Jackson v. Metropolitan Edison Co.

Brief Fact Summary.

Metropolitan Edison Co. (Metropolitan Edison) terminated electricity provider services to Jackson. Jackson claimed that termination “without adequate notice and a hearing before an impartial body” deprived her of property without due process of law.

Synopsis of Rule of Law.

For purposes of the Fourteenth Amendment, the fact that a business is subject to state regulation does not by itself convert its action into that of the state.

Facts.

Metropolitan Edison Co. (Metropolitan Edison) is a heavily regulated private utility with a state certificate of public convenience to sell electricity. Metropolitan Edison terminated service to Jackson for nonpayment, pursuant to a provision of its general tariff that had been filed with the Pennsylvania Public Utilities Commission. Jackson claimed that termination “without adequate notice and a hearing before an impartial body” deprived her of property without due process of law.

Issue.

Did Metropolitan Edison’s termination of Jackson’s electrical service qualify as “state action” under the Fourteenth Amendment?

Held.

Metropolitan Edison’s termination of Jackson’s electrical service does not qualify as “state action” under the Fourteenth Amendment.

Dissent.

Justice Marshall

I agree with the majority that it requires more than a finding that a particular business is “affected with the public interest” before constitutional burdens can be imposed on that business. But when the activity in question is of such public importance that the state invariably either provides the service itself or permits private companies to act as state surrogates in providing it, much more is involved than just a matter of public interest. In those cases, the state has determined that if private companies wish to enter the field, they will have to surrender many of the prerogatives normally associated with private enterprise and behave in many ways like a governmental body.

Discussion.

Although Metropolitan Edison is heavily regulated by the Pennsylvania Public Utility Commission, this regulation does not make Metropolitan Edison part of the state. There is not a sufficiently close nexus between the state and the challenged action of the regulated entity here such that the latter may be fairly treated as that of the state itself. As such, Metropolitan Edison’s termination of Jackson’s service did not qualify as state action. Rather, it was private action, which is immune from the restrictions of the Fourteenth Amendment.