VII. Comments on Draft Decision
This is an intervenor compensation matter and normally the comment period is waived. However, given the magnitude of the award and the disallowances, we allowed 30 days from the mailing date for parties to comment on the draft decision.
TURN filed comments on the draft decision on August 2, 2006. TURN makes two contentions: 1) that the Commission may not disallow intervenor compensation for time TURN spent on issues as to which it did not prevail; and 2) that the hourly rates for Murray, Cratty, and Kientzle are too low. We address each contention below.
A. Disallowance Where TURN Did Not Prevail
TURN states that,
The Commission must modify the decision so that any disallowance of compensation for hours or expenses on a particular issue is not attributed to a failure to "prevail" on that issue. Section 1802(i) and numerous Commission decisions recognize that a party need not prevail in order to receive an award of intervenor compensation. Instead, any adjustments should address work for which TURN's requested compensation is not reasonable. TURN submits that all of work included in the Request for Compensation should be found reasonable.
Contrary to TURN's assertion, there is precedent for denying compensation where a party does not prevail on an issue and the party's position does not assist the Commission in its decisionmaking.
"We disallow time UCAN spent opposing two, related motions filed by Cingular. UCAN's position did not prevail and its effort did not advance our decisionmaking in any way."69
"Finally, CAUSE did not prevail on most of the issues on which its time was spent. . . . To summarize, approximately 53% of the hours for which CAUSE requests compensation, excluding hours spent preparing the NOI and the request for compensation (239.05 hours from a total of 447.45), were devoted to positions that we ultimately adopted and that CAUSE took or shared the lead in advocating. Subject to the reductions for other reasons noted above, we believe these hours qualify for intervenor compensation."70
TURN cites other examples in its comments.
Indeed, TURN has in some cases voluntarily reduced its claimed award to reflect issues on which it did not prevail, and we accepted the reduction.71 Other parties have done so as well, and the Commission has only awarded the compensation requested.72
TURN asserts that "making an award of compensation too dependent on whether an intervenor prevailed creates the risk that intervenors will be discouraged from presenting `more novel, creative recommendations, which may have a lower likelihood of being adopted the first time they are presented to the Commission.'"73 This is true, but we have also stated that, "Although the Commission may award compensation for substantial contributions when the intervenor did not prevail, such intervention must meet two tests. The underlying proceeding must be "an extraordinary complex proceeding requiring technical or legal skills not demanded by the majority of Commission proceedings," and it must be "a case of unusual importance."74
As we illustrate elsewhere in this decision, this case was unique in many ways. The bottom line is that TURN did not prevail in the final decisions on most of the issues it raised. Had TURN prevailed on most issues, it may have been appropriate to award TURN compensation for all of its efforts. But where, as here, the final Commission decisions diverged very significantly from TURN's recommendations, we must be realistic about the amount of compensation to which an intervenor is entitled. We must have the discretion to reduce an award under the circumstances presented here. Indeed, the statute clearly provides such discretion:
"Where the customer's participation has resulted in a substantial contribution, even if the decision adopts that customer's contention or recommendations only in part, the commission may award the customer compensation for all reasonable [fees and] costs incurred by the customer in preparing or presenting that contention or recommendation." (Section 1802(i), emphasis added.)
In short, we retain the reduction in the award to TURN to reflect those contentions or recommendations that were not adopted or otherwise useful in our final decisions here.
B. Hourly Rates for Murray, Cratty, and Kientzle
TURN is correct that we used the 2001 hourly rates for compensation for time outside consultants Murray, Cratty, and Kientzle spent on the case in 2002.75 We continue to find these 2001 rates appropriate for use to compensate work performed in 2002. We note that the rates are all within the range of experts' hourly rates that we approved for work in 2005, namely, $110 to $360. (See D.05-11-031.) Further, the passage of one year does not automatically justify an increase in hourly rates. For example, in D.05-11-031, we determined that no general increase in rates was appropriate for 2005 over rates previously approved for 2004. In these circumstances, we affirm the draft decision's hourly rates for these consultants.
69 D.05-02-005, 2005 Cal PUC LEXIS 57, at *14.
70 D.02-11-019, 2002 Cal PUC LEXIS 24, at *23.
71 D.02-01-029, 2002 Cal PUC LEXIS 42, at *9-10 (TURN only claimed 75% of time spent to reflect areas in which it did not prevail; Commission granted compensation only for hours claimed); D.02-08-032, 2002 Cal PUC LEXIS 457, at *8 (both TURN and Aglet Consumer Alliance voluntarily reduced requested compensation by 50% for participation on issues on which they did not prevail).
72 See, e.g., D.02-11-021, 2002 Cal PUC LEXIS 714, at *0-10 (granting California Mobilehome and Resource Action Association (CMRAA) claimed amount of compensation; CMRAA had voluntarily requested only 80% its costs because it did not prevail on all its recommendations).
73 TURN Comments at 6, citing D.98-04-059, 79 CPUC 2d 628, 654.
74 D.01-08-050, 2001 Cal PUC LEXIS 507, at *5-6. See also D.05-01-059, 2005 Cal. PUC LEXIS 48, at *31 (same quotation).
75 The draft decision awarded $320 for Murray, $185 for Cratty, and $185 for Kientzle-all the rates we had previously approved for these consultants for work in 2001. See D.05-12-038.
