Early this morning, Texas’s First Court of Appeals conditionally granted petitions for writs of mandamus filed by power generators in connection with the Multidistrict Litigation (“MDL”) Pretrial Court’s rulings on Rule 91a motions in the Winter Storm Uri MDL. In re Winter Storm Uri Litigation, Master Cause No. 2021-41903. The Court of Appeals held that plaintiffs’ causes of action against the power generators “have no basis in law or fact and should have been dismissed under Rule 91a.” Opinion, 33. A copy of the Court’s opinion is available here. 

The Court of Appeals’ opinion analyzes several key issues related to the structure of the Texas electricity market, the relationship among market participants, and the lack of any legal duty owed to retail electric customers by the power generators to continuously supply electricity. Of particular note, the Court found that there was no existing duty owed to retail customers under the current statutory framework in Texas, and that in Texas’s fully-competitive retail market for electricity, wholesale power generators are statutorily precluded by the Legislature from having any direct relationship with retail customers of electricity and can have no legal relationship with retail customers as a matter of law. As the Court put it, “based on the current state of our jurisprudence in Texas and the plain language of the controlling deregulatory statutes . . . Texas does not currently recognize a legal duty owed by wholesale power generators to retail customers to provide continuous electricity to the electric grid, and ultimately to the retail customers, under the allegations pleaded here by the retail customers.” Opinion, 15-16.

The Court also analyzed whether Texas law should recognize any such duty to supply electricity. For a variety of reasons, the Court found that creating such a new duty would upend the statutory framework that already meaningfully reduces the risk of harm and that imposing any new duty on generators is a more appropriate task for the Legislature. 

Baker Botts represents over a dozen power generators in connection with the Winter Storm MDL. 

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