Franchise Tax Board of California v Hyatt

Board sought review of the Nevada Supreme Court decision that the United States Supreme Court case Nevada v hall allows jurisdiction in Nevada over Board and that the limits on damage claims against Nevada state agencies did not apply to Hyatt’s claim against Board. The Court, 6 (5 justice majority plus Alito concurring in judgment)-2, vacated and remanded. The majority announced that the justices split 4-4 on whether to overturn the Hall case and thus announced Hall remains good law. It held that the refusal to apply the Nevada damages cap was unconstitutional as it evidenced hostility towards California and thus violated the full faith and credit clause of the Constitution. Roberts, joined by Thomas, dissented arguing that Nevada Supreme Court stated a sufficient rationale for not applying the cap namely California had a less of an interest in protecting Nevada citizens than Nevada does, showed sensitivity to the principal of comity by reversing the punitive damages award and the majority approach does not allow full credit to Nevada or California law as neither fully immunizes Board nor allows Nevada law to fully control.

Hughes v Talen Energy Marketing, LLC

Talen challenged Maryland’s program to incentivize new power plant construction. They prevailed at the district court and the 4th Circuit affirmed. The Court, with Thomas concurring in part and in judgment, affirmed. It held that Maryland’s program intrudes on the Federal Energy Regulatory Commission’s plenary authority over wholesale electricity prices because it guarantees the new generators of power a rate and requires money exchanges between new generators and the retail sales entities to enforce that rate within the clearing price auction process and thus disregards the clearing price set by the Commission under it authority in the Federal power Act. Thus, the program is preempted. Sotomayor added a concurrence stating her understanding that electrical power generation is an area of federal-state interdependence, generic preemption analysis does not apply and the preemption here is based on the Federal Power Act’s assignment of wholesale pricing to the Commission which Maryland’s program of a guaranteed payment rate different from Commission’s rate is preempted. Thomas argued that the Federal Power Act prohibits states from setting wholesale prices and joined the majority to the extent it based its decision on that basis.