, this court, in CITGO I, affirmed the judgment of the district court and remanded the matter to the LPSC to include the outer bar in the determination of the final tariff. Post CITGO I On remand from this court, the LPSC referred the matter to an Administrative Law Judge ("ALJ"), to conduct a hearing. Prior to and at the hearing, the ALJ made three interlocutory rulings: (1) The ALJ denied Pilots' motion to compel production of invoices and other documents showing payments made by CITGO and Conoco to other state-commissioned pilots in other U.S. ports; (2) The ALJ struck the testimony of Brent Dibner, Pilots' expert witness; and (3) The ALJ denied Pilots' motion to strike the testimony of David Moore, CITGO and Conoco's expert witness, despite Pilot's contention that his testimony was not timely filed.

Pilots appealed these three interlocutory rulings to the LPSC. Meanwhile, on

(...continued) La. R.S. 34:1121 was amended by ACT No. 902, 2004 Regular Legislative Session.
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See footnote 1, supra. La. R.S. 34:1073 provides: There shall be a body of pilots to be known as River Port Pilots whose duty it shall be to pilot seagoing vessels within the state of Louisiana, through all navigable streams, canals, channels, rivers, passes and bars within the state of Louisiana and across the bars and passes.

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September 10, 2003, the ALJ issued a Final Recommendation on the merits of the tariff determination. The LPSC scheduled a review of the ALJ's Final

Recommendation at its Business and Executive Session "(Executive Session") which was scheduled to be held on October 9, 2003. Pilots' appeals of the three

interlocutory rulings of the ALJ were also scheduled for consideration at that time. In Order T-23792-C, rendered on November 6, 2003, the LPSC made the following rulings with respect to the ALJ's interlocutory rulings: 1) The LPSC affirmed the ALJ's denial of the motion to compel CITGO and Conoco to produce documents relating to the fees they paid in other ports. However, the LPSC directed its staff to issue subpoenas to CITGO, Conoco Philips and BG LNG Services, L.L.C. 2) The LPSC affirmed the ALJ's ruling to exclude Brent Dibner's testimony in part, but ordered that it would convene en banc to hear Mr. Dibner's testimony relating to state pilotage rates charged in other ports, subject to crossexamination; and 3) The LPSC affirmed the ALJ's denial of the Pilot's motion to strike David Moore's testimony.

The LPSC deferred ruling on the Final Recommendation of the ALJ until it received more information at the anticipated en banc hearing. CITGO and Conoco objected to the subpoenas and filed a formal response with the LPSC. On November 7, 2003, CITGO and Conoco filed a Petition for Supervisory Relief and Request for Expedited Hearing with the Nineteenth Judicial District Court within the pending case of Citgo Petroleum Corp., ConocoPhillips Co., Inc. and the Lake Charles Harbor and Terminal District v. La. Public Service Commission, No. 468,813, Sec. 22. The petition requested a stay of the LPSC's proceedings and a decree that the LPSC's rulings were invalid and unenforceable, including the issuance of subpoenas. In response, the LPSC filed Exceptions of Improper Use of Summary

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Proceedings and No Cause of Action. After a hearing, the district court overruled the LPSC's exceptions and vacated the orders from the LPSC's Executive Session. The district court also directed the LPSC to either affirm or modify the Final Recommendation of the ALJ and either sustain or overrule the two remaining interlocutory rulings. The district court based its ruling on the internal rules of LPSC. Under the LPSC's rules, the district court found that the only options available to the LPSC in reviewing the ALJ's determinations were to: 1) affirm or modify the Final Recommendation on the record, and 2) affirm or overrule one or more of the interlocutory rulings. The district court found that in scheduling additional hearings after the Final Recommendation, and by issuing subpoenas, the LPSC "acted in an arbitrary, capricious, and unreasonable manner." Following the district court's ruling, the parties sought review from this Court. On April 12, 2004, the LPSC filed an application for supervisory writ designated as 2004-CD-0914, seeking review of the district court judgment reversing its interlocutory rulings. Also on April 12, 2004, Pilots filed its own application for supervisory writ, designated as 2004-CD-0917, joining the arguments advanced by the LPSC. In addition to the supervisory writs, the LPSC filed two separate appeals, one designated as 2004-CA-1190 and the other designated as 2004-CA-1191. Pilots also filed its own appeal, designated as 2004-CA-1192. On May 19, 2004, the record for these three appeals was lodged with this court. A review of the supervisory writs and appeals filed in this case reveals that the substance of all of the filings are practically identical; i.e. all seek review of the district court's judgment concerning the LPSC's review of the ALJ's rulings. Meanwhile, in the 2004 regular legislative session, the legislature enacted Act

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902, which will be discussed in more detail infra. On July 12, 2004, the governor signed this Act, which became effective on January 1, 2005. On August 19, 2004, CITGO and Conoco filed a motion to dismiss the three appeals in this court arguing that the judgment of the district court related to an interlocutory, and not a final, ruling of the LPSC. CITGO and Conoco argue that this court may only invoke its appellate jurisdiction when there has been a final judgment rendered. We consolidated the writs and the appeals and issued an order directing the parties to address two specific issues: (1) whether this court should exercise its appellate and/or supervisory jurisdiction and (2) if such jurisdiction exists, whether a justiciable controversy exists in light of Act No. 902 of the 2004 Regular Legislative Session. JURISDICTION In the instant case, the LPSC and Pilots seek review of the district court's ruling under both this court's appellate and supervisory jurisdiction. CITGO and Conoco only object to the exercise of this court's appellate jurisdiction. Supervisory Jurisdiction La. Const. art. V,

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