COURT OF APPEALS FOR THE FIRST CIRCUIT
Tyngsboro Sports II Solar, LLC v. National Grid USA Service Co., Inc.
United States Court of Appeals
For the First Circuit
No. 23-1391
TYNGSBORO SPORTS II SOLAR, LLC and 201 OAK PEMBROKE SOLAR LLC,
individually and on behalf of all others similarly situated,
Plaintiffs, Appellants,
v.
NATIONAL GRID USA SERVICE COMPANY, INC. and MASSACHUSETTS
ELECTRIC COMPANY,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Richard G. Stearns, U.S. District Judge]
Before
Rikelman, Selya, and Howard,
Circuit Judges.
Andrew M. McNeela, with whom John R. Low-Beer, David E.
Kovel, Kirby McInerney LLP, Seth H. Handy, and Handy Law LLC were
on brief, for appellants.
Richard H. Brown, with whom Michael J. Fitzpatrick and
Day Pitney LLP were on brief, for appellees.
December 6, 2023
HOWARD, Circuit Judge. For the past nine years, various
renewable-energy generators have unsuccessfully petitioned state
authorities to prohibit utility companies from charging them
certain tax-related fees. Seeking better fortune in federal court,
two such generators brought this putative class action, but the
district court dismissed the case after finding that it lacked
subject-matter jurisdiction. The generators now appeal, arguing
that the court had jurisdiction based on the suit's connection to
federal tax law. Yet their complaint does not bring any claim
that arises under federal law. Accordingly, we affirm.
I. BACKGROUND
A. The Parties
The fees at issue are features of service agreements
between Tyngsboro Sports II Solar, LLC and 201 Oak Pembroke Solar
LLC (collectively, the "Solar Companies" or "Companies") and
National Grid USA Service Company and Massachusetts Electric
Company (collectively, "National Grid").1 National Grid operates
an "electric distribution network" -- a system that delivers
electricity from a "transmission network" to customers.2 The Solar
Companies operate solar-generation projects in Massachusetts.
1The appellees are both subsidiaries of the same utility
conglomerate. Any distinction between the two is irrelevant to
this appeal.
2For the purposes of this dispute, a transmission network is
critically different from a distribution network. Transmission
networks operate at a very high voltage and move electricity from
- 2 -
To deliver solar-generated electricity to their
Massachusetts-based customers, the Solar Companies need to connect
to National Grid's distribution network, and to make this
connection, National Grid must modify its hardware. National Grid
charges the Companies for the right to use the distribution network
and for the costs of the modifications. These arrangements are
governed in part by standardized interconnection service
agreements (ISAs) between National Grid and each Company. The
ISAs are at the heart of a long-running dispute between the Solar
Companies and National Grid, specifically, their requirement that
the Solar Companies pay a "tax gross up" that compensates National
Grid for any tax liability incurred by the transaction.
B. The Dispute
National Grid contends that the Solar Companies'
interconnection payments are taxable income to it and therefore
the Companies must pay National Grid a tax gross up to offset the
liability. The
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