The Keogh or 'Filed-Rate' Doctrine

• Author: Christopher L. Sagers
• Pages: 153-171

153

CHAPTER VIII

THE KEOGH OR “FILED-RATE” DOCTRINE

In some regulated industries—electrical power, natural gas and

telecommunications, for example—market participants are required to

file their rate-related information with a state or federal agency. These

filings (which are sometimes referred to as “tariffs”) usually describe a

company’s services or products, along with the terms and prices at which

the company offers them to its customers.

1

Statutes requiring rate filing often require the relevant agency to

ensure that rates are reasonable.

2

The statutes may also prohibit deviation

from the filed rate.

3

These statutory provisions, along with a general

judicial distaste for interfering with the work of regulatory agencies,

4

led

1

. Under the Federal Communications Act of 1934, for example, certain

telecommunications providers are required to file tariffs with the Federal

Communications Commission (FCC) that set forth the providers’ rates,

terms, and conditions of service, and are required to adhere to those rates,

terms, and conditions. See 47 U.S.C. § 203(a), (c). Likewise, the Natural

Gas Act requires certain participants in the natural-gas market to file their

“rates and charges . . . , and the classifications, practices, a nd regulations

affecting such rates and c harges” with the Federal Energy Regulator y

Commission (FERC). 15 U.S.C. § 717c(c).

2

. See, e.g., 15 U.S.C. § 717c(a) (“All rates and charges made, demanded, or

received by a ny natural-gas company for or in connection with the

transportation or sale of natural gas . . . shall be just and re asonable, and

any such rate or charge that is not just and reasonable is declared to be

unlawful.”); id. § 717d (giving FERC authority to set “just and

reasonable” rates, in certain circumstances); 47 U.S.C. § 205 (giving the

FCC limited authority to prescribe “just and reasonable” rates for

telecommunications services).

3

. See, e.g., 47 U.S.C. § 203(c).

4

. See, e.g., Sun City Taxpayers Ass’n v. Citizen Utils. Co., 45 F.3d 58, 62

(2d Cir. 1995) (filed rate doctrine recognizes that “(1) legislatively

appointed regulatory bodies have institutional competence to address

rate-making issues; (2) courts lack the competence to set . . . rates; and (3 )

the interference of courts in the rate-making process would subvert the

authority o f rate-setting bodies and undermine the regulatory regime.”);

A Handbook on the Scope of Antitrust

154

to the so-called filed rate or filed tariff doctrine. At its most basic level,

the filed rate doctrine is really two doctrines: a rule of administrative law

that bars a regulated company from selling its services at terms or prices

that differ from those described in the company’s tariff, and a rule that so

long as the regulated firm charges the filed rate, it cannot be liable to

private plaintiffs in money damages on any theory of liability.

5

Strictly

speaking, the doctrine does not exempt or immunize any conduct from

antitrust specifically. It merely bars private recovery of money damages.

6

The doctrine originated in 1907

7

and was first applied to antitrust in

1922, in Keogh v. Chicago & Northwestern Railway Co.

8

The courts recognize some exceptions to this rule. It does not bar

antitrust enforcement actions by the government,

9

it does not necessarily

bar claims for injunctive relief,

10

and most Circuits hold that it does not

apply to antitrust claims brought by one competitor against another.

11

A. The Filed-Rate Doctrine in General

Courts now commonly say that the filed-rate doctrine reflects two

policies: the goals of “nondiscrimination” and “nonjusticiability.”

12

see also Square D Co. v. Niagara Frontier Tariff Bur., Inc., 760 1347,

1351 (2d Cir. 1985), aff’d 4 76 U.S. 409 (1986) (carefully analyzing

leading case of Keogh v. Chi. & Nw. Ry. Co., 260 U.S. 156 (1922), and

finding among its rationales a preference for judicial deference to agency

authority).

5

. See, e.g., Town o f Norwood v. FERC, 217 F.3d 24 , 28 (1st Cir. 2000)

(stating that filed-rate doctrine “is actually a set of rules that have evolved

over time but revolve around the notion that [where regulated entities are

required to file rates with the regulatory agency], utility filings with the

regulatory agenc y p revail over unfiled contracts or other claims seeking

different rates or terms t han those reflected in t he filings with the

agency”).

6

. See part VIII.A below.

7

. Texas & Pac. Ry. Co. v. Abilene Cotton Oil Co., 204 U.S. 426 (1907).

8

. 260 U.S. 156 (1922). In the antitrust context, courts often refer to the

filed-rate doctrine as the Keogh doctrine.

9

. See part VIII.B.3 below.

10

. See id.

11

. See id.

12

. Arkansas La. Gas Co. v. Hall, 453 U.S. 571, 577 (1981) (“The

considerations underlying the doctrine . . . are preservation o f the

agency’s primary jurisdiction over reasonableness of rates and the need to

insure that regulated companies charge only those rates of which the

agency has been made cognizant.” (interna l quotation marks omitted)).