Law360 quoted Manatt’s Craig Moyer, co-chair of the firm’s energy practice, for an article about the status of California’s cap-and-trade program following a victory in a state appeals court. A Third Appellate District panel has found that auction revenues are not taxes under the state Constitution, thus allowing the program to continue without two-thirds approval of the legislature.
The publication reports that the program could be challenged in the California Supreme Court or by potential actions by the legislature and regulatory agencies. Moyer agreed that the case will be an attractive one for the state high court to take up, if only to clarify its Sinclair findings on the taxes and fees issue.
“The conventional wisdom is that when the Supreme Court takes a case they reverse. But I don’t think that will be the case here,” Moyer said. “I think they could take the case and uphold the Court of Appeal’s opinion, but narrow it or clarify it, or just take the opportunity to weigh in short of overruling the decision.”