Last week, the U. S. Supreme Court handed down an important decision on the jurisdictional reach of the Natural Gas Act (NGA).  The Court concluded that the NGA does not pre-empt a long-running group of state-law antitrust suits aimed at alleged misconduct by natural gas pipelines.

In Oneok, Inc. et al. v. Learjet, Inc. et al., No. 13-271, the Court considered claims brought as class actions and consolidated in 2003 as the Western States Wholesale Natural Gas Antitrust Litigation in federal court in Nevada.  The plaintiffs are manufacturers, hospitals, and other institutions that buy natural gas directly from interstate pipelines.  These purchasers sued more than a dozen pipelines for reporting false information to natural gas price indexes, claiming injury because contract prices, based on the price indexes, were inflated by the allegedly false reports.
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On August 5, 2013, the Federal Energy Regulation Commission issued an Order to Show Cause and Notice of Proposed Penalty against BP America, Inc., BP Corporation North America, Inc., BP America Production Company, and BP Energy Company (collectively BP). The Order directs BP to show cause why it should not be assessed a $28 million civil penalty and disgorge $800,000 in unjust profits. The Order to Show Cause concerns allegations that BP violated the Commission’s Anti-Manipulation Rule, 18 C.F.R. §1c.1 and section 4A of the Natural Gas Act. The Order to Show Cause follows the Commission’s Notice of Alleged Violation against BP, issued July 28, 2011.
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On July 18, 2013, FERC issued an order addressing optional notice procedures for processing rate filings by intrastate and Hinshaw pipelines in Docket No. RM12-17-000. Revisions to Procedural Regulations Governing Transportation by Intrastate Pipelines, 144 FERC ¶ 61,034 (2013) http://ferc.gov/whats-new/comm-meet/2013/071813/G-1.pdf (Order No. 781 or the Order).
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Commenters have weighed in overwhelmingly opposed to the regulations proposed in the FERC’s Notice of Intent (“NOI”) issued November 15, 2012 in RM13-100. In that NOI, the Commission’s stated intent was to enhance transparency in the natural gas market with new gas purchase reporting requirements, an intent the majority of the commenters argue would in fact be thwarted by the very reporting requirements proposed. Commenters note other concerns with FERC’s proposal, including that it is anticompetitive, and that the resources required for compliance would be considerable.
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