Facts of the Case:
The Maine Public Utilities Commission along with the attorneys general of Connecticut and Massachusetts filed for petitions of review of orders of the Federal Energy Regulatory Commission (FERC). FERC approved a settlement and redesigned New England's "capacity" electricity market, which Maine, Connecticut, and Massachusetts were subject to, even though they were not parties to the settlement. FERC denied their request for rehearing.
On appeal to the U.S. Court of Appeals for the District of Columbia, Maine, Connecticut, and Massachusetts argued that FERC erred in finding that "transition payments" under the settlement should be reviewed under the "public interest" standard as dictated by Mobile-Sierra rather than the "just and reasonable" standard. The District of Columbia Circuit agreed holding that the Mobile-Sierra doctrine should not apply to non-parties to the settlement agreement. It reasoned that the Mobile-Sierra doctrine is premised on the existence of a "voluntary contract" between the parties. Maine, Connecticut, and Massachusetts never entered a voluntary agreement with FERC and therefore the standard was inappropriate.
