On December 18, 2008, FERC withdrew the NOPR issued on December 27, 2005, regarding the standard of review for modifications to jurisdictional agreements, in Docket No. RM05-35. FERC concluded that in light of the Supreme Court's decision in Morgan Stanley Capital Group, Inc. v. Public Utility District No. 1 of Snohomish County, 128 S. Ct. 2733, 2739 (2008), the rulemaking was not necessary. In Morgan Stanley, the Supreme Court found that rates initially set in a freely negotiated contract meet the statutory just and reasonable standard, and that "parties could contract out of the Mobile-Sierra presumption by specifying in their contracts that a new rate filed with the Commission would supersede the contract rate," but otherwise "the Mobile-Sierra presumption remains the default rule."
Commissioners Kelly and Wellinghoff issued a separate concurring statement, noting that the FERC would also be bound by a similar ruling by the U.S. Court of Appeals for the District of Columbia Circuit (Maine Public Utilities Commission v. FERC, 520 F.3d 464 (2008).
