Tuesday, February 28, 2017
In the Matter of Duke Energy Ohio Inc. for an Increase in its Natural Gas Distribution Rates, Case no. 2014-0328
Public Utilities Commission of Ohio
State of Ohio et al. v. Shannon Ferguson, Case no. 2015-1975
Eighty District Court of Appeals (Cuyahoga County)
State of Ohio v. Rickym Anderson, Case no. 2016-0317
Second District Court of Appeals (Montgomery County)
State of Ohio v. Melvin Mutter, Case nos. 2016-0440 and 2016-0441
Fourth District Court of Appeals (Scioto County)
Can Utility Pass $55.5 Million Clean-Up Cost of Old Gas Plants to Ratepayers?
In the Matter of Duke Energy Ohio Inc. for an Increase in its Natural Gas Distribution Rates, Case no. 2014-0328
Public Utilities Commission of Ohio
ISSUES:
- Did the Public Utilities Commission of Ohio (PUCO) disregard the requirement that only property that’s “used and useful” be factored into a natural gas rate increase when it approved a utility’s cost for investigation and remediation of long-defunct manufactured gas plants?
- Does environmental remediation of a defunct manufactured gas plant count as a normal operating expense for a natural gas distributor?
- Is the requirement that a bond be posted by a party appealing a PUCO decision, even a public office such as the Office of the Consumers’ Counsel, an unconstitutional violation of the separation-of-powers principle?
BACKGROUND:
When Duke Energy acquired the natural gas supplier for the Cincinnati area, it inherited two manufactured gas plants (MGPs) that began operations in the mid- and late-1800s. Before the introduction of natural gas, MGPs developed gas from coal tar and other substances, and created toxic waste that was left on site. The West End plant closed in 1928 and the East End plant in 1963. Most of the surface-level equipment has been removed from the sites, while underground tanks and gas lines remain in place.
For many years the sites were relatively remote and the environment was protected by capping the grounds with asphalt, concrete, and soil. Duke uses a portion of the East End site for continuing operations, and with the introduction of utility deregulation, the company is now a gas distributor, not a gas producer. Beginning in 2007, Duke began investigating the pollution at the sites and considering remediation because residential development was proposed at land adjacent to the East End site and the states of Ohio and Kentucky began considering part of the West End site for a new interstate bridge.
Duke applied to the PUCO for permission to defer $62.2 million in cleanup costs for the two sites with the intent to begin passing on the costs of the work to customers sometime after 2012. The commission granted approval of the plan, but didn’t consider the charge until Duke filed for a rate increase. As part of a rate increase approved in 2013, the PUCO allowed Duke to institute a “MGP rider” that would be an additional cost to customers for five years, at about $925,000 per month, to recoup the remediation costs.
Rider Approved
The proposal of the rider has drawn objections from residential and business consumers, who argue that the MGPs haven’t provided gas service in more than 50 years, and the law doesn’t allow utilities to pass on the costs associated with land or property that isn’t found to be “used or useful” is rending service to the current customers. Duke argues it is liable for the toxins on the land and is under a federal mandate to assure the waste doesn’t pollute the environment. The company entered into a voluntary agreement with the Ohio Environmental Protection Agency to remediate the properties. It maintains the proactive approach was less costly and gas customers, as well as the entire community, benefitted from the work. It argues that other states and the PUCO in other cases considered clean-up costs as “expenses” that the company can pass on regardless of whether the property was considered used or useful in providing service.
During PUCO proceedings, the PUCO staff recommended that Duke be allowed to recover about $6.3 million of the $62.2 million it sought, citing that part of the land with gas operations and lines in use qualify as useful property under R.C. 4909.15. Opponents argued that none of the cost should be borne by current customers and that Duke shareholders are responsible for the remediation. In a 3-2 decision the PUCO granted Duke the right to recoup $55.5 million through the MGP rider, siding with the company’s position that the “used and useful” provision of R.C. 4909.15(A)(1), isn’t applicable in the case. The two dissenting commissioners wrote that the PUCO’s powers come solely from laws passed by the General Assembly and the commission simply had no authority to permit the MGP costs to be passed on.
The MGP rider went into effect in February 2014, and a group of four organizations — the Office of the Ohio Consumers’ Counsel, Kroger Company, the Ohio Manufacturers’ Association, and Ohio Partners for Affordable Energy — jointly appealed the decision to the Ohio Supreme Court. The group requested the PUCO’s decision be stayed during the appeal, which would prevent the collection of the charges through the rider. The challengers asked that they not be required to post a bond that would pay Duke for the losses in revenue it suffered for not being allowed to impose the charges.
The Court originally agreed to the challengers’ request and stayed the MGP rider in May 2014 without a bond while the appeal was pending. The PUCO and Duke objected, arguing that R.C. 4903.16 requires a bond. In November 2014, the Court ordered the opponents pay a $2.5million bond in order for the stay to continue. The opponents didn’t post the bond, the stay was lifted, and the PUCO allowed Duke to begin collecting the rider again in January 2015, having gone seven months without collecting the funds.
The opponents have asked the Court to declare the bond requirement unconstitutional. Ohio law requires the Court to hear these types of PUCO decision appeals.
Utility, Consumer Groups Interested in Case
The case has drawn statewide interest by gas suppliers and other utilities, and the Court allowed Duke to intervene so it could argue on its own behalf. Duke filed a brief in support of the PUCO’s decision. Testimony before the PUCO indicated that more than 90 MGP site exists throughout Ohio, and other utility companies filed amicus curiae briefs supporting the PUCO majority’s position to allow MGP cleanup costs to be passed along to customers while additional consumer groups oppose the practice.
Law Provides No Exception to Allow MGP Charge, Opponents Claim
The challengers claim the PUCO disregarded R.C. 4909.15(A)(1) when it approved the Duke rider. R.C. 4909.15(A)(1) states, “(A) The public utilities commission, when fixing and determining just and reasonable rates, fares, tolls, rentals, and charges, shall determine: (1) The valuation as of the date certain of the property of the public utility used and useful or, with respect to a natural gas, water-works, or sewage disposal system company, projected to be used and useful as of the date certain, in rendering the public utility service for which rates are to be fixed and determined.”
They argue the property ceased being of use in natural gas production when one plant closed in 1928 and the other in 1963, and the law provides no exception that allows expenses for property not in use to be calculated as part of the rates. The PUCO maintains that under the circumstances, including a mandate in federal law that Duke clean up the sites, the costs are “expenses” that are allowed to be included in the rate regardless of whether the property was used or useful.
The challengers note that R.C. 4909.15(C)(1) permits expenses as part of the proposed rate and are measured during a 12-month “test period,” that the utility selects to prove its actual costs and revenues. However, R.C. 4909.15(A)(4) states the expenses noted R.C. 4909.15(C)(1) are those for “rendering the public utility service for the test period.” The opponents maintain that the expenses for the MGPs can’t be included because they haven’t been used to render service in more than 50 years.
In addition to the lack of use, the challengers argue the PUCO staff has adopted a “matching” principle based on prior Court rulings and matches the expenses of a piece of property to the use by the company to provide its PUCO regulated service. The opponents note that after deregulation of the natural gas industry Duke Energy is now a gas distributor and that the MGP properties weren’t used to distribute gas, but rather to produce and supply gas. With that change, the MGP property doesn’t match Duke’s business of distributing gas, they contend.
“The PUCO completely missed and ignored this important linkage in authorizing Duke to charge customers $55.5 million for MGP-related investigation and remediation expenses for facilities that were not used and useful as of the date certain —and have not been used and useful for at least 50 years,” the four opponents state in their joint brief.
Citing the Court’s 1981 Office of Consumers’ Counsel v. Pub. Util. Comm. decision, the challengers also assert that for the purposes of establishing a rate under R.C. 4909.15, expenses are defined as “normal, recurring expenses,” such as those for repairs, maintenance, personnel-related costs, and administrative expenses. In the 1981 case, the PUCO rejected an electric company’s request to collect costs associated with a canceled nuclear power plant. The challengers argue Duke’s case is similar because it deals with expenses that aren’t part of providing service to current or future customers.
Opponents Believe Bond Requirement Unconstitutional
The challengers also argue the bond requirement in R.C. 4903.16 is unconstitutional because the Court has the authority to issue stays and the requirement by statute to post a bond violates the independent power of the Court. They argue that while state law creates PUCO processes, including the right to appeal a PUCO decision, the legislature has no right to encroach on how the Supreme Court handles an appeal. They maintain the legislature doesn’t have the power to place a condition on what steps the Court must take to issue a stay, such as requiring a bond.
Commission Maintains Rates Can Include Cleanup Costs
The PUCO maintains that the law requires the land to be cleaned up and Duke Energy used a cost-effective method of addressing the problem. It argues those were costs of doing business, which can be passed on to ratepayers.
The commission asserts that operating expenses accumulate over time and arise from activities that occur over time. The remediation was an expense Duke was incurring while it was rendering service during the test period and can be included in rates, it concludes. It also counters that just because the remediation isn’t a normal, recurring expense, it’s a logical business cost, and the law doesn’t require all property expenses to be tied to current service. As an analogy, the PUCO notes that mine closure costs are recoverable even if the mine is no longer producing coal as long as the obligation to pay for the closure cost is current.
“It is the obligation to pay that must be current. And the Commission found, as a matter of fact, that Duke’s obligation to remediate is current,” the PUCO’s brief states. “Thus it is clear that the environmental remediation costs pass the test and are recoverable under R.C. 4909.15(A)(4) and consistent with important jurisprudence of the Court.”
The commission defends its determination that the “used and useful” requirement didn’t apply because the remediation costs expenditures are normal operating costs.
“For many types of expenditures this kind of relationship does not exist as is certainly true for the advertising, rate case, stock issuance, chamber of commerce dues, and tax expenses the Court has determined to be recoverable as discussed previously,” the brief states.
Bond Required, Commission Asserts
The commission argues the Court has essentially addressed the constitutionality of the bond requirement when it ordered a bond be posted in November 2014. Because the Court first allowed the stay without a bond, the PUCO and Duke presented arguments that compelled the Court to impose a $2.5 million bond. The commission maintains that decision proves a bond requirement is constitutional.
Duke Finds PUCO Just, Reasonable
Duke asks the Court to support the PUCO’s decision and contends that the old MGP sites are part of the current operation to serve customers and that the land must be managed in compliance with current environmental law. The company challenges the notion that only costs associated with a current piece of property in use can be charged, and that when all the aspects of the law are read together, it is clear that cleanup costs are operating costs that can be included in a rate increase.
Duke also notes that several other states have permitted the recovery of MGP cleanup costs, including Michigan, New Jersey, Illinois, and Wisconsin.
Friend-of-the- Court Briefs
Columbus Gas of Ohio, Dominion East Ohio and Vectren Energy Delivery of Ohio collectively filed an amicus brief supporting the PUCO’s position. Three electric companies collectively known as First Energy also submitted a brief siding with the PUCO’s position on the bond requirement and urging the Court to find provision constitutional.
The Ohio Energy Group and the Industrial Energy Users-Ohio submitted an amicus brief in support of the challengers and argue that MGP cleanup costs aren’t allowed to be passed on to customers. If the Court finds the costs are allowed, the group suggests the PUCO staff’s position be adopted to allow only $6.3 million to be charged.
- Dan Trevas
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing Kroger Company: Kimberly Bojko, 614.365.4124
Representing the Office of the Ohio Consumers’ Counsel: Larry Sauer, 614.466.1312
Representing the Ohio Manufacturers’ Association: Robert Brundrett, 614.629.6814
Representing Ohio Partners for Affordable Energy: Colleen Mooney, 614.488.5739
Representing the Public Utilities Commission of Ohio from the Ohio Attorney General’s Office: Thomas McNamee, 614.466.4397
Representing Duke Energy Ohio: Amy Spiller, 513.287.4359
Must Injured Worker Receive Employer’s Permission to Dismiss Appeal of Workers’ Compensation Case?
State of Ohio et al. v. Shannon Ferguson, Case no. 2015-1975
Eighty District Court of Appeals (Cuyahoga County)
ISSUES:
- Did the General Assembly violate the constitutional rights of injured workers when it adopted a “consent provision” that requires employer consent before an employee may dismiss an appeal and refile the appeal up to a year later, while all that time receiving Ohio Bureau of Workers’ Compensation benefits?
- Is the consent provision, R.C. 4123.512(D), a “substantive” law that would trump a “procedural” rule developed by the Ohio Supreme Court, or is it procedural, which would mean the Ohio Rules of Civil Procedure would govern the matter?
BACKGROUND:
In 2009 Shannon Ferguson injured a shoulder while working at the Ford Motor Company and filed a workers’ compensation claim. Ford contested the claim, but the Ohio Industrial Commission allowed the claim for a sprained/strained shoulder, and later also allowed for a left rotator cuff tear.
Ford appealed the allowances as the case went through the Industrial Commission’s administrative appeal process, and then in 2012 Ford appealed the Industrial Commission’s ruling in favor of Ferguson to the Cuyahoga County Common Pleas Court.
Non-Traditional Process for Workers’ Compensation Appeals
The specialized procedures of Ohio’s workers’ compensation law allows either the injured worker or the employer to appeal decisions of the Industrial Commission to common pleas court when there is a dispute about whether the injury is caused by a workplace incident. Regardless of who appeals, the injured worker is considered the plaintiff who must file the complaint in common pleas court to initiate the case. The law also requires the court to hear the case de novo, without the judge or jury benefitting from the record of the Industrial Commission proceedings that sided with the injured worker. The worker carries the burden of proof to demonstrate the injury is work-related.
During the court appeals process, the injured worker continues to receive compensation from the bureau. Just before the case went to trial in 2013, Ferguson moved to voluntarily dismiss his case without prejudice, citing Civil Rule 41. He intended to use the state’s “savings statute” that would allow him to refile his case within one year of the dismissal. During that time, the bureau would continue to pay him benefits. He also sought to add a declaratory judgment to find R.C. 4123.512(D), the consent provision, unconstitutional because it required that he receive permission from Ford to dismiss the complaint, and he argued that requirement contradicted Civ. R. 41(A)(1), which doesn’t require consent of the defendant.
Law Declared Unconstitutional
The trial judge denied Ferguson’s effort to dismiss the case without Ford’s consent and his declaratory judgment request. Ferguson filed a separate declaratory judgment case, arguing the consent provision violates the Ohio Constitution because it improperly intrudes on the Ohio Supreme Court’s power to govern courtroom procedure, and it violates the equal protection and due process clauses of the Ohio and U.S. constitutions. In 2014, the trial court ruled in Ferguson’s favor finding the law unconstitutional.
The Ohio Attorney General’s Office appealed the decision on behalf of the state to the Eighth District Court of Appeals, noting the consent provision was adopted by the General Assembly in 2006 as a result of another Ohio Supreme Court decision regarding the contested injury appeals process. The attorney general argued the provision doesn’t violate the constitutions, but the Eighth District rejected the attorney general’s arguments in 2015, and the attorney general appealed to the Supreme Court, which agreed to hear the case.
The case has drawn the attention of several statewide organizations representing Ohio employers and injured workers, with eight organizations and one business filing amicus curiae briefs.
Process Without Consent Provision Leads to Abuse, Attorney General Argues
The attorney general notes the trial court and Eighth District struck down the consent provision on all five constitutional claims made by Ferguson, but maintains the lower courts fail to recognize that a workers’ compensation appeal is a unique process and lawmakers developed a unique set of rules that tries to protect the rights of all parties in the litigation.
The attorney general explains the law was changed after testimony before the legislature revealed that “in nearly all” the thousands of appeals filed by employers, the employee would voluntarily dismiss their claims, citing Civ. R. 41, and would continue to receive benefits. Advocates for the change argued the process was being abused because a typical appeal takes about one year from the time of filing the case. With the ability to dismiss, the attorney general maintains the employee could extend the case to nearly three years by waiting until right before the trial to file for dismissal, then waiting until the one-year deadline to refile, and then trying the case, which typically takes a year.
The employee would collect the disputed benefits the entire time, the attorney general explains, and if the employee loses, the employee will be forced to repay the benefits or the bureau will use a special fund to cover its costs for invalid payments. Employers pay workers’ compensation premiums based on their “experience” rating, which includes the type and number of work injuries an employer incurs. During the three years of an appeal the employer may incur higher premiums based on the contested injury, though the bureau will refund the money if the employer prevails. The attorney general claims some businesses are severely hampered or go out of business because of the increased premium cost.
The attorney notes that if the Industrial Commission rejects an injured worker’s injury claim, and the employee appeals to a court, the employee doesn’t receive any benefits unless the court awards the funds. The attorney general states the consent provision was designed to treat the parties fairly by paying compensation, but not allowing the injured worker to unilaterally delay the process.
Due Process and Equal Protection Afforded, Attorney General Asserts
Under the equal protection claim, the attorney general notes the Eighth District reasoned that an injured worker seeking compensation is like any other plaintiff in a civil case and must be treated like all plaintiffs, including having the right to invoke any of the civil rules for Ohio court cases. Those rights include the ability to voluntarily dismiss the case without employer consent.
Under the due process claim, the lower courts found the provision takes away a substantive protection for an injured worker who might need more time to put together a case to defend the claim of being injured on the job, and there is no rational reason for the state to place a restriction on the rights of injured workers that other plaintiffs in civil cases don’t face.
The attorney general argues equal protection rights weren’t violated by the provision and the courts give legislatures great deference in creating public policy. In most cases, courts consider a law constitutional if there is any rational basis for its passage, the attorney general explains, and a law can treat dissimilar groups of people differently if there is a rational reason. In this case, lawmakers had a rational reason to treat workers’ compensation appeal parties differently than other plaintiffs in civil cases. One key difference, the attorney general notes, is that a plaintiff in a typical civil case doesn’t collect damages from the defendant while the case is in process, especially when the case is on hold because of a voluntary dismissal.
“Factually, the Eighth District showed a cavalier disregard for other people’s money. An employer who must pay during the delay that is possible without the consent provision is not aided during those three years if it is cash-strapped. Nor is it aided at all if it goes out of business during those years. And, the real cost here is borne by the bureau of workers’ compensation, which generally adjusts an employer’s obligations to the state if the employer wins an administrative appeal,” the attorney general’s brief states. “Ultimately, the bureau passes the tab on to Ohio’s employers generally. It is rational for the General Assembly to avoid delays that costs the state money.”
Due process challenges also are based on a rational basis tests, the attorney general notes, and argues for the same reason the consent provision is valid under the equal protection test, it meets the due process test. The attorney general asserts the Eighth District “mistakenly elevates Civil Rule 41 to a constitutional mandate that allows litigants to delay cases.”
Provision Honors Separation of Powers, Attorney General Maintains
Ohio’s Constitution recognizes the separate independent powers of the legislature and the judiciary, and the adoption of the “modern courts amendment” further clarified the roles of the judiciary and the General Assembly in governing Ohio courts, the attorney general notes. The modern courts amendment generally states that legislative acts control court cases except in the area of court procedure, where a statute only violates the separation-of-powers principle if the law directly conflicts with a court-drafted rule, the attorney general explains.
If a law is “substantive,” then by its nature it isn’t procedural and doesn’t conflict with a court rule, the attorney general notes. The attorney general maintains that the consent provision is a substantive law change, and the uniqueness of a workers’ compensation appeal makes it a “special proceeding” governed by rules created by state law. The provision covers the dismissal of a complaint by an opponent in an administrative appeal, and the attorney general asserts that neither Civ. R. 41 nor any other civil rule govern that matter, meaning the consent provision doesn’t conflict with a civil rule. The attorney general notes that substantive rules are often expressed through procedures and in this case the statute is substantive because it “gives the employer the right to prevent dismissal of its own appeal,” and prevents the delay of the hearing of its appeal.
Law Is Unconstitutional, Ferguson Maintains
Ferguson cites the Ohio Supreme Court’s 1999 Kaiser v. Ameritemps, Inc. and other cases to demonstrate that the Court has repeatedly determined an injured worker is to be treated like any plaintiff in a civil appeal and has the same rights, including the right to voluntarily dismiss the case. Ferguson argues the reason the employee is granted the use of the rules is because the injured worker has to file the complaint, has to re-litigate the matter in a new trial, and has the burden of proof that a work-related injury occurred. In contrast, Ferguson suggests the employer isn’t harmed by any delay in appeal because any benefits paid by the employer are reimbursed by the state if the injured worker loses the appeal, the accident isn’t counted against the employer for premium purposes if the employer wins, and the savings statute allows for a one-time, one-year delay and prevents perpetual delays. Because the employer isn’t harmed, and the rule is procedural, Ferguson argues the consent provision is unconstitutional.
Ferguson also counters the attorney general’s argument that the appeal is a special proceeding regarding an administrative appeal. He notes that in most state administrative appeals, the trial court is reviewing the record of the administrative appeal and determining if the government agency followed the rules when making a decision. In this case, the injured worker begins a new case and has to re-prove a work-related injury occurred without any reference to the administrative record, and unlike most other administrative appeals, there is a requirement to follow the Rules of Civil Procedure, he added.
Modern Rules Prevent General Assembly Overreach, Ferguson Suggests
Ferguson discusses the development of Ohio’s civil rules and notes the General Assembly can enact laws to create special proceedings and can write the rules for those types of cases. The court rules are intended to protect against the General Assembly enacting procedural rules for the purpose of “satisfying particular interests,” Ferguson noted, and charged the consent provision was exactly the type of attempt to override the civil rules that amendment backers sought to block.
“In the special interest of employers over claimants, the General Assembly is attempting to override a civil rule that the Supreme Court has already determined applies to workers’ compensation appeals,” Ferguson’s brief states.
Ferguson states the Supreme Court has determined the right to voluntarily dismiss the case is a procedural rule, and a state law that adds the requirement of employer consent violates the separation-of-power principle, which means the court rule governs the proceeding.
Friend-of-Court Briefs
An amicus brief was filed by Automation Tool & Die, Inc., a Medina manufacturing firm that has a similar case pending before the Ohio Supreme Court. The Ninth District Court of Appeals didn’t find a separation-of-powers violation in Automation’s case where a trial court ruled that the consent provision applied and the injured worker couldn’t unilaterally dismiss the case. The company also notes that because the Court is hearing the appeal of Ferguson’s declaratory judgment case that solely questioned the constitutionality of the law, there is no employer that is a direct party to the case before the Court. Automation and other employer organizations side with the attorney general to advocate the reversal of the Eighth District’s ruling.
Other briefs filed in support of the attorney general were submitted jointly by the Ohio Chamber of Commerce, National Federal of Independent Business/Ohio, Ohio Council of Retail Merchants, Ohio Farm Bureau Federation, and the Ohio Self Insurers Association.
A brief supporting Ferguson was filed jointly by the Ohio Association of Justice and the Ohio Association of Claimant’s Counsel.
- Dan Trevas
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing the State of Ohio et al. from the Ohio Attorney General’s Office: Eric Murphy, 614.466.8980
Representing Shane Ferguson: David Meyerson, 216.696.1080
Are Mandatory Sentences in Criminal Code Unconstitutional When Imposed on Juveniles?
State of Ohio v. Rickym Anderson, Case no. 2016-0317
Second District Court of Appeals (Montgomery County)
ISSUES:
- Was the longer sentence received by a co-defendant who went to trial an impermissible trial tax when compared with the sentence for the co-defendant who negotiated a plea agreement?
- Are the mandatory sentencing statutes in R.C. Chapter 2929 unconstitutional as applied to children because they don’t allow the trial court to make an individualized determination when sentencing a juvenile?
BACKGROUND:
Rickym Anderson, Dylan Boyd, and another high school friend skipped school on April 20, 2012. In the mid-afternoon, they came to a Dayton home where the garage door was open. Brian Williams and Tiesha Preston were in the garage. Boyd approached them and told them not to move, but Williams ran out the back of the garage. Boyd shot Williams, hitting him in the abdomen, but Williams was able to run to a neighbor’s house. The trio ordered Preston into the trunk of a car in the driveway and took off with her purse.
Later that afternoon, Anderson and Boyd and a different friend walked up to a young woman taking out her trash. Anderson had a gun, and they asked if the woman had money and threatened her. After she handed over her purse, a nearby resident came by and heard the woman yelling, and the teenagers ran.
Police arrested Anderson, who was 16 years old, and Boyd, also a teen. The Montgomery County Juvenile Court transferred Anderson’s case to adult criminal court in accordance with a state law that requires mandatory transfer for certain alleged offenses when a juvenile is 16 and uses a firearm.
One Teen Pleads, Other Goes to Trial
Boyd, who was also tried as an adult, pled guilty to three felonies in October 2012, and the court sentenced him to nine years in prison. Anderson took his case to trial. In January 2013, the jury found him guilty of three counts of aggravated robbery, one count of kidnapping, and firearm specifications, but not guilty of felonious assault. After an initial appeal, the trial court resentenced Anderson to 19 years in prison – three concurrent 11-year terms for each robbery count, five years for kidnapping, and three years for merged firearm specifications.
Anderson appealed to the Second District Court of Appeals, which upheld the trial court’s decision. The Second District conveyed that Boyd received a lesser sentence as a reward for taking responsibility, pleading guilty, and agreeing to testify against Anderson. The appeals court also rejected Anderson’s argument that the mandatory sentencing law was unconstitutional for juveniles.
Anderson asked the Ohio Supreme Court to review the issues, and the Court agreed to consider the case.
Anderson Asserts He Received Harsher Sentence for Going to Trial
Anderson argues that the difference between his 19-year sentence and Boyd’s nine-year prison term for similar crimes shows that he was being punished for going to trial rather than pleading guilty. The U.S. and Ohio constitutions protect defendants from being punished for exercising their right to a trial by jury, Anderson maintains. Noting that the trial court heard both cases and described him and Boyd as equally accountable for the crimes, Anderson disputes the Second District’s conclusion that the benefit Boyd received for not going to trial was different than punishing Anderson for exercising his right to a jury trial.
“This characterization is a distinction without a difference: any mechanism for saddling an equally culpable co-defendant who chooses to exercise his right to trial with a longer sentence, absent a proper justification for the longer sentence, is an impermissible trial tax,” Anderson’s brief to the Court states.
He contends that the trial court had to state reasons for the dissimilar sentences to dispel trial tax concerns. Possible reasons for distinct punishments could include differing criminal histories, threats to society, or levels of responsibility, he notes. However, neither the trial nor appellate court provided clear justification, beyond Boyd’s plea deal, for the different sentences, Anderson asserts.
Prosecutor States Court Had Reasons to Impose Different Sentences
The Montgomery County Prosecutor's Office responds that courts aren’t required to impose the same sentence on co-defendants. The trial court in no way inferred that Anderson was sentenced more harshly than Boyd for going to trial, the prosecutor maintains, adding that the judge specifically stated that Anderson wasn’t being penalized for going to trial.
The prosecutor argues that Anderson and Boyd were treated differently because of their differing situations. The jury convicted Anderson of four first-degree felonies with multiple firearm specifications, while Boyd was convicted of three felonies with only one firearm enhancement. The prosecutor indicates that Anderson also denied committing any crimes, showed no remorse, and had a prior juvenile record and violations related to those offenses. State law requires trial courts to consider offenders individually for sentencing, the prosecutor points out.
“The trial court selected his sentence from the range applicable to his offenses after considering the facts presented at trial, the seriousness of his conduct, his individual characteristics, and his likelihood of recidivism,” the prosecutor wrote in the brief to the Court. “Anderson’s sentence of nineteen years is well within the six[-] to fifty[-]year sentencing range that was available for his offenses.”
Sentencing Law Constrains Court’s Assessment of Juveniles, Anderson Argues
State laws that require mandatory minimum sentences for crimes are unconstitutional when imposed on juveniles, Anderson also contends.
“Ohio’s mandatory minimum sentencing scheme provides no opportunity for the sentencing court to consider the child’s age and the mitigating factors of youth; the child’s family and home environment; the ‘circumstances relating to youth that may have played a role in the commission of the crime’; the challenges that the child faces when navigating the adult, criminal justice system; and, the possibility of rehabilitation and the child’s capacity for change,” Anderson’s brief states.
This lack of discretion for courts sentencing juveniles in adult court runs contrary to a line of U.S. Supreme Court decisions differentiating between juveniles and adults in the criminal justice system, Anderson argues. Though those cases involved death and life-without-parole sentences, Anderson maintains that individualized sentencing for children must apply in every juvenile case. Ohio’s criminal sentencing law wrongly forces courts to treat juveniles like adults, but courts must be allowed to take into account how children are different when imposing a sentence, he asserts.
Youth Is Considered in Criminal Sentencing, Prosecutor Maintains
The prosecutor counters that Ohio’s criminal sentencing law does give courts the ability to consider a child’s age and mitigating factors related to youth. Citing the Ohio Supreme Court’s ruling in State v. Long (2014), the prosecutor points out that trial courts are directed by statute to consider, for example, factors that make an offense more or less serious as well as “any other relevant factors.” Youth is a factor for courts to consider when sentencing juveniles, the Court concluded.
In Anderson’s case, the court could’ve sentenced him to a maximum of 50 years, but he received only 19 years, the prosecutor explains. The prosecutor states that the court imposed concurrent, rather than consecutive, sentences for the robbery charges; sentenced near the bottom of the possible range for the kidnapping offense; considered testimony about his life; and reviewed his juvenile record. In addition, Anderson will be eligible to ask the trial court for release after eight years if he shows maturity and rehabilitation, the prosecutor notes.
While the three-year sentence for the firearm specification was mandatory, the prosecutor contends that this punishment isn’t comparable to the death penalty or a life sentence without parole, as was the case in the U.S. Supreme Court decisions cited by Anderson. Noting that the trial court merged the three firearm offenses into one by for sentencing, the prosecutor concludes that Anderson’s sentence for using a firearm doesn’t rise to the level of cruel and unusual punishment.
Additional Briefs Filed
Amicus curiae briefs supporting the Montgomery County prosecutor’s position has been submitted by the Ohio Attorney General’s Office and Franklin County Prosecutor’s Office.
Court Increases Oral Argument Time
The Ohio Attorney General’s Office asked the Court for permission to participate in oral arguments in the case. The Court granted the motion, allowing the attorney general five minutes to argue in addition to the 15 minutes already allotted to the Montgomery County Prosecutor’s Office. Anderson will be given 20, rather than the standard 15, minutes to present his positions.
- Kathleen Maloney
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.
Contacts
Representing Rickym Anderson from the Ohio Public Defender’s Office: Stephen Goldmeier, 614.466.5394
Representing the State of Ohio from the Montgomery County Prosecutor’s Office: Meagan Woodall, 937.225.4117
Did Plea Bargain Prevent Subsequent Prosecution for Related Charges?
State of Ohio v. Melvin Mutter, Case nos. 2016-0440 and 2016-0441
Fourth District Court of Appeals (Scioto County)
ISSUES:
- Do the “double jeopardy” clauses of the U.S. and Ohio constitutions bar a second prosecution for a felony charge by a county prosecutor that is based on the same factual issues that resulted in a plea bargain negotiated by a city prosecutor to convict suspects of misdemeanor charges?
- When the state appealed a trial court’s decision, did an appellate court improperly place the burden of proof on the criminal defendant as the case moved forward, and does such a shift violate the “due process” clauses of the U.S. and Ohio constitutions?
BACKGROUND:
Criminal charges were filed against Buddy and Melvin Mutter in Portsmouth Municipal Court stemming from a single incident that happened on Oct. 17, 2014. Melvin Mutter was charged with misdemeanors of aggravated menacing and public indecency, and a fifth-degree felony of ethnic intimidation. Buddy Mutter was charged with aggravated menacing and ethnic intimidation.
On Oct. 23, Buddy Mutter pleaded no contest in municipal court to aggravated menacing, and the ethnic intimidation charge was reduced to menacing by stalking, in which he pleaded no contest.
On Oct. 23, a new charge of menacing by stalking was added for Melvin Mutter. On Oct. 29, he pleaded no contest to aggravated menacing and menacing by stalking. The public indecency and ethnic intimidation charges were dismissed with prejudice. Two days later, a Scioto County grand jury indicted both Mutters for ethnic intimidation, and felony charges were filed in Scioto County Common Pleas Court.
The Mutters asked the common pleas court to dismiss the ethnic intimidation charges on double jeopardy grounds, and the trial court conducted a brief hearing to allow arguments from attorneys and the consideration of briefs. The trial court then dismissed the cases, stating that the misdemeanor convictions “involved the same fact situation as the indictment” and a second prosecution was barred by double jeopardy. The Scioto County Prosecuting Attorney appealed the decision to the Fourth District Court of Appeals
At the appeals court, the prosecutor argued that convicting the Mutters of ethnic intimidation isn’t double jeopardy because the conviction for aggravated menacing isn’t a lesser-included offense, and the two aren’t being punished twice for the same crime.
The appeals court disagreed with the state’s premise finding that the trial judge was correct that aggravated menacing, R.C.2903.21, is a lesser included offense of ethnic intimidation, R.C. 2927.12. However, the appeals court found that the Mutters were found guilty of menacing by stalking, R.C. 2903.211, and menacing by stalking isn’t a lesser offense of ethnic intimidation. Because it isn’t a lesser charge, it isn’t a double jeopardy violation for the state to pursue the felony charges.
The Mutters contended their pleas were based a on plea bargain with the city prosecutor and that the ethnic intimidation charges were amended or dropped in exchange for their no contest pleas to the misdemeanors. They argued the common pleas court judge was correct in dismissing their cases because the convictions were based on the same conduct and that they can’t be charged for the greater offenses after agreeing to be convicted for the lesser offenses.
The Fourth District ruled that the municipal court records are unclear as to why the Mutters were charged with menacing by stalking, and there is no proof that the stalking charges arose from the same incident as the ethnic intimidation. It remanded the case to the common pleas court for further proceedings.
The Mutters appealed the Fourth District’s decision, and the Supreme Court agreed to hear the cases. The Court has consolidated the cases for oral argument.
Plea Bargain Prevents Second Prosecution, Mutters Maintain
A negotiated plea where the Mutters reasonably believed the plea would prohibit their future prosecution bars a second attempt to prosecute them for the greater charge, they argue. They explain that a negotiated plea is essentially a contract and ensures the prosecutor won’t break the promise by seeking a greater charge. They maintain the common pleas court recognized the misdemeanor convictions involved the same fact situation as the felony charge and that it was the intent of the state to have the Mutters accept menacing-by-stalking convictions as a reduction for ethnic intimidation. The Mutters argue the no contest pleas were intended to resolve all charges from the incident and to prevent future prosecutions.
Citing the 1975 State v. Best decision, the Mutters assert the municipal and county prosecutors constitute one entity, the state of Ohio, and the municipal prosecutor acting on behalf of the state entered the plea agreements that led to the dismissal of the felony charges. This prevents the state, through the county prosecutor, from seeking the second charges, they conclude.
Burden Unfairly Shifted, Pair Asserts
The Mutters also argue the Fourth District is unfairly trying to place the burden of proof on them to prove the trial court didn’t make an error. They argue the trial court’s judgment is presumed to be regular and legal.
The Mutters maintain the Fourth District must provide due process, and the court failed to do so when it held that there was no “evidence on this record or the municipal court’s publicly accessible dockets” to determine if the plea convictions and the ethnic intimidation charge arose from the same incident.
The Mutters argue the Fourth District is placing the burden on them to prove the municipal court intended for the menacing charges to settle the felony charges. They argue that while the appellate court might have a limited view on what happened because the prosecutors didn’t provide more information, the Fourth District should assume the common pleas court judge had access to more information. Further, the trial court judge was in the best position to weigh the credibility of the Mutters’ argument that it was a plea, they maintain.
Proper Plea Procedure Not Followed, Prosecutor Agues
The Scioto County prosecutor argues the municipal court, which only sentences convicts in misdemeanor cases, lacked jurisdiction and didn’t follow the proper procedure to reduce a felony ethnic intimidation charge or to dismiss the felony charge and replace it with a misdemeanor menacing-by-stalking charge.
The prosecutor notes that Criminal Rule 5(B) and R.C. 1901.20 govern the municipal court’s authority and it doesn’t have the jurisdiction to decide felonies. The county prosecutor doesn’t dispute the county and municipal prosecutors are one entity – the state – but that they have their own authority and constraints. The county prosecutor explains the municipal court can do three things at the conclusion of a preliminary hearing: (1) find there is probable cause to believe the felony charge or another felony was committed and bind the defendant over to common pleas court to face the charge; (2) find probable cause that a misdemeanor was committed and retain the case; or (3) discharge the accused.
If at the preliminary hearing the municipal court finds that a felony charge wasn’t committed but considers reducing the crime to a misdemeanor, there is a process that must be followed, the county prosecutor notes, and the Portsmouth Municipal Court didn’t follow the process. In the Mutters’ case, there was no preliminary hearing, no evidence taken, no finding of a probable cause for any of the charges, and no new complaint filed, which are all required to reduce a charge, the county prosecutor concludes.
“Simply put, the Portsmouth Municipal Court did not comply with Crim. R. 5(B) and R.C. 1901.20 and jeopardy did not attach to bar prosecution for the ethnic intimidation charges against these defendants,” the prosecutor’s brief states.
Since the municipal court didn’t have jurisdiction, then its judgment is void and treated as if it didn’t occur, the prosecutor argues. That means the Mutters were never convicted of the misdemeanor charges, and it isn’t a double-jeopardy violation to charge them with the felonies. The prosecutor also maintains the Mutters were responsible for knowing the municipal court couldn’t address their felony charges and it was unreasonable for them to believe they couldn’t face felony charges from the county prosecutor.
Burden of Proof Appropriately Shifted, Prosecutor Suggests
Regarding the burden of proof, the county prosecutor argues the burden of proof properly shifted to the Mutters when they filed the motion to dismiss the case in common pleas court. The prosecutor maintains the common pleas court proceeded to rule on the motion based on the scant municipal court records provided by the Mutters, and maintains the common pleas court failed to conduct an evidentiary hearing to allow for cross-examination and review of the records to determine if the municipal court followed the proper procedures.
Because the prosecutor was prejudiced by the actions of the common pleas court, it was proper for the Fourth District to require the Mutters to provide more evidence of their plea agreement if they are to prevail, the office argues.
Friend-of-Court Brief
An amicus curiae brief supporting the Scioto County prosecutor’s position has been submitted by the Franklin County Prosecuting Attorney. The Franklin County prosecutor argues that if there is a contractual agreement between the municipal prosecutor and the defendants to drop a felony charge, the county prosecutor can’t be bound to that agreement if the county prosecutor is not even made aware of it. An agreement that doesn’t follow the proper procedures and doesn’t give the prosecutor notice of the change isn’t valid, the Franklin County prosecutor asserts.
- Dan Trevas
Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket (2016-0440 and 2016-0441).
Contacts
Representing Melvin and Buddy Mutter from the Office of the Ohio Public Defender: Peter Galyardt, 614.466.5394
Representing the State of Ohio from the Scioto County Prosecutor’s Office: Jay Willis, 740.981.3112
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