City of Cleveland v. CEI: A Case Study in Attempts to Monopolize by Regulated Utilities

In Cleveland, Ohio a legal controversy had developed which compels the judiciary to evaluate the limits of competition. Seventy years of head-to-head combat between a large investor-owned electric system and a smaller city-owned company has entered the federal courts as an issue to be resolved under section two of the Sherman Act. The precise issue is whether a refusal by the larger utility to sell or wheel power to the smaller utility constitutes an illegal act of monopolization. To resolve this issue, the judiciary must superimpose upon a stormy political dispute an abstract formulation of proper and improper business conduct.

That this type of dispute should be resolved by such a process is a matter of some curiosity, but that is not the subject of this Article. This Article is simply a dramatization in three parts: the plaintiff's factual case, the defendant's affirmative defense as to the legal merits of the plaintiff's case, and a suggested analysis and resolution.