GANN v. STATE OF OKLAHOMA (2026 OK 24): Issue Exhaustion Required for All Oklahoma Corporation Commission Rate-Order Appeals—Including Non-Parties; Public Comments Do Not Preserve Issues

I. Introduction

Case: GANN v. STATE OF OKLAHOMA, ex rel. Oklahoma Corporation Commission, and Public Service Company of Oklahoma (PSO).
Court: Supreme Court of Oklahoma (exclusive appellate jurisdiction over OCC rate orders under Okla. Const. art. IX, § 20).
Posture: State Representative Tom Gann, proceeding pro se and as a PSO ratepayer (but not as a party in the OCC case), appealed a final Oklahoma Corporation Commission order in a general rate case (PUD2023-000086, Order No. 746624).

Core issues on appeal: (1) whether the OCC’s final order should be reversed because PSO allegedly failed to present sufficient evidence of the audit required by 74 O.S. § 9078; (2) whether the order should be reversed because Commissioner Todd Hiett participated despite allegations reported outside the record; and (3) whether Gann could collaterally attack three unappealed OCC orders entered in prior OCC causes (including a Winter Storm Cost securitization financing order).

Central holding: Even though Gann had standing as an “aggrieved” ratepayer under Okla. Const. art. IX, § 20, his arguments were not preserved because they were not presented to and decided by the OCC in the first instance. The Supreme Court affirmed.

II. Summary of the Opinion

  • Standing: Gann, as a PSO ratepayer, was a “person deeming himself aggrieved” and therefore had standing to appeal under Okla. Const. art. IX, § 20.
  • Issue exhaustion: The Court refused to decide, for the first time on appeal, (a) the sufficiency of § 9078 audit evidence and (b) the propriety of Commissioner Hiett’s participation, because no party made timely evidentiary objections, filed exceptions, sought rehearing/vacatur, or moved to disqualify at the OCC.
  • Public comments: Public comments are not evidence and do not function as legal objections preserving issues for appellate review.
  • Collateral attacks: Gann’s collateral attacks failed because (a) they were not raised and exhausted at the OCC, (b) he did not show the appealed final order relied on the earlier orders, and (c) 74 O.S. § 9079 renders the previously approved ratepayer-backed bonds and pledged revenues (including the Winter Storm Cost charge revenues) “incontestable.”
  • Disposition: Final Order of the Corporation Commission affirmed; motion to take judicial notice of a purported prior version of 74 O.S. § 9078 denied.

III. Analysis

A. Precedents Cited (and How They Drove the Result)

1. The OCC’s constitutional primacy in ratemaking and the exhaustion rule

The opinion anchors its approach in Oklahoma’s constitutional allocation of ratemaking power to the OCC (Okla. Const. art. IX, § 18), and the Supreme Court’s “judicial only” review of rate orders (Okla. Const. art. IX, § 20). Against that structure, the Court relies on a line of cases requiring that ratemaking-related issues be presented to and decided by the OCC before they can be reviewed on appeal:

  • State ex rel. Cartwright v. Okla. Nat. Gas Co., 1982 OK 11, § 12, 640 P.2d 1341, 1346: The foundational statement that issues that “could have been presented” to the Commission but were not are “precluded from review” on appeal. The opinion uses Cartwright for the policy rationale: orderly procedure and avoiding parties “sitting quietly by” until the proceeding closes.
  • Turpen v. Okla. Corp. Comm'n, 1988 OK 126, ¶ 28, 769 P.2d 1309, 1321: Cited as reinforcing the principle that courts do not decide ratemaking issues in the first instance; the Commission must first exercise its delegated judgment.
  • Okla. Elec. Co-op., Inc. v. State ex rel. Okla. Corp. Comm’n, 1995 OK 91, ¶ 18, 903 P.2d 321, 324-25: Critical here because it applied exhaustion to a non-intervening appellant. The Court in Gann adopts Okla. Elec. Co-op.’s rule that issues are preserved by “affirmative evidence, or objection,” not by generalized participation or commentary—making it dispositive against Gann’s reliance on late public comments.

2. General appellate preservation and administrative exhaustion

  • Bane v. Anderson, Bryant & Co., 1989 OK 140, ¶ 24, 786 P.2d 1230, 1236: Provides the general rule that issues cannot be raised for the first time on appeal.
  • Bivins v. State ex rel. Okla. Mem’ Hosp., 1996 OK 5, ¶ 19, 917 P.2d 456, 464: Supplies the administrative-law analogue: issue exhaustion applies to appeals from agencies.

3. Standing to appeal an OCC rate order

  • Cox Oklahoma Telecom, LLC v. State ex rel. Okla. Corp. Comm'n, 2007 OK 55, ¶ 5, 164 P.3d 150, 154: Used for the proposition that standing is a threshold issue.
  • Missouri-Kansas-Texas R. Co. v. State, 1985 OK 108, ¶ 18, 712 P.2d 40, 42-43: Defines “aggrieved” in terms of a directly and injuriously affected pecuniary interest; applied to conclude that a ratepayer is aggrieved.
  • State ex rel. Fugate v. Stitt, 2025 OK 54, ¶ 15, 577 P.3d 265, 270: Cited to clarify that Gann’s legislative office did not itself confer standing; his standing derived from ratepayer status.

4. Collateral attacks on prior orders

  • In re Hyde, 2011 OK 31, ¶ 11, 255 P.3d 411, 414: Supplies the definition of a collateral attack as an attempt to undermine a judgment by means other than the avenues provided by law.
  • State ex rel. Comm'n of Land Office v. Corp. Comm’n, 1979 OK 16, ¶ 9, 590 P.2d 674, 677: Cited within Hyde for the collateral-attack concept.
  • State ex rel. Comm’rs Land Office v. Corp. Comm'n, 1979 OK 16, ¶ 10, 590 P.2d 674, 677: Used for the prerequisite to reach collateral-attack merits in this posture: the challenged prior order must be shown to have been relied upon in the order under direct review—something Gann did not establish.

5. Winter-storm securitization finality and “incontestability”

  • In re Okla. Dev. Fin. Auth., 2022 OK 41, ¶ 2, 510 P.3d 165, 166-67: Provides background for the February 2021 crisis and the legislative purpose of spreading extreme fuel costs over time.
  • In re Okla. Dev. Fin. Auth., 2022 OK 48, ¶ 13, 511 P.3d 1048, 1051: Used to reinforce that the bonds were judicially approved and, by statute (74 O.S. § 9079), the bonds and pledged revenues are thereafter “incontestable,” foreclosing Gann’s requested relief targeting the Winter Storm Cost charge revenues.

B. Legal Reasoning

1. Standing is broad—preservation is not

The Court reads Okla. Const. art. IX, § 20 to allow appeals not only by “part[ies] affected” but also by any “person deeming himself aggrieved.” That grants a wide door to appellate access for ratepayers. But the Court then draws a firm line: the same constitutional scheme that permits broad access also cabins review to “judicial only,” which (as construed through precedent) requires the OCC to first hear and decide the issues. Thus, standing does not relax exhaustion.

2. The audit claim failed because nobody preserved it through the OCC’s litigation steps

On the merits-adjacent facts, the opinion notes testimony at the settlement hearing (Andrew Scribner, Public Utility Division) addressing § 9078 compliance and the absence of any objection. The Court then ties preservation to specific procedural mechanisms:

  • Evidentiary objections: must be made as objections (Okla. Admin. Code § 165:5-13-3(f)).
  • Exceptions to the ALJ report: can preserve disagreements with the report and recommendation (Okla. Admin. Code § 165:5-13-5).
  • Rehearing / application to vacate: another preservation route after the final order (Okla. Admin. Code § 165:5-17-1(a)).

Because none of these were used to contest § 9078 compliance, the Court applied Cartwright and Okla. Elec. Co-op. to hold the issue unexhausted.

3. The commissioner-participation claim failed for the same structural reason—no motion to disqualify at the OCC

The Court expressly declined to decide whether “a Corporation Commissioner may ever be disqualified in a ratemaking proceeding,” because the necessary predicate—a motion to disqualify at the Commission—never occurred (citing Okla. Admin. Code § 165:5-9-4(a)). Without an OCC-developed record and decision, appellate review would require the Supreme Court to decide the question in the first instance, which Article IX’s structure and the exhaustion cases forbid.

4. Public comments were treated as argument, not evidence or objections

Gann’s strategy—filing public comments after the record closed—was categorically insufficient. The opinion’s reasoning is two-fold:

  • Functional: comments filed after the evidentiary and objection windows cannot enable OCC correction.
  • Doctrinal: under Commission rules, public comments are not evidence but argument (Okla. Admin. Code § 165:5-13-3(k), as cited in the opinion), and Okla. Elec. Co-op. requires preservation by “affirmative evidence, or objection.”

The Court also rejected the notion that a single Commissioner’s public comment (referencing then-Commissioner Anthony’s “WHERE'S THE AUDIT” comment) could substitute for litigant preservation.

5. Collateral attack was blocked by (i) exhaustion, (ii) non-reliance, and (iii) statutory incontestability

The Court stacked three independent barriers to Gann’s attempt to undo earlier OCC orders:

  1. Exhaustion: the collateral attack, like the direct issues, was not raised at the OCC in this rate case.
  2. Non-reliance requirement: under State ex rel. Comm’rs Land Office v. Corp. Comm'n, a collateral attack is considered in this posture only if the appealed order relied on the earlier order(s). The Court found no such reliance: the appealed rate order did not alter or depend on the Winter Storm Cost charge set by the earlier financing order, nor did it rely on the prior rate-case orders.
  3. 74 O.S. § 9079 incontestability: once the Supreme Court approved the ratepayer-backed bonds (as in In re Okla. Dev. Fin. Auth., 2022 OK 48), the bonds and “revenues pledged to their payment” became “incontestable in any court in this state,” foreclosing Gann’s request to stop collection of the Winter Storm Cost charge and order refunds.

C. Impact

  • Reinforced preservation duties for “aggrieved” non-parties: Oklahoma’s constitution allows non-party ratepayers to appeal, but Gann emphasizes that appellate access does not eliminate the need to meaningfully participate at the OCC through intervention or timely motions/objections that build a record.
  • Public-comment participation is not a substitute for litigation participation: The decision draws a sharp line between civic input and adjudicative preservation—important in high-profile utility cases where many members of the public comment but few intervene.
  • Procedural predictability in rate cases: By insisting on OCC-first issue development, the opinion protects the Commission’s policymaking space and reduces the risk that settlements and final orders are later destabilized by arguments not presented during the case.
  • Strengthened finality of winter-storm securitization mechanisms: The application of 74 O.S. § 9079 underscores that once bonds and pledged revenues are judicially approved, later litigation aiming to unwind the pledged charge mechanism faces a statutory wall.

IV. Complex Concepts Simplified

“Standing” (Okla. Const. art. IX, § 20)
Who may appeal an OCC rate order. Oklahoma uniquely allows appeals by parties and by any non-party “person deeming himself aggrieved.” Here, a ratepayer is “aggrieved” because rates directly affect the ratepayer’s pocketbook.
“Issue exhaustion” / “preservation”
A rule requiring that you raise an issue at the agency (here, the OCC)—by evidence, objection, exceptions, or other authorized procedural steps—so the agency can address it and create a record. If you do not, an appellate court generally will not consider it later.
“Judicial only” review (Okla. Const. art. IX, § 20)
The Supreme Court is not a second ratemaking body. Its role is to review what the OCC did on the issues the OCC actually had the chance to decide, based on a developed record.
Public comment vs. evidence
A public comment expresses a viewpoint, but it does not function like sworn testimony or an evidentiary objection. In Gann, comments—especially those filed after the record closed—could not preserve issues for appeal.
Collateral attack
An attempt to invalidate earlier final orders outside the ordinary, timely appellate path. The Court treated Gann’s effort to undo unappealed OCC orders from other cases as a collateral attack and rejected it.
Ratepayer-backed bonds and “incontestable” pledged revenues (74 O.S. § 9079)
Under the winter-storm securitization statute, the charge that repays the bonds (the pledged revenue stream) becomes legally insulated from later court challenges once approved—preventing after-the-fact undoing of the repayment mechanism.

V. Conclusion

GANN v. STATE OF OKLAHOMA reaffirms a strict, structural rule in Oklahoma utility regulation: even though any aggrieved ratepayer may appeal an OCC rate order, the Supreme Court will not decide unpreserved issues in the first instance. Challenges to statutory audit compliance and objections to a commissioner’s participation must be timely raised at the OCC through the procedures that create a record—public comments are not enough. The decision also reinforces the high finality of winter-storm securitization orders and pledged charges under 74 O.S. § 9079, limiting later attempts to unwind bond-repayment mechanisms once judicially approved.