RECHERCHE, LLC, and Brooks Davis, individually and on behalf of all others similarly situated
BALDWIN COUNTY ELECTRIC MEMBERSHIP CORPORATION.
from Baldwin Circuit Court (CV-12-900820).
F. Green and James E. Fleenor, Jr., of Fleenor & Green,
LLP, Tuscaloosa; Brian. P. Strength and Joel Connally of
Strength & Connally, LLC, Montgomery; Stephen D. Heninger
of Heninger Garrison Davis LLC, Birmingham; Daniel G.
McDowell of McDowell Beason & Hamilton P.C.,
Russellville, and David M. Cohen of Complex Law Group, LLC,
Marietta, Georgia, for appellants.
G. Blackburn of Blackburn & Conner, P.C., Bay Minette;
Robert E. Poundstone IV and George R. Parker of Bradley Arant
Boult Cummings LLP, Montgomery; and Marc James Ayers and J.
Thomas Richie of Bradley Arant Boult Cummings LLP,
Birmingham, for appellee.
R. Bailey, Christopher S. Simmons, and J. Evans Bailey of
Rushton Stakely Johnston & Garrett, P.A., Montgomery, for
amicus curiae Alabama Rural Electric Association of
Cooperatives, in support of the appellee.
H. Ott and Edward M. Price, Jr., of Farmer, Price, Hornsby
& Weatherford, L.L.P., Dothan, for amici curiae Pea River
Electric Cooperative and Wiregrass Electric Cooperative, in
support of the appellee.
appeal involves the interpretation of the patronage-refund
requirements imposed on electric cooperatives by §
37-6-20, Ala. Code 1975. Recherche, LLC, individually and on
behalf of all other current and former members of Baldwin
County Electric Membership Corporation ("the
members"), filed a class-action complaint in the Baldwin
Circuit Court ("the trial court") against Baldwin
County Electric Membership Corporation ("Baldwin
EMC"), seeking a judgment declaring the rights of the
members to a return of "Patronage Capital" or
"Capital Credits," which the members assert are
"excess revenues" due to be distributed to the
members under § 37-6-20. Brooks Davis subsequently filed
a motion to intervene to represent all former members of
Baldwin EMC. Recherche and Davis asserted that Baldwin
EMC's method of allocating excess revenues to capital
accounts violates § 37-6-20. The trial court dismissed
the action, and Recherche and Davis appealed. We affirm.
and Procedural History
procedural history of the action underlying this appeal is
lengthy; accordingly, we will discuss only those facts
relevant to the issue of Baldwin EMC's distribution of
excess revenues. Recherche, LLC, a domestic limited-liability
company located in Baldwin County and a member of Baldwin
EMC, initiated the underlying class action against Baldwin
EMC in June 2012. In May 2014, Davis filed a motion to
intervene, which the trial court initially denied. On
September 21, 2015, after Davis had appealed that
determination, this Court vacated the trial court's order
denying intervention and ordered the trial court to allow
Davis to intervene. (Case no. 1140057.) Thereafter, Davis
filed a class-action complaint in intervention. Baldwin EMC
amended its answer numerous times and filed multiple
dispositive motions that were denied throughout the course of
the underlying proceedings.
3, 2018, Recherche and Davis filed a joint amended complaint
to which they attached the Baldwin EMC bylaws. On June 7,
2018, Baldwin EMC filed a
motion to dismiss and a supporting brief in which it argued
that its method of allocating capital credits to members'
capital accounts as provided in its bylaws complied with
§ 37-6-20 and that the following federal precedent
supported the dismissal of the class action: Davis v.
Central Alabama Electric Cooperative, No. 15-0131-WS-C,
2015 WL 5285894, Sept. 8, 2015 (S.D. Ala. 2015)(not selected
for publication in F.Supp.), Caver v. Central Alabama
Electric Cooperative, No. 15-0129-WS-C, Sept. 8, 2015
(S.D. Ala. 2015)(not selected for publication in
F.Supp.)("Caver I"), and Caver v.
Central Alabama Electric Cooperative, 845 F.3d 1135,
1141 (11th Cir. 2017)("Caver II"). Baldwin
EMC attached to its motion the Baldwin EMC bylaws and copies
of the opinions issued in Davis, Caver I, and
Caver II. On July 16, 2018, Recherche and Davis
filed a response in opposition to Baldwin EMC's motion.
On July 24, 2018, the trial court denied Baldwin EMC's
motion to dismiss.
30, 2018, however, the trial court entered the following
order withdrawing its July 24, 2018, order and granting
Baldwin EMC's motion to dismiss:
"The MOTION TO DISMISS [RECHERCHE AND DAVIS'S]
AMENDED COMPLAINT PURSUANT TO RULE 12(B)[, Ala. R. Civ.
P.,] is hereby GRANTED based solely upon the Caver
arguments asserted by [Baldwin EMC]. The opinion of the
Eleventh Circuit Court of Appeals in Caver v. Central
Alabama Electric Cooperative, 845 F.3d 1135 (11th Cir.
2017), upheld Rule 12 orders of dismissal by the United
States District Court for the Southern District of Alabama.
While that opinion is not binding precedent on this Court,
it is the only appellate opinion to interpret the subject
statute. The Court is convinced that, given the number of
identical cases pending in Alabama state courts, the
Alabama Supreme Court's consideration of the statute is
necessary to ultimately resolve the issue of how electric
cooperatives must distribute excess revenues under the
controlling statute. [Recherche ...