Opposition — Johnson Oil Co. v. Mountain Fuel Supply Co.
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7 Supreme Court, U,
; FILED
APR 17 1979
MICHABL RODAK, JR., CLERW
In the Supreme Court of the
United States
OCTOBER TERM 1978
No. 78-1431
JOHNSON OIL COMPANY, INC.,
Petitioner
v.
MOUNTAIN FUEL SUPPLY COMPANY,
Respondent.
ON PETITION FOR WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
BRIEF OF MOUNTAIN FUEL SUPPLY COMPANY
IN OPPOSITION
ROBERT S. CAMPBELL, JR.
310 South Main Street
12th Floor
Salt Lake City, Utah 84101
Counsel for Mountain Fuel
Supply Company, Respondent
a A
TABLE OF CONTENTS
Page
JURISDICTIONAL BASIS OF JOHNSON OIL
PETITION FOR CERTIORARI —........................ 2
FEDERAL CONSTITUTIONAL AND STATUTORY
PROVISIONS RAISED BY JOHNSON OIL ............ 2
QUESTIONS PRESENTED FOR REVIEW ...................... 3
ee ee 4
POINT I THE CERTIORARI PETITION OF JOHN.-
SON OIL IS IMPROVIDENT AND
SHOULD BE DENIED, FOR JOHNSON
OIL BY ACCEPTING PAYMENT AND
SATISFYING THE JUDGMENT BELOW,
HAS WAIVED ANY RIGHT TO REQUEST
CERTIORARI REVIEW BY THIS COURT .... 12
1. Johnson Oil Does Not Have Standing
1 nn i ccsmemnbene 12
2. The General Rule on Standing and Waiver .............. 13
Cm UD DN nt nteneens 17
POINT II THERE IS NO CONFLICT, MUCH LESS
SUBSTANTIAL OR IRRECONCILABLE
DISPARITY, BETWEEN THE DECISION
OF THE TENTH CIRCUIT AND TECA ...... 17
1. The Basis for Certiovari is Absent ..............---0--o-n- 17
2. The Position of JOHNSON OIL on Conflict
Of Circuit and TECA Decisions ..0......c.eeceeeseeoesee0e 19
it
Page
3. The Issue of Punitive Damages Raised by
JOHNSON OIL on Appeal was Plainly a
Question for TECA Under the Controlling Law ........ 20
4. The Holding of the Tenth Circuit Herein
is not in Conflict with the Decisions of TECA ........ 24
POINT III THE HOLDING OF THE TENTH
CIRCUIT IN THE INSTANT CASE IS
PLAINLY DISTINGUISHED FROM THE
DECISION OF THIS COURT IN BRAY
TF, RTE PO FE aac ensgcntaiinirmninnsp 26
POINT IV THIS COURT SHOULD NOT, AND IN
LAW, IS UNABLE TO INVENT TRANS-
FER JURISDICTION FROM THE CIRCUIT
COURT TO TECA OR VICE VERSA .......... 28
POINT V_ IF THIS COURT WERE TO GRANT THE
PETITION FOR CERTIORARI OF JOHN-
SON OIL HEREIN, THE WRIT SHOULD
ISSUE AS TO ALL FACETS OF THE CASE,
INCLUDING THE QUESTIONS RAISED
BY MOUNTAIN FUEL IN ITS CROSS-
APPEAL BEFORE THE TENTH CIRCUIT .. 29
CB 6 ORME REG he LOE IPOs ORES nS a ee 30
CASES CITED
Aldinger v. Howard, 427 US. }, 49 L.Ed. 2d
296, 98 BIA. DUS (IEE vince. 18
Anderson v. Kibbe, 431 U.S. 145, 52 L.Ed. 2d
BOD FT RR ATO CRIT iat sienna 19
POG Ried aT eee z
418
Page
Associated General Contractors of America
v. Laborers International Union of North
America, 489 F.2d 749 (Em.App. 1973) ......-------- 24, 25
Avco Corporation v. Aero Lodge, 390 U.S. 557, 20
L.Ed. 2d 126, 88 S.Ct. 1235 (1968) .-..-....---.sssssssssss0= 18
Bray v. United States, 423 U.S. 73, 46 L.Ed. 2d
215, 96 S.Ct. 307 (1975) sdbbestcientdbartikidebubidinasindiaddenphigis 19, 27
Colquette v. Crossett Lumber Co., 149 F.2d 116
NI Mt lg he nlnais 13
Fuller v. State of Oregon, 417 US. 40, 40 L.Ed.
2d 643, 94 S.Ct. 2116 (1974) .eeeececcccscsesescnsseesseeeeeeeeeeee 18
Kaiser v. Standard Oil Co. of N.]., 89 F.2d 58
CO FU I acne. cecnscrevevensicosocsocsmnanes 13
Keller v. Adam-Campbell Co., 264 U.S. 314, 68 L.Ed.
705, 44 S.Ct. 356 (1924) i pbidcisthes tinhdiodabiadaquiiclsssaonininiieest 18
Lay v. Williams, 434 U.S. 910, 54 L.Ed. 2d 196,
98 S.Ct. 311 (1977) Sipe te ae i aebhaeada tania benaateninbananes 18
Longview Refining Co. v. Shore, et al., 554 F.2d
SG PU BITTY cin cecceentrcseserseseneveevennernrese 25
Luther, et al. v. United States, 225 F.2d 495
CCI BUS TBS) wicca sssnisensetcivainsessoteneennasensesansesinsnne 13
Maw v. Weber Basin Water Conservancy District,
20 U.2d 195, 436 P.2d 230 (1968) scigbigsbivianionlinscittiibansiins 15
Mountain Fuel Supply Company v. Reland Johnson,
586 F.2d 1375 (10 Cir. 1978) -.....---sssseeeeeee 2, 23, 27
tv
Page
North Carolina v. Rice, 404 U.S. 244, 30 L.Ed.
De SR, 92 BAG,-O0S GIDTN) ivi 12 .
Northeastern National Bank v. United States, 387 US.
213, 18 L.Ed. 2d 726, 87 S.Ct. 1573 (1967) -cosocs0--- 18
Owen Equipment and Erection Company v. Kroger,
aan US. ...... 57 L.Ed. 2d 274, 98 S.Ct. 2396 (1978) .. 29
Price v. Franklin Investment Co.,; Inc.,
S76: FAs 06 GE. Ge, MOTOS ai cee 14
Sears Roebuck & Co. v. Carpet, Linoleum, Soft Tile &
Resilient Floor Covering Layers, et al., 397 US. 655,
25 L.Ed. 2d 637, 90 S.Ct. 1299 (1979) ahitbninaadecddpnsiae 12
Smith v. Morris, et al., 69 F.2d 3 (CCA 3rd 1934) .......... 13
Spinetti v. Atlantic Richfield Company, 522
F.2d 1401 (Em.App. 1975) -svsooccceee-sseeseeee----- 20, 24, 25
United States v. Cooper, 482 F.2d 1393
(Em.App. 1973) ............... sith heed ticiacbibatteecdalpnienne 20, 24
United States v. E. B. Hougham, et al., 364
U.S. 319, 5 L.Ed. 2d 8, 81 S.Ct. 13 (1960) ............ 14, 16
W arth v. Seldin, 422 U.S. 490, 45 LEd. 2d
i ee CS ee 12
_ Wilkinson v. United States, 365 U.S. 399, 5 L.Ed.
0-665,08 SE% 30) (08y 19
Wilson v. The Pantasote Company, 254 F.2d 700
(Ck NP Boo ee 13
Wisconsin Electric Co. v. Dunmore Co., 282 US.
813, 75 L.Ed. 728, 51 S.Ct. 214 (193%) —............... 18
SS eee
———
NE AO TS a ee
?
STATUTES AND REGULATIONS
Page
12 US.C. §1904 Note,
Emergency Stabilization Act .............-...-.- 2, 3, 4, 9, 23, 28
15 U.S.C. §751, Emergency Petroleum Allocation
Act hcejensibetiaaitbilebiesiinanciataaniinininasnncuumunenee 2, 4, 22, 23, 28
5B UGK, BOE nineteen Ree iahieesensynicnsicecee een 27
Ba OT eae enenecrecsnnensnsensnenescees 2
0... 12, 28
Rule 19, Rules of the Supreme Court ....................-..--. 2, 12, 17
Rule 24, Rules of the Supreme Court ..........---..-.-.-.-.--------- l
Rule 34(d), Federal Rules of Appellate Procedure ............ 8
CONSTITUTIONS
Article III Section 1, United States Constitution ................ 28
AUTHORITIES
Moores Federal Practice, Vol. 9 1203.07 -................2-202..------ 14
in the Supreme Court of the
Anited States
OCTOBER TERM 1978
No. 78-1431
JOHNSON OIL COMPANY, INC.,
Petitioner
v.
MOUNTAIN FUEL SUPPLY COMPANY,
Respondent.
ON PETITION FOR WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
BRIEF OF MOUNTAIN FUEL SUPPLY COMPANY
IN OPPOSITION
The Respondent, Mountain Fuel Supply Company (here-
after MOUNTAIN FUEL) respectfully submits this Brief
pursuant to Rule 24 of the Rules of Practice of this Honor-
able Court and urges that this Court deny the Petition for
Writ of Certiorari of Johnson Oil Company (hereafter JOHN-
SON OIL) which seeks review of the Opinion of the Court
2
of Appeals for the Tenth Circuit in Case Nos. 77-1410 and
77-1432 reported at 586 F.2d 1375 (10 Cir. 1978).
JURISDICTIONAL BASIS OF JOHNSON OIL
PETITION FOR CERTIORARI
JOHNSON OIL rests its Petition for Certiorari herein
upon the omnibus Certiorari Statute, 28 U.S.C. 1254(1). The
Tenth Circuit issued its opinion in the Case on November 22,
1978 dismissing both the appeal of JOHNSON OIL and the
cross-appeal of MOUNTAIN FUEL. On December 20, 1978,
the Tenth Circuit denied Petitions for Rehearing filed by
both parties to the litigation. The Petition of JOHNSON
OIL is improvidently laid under the Staute and does not
meet the foundation and fundamental prerequisites with re-
spect to granting Certiorari review by this Court pursuant
to Rule 19 of the Rules of Practice and of the law of the case.
FEDERAL CONSTITUTIONAL AND STATUTORY
PROVISIONS RAISED BY JOHNSON OIL
JOHNSON OIL does not urge that its Petition for Cer-
tiorart is bottomed on the contradiction of any constitutional
right. Rather, it fastens its claim for certiorari review to cer-
tain sections of the Economic Stabilization Act of 1970 and
the Emergency Petroleum Allocation Act of 1973.
They are:
15 U.S.C. §754(a) (1) of the Emergency Petroleum
Allocation Act.
Sections 205-207 and 209-211 of the Economic Stabiliza-
tion Act as incorporated by reference within 15
U.S.C. §754(a) (1).
rr ee a a
3
12 U.S.C. §1904 Note, the 1970 Emergency Stabilization
Act.
QUESTIONS PRESENTED FOR REVIEW
1. Is JOHNSON OIL entitled to pursue its Petition
for Certiorari herein when MOUNTAIN FUEL has, subse-
quent to the mandate of the Tenth Circuit being entered in
the District Court, made full payment and satisfaction of
Judgment with the Registry of the Court and JOHNSON
OIL has voluntarily withdrawn and recovered said funds in
satisfaction of the judgment?
2. Is certiorari review jurisdiction available to JOHN-
SON OIL with respect to the decision of the Tenth Circuit
Court of Appeals which is not in conflict with any decision
of the Temporary Emergency Court of Appeals or of the
Supreme Court?
3. Is certiorari review jurisdiction available to JOHN-
SON OIL with respect to a question which, under the attend.
ant facts, is insubstantial ?
4. Is there a direct and inexorable nexus between the
appeal of JOHNSON OIL for punitive damages against
MOUNTAIN FUEL and the TECA issues that MOUNTAIN
FUEL violated the express provisions of the 1973 Emergency
Petroleum Allocation Act or the pricing provisions of the
1970 Economic Stabilization Act?
5. If this Court were to grant a Writ of Certiorari
based on the Petition of JOHNSON OIL, should the Court
take and hear the full case, including the cross-appeal of
MOUNTAIN FUEL before the Tenth Circuit ?
4
STATEMENT OF THE CASE
While the Petition of JOHNSON OIL herein is correct
in some parts, it falls quite short of a complete accounting
of the facts of the matter necessary to a full assessment by
this Court of the Certiorari Petition, including the crucial
questions of subject matter jurisdiction as analyzed by the
Tenth Circuit.
As a result of this deficiency of JOHNSON OIL, MOUN-
TAIN FUEL sets out, in capsule form, its own Statement of
the Case:
1. MOUNTAIN FUEL filed an action against JOHN-
SON OIL in the. State Court for Utah in June of 1974 where-
in judgment was sought for crude oil deliveries sold from
MOUNTAIN FUEL’s Dry Piney Field. While the MOUN-
TAIN FUEL action was founded on breach of contract and
for monies due and owing, the quantum of recovery was
founded upon the regulations ‘of the Cost of Living Council
and the Economic Stabilization Act of 1970 (hereafter
“ESA"), 12 U.S.C. §1904 Note.
2. JOHNSON OIL initially filed an Answer and Count-
erclaim in State Court against MOUNTAIN FUEL, later
amended, which challenged the constitutional validity of the
Emergency Petroleum Allocation Act, (hereafter sometimes
referred to as “EPAA”’ or ‘Allocation Act’’), 15 U.S.C. §751
and the regulations promulgated thereunder. The counter-
claim, as well, sought the recovery of civil penalties for
claimed overcharges in the sale of Dry Piney crude oil by
MOUNTAIN FUEL, which were also alleged to have been
made in violation of the Allocation Act.
5
3. On January 6, 1975, JOHNSON OIL filed a Peti-
tion for Removal of the case from the State District Court of
Utah to the U.S. District Court for Utah, Central Division,
urging, inter alia, (i) breach of contract by MOUNTAIN
FUEL for failure to make crude oil deliveries to JOHNSON
OIL under the Allocation Act, (ii) wrongful interference
with a business relationship, (iii) alleged violations of the so-
called “freeze’’ regulations of the Federal Energy Office prom-
ulgated under the 1973 Allocation Act with respect to the
producer-purchaser relationship, (iv) that sales of “new” and
“released” oil to JOHNSON OIL were made at a claimed
“illegal” price contrary to the Allocation Act, and (v) civil
penalties and treble damages under the ESA as the same are
incorporated within the EPAA.
4. Once the case was removed to the Federal side,
JOHNSON OIL again amended its Counterclaim to seek
punitive damages against MOUNTAIN FUEL for the viola-
tion of the government “freeze order” in terminating sales of
crude oil, for willful breach of contract, and for improper and
illegal charges and prices by MOUNTAIN FUEL of crude
oil sales to JOHNSON OIL, all in claimed violation of the
EPAA and the ESA.
5. By interlocutory Order dated May 26, 1976, the trial
Court determined that the authorized and highest posted price
under the 1973 Allocation Act (which incorporates the ceiling
price provisions of the ESA) was higher, per barrel, than that
argued by JOHNSON OIL but a lower per-barrel price than
that charged by MOUNTAIN FUEL.
6. In June of 1976, the case was set down for trial by
jury on the following questions of fact:
oe
ee
6 7
(i) Was JOHNSON OIL in breach of its contract. 8. At the trial of the Case, JOHNSON OIL argued
with MOUNTAIN FUEL for failure to pay for crude that the foundational basis for its claim of punitive damages
oil purchases? JOHNSON OIL stipulated at the outset of | against MOUNTAIN FUEL was the “‘illegal” prices charged
trial that it owed MOUNTAIN FUEL the sum of $1y,- by MOUNTAIN FUEL under the ESA and the intentional
628.50 for crude oil sold and delivered by MOUNTAIN
FUEL, the price of said oil being based upon the regu-
violation by MOUNTAIN FUEL of the Allocation Act which
allegedly “froze” the relationship between producer and buyer.
oo ee a eR RRR
\ lations of the Cost of Living Council under the ESA. JOHNSON OIL also argued that it was entitled to exemplary
| damages for selling “new” and “released” oil when JOHN-
(ii) Was MOUNTAIN FUEL entitled to terminate SON OIL was entitled under the ESA and the EPAA to
its contract with JOHNSON OIL for the failure of the the “‘old”’ oil price. :
latter to pay for the quantity of crude oil sold by MOUN.- ©
TAIN FUEL at prices MOUNTAIN FUEL determined | 9. On the issues made the subject of trial by jury, a
to be due under the ESA? general verdict was returned in favor of JOHNSON OIL in
the sum of $65,000.00 compensatory damages and $110,000.00
» (itt) Did MOUNTAIN FUEL wrongfully interfere punitive damages. The trial Court, on a Motion for Directed
with the alleged business relationship between JOHN- Verdict filed by MOUNTAIN FUEL, concluded that the
SON OIL and a third party corporation, Allied Chem- punitive damage award to JOHNSON OIL could not stand
ical? Such issue,implicity raised the Allocation Act and under the evidence, as to either the counts of breach of con-
regulations thereunder. tract, or business interference and accordingly, the directed
verdict Motion was granted and the punitive damage award
(iv) Was JOHNSON OIL entitled to exemplary of $110,000.00 was set aside and struck from the ultimate
damages against MOUNTAIN FUEL for what was al- Judgment.
leged to be reckless, intentional and wanton disregard
for the contractual rights of JOHNSON OIL to receive | 10. The trial Court thereafter determined that JOHN-
Dry Piney crude oil pursuant to the Allocation Act and | SON OIL was unentitled to recover treble damages, civil pen-
at a price in accordance with Johnson’s interpretation of | alties or attorneys’ fees and costs under the ESA by Order
the regulations promulgated under the ESA? dated December 23, 1976. A final Judgment on all issues in
the litigation was entered by the District Court on May 2, 1977.
7. The trial Court reserved for post-trial adjudication
the claims of JOHNSON OIL with respect to the recovery of | 11. Exactly one day after the entry of the final Judg-
civil penalties, statutory overcharges, treble damages and at- ment of the trial Court on May 2, 1977, JOHNSON OIL
torneys’ fees as provided by the ESA. filed its Notice of Appeal with the Tenth Circuit Court of
8
Appeals. It raised in that appeal all of the questions as to
which it had taken an adverse 1uling under the ESA and the
EPAA. Included therein was the claimed entitlement of
JOHNSON OIL to punitive damages, civil penalties, treble
damages, attorneys’ fees and costs. The claim of JOHNSON
OIL for punitive damages, as well as the punitive damage
defenses of MOUNTAIN FUEL, were inextricably connected
to a judicial review of the administrative regulations under
the ESA and the Allocation Act of 1973, having a nexus to
the federal pricing and allocations policies on crude oil.
12. MOUNTAIN FUEL filed a cross-appeal before the
Tenth Circuit with respect to evidentiary rulings surrounding
the award of compensatory damages for breach of contract
and as well, for what MOUNTAIN FUEL urged to be an
erroneous interpretation of the crude oil regulations with re-
spect to the highest posted price in the Dry Piney Field. By
reason of Rule 34(d) Federal Rules of Appellate Procedure,
MOUNTAIN FUEL, although the Appellee and Cross-Ap-
pellant before the Tenth Circuit, became and was treated as
the Appellant.
13. JOHNSON OIL did not at any time attempt to
undertake an appeal of the final Judgment of the District
Court to the Temporary Emergency Court of Appeals (here-
after TECA) with respect to punitive damages or any other
issue of crude oil pricing or allocation that had an inexorable
relationship to the ESA of 1970 or the Allocation Act of
1973 and the regulations promulgated thereunder.
14. Jurisdiction.
During the briefing phase of the appeals, the Tenth
9
Circuit requested that the parties address the question of the
subject matter jurisdiction of the Tenth Circuit to entertain the
JOHNSON OIL appeal and/or the MOUNTAIN FUEL cross-
appeal. MOUNTAIN FUEL submitted its position on sub-
ject matter jurisdiction in its Opening Brief. MOUNTAIN
FUEL argued, on the one hand, that the initial Complaint
filed in State District Court did not ‘arise under” the EPAA
of 1973, for the MOUNTAIN FUEL cause of action was
one for the payment of crude oil sold and delivered and thus,
for breach of contract. On the other hand, federal subject
matter jurisdiction, it was contended, was extant under sec-
tion 211 of the ESA, as incorporated by reference into the
EPAA under the Answer and Counterclaim of JOHNSON
OIL... MOUNTAIN FUEL maintained that in all events, the
Tenth Circuit maintained jurisdiction over the non-TECA
questions. Pages 19-25 of the MOUNTAIN FUEL Opening
Brief to the Tenth Circuit are attached hereto as Appendix 1.
JOHNSON OIL concurred with and did not add anything to
the MOUNTAIN FUEL statement on subject matter juris-
diction in its Opening Brief.
Upon oral argument of the appeals in September of 1978
(a predominant portion of which was directed to the issue of
subject matter jurisdiction of the Tenth Circuit v7s-a-vis
TECA), the Tenth Circuit issued its opinion on November
22, 1978 dismissing both the appeal of JOHNSON OIL and
the cross-appeal of MOUNTAIN FUEL for lack of subject
1 Under section 211 of the ESA, a case is subject to removal from
a state court to federal district court at any time by any party
when the constitutionality of the statute or the validity of any
agency action (regulation) is called into question under the
ESA or the EPAA. Such issue could be raised by complaint,
answer, counterclaim or other pleading. Section 211, Economic
Stabilization Act.
10
matter jurisdiction.? The Tenth Circuit determined that all
issues, including the punitive damage question raised by
JOHNSON OIL, in the case were TECA-related and that the
exclusivity of TECA statutory jurisdiction foreclosed appel-
late review by the Tenth Circuit.
Both parties filed Petitions for Rehearing. MOUNTAIN
FUEL urged’ that the evidentiary rulings of the trial Court
with respect to the breach of contract question and the tn-
consistency of the trial Court in submitting the tortious busi-
ness interference claim to the jury while at the same time
granting MOUNTAIN FUEL’s Motion for a Directed Ver-
dict on punitive damages, were unequivocally non-TECA
questions having no relationship to the ESA or the EPAA.
JOHNSON OIL, in its Petition, urged that the punitive dam-
age issue was of a non-TECA character and that the Tenth
Circuit should proceed to hear the same; on the other hand,
MOUNTAIN FUEL contended that the punitive damage
question was plainly an outgrowth of claims made by JOHN-
SON against MOUNTAIN FUEL for alleged violations of
the ESA and the EPAA, and was therefore clearly an issue
for TECA.
15. On December 20, 1978, the Tenth Circuit denied
Petitions for Rehearing of both JOHNSON OIL and MOUN-
TAIN FUEL.
16. The entitlement of JOHNSON OIL to any com-
pensatory damage or judgment for breach of contract was
sharply contested by MOUNTAIN FUEL on evidentiary and
2A conformed copy of the November 22, 1978 Opinion of the
Tenth Circuit is attached to the Petition for Certiorari of John-
son Oil pp. 29-65 inclusive.
il
legal bases before the trial Court and on appeal to the Tenth
Circuit. (Better than 60% of MOUNTAIN FUEL’s 74-page
Brief to the Circuit was directed to the compensatory damage
issue.) Nonetheless, in order tc compromise, resolve and put
an end to the litigation, upon the mandate in the case being
entered in the District Court, MOUNTAIN FUEL, on Janu-
ary 3, 1979, tendered into the Registry of the Court the sum
of $47,393.24 to JOHNSON OIL in full payment and satis-
faction of the Judgment of May 2, 1977 of the District Court.’
(See Appendix 2.) Thirteen days later on January 16, 1979,
JOHNSON OIL asked the District Court for permission to
withdraw the monies from the Registry of the Court and at
the same time to reserve any right that it may have as to
any other portion of its counterclaim. Upon oral argument,
_Chief U.S. District Judge Aldon J. Anderson denied the
JOHNSON OIL Motion without prejudice to bring the same
before the Senior Judge, William G. Juergens, specially as-
signed to the case. No such Motion was ever brought before
Judge Juergens, even though Chief Judge Anderson ordered
that it would be procedurally appropriate to so do. (See Ap-
pendix 3.)
17. Without notice or motion, JOHNSON OIL, on
February 5, 1979, withdrew from the Registry of the District
Court the MOUNTAIN FUEL tender and accepted the $47,-
393.24 in full payment and satisfaction of the May 2, 1977
final Judgment of the District Court. While acknowledging
’Said tender took into account as an offset against the com-
pensatory damage award of $65,000.00 in favor of Johnson Oil,
the stipulated judgment in favor of Mountain Fuel, together
with interest, for crude oil sold and delivered in the sum of
$23,203.99. The net tender and satisfaction of judgment was
the sum of $47,393.24.
12
full payment and satisfaction of said Judgment, JOHNSON
OIL attempted to reserve any right of appeal it otherwise
had “on any portion of its counterclaim’. (See Appendix 4.)
POINT I
THE CERTIORARI PETITION OF JOHNSON OIL
IS IMPROVIDENT AND SHOULD BE DENIED,
FOR JOHNSON OIL BY ACCEPTING PAYMENT AND
SATISFYING THE JUDGMENT BELOW, HAS WAIVED
ANY RIGHT TO REQUEST CERTIORARI REVIEW
BY THIS COURT
1. Johnson Oil Does Not Have Standing to Petition for
Certiorart.
At the threshold of any case brought to this Honorable
Court via certiorari procedure under 28 U.S.C. §2101(c), is
the standing of the Petitioner to request the issuance of the
Writ. Warth v. Seldin, 422 US. 490, 45 L.Ed. 2d 343, 95
S.Ct. 2197 (1975). Indeed, the Rules of Practice of this
Court, Rule 19 ef seq., are implicit that a sine gua non of
certiorari jurisdiction is that the petitioner be clothed with
standing to present the case. If the case is at an end or has
become moot by action in the lower Court, or if the cause
is no longer justiciable by reason of the lack of standing of
the petitioner, certiorari will be denied. North Carolina v.
Rice, 404 U.S. 244, 30 L.Ed. 2d 418, 92 S.Ct. 402 (1971);
Sears Roebuck & Co. v. Carpet, Linoleum, Soft Tile & Re-
silient Floor Covering Layers, et al., 397 U.S. 655, 25 L.Ed.
2d 637, 90 S.Ct. 1299 (1970).
13
Under the extant facts of this Case, the justiciable issues
of the controversy have been put to rest and are not open to
review. Those facts plainly are that on January 3, 1979,
MOUNTAIN FUEL paid the final Judgment of the District
Court in the sum of $47,393.24, a Judgment which at the
time was keenly disputed. The payment by MOUNTAIN
FUEL was made to bring an end to the litigation and hence
tender was in “full payment and satisfaction” of the Judgment,
inclusive of each and every part thereof. (See Appendix 2.)
JOHNSON OIL recovered and accepted MOUNTAIN
FUEL's tender in full payment and satisfaction of the Judg-
ment and acknowledged full satisfaction of said Judgment on
February 5, 1979. (See Appendix 4.) Such acceptance and ac-
knowledgment stripped JOHNSON OIL of the standing to
undertake a Petition for Certiorari to this Court from the very
Judgment which it acknowledges to have been satisfied.
2. The General Rule on Standing and Waiver.
The controlling precept of law is to the effect that a
party cannot accept the benefits or fruits of a non-severable
judgment and at the same moment, appeal the specific aspects
of the same judgment which cuts against the party. The vari-
ous Circuit Courts of Appeal have long recognized the propo-
sition. Smith v. Morris, et al., 69 F.2d 3 (CCA 3rd 1934);
Kaiser v. Standard Oil Co. of N.J., 89 F.2d 58 (CCA Sth
1937); Colquette v. Crossett Lumber Co., 149 F.2d 116 (CCA
8th 1945); Luther, et al. v. United States, 225 F.2d 495 (CCA
10th 1955); Wilson v. The Pantasote Company, 254 F.2d
700 (2 Cir. 1958).
As stated by the Tenth Circuit in Luther:
“* * * Tt is a well established general rule of solid
14
foundation that a litigant who accepts all or any sub-
stantial part of the benefits of a judgment or decree
is precluded from asking that such judgment or decree
be reviewed on appeal. He cannot avail himself of
its advantages and then challenge its disadvantages on
appeal. After accepting all or any substantial part of
its benefits, he cannot escape its burdens. * * *’” (Cita-
tions omitted. )
There appears to be two possible exceptions to the gen-
eral rule that a party may not pocket the monies from a
judgment on the one hand, and simultaneously launch an
appeal from that judgment on the other hand. The first is
that if the judgment is severable or divisible into independent
parts, satisfaction of one part of the judgment is not a bar
to an appeal of a separate and severable issue. Price v.
Franklin Investment Co., Inc., 574 F.2d 594 (D.C. Cir. 1978).
The second possible exception was suggested by this Court in
United States v. E. B. Hougham, et al., 364 U.S. 310, 5 L.Ed.
2d 8, 81 S.Ct. 13 (1960) wherein it was held that in an appeal
from a damage award claimed to be inadequate, the accept-
ance of payment of the compensatory judgment does not,
standing alone, amount to a waiver or an accord and satis-
faction. The decision in Hougham carries with it a strongly-
worded dissent by Justices Whittaker and Douglas and at least
one treatise writer questions the breadth or reach of the hold-
ing. See Moores Federal Practice, Vol. 9 (203.07 at p. 718.'
‘Moore would restrict the opinion in Hougham to the four
corners of the facts before the Court therein, characterizing it
as a “guarded” opinion:
“ * * * Furthermere, the judgment debtor’s argument
that his payment was offered and accepted as an accord
and satisfaction was made untenable by the fact that
he himself took the initial appeal from the judgment.”
9 Moores Federal Practice at p. 718. (Emphasis added.)
|
15
It is patently clear that the facts of this Case fall un-
mistakably within the framework of the general rule an-
nounced time and again by a legion of federal circuit de-
cisions which have never been overturned. Those facts are
that the compensatory damage judgment is an integral facet
of the claim of JOHNSON OIL to punitive damages under
its Petition for Certiorari herein. But for the compensatory
damages judgment, the exemplary damage claim could not
stand as a matter of law, regardless of the facts Maw v.
Weber Basin Water Conservancy District, 20 U.2d 195, 436
P.2d 230 (1968). Ergo, the conclusion is inescapable that the
determination of the punitive damage claim was a non-sever-
able or indivisible part of the judgment as to compensatory
damages. The punitive damage claim and the compensatory
damage claim, while separate causes of action, were non-sev-
erable in law, for they were non-severable in fact under the
evidence at trial.
It turns out, however, that the compensatory damage
judgment was one that was hotly contested and disputed by
MOUNTAIN FUEL. Such judgment was made the subject
of a cross-appeal by MOUNTAIN FUEL before the Tenth
Circuit. When the Circuit dismissed MOUNTAIN FUEL's
cross-appeal of the compensatory judgment as well as the
direct appeal of JOHNSON OIL on punitive damages,
MOUNTAIN FUEL, in order to compromise and resolve a
disputed judgment, paid the same, less its offset judgment
against JOHNSON OIL, on January 3, 1979. At no time did
MOUNTAIN FUEL acknowledge that the compensatory
damage judgment in favor of JOHNSON OIL was, in fact
or law, due and owing.
16
Thirteen days later, on January 16, JOHNSON OIL filed
a Motion before the District Court to permit acceptance of
the tender without prejudicing any appellate claims it may
have had. Upon hearing, Chief United States District Judge
Aldon J. Anderson denied the JOHNSON OIL Motion, find-
ing that it had been brought before the wrong judge and that
such Motion should be submitted to Senior Judge William G.
Juergens, to whom the Case was originally assigned.
But JOHNSON OIL did not take such steps. Rather, it
withdrew from the Registry of the Court on February 5, 1979,
the draft of $47,393.24 which had been expressly tendered
by MOUNTAIN FUEL in fuli payment and satisfaction of
the final Judgment. Although it tried to hedge against the
plain implications of an accord and satisfaction and waiver of
appeal (including Certiorari to this Court) with the statement
that such “acceptance’’ was not meant to limit its right of
appeal on any portion of its counterclaim, the fact is that
JOHNSON OIL did just that. It recovered the monies, ac-
knowledged satisfaction of the compensatory judgment that
was otherwise fervidly contested by MOUNTAIN FUEL and
in so doing, accepted the terms of the MOUNTAIN FUEL
tender, namely, the satisfaction of judgment and the term-
ination of the litigation on any damage issue whatsoever.
Nor do the facts of this matter fit within the possible
exception of Hougham. To begin with, in Hougham the
respondents, themselves, had undertaken the initial appeal,
thus expressly negating a finding of accord and satisfaction.
Such conduct is the antithesis of MOUNTAIN FUEL’s con-
duct in the Case at Bar. But more to the point, JOHNSON
OIL makes no claim in its Petition for Certiorari that the
17
compensatory damage award or judgment, itself, is inadequate.
Indeed, that conclusion is explicit, for JOHNSON OIL did
not undertake any appeal to the Tenth Circuit of the com-
pensatory damage judgment, much less incorporate it within
the Petition for Certiorari herein. Thus it is that JOHNSON
OIL does not seek a higher compensatory damage award as
did the Government in Hougham. It seeks an award of
punitive damages which, while inseparable from the final
Judgment on compensatory damages, is not an add-on for
further compensatory damages.
3. Conclusion on Standing.
JOHNSON OIL is without standing before this Court
on the Petition for Certiorari filed. The Judgment of the
lower Court was paid by MOUNTAIN FUEL in compromise
of and to end the litigation on damage issues. JOHNSON
OIL accepted the conditional tender, and acknowledged full
satisfaction of the Judgment. Under the exigent facts, the
litigation with respect to damages, inclusive of the adjunct
issue of punitive damages, is at an end. To find otherwise
would be to permit a party to pocket a money judgment which
is in dispute and at the same time to appeal that judgment.
POINT II
THERE IS NO CONFLICT, MUCH LESS SUBSTANTIAL
OR IRRECONCILABLE DISPARITY, BETWEEN THE
DECISION OF THE TENTH CIRCUIT AND TECA
1. The Basis for Certiorari is Absent.
Rule 19(b) of the Supreme Court Rules of Practice is
the cornerstone upon which the Petition for Certiorari of
18
JOHNSON OIL must rest. The Rule is unequivocal that in
order for a Certiorari Writ to issue to the Tenth Circuit in
the instant Case, the Circuit decision must collide with that
of TECA on the same matter, or the holding of the Tenth
Circuit must stand in opposition to a decision of this Court.
The asserted conflict between the Circuit decision and that of
TECA requires a finding of square and irreconcilable contra-
diction in the application of federal law. Avco Corporation
v. Aero Lodge, 390 U.S. 557, 20 L.Ed. 2d 126, 88 S.Ct. 1235
(1968); Northeastern National Bank v. United States, 387
US. 213, 18 L.Ed. 2d 726, 87 S.Ct. 1573 (1967). Conflicts
between a Circuit and TECA which are only apparent or
superficial and which require invented argument to establish
the same, will normally result in a denial of Certiorari. Keller
v. Adam-Campbell Co., 264 U.S. 314, 68 L.Ed. 705, 44 S.Ct.
356 (1924); Wisconsin Electric Co. v. Dunmore Co., 282
U.S. 813, 75 L.Ed. 728, 51 S.Ct. 214 (1931).
Even assuming, arguendo, the assistance of a square and
irreconcilable conflict (not extant in this Case) between the
decisions of the Circuit and TECA, the issue, to justify Cer-
tiorari must be one of substantial importance, having a sig-
nificant bearing on the body of federal jurisprudence and per-
sons affected thereby, and/or be of a recurring nature in the
cases and controversies. Lay v. Williams, 434 U.S. 910, 54
L.Ed. 2d 196, 98 S.Ct. 311 (1977); Aldinger v. Howard, 427
US. 1, 49 L.Ed. 2d 276, 96 S.Ct. 2413 (1976); Fuller v.
State of Oregon, 417 US. 40, 40 L.Ed. 2d 643, 94 S.Ct. 2116
(1974).
Lastly, the law is squarely settled that in order for the
case to be worthy of Certiorari by reason of a conflict of a
19
Circuit holding with a decision of this Court, that conflict
must be of the most direct, substantial and unequivocal char-
acter. Wilkinson v. United States, 365 U.S. 399, 5 L.Ed. 2d
633, 81 S.Ct. 567 (1961); Anderson v. Kibbe, 431 US.
145, 52 L.Ed. 2d 203, 97 S.Ct. 1730 (1977).
An evenhanded analysis of the Petition for Certiorari of
JOHNSON OIL herein yields the unavoidable conclusion that
the decision of the Tenth Circuit with respect to its re-
view of the punitive damage issue ~raised by JOHNSON
OIL is in harmony, not disharmony, with the holdings of
TECA as to appellate jurisdiction involving issues under the
ESA and the EPAA. On top of that, the holding of the Cir-
cuit in this matter is palpably distinguished from the decision
of the Supreme Court in Bray v. United States, 423 US. 73,
46 L.Ed. 2d 215, 96 S.Ct. 307 (1975). Accordingly, Cer-
tiorari is not providently laid in this case.
2. The Position of JOHNSON OIL on Conflict of Cir-
cuit and TECA Decisions.
Taken at its very best, the argument of JOHNSON OIL,
in its Petition for Certiorari is that its appeal to the Tenth
Circuit, with respect to the directed verdict of the District
Court against JOHNSON OIL on entitlement to punitive
damages, was and is a non-TECA issue that otherwise was
within the general appellate jurisdiction of the Circuit; the
argument continues that the Tenth Circuit improperly dis-
missed the JOIINSON OIL. appeal as to punitive damages,
because the question was swept out with TECA issues which
the Tenth Circuit refused to hear; it is then contended that if
the punitive damage issue had been appealed by JOHNSON
20
OIL in the first instance to TECA rather than the Tenth Cir-
cuit, TECA, based upon the case precedent of Cooper,’ Spin-
etti,° and its progeny, would have likewise dismissed the
issue for lack of subject matter jurisdiction on the basis that
TECA is jurisdictionally precluded from hearing non-ESA and
non-EPAA questions; the JOHNSON OIL argument concludes
on the note that in light of the foregoing, the decision of
the Tenth Circuit dismissing the JOHNSON OIL appeal
herein (which incorporated what JOHNSON claims to be
the non-TECA issue of punitive damages) is in conflict with
the decisions of TECA in Cooper and Spinetti, et al., and that
this Court should take the case on Certiorari to resolve the
apparent conflict.
The entire fabric of the JOHNSON OIL position in its
Certiorari Petition is wedded to the notion that the question
of punitive damages in the instant litigation is a federal
common law issue with the general appellate jurisdiction of
the Tenth Circuit and that it has no nexus to any TECA issue
under the ambit of the ESA or the Allocation Act. It is al-
together clear that if the contrary proposition is correct and
that the question of punitive damages in this Case requires
the interpretation of statute and/or regulation of the ESA and
the Allocation Act as the Tenth Circuit so determined, the
entire Petition of JOHNSON OIL falls of its own weight,
notwithstanding the argument made in Point [ of this Brief.
3. The Issue of Punitive Damages Raised by JOHNSON
OIL on Appeal was Plainly a Question for TECA Under the
Controlling Law.
5’ United States v. Cooper, 482 F.2d 1393 (Em.App. 1973).
‘ Spinetti v. Atlantic Richfield Company, 522 F.2d 1401 (Em.App.
1975).
21
A fair reading of the JOHNSON OIL Brief before the
Tenth Circuit, as well as the decision of the Tenth Circuit,
itself, places the matter beyond any reasonable debate that the
question of whether there was sufficient evidence before the
trial Court to sustain, as a matter of law, a finding of punitive
damages in favor of JOHNSON OIL and against MOUN-
TAIN FUEL, was within the sole jurisdictional province of
TECA and not the Tenth Circuit.
JOHNSON OIL is correct in its assertion, at page 22
of its Petition, that a substantia: portion of its appeal to the
Tenth Circuit was devoted to a discussion of the evidence
which it claimed allegedly supported a reinstatement of the
punitive damage award of the jury. The flaw in JOHNSON
OIL’s argument, however, is the very character and substance
of that evidence which JOHNSON OIL argued to support the
exemplary damage issue. Such argument was fundamentally
directed to crude oil pricing and allocation practices of
MOUNTAIN FUEL v7/s-a-vis JOHNSON OIL pursuant to
federal regulations under the ESA and the Allocation Act. In
the opening lines of the JOHNSON OIL Brief to the Circuit,
the contention is that punitive damages were recoverable
against MOUNTAIN FUEL because of a violation of such
federal Statutes:
“Tt is submitted that Mountain Fuel, by disregarding
the government freeze order, making illegal charges
above the ceiling price, by disregarding the terms of
the written contract with Johnson, and by wrongfully
and intentionally interfering with Johnson’s contractual
relationship with Allied Chemical establishes an ag-
gravated case of wanton and oppressive conduct as de-
fined by the court.” Johnson Oil Opening Brief to
Tenth Circuit p. 7. [Emphasis added. ]
22
At page 10 through 21, inclusive, of its Circuit Brief,
JOHNSON OIL urged that the “illegal overcharge” of
MOUNTAIN FUEL for “new” and “released” oil as against
“old” oil and the alleged overcharge of $.44 per barrel above
the regulated posted price in the area were grounds for puni-
tive damages. From pages 22 to 27 inclusive, JOHNSON
OIL argued, as a basis for punitive damages, that “Mountain
Fuel Ignored Governmental Freeze’ under the Allocation
Act of 1973 and promulgated regulations of the Federal
Energy Office. JOHNSON OIL argued therein that it was
not required under the regulations to take “new” or ‘‘released”
oil as defined by the oil regulations, and therefore was en-
titled to receive “old” oil at the old oil price under the Al-
location Act.
Throughout the Brief to the Tenth Circuit the JOHN-
SON OIL argument is fairly drenched with allegations that
MOUNTAIN FUEL violated the government allocation order
with respect to “new” and “‘released”’ oil, that it intentionally
overcharged JOHNSON OIL contrary to agency regulations
of the ESA, and that it illegally adopted a posted price for
Dry Piney crude oil, all of which entitled it to punitive
damages. All of the charges of JOHNSON OIL that MOUN-
TAIN FUEL violated the regulations of the ESA and the
Allocation Act were vigorously opposed by MOUNTAIN
FUEL. Such charges required interpretation of the adminis-
trative regulations by the appellate Court in light of the rul-
ings of the District Court. To suggest that the JOHNSON
OIL claim of punitive damages was not directly linked to
alleged violations of the ESA and the Allocation Act would
not only be inaccurate, it would be a fantasy.
23
The Tenth.Circuit added its stamp of acknowlegement
that the JOHNSON OIL Counterclaim, including the
Amended Counterclaim for punitive damages, implicated fed-
eral laws and regulations under the ESA and the EPAA.
Writing for the Court, Circuit Judge Barrett stated:
“We have previously noted that the issues tried in
this case were those framed by the Johnson Counter-
claim. The allegations set forth in that Counterclaim
invoked and implicated United States laws under the
ESA of 1970, 12 US.C.A. §1904 Note (Supp.
1977); the EPAA of 1973, 15 U.S.C.A. §§751, et Seq.,
and the implementing regulations duly promulgated
thereunder 6 CFR §150.353 (1974); 10 CFR §211.63
(4) (1977). These regulations spell out the two-tier
pricing system established in 1973 which provides that
‘old oil’ may not be sold above the lower tier ceiling
price, 10 CFR §212.72 (1977) and that ‘new oil’ may
not be sold above the upper tier ceiling price, 10 CFR
§212.74 (1977). Allegations against Mountain Fuel
involve its alleged disregard of the government ‘freeze
order,’ making ‘illegal’ charges above the ‘ceiling
prices, and requiring Johnson to purchase ‘old,’ ‘re-
leased’ and ‘neu’ oil at illegal prices contrary to gov-
ernment regulations.” 586 F.2d at 1384. [Emphasis
added. |
The Tenth Circuit went on to state that any claim by JOHN-
SON OIL that any strict “contract law allegations” made by
JOHNSON OIL against MOUNTAIN FUEL were inseparable
from the federal acts and regulations cited above and that
JOHNSON OIL so acknowledged the same to the Circuit in
its appellate brief. The Circuit concluded with the affirmative
statement that:
“We hold that this court is without jurisdiction to
entertain this appeal. In our view, exclusive jurisdic-
24
tion vests in the TECA by virtue of 28 U.S.C.A. §1331
(Supp. 1977); 15 U.S.C.A. §754(a) (1), which in-
corporates §211 of the ES Aof 1970, 12 U.S.C.A.
corporates §211 of the ESA of 1970, 12 US.C.A.
§1904 Note (Supp. 1977).” Id.
The ESA and EPAA pled and argued by JOHNSON OIL
invoked the mandatory and exclusive jurisdiction of TECA
and it was TECA and not the Tenth.Circuit as to which the
JOHNSON OIL appeal on punitive damages should have
been directed. The Tenth Circuit properly dismissed the
JOHNSON OIL appeal on that score as well as other TECA
related issues.
4. The Holding of the Tenth Circuit Herein is not in
Conflict with the Decisions of TECA.
Little time need be spent in squaring the instant de-
cision with the decisional precedent of TECA, in view of what
has already been said. While JOHNSON OIL is heard to
argue that the holdings of the TECA Court in United States
v. Cooper, 482 F.2d 1343 (Em.App. 1973), Associated Gen-
eral Contractors of America v. Laborers International Union of
North America, 489 F.2d 749 (Em.App. 1973) and Spinetti
v. Atlantic Richfield Company, 522 F.2d 1401 (Em.App.
1975) are in substantial conflict with the opinion of the
Tenth Circuit in the Case at hand, its argument on the subject
falls far short of persuasive.
There is nothing remarkable about Cooper, Associated
General Contractors, and Spinetti, they all assert the same
axiom of law — that TECA is a court of limited, statutory
jurisdiction under the EPAA of 1973, which incorporates sec-
tion 211 of the ESA of 1970, and that claims or appeals
25
having no bearing upon or nexus to the ESA or the EPAA
are without its jurisdiction. Thus in Spinetti, TECA declared
that separate antitrust, Fair Trade, and contractual claims,
having no foundation under either the Stabilization Act
or the Allocation Act, were not properly before it and could
only be appealed to the Court of Appeals (in that case the
Ninth Circuit).
TECA has been consistently conspicuous in recognizing
its restricted judicial field of operation. Longview Refining
Co. v. Shore, et al., 554 F.2d 1006 (Em.App. 1977); Associ-
ated General Contractors of America, supra. While there is
nothing novel about the string of TECA decisions proclaiming
that the Court will not entertain appeals which are not
grounded in the ESA or the Allocation Act, there is, at the
same moment, nothing inconsistent with the enunciated doc-
trine.
It is to state all but the obvious that the decision of
the Tenth Circuit in the Case at Bar dismissing the JOHN-
SON OIL appeal on the question of punitive damages, is not
out of step or in conflict with the holdings of TECA. Indeed,
whatever else might be said about the Opinion of the Circuit
in this Case, the dismissal of the JOHNSON OIL appeal on
punitive damages was not only eminently correct, it was in
lockstep with the holdings of TECA above-cited.
The Circuit found, with unmitigated cause, that JOHN-
SON OIL's clair and appeal on punitive damages was
grounded in and arose out of the interpretation and con-
struction of the ESA, the Allocation Act, and administrative
regulations thereunder. In point of fact, the principal targets
26
of the JOHNSON OIL appea!, on exemplary damages, was
the alleged violation by MOUNTAIN FUEL of the ESA and
the Allocation Act. The Tenth Circuit could not have entered
upon an examination of the evidence or the law which JOHN-
SON OIL claimed for its punitive damage appeal without
running headlong into the judicial interpretation and con-
struction of the ESA, the EPAA, and the regulations. Accord-
~ ingly, it is not too much to say that the holding of the Tenth
Circuit on this issue is entirely consistent with the rationale
of the TECA precedent cited.
This is not to say that the creation of TECA and the
specific parameters of its jurisdiction vis-a-vis the general jur-
isdiction of the Court of Appeals, may not present consider-
able procedural problems for a litigant in a given case. The
prospects of bifurcated jurisdiction between TECA and the
Court of Appeals in a multi-claim case or whether or not a
claim presents a TECA question, is not always the subject of
quick or simple deterraination. But it is to say that under the
facts of this Case, the ruling of the Tenth Circuit in the puni-
tive damage appeal of JOHNSON OIL was squarely on the
mark and completely comports with the decisions of TECA
on the same subject.
POINT III
THE HOLDING OF THE TENTH CIRCUIT IN THE
INSTANT CASE IS PLAINLY DISTINGUISHED
FROM THE DECISION OF THIS COURT IN
BRAY V. UNITED STATES
JOHNSON OIL, at page 21 of its Brief, attempts to sug-
gest that the decision of the Tenth Circuit in the instant liti-
27
gation is at odds with the per curiam opinion of the Supreme
Court in Bray v. United States, 423 U.S. 73, 46 L.Ed. 2d 215,
96 S.Ct. 307 (1975). Such suggestion is wrong and for the
wrong reasons. In Bray, the defendant was cited for criminal
contempt under 18 U.S.C. §401 for failure to produce records
in connection with an investigation of possible violations of
the ESA. This Court held that the contempt citation did not
arise under the ESA of 1970 but rather under the Criminal
Contempt Statute, 18 U.S.C. §401 and ergo, the case was
properly within the general appellate jurisdiction of the Tenth
Circuit.
The facts in Bray are a far cry from those facing JOHN-
SON OIL in this Case. The punitive damage appea! of JOHN-
SON OIL is firmly grounded in claimed violations by MOUN-
TAIN FUEL of both the ESA and the EPAA and only that
Court (namely TECA) which maintains jurisdiction to inter-
polate and construe the crude oil statutes and regulations
could pass upon and ascertain whether such claimed violations
had in fact occurred and could sustain a claim for punitive
damages.
The decision of this Court in bray is distinguished on its
facts from the facts of the instant Case. Moreover, the hold-
ing of the Tenth Circuit om the JOHNSON OIL appeal on
punitive damages is in full conformity with the opinion in
Bray. Indeed, the Tenth Circuir cites Bray at length in sup-
port of its ruling. See 586 F.2d at 1383.
The argument of JOHNSON OIL with respect to the
Bray Case is bankrupt.
»
28
POINT 1V
THIS COURT SHOULD NOT, AND IN LAW, IS
UNABLE TO INVENT TRANSFER JURISDICTION
FROM THE CIRCUIT COURT TO TECA
OR VICE VERSA
JOHNSON OIL argues in Point II of its Petition for
Certiorari that this Court should decree a method in which
appeals, which are improvidently filed in the Tenth Circuit,
could be transferred to TECA for adjudication. JOHNSON
OIL in the same breath also urges the flip side of the propo-
sition, viz., that this Court should judicially provide for trans-
fer jurisdiction for appeals improvidently filed with TECA to
an appropriate Circuit.
The short answer to the position of JOHNSON OIL is
that this Court is not engaged in the business of inventing
and restructuring new jurisdiction for either Courts of Appeal
or TECA. It is an axiomatic canon that the Courts of Appeal
and TECA are Article III Section | tribunals under the United
States Constitution and that the Congress is the only entity with
power to establish or modify the core, reach, or field of juris-
diction of such appellate courts. The appellate review juris-
diction of the Courts of Appeal are prescribed by the Con-
gress under 28 U.S.C. §2101, et seg., while TECA jurisdiction
is set forth in section 211 of the Economic Stabilization Act
incorporated into 15 U.S.C. §754 of the Emergency Petroleum
Allocation Act.
This Court could not provide for transfer jurisdiction
from a Circuit to TECA or back, any more than it could legis-
late a ruling allowing for transfer from one circuit to another,
29
in the event that a litigant had mistakenly filed his appeal in
the event that a litigant had mistakenly filed his appeal in
the wrong court of appeals. Owen Equipment and Erection
Company v. Kroger, ...... USS. ......, 57 L.Ed. 2d 274, 98 S.Ct.
2396 (1978).
JOHNSON OIL cites no authority whatsoever that would
begin to permit this Court to enter the legislative arena and
reconstruct the appellate review jurisdiction of the Courts of
Appeal or TECA. Its argument is without merit and should
be denied.
POINT V
IF THIS COURT WERE TO GRANT THE
PETITION FOR CERTIORARI OF JOHNSON OIL
HEREIN, THE WRIT SHOULD ISSUE AS TO ALL
FACETS OF THE CASE, INCLUDING THE QUESTIONS
RAISED BY MOUNTAIN FUEL IN ITS CROSS-APPEAL
BEFORE THE TENTH CIRCUIT
It is plain enough that the Petition for Certiorari of
JOHNSON OIL in this matter is not well taken for a variety
of reasons and should be denied. If, notwithstanding the
arguments submitted in this Opposition Brief, this Court de-
termines that Certiorari should be granted, the Writ to be
issued to the Tenth Circuit should be directed to the entire
case, and all facets thereof, inclusive of the Cross-Appeal of
MOUNTAIN FUEL on the issue of breach of contract.
If any party in the instant litigation had provocation to
urge that the Tenth Circuit erroneously dismissed its appeal,
it is MOUNTAIN FUEL and not JOHNSON OIL. MOUN-
30
TAIN FUEL raised by way of its Cross-Appeal the common
law question of whether it breached its contract with JOHN-
SON OIL by terminating further sales of crude oil by reason
of JOHNSON OIL'’s failure tc pay for previous sales. The
evidence that was permitted by the trial Court regarding the
alleged breach of contract on the part of MOUNTAIN FUEL
was erroneous in several parts and the testimony on damages
was speculative, without foundation, and inadrissible. Thus,
the alternative position of MOUNTAIN FUEL is that the
breach of contract issue, particularly in light of the contra-
dictory rulings of the trial Court, involved non-TECA ques-
tions and should, in all events have been heard by the Tenth
Circuit.
MOUNTAIN FUEL does not propose that this Court
scrub the arguments advanced herein and somehow grant the
Petition for Certiorari of JOHNSON OIL. It does respectfully
submit, however, that if Certiorari is permitted, the breach of
contract issue under the MOUNTAIN FUEL Cross-Appeal is
such an integral part of the punitive damage issue of JOHN-
SON OIL, that the MOUNTAIN FUEL Cross-Appeal should
be, as well, brought before the Supreme Court for review.
CONCLUSION
The Petition of JOHNSON OIL for Certiorari is insipid
and unfounded. It does not reach the requirements of Rule
19 with respect to a provident grant of Certiorari, for the
decision of the Tenth Circuit does not do violence to any
holding of the Supreme Court and it is not in conflict with
any case precedent of the TECA Court. The JOHNSON OIL
appeal of the Tenth Circuit on the issue of punitive damages
31
was ladened with issues under and requiring the interpretation
of the ESA of 1970 and the EPAA of 1973, by TECA. The
JOHNSON OIL appeal in the Tenth Circuit on punitive
damages was properly dismissed.
JOHNSON OIL has no standing to bring the instant
Petition for Certiorari before this Court. It accepted in full
satisfaction of the final Judgment the tender by MOUNTAIN
FUEL in payment of that Judgment. It may not accept the
fruits of the Judgment in one hand and instantaneously con-
test or appeal that Judgment with the other hand.
The Petition of JOHNSON OIL should be, by this Court,
denied.
Respectfully submitted,
ROBERT S. CAMPBELL, JR.
310 South Main Street, 12th Floor
Salt Lake City, Utah 84101
Attorney for Mountain Fuel
Supply Company, Respondent
April 16, 1979
that there was no evidence to support the claim of business
interference although the verdict was not modified to so .vflect.
(R. 314-15.)
Pursuant to the stipulation of counsel prior to the
trial, the issue of JOHNSON's entitlement to statutory overcharges,
civil penalties, attorney's fees and costs were reserved for
post-trial determination by the Court. By Order dated December 23,
1976, it was held that JOHNSON could not recover any such over-
charges, penalties or fees. (R. 321-26.)
14.4 Entry of Judgment.
Upon the resolution of all outstanding issues, a Final
Judgment and Order on Particular Issues and Judgment of Verdict
of Jury was entered by the trial Court on May 2, 1977. (R. 327-
29.)
JURISDICTION
The Court has, on its own motion, raised the issue of
whether it properly has jurisdiction over the subject matter of
this appeal or whether the matter should be submitted to the
Temporary Emergency Court of Appeals (hereinafter "T.E.C.A.").
It is the position of MOUNTAIN FUEL that this Court has juris-
diction to hear and adjudicate each of the claims of the respec-
tive parties in that this is not a case which “arises under" the
Allocation Act of 1973, insofar as that term has been generally
defined. Further, MOUNTAIN FUEL asserts that this Court retains,
in all events, jurisdiction over those issues not directly related
to the Allocation Act or the regulations promulgated thereunder.
={9=
APPENDIX 1
Page 1 of 7
1. To come within the exclusive jurisdiction of T.E.C.A. the
case must "arise under” the Allocation Act.
It is recognized, at the outset, that § 211 of the ESA (as
incorporated into the Allocation Act) affirmatively provides:
"(T)he Temporary Emergency Court of Appeals shall
have the exclusive jurisdiction of all appeals from
the district courts of the United States in cases
and controversies arising under this title or under
regulations or orders issued thereunder.” 12 U.S.C.
§ 1904 Note (emphasis added).
While the statute would seem to be clear on its face, it has
proven difficult in application. But at the very least, under
its own terms, § 211 is operative only as to those matters that
“arise under" the Acts.
The meaning of the term "arise under,” although specif-
ically addressed in other contexts, has seldom been reviewed in =
the context of the 1970 and 1973 Acts. Indeed, in only one
instance has a United States Court of Appeals attempted to interpret
the meaning of “arise under” as specifically used in the 1970
Act. In St. Mary's Hospital of East St. Louis, Inc. v. Ogilvie,
496 F.2d 1324 (7th Cir. 1974), the Seventh Circuit, after first
citing §211 of the 1970 Act, enunciated the test for determining
when an action "arises under” the Act:
"We interpret the phrase "arising under” as
requiring that the allegations of the complaint,
not merely the answer, call for the application
of the Economic Stabilization Act to the suit.
In the absence of such triggering allegations in
,:
tion over the appeal. emphasis
added).
In determining the meaning of the phrase "arise under,"
the Seventh Circuit noted that the test espoused by it was little
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APPENDIX 1
Page 2 of 7
es
more than the test traditionally employed for determining the
existence of federal jurisdiction. The statute which gives rise
to federal jurisdiction, 28 U.S.C. §133l(a), specifically requires
that an action "arise under” the Constitution, laws or treaties
of the United States. Further, it is a well-settled rule of law
that in determining whether an action falls within the limits of
§ 1331 so as to confer jurisdiction, a Federal Court may look
only to the complaint for the requisite allegations.
The question, not surprisingly, comes up most frequently
in cases where there has been removal from a State to a Federal
Court. In the leading case of Pan American Petroleum Corporation
v. Superior Court, 366 U.S. 656 (1961), the United States Supreme
Court, in a unanimous decision, enunciated the rules for determining
when subject matter jurisdiction obtains in the Federal Court.
Therein, the Court, speaking through Mr. Justice Frankfurter,
observed:
"It is settled doctrine that a case is not cog-
nizable in a federal trial court, in the absence
of diversity of citizenship, unless it appears
from the face of the complaint that determination
of the suit depends upon a question of federal
law." 366 U.S. at 663 (emphasis added).
The Court then declared, citing from its decision in Gully v.
First National Bank, 299 U.S. 109 (1936):
“Apart from diversity jurisdiction, ‘a right or
immunity created by the Constitution or laws of
the United States must be an element, an essen-
tial one, of the plaintiff's cause of action
+ « « and the controversy must be disclosed upon
the face of the complaint, unaided mv, the answer
or by the petition for removal. .. Id.
(emphasis added).
-2l-
APPENDIX 1
Page 3 of 7
And further, the Court, in Pan American, noted:
"For this requirement it is no substitute that
the defendant is almost certain to raise a
federal defense." Id.
Since Pan American, as does the case at hand, involved
an issue of exclusive jurisdiction, the Court was compelled to
note that "exclusive jurisdiction” under the federal act applied
only to those suits which could be brought in Federal Court in
all events. As it was the ruling of the Supreme Court that
federal jurisdiction did not appear upon the face of the com-
plaint, the Court found the statutory grant of exclusive juris-
diction wholly inapplicable. 366 U.S. at 664.
That the Tenth Circuit has consistently followed the
so-called “well-pleaded complaint" rule in federal-question cases
and thus should apply the same test to determine jurisdiction
under the 1970 and 1973 Acts herein, cannot be disputed. One of
this Court's most recent pronouncements of the rule is found in
Mescalero Apache Tribe v. Martinez, 519 F.2d 479 (10th Cir.
1975). In that case, this Court, in holding that jurisdiction
was not providently laid under 28 U.S.C. § 1331, said:
"It has been suggested that the proper test under
§ 1331 for finding original federal jurisdiction
is that there be a ‘substantial claim founded
directly upon federal law.' In deciding whether
the matter in controversy involves such a claim,
only the complaint should be examined, and, indeed,
only those parts of the complaint directly and
necessar relating to the aint s cause of
action should be considered Id. at 461 (emphasis
added).
See also, North Davis Bank v. First National Bank of Layton, 457
F.2d 820 (10th Cir. 1972) and Chandler v. O'Bryan, 445 F.2d 1045
APPENDIX 1 ——
Page 4 of 7
Lay
- A anna
(10th Cir. 1971). See, in addition, Rath Packing Co. v Becker,
530 F.2d 1295 (9th Cir. 1975), wherein the Ninth Circuit rcvently
held that a federal issue raised in a counterclaim was also not
sufficient to bestow jurisdiction on a Federal Court.
The case at bar, under the undisputed facts, falls
squarely within the parameters of the “well-pleaded complaint
rule" of St. Mary's and Mescalero. The record before the Court
indicates that MOUNTAIN FUEL originally instigated this action in
one of the District Courts for the State of Utah. The original,
and only, Complaint filed by MOUNTAIN FUEL, in the State District
Court for Utah, did not, in any sense, involve itself with or
raise substantive issues concerning either the 1970 or 1973 Acts
or any regulations promulgated thereunder. (R. 4-7.) Indeed,
the Complaint alleges a cause of action sounding solely in breach
of contract. Paragraph 4 of the Complaint reads: 7
"4. That on or about the 15th day of July,
1970, the parties entered into a written agree-
ment, a copy of which is attached hereto, referred
to hereby and incorporated herein." (R. 4.)
While it is true that Paragraphs 6 and 7 of the Com-
plaint (R. 5) allude to "Phase IV" oil regulations promulgated by
the CLC, such does not change the essence or character of the
Complaint. The said regulations are neither attacked nor sought
to be enforced. Nowhere on the face of the Complaint does
MOUNTAIN FUEL ask for an interpretation or application of the
regulations.
It is equally clear from the record that the issues
involving the 1970 and 1973 Acts were specifically raised by the
-23-
APPENDIX 1
Page 5 of 7
Defendant, essentially in the nature of a defense, in the Answer
and Counterclaim. (R. 20-23.) Thus it is that under the .~-evailing while it did have jurisdiction over that count of the complaint
and dispositive case law, the action on appeal herein did not, alleging violations of the Allocation Act, it did not have ,uris-
and does not, “arise under" the ESA or the Allocation Act, as is i diction over the remaining counts since the same did not arise
required by the operative provisions of §211 of the 1970 Act. ; under the Act. Said the Court:
It should further be noted that the cases cited by "The antitrust, Fair Trade and contractual
; claims are appealable only to the Ninth Circuit
letter of counsel for the Clerk of the Court dated September 13, : Court of Appeals... . As stated in United
; States v. Cooper, 482 F.2d 1393, 1398 (Em. App.
1977, are not controlling in the instant case. Each of the cases 1573: r{Clourts of special jurisdiction should
strictly construe their statutory grants of
deals with a situation wherein the issues involving the Allocation : jurisdiction.'" Id. at 1403.
Act were expressly raised and confronted by the initial complaint The Spinetti decision is persuasive in the instant case
of the plaintiff. See, for example, Withington v. F.E.A. and : for two reasons. First, it is support for the application of the
Frank Zarb, No. 76-1612 (10th Cir. August 25, 1976). . “well-pleaded complaint” rule discussed hereinabove. It is clear
2. Even were it assumed for the sheer sake of argument that that in Spinetti, T.E.C.A. limited its exercise of jurisdiction
° . s 3 mite
strictly to those issues which deal rectly and sub- only to those issues which, on the face of the complaint, dealt
stantively with the 1970 and 1973 Acts.
directly with the Allocation Act. Second, it illustrates that
Since T.E.C.A. is a Court of special jurisdiction, it
T.E.C.A., as a Court of special jurisdiction, has no authority to
has been held numerous times that the exercise of jurisdiction by
review “pendant” claims or issues.
T.E.C.A. must be strictly construed and narrowly defined. In the
case of Spinetti v. Atlantic Richfield Company, 522 F.2d 1401
(Em. App. 1975), T.E.C.A., itself, held that it had jurisdiction
3. Conclusion as to Jurisdictional Issue.
; This Court has a firm hand on subject matter jurisdiction
on each and all of the issues, including “posted price" and
to hear only those issues dealing directly with the validity,
| "allocation" of Dry Piney crude oil, on appeal herein, whether
interpretation or application of the Acts or their regulations. : ?
: those issues are raised under the crosg-appeal of MOUNTAIN FUEL
In Spinetti, the Plaintiff brought an action in Federal Court :
or the main appeal of JOHNSON. In the unlikely event it is determined
|
alleging, in separate counts, antitrust, fair trade and contractual |
i that the issues of “posted price” and “allocation” under the 1970
violations. In addition, the plaintiff alleged that the conduct }
and 1973 Acts are ones of exclusive jurisdiction with T.E.C.A.,
of the defendant violated certain of the regulations issued
only those specific issues should be referred to that Court.
pursuant to the Allocation Act. On appeal, T.E.C.A. held that
-25-
-24- | APPENDIX 1
APPENDIX 1 | Page 7 of 7
Page 6 of 7
|
ROBERT S. CAMPBELL, JR.
WATKISS & CAMPBELL
Attorneys for Plaintiff
310 South Main Street, 12th Floor
Salt Lake City, Utah 84101
Telephone: (801) 363-3300
IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
NORTHERN DIVISION
MOUNTAIN FUEL SUPPLY COMPANY, :
a Utah corporation,
: TENDER OF SATISFACTION
Plaintiff,
: OF JUDGMENT
vs.
H
RELAND JOHNSON and
JOHNSON OIL COMPANY, : Case No. Nce-75-3
Defendants. :
COMES NOW the Plaintiff, MOUNTAIN FUEL SUPPLY COMPANY, by
and through its counsel of record, ROBERT S. CAMPBELL, JR., and
herewith tenders the sum of $47,393.24 in full payment and satis-
faction of that certain Judgment entered in the above-styled
action on May 2, 1977. The sum has been calculated as follows:
Original judgment $65,000.00
Less: Amount due to Mountain Fuel
Supply for crude oil purchases of
Johnson Oil, together with interest
at the rate of 6% per annum from the
date of each partial payment to the
date of judgment. 23,203.99
S41, 796.01
Plus interest at the rate of 8% per
annum on the balance from May 2,
1977, the date of judgment, to
January 3, 1979.
5,597.23
Total Judgment $47,393.24
Said sum is also exclusive of costs, which were awarded to the
Defendant as a part of the Final Judgment but which have not, as
yet, been taxed by the Clerk of the Court.
DATED this 3rd day of January, 1979.
Rik Lg LA
of and for
WATKISS & CAMPBELL
310 South Main Street, 12th Floor
Salt Lake City, Utah 84101
Attorneys for Plaintiff
Mountain Fue upply Company
APPENDIX 2
‘
ne ae Cee ee
ot ree mete
ed in [intot Or tee
IN THE UNITED STATES DISTRICT COURT FOR THE prsrqic Or. ‘trict
eee
NORTHERN DIVISION Tice :
JAN 19 1979
PILL CER
MOUNTAIN FUEL SUPPLY COMPANY, 3 Serk
a Utah corporation,
:
Plaintiff,
3 ORDER WITHOUT PREJUDICE
vs.
:
RELAND JOHNSON and
JOHNSON OIL COMPANY, : Case No. NC-75-3
Defendants. ry
The Motion of the Defendant, JOHNSON OIL COMPANY, permitting
it to withdraw and accept the Tender of Satisfaction of Judgment
of Plaintiff with reservation to pursue an appeal or any other
portion of its Counterclaim having come on for hearing before
this Court, the Honorable ALDON J. ANDERSON, Chief United States
District Judge presiding, on Thursday, the 18th day of January,
1979, Plaintiff being represented by its counsel ROBERT S. CAMPBELL,
JR., ESQ. of WATKISS & CAMPBELL and the Defendant being repre-
sentei by its counsel JOSEPH C. RUST of KIRTON & MC CONKIE, and
the Court having heard argument in connection with Plaintiff's
Motion and being advised in the premises,
NOW THEREFORE, good cause appearing, IT IS HEREBY ORDERED
that the proceedings in this case have been and are before Senior
U. S. District Judge WILLIAM G. JUERGENS, that it is procedurally
appropriate that Plaintiff's Motion be brought before Judge
Juergens for review and disposition and this Court defers to
Judge Juergens in the matter;
IT IS FURTHER ORDERED that the Motion of the Defendant,
JOHNSON OIL COMPANY, be and the same is hereby denied without
prejudice to bring the matter before Judge Juergens for review
and determination.
APPENDIX 3
Page 1 of 2
— j
;
IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
DATED this day of January, 1979.
NORTHERN DIVISION
BY ORDER OF THE COURT a a on en oe 2
Pi j
a MOUNTAIN FUEL SUPPLY COMPANY, )
a Utah corporation,
ACCEPTANCE OF TENDER OF
SATISFACTION OF JUDGMENT
States District Judge Plaintiff,
vs.
RELAND JOHNSON and , ee eee
JOHNSON OIL COMPANY,
Defendants. )
| * 2 @ &@ @ &
Defendants Johnson Oil Company and Reland Johnson accept
Plaintiff's tender of satisfaction of judgment to the extent as
the same is described in plaintiff's Tender of Satisfaction of
Judgment on file with the Court herein and with the explicit
understanding that defendants did not receive deliveries of oil
from Mountain Fuel between the date of the jury verdict of June 23,
1976 and November of 1976 when deliveries of oil were resumed,
and that plaintiff's Tender of Satisfaction of Judgment does not
resolve or satisfy defendants' claim to those deliveries, and
with the further understanding that this acceptance is not meant
in any way to limit defendants’ right of appeal on any portion of
its counterclaim.
Dated this 5th day of February,1979.
KIRZON & McCONKIE
rneys for Defendants
South Third East
lt Lake City, Utah 84111
Telephone: (801) 521-3680
@2-
APPENDIX 3
Page 2 of 2 nui ¢
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.