# Petition for Writ of Certiorari — Pennzoil Co. v. Associated Gas Distributors

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1985
- **Citation:** 474 U.S. 847

## Text

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85-139. FILED

JUL 25 1985
No. 85- ——
| ALEXANDER |. STEVAS,
| CLERK ~—

IN THE
Supreme Court of the United States

OCTOBER TERM, 1985

PENNZOIL COMPANY, et al.,
Petitioners,
v.

ASSOCIATED GAS DISTRIBUTORS, et al.,
Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

CHARLES ALAN WRIGHT
727 East 26th Street
Austin, Texas 78705
(512) 471-5151

R. GORDON GOOCH
CHARLES M. DARLING, IV
THOMAS J. EASTMENT
BAKER & BOTTS
1701 Pennsylvania Ave., N.W.
Washington, D.C. 20006
(202) 457-5500

[Additional Of Counsel Listed Inside]

EARNEST OS: SL ATT Te A TE ST SR AEC
WILSON - EPES PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

AMOCO PRODUCTION COMPANY

William T. Benham
200 East Randolph Drive
Chicago, Illinois 60601

ARCO OIL AND GAS COMPANY
DIVISION OF ATLANTIC
RICHFIELD COMPANY

Michael G. Maloney
P.O. Box 2819
Dallas, Texas 75221

CHAMPLIN PETROLEUM COMPANY

B.J. Zimmerman

Kerry R. Brittain

Constance D. Coleman

801 Cherry Street, M.S. 4010
P.O. Box 7

Forth Worth, Texas 76101

CHEVRON U.S.A. INC.

James B. Atkin

Pillsbury, Madison & Sutro
1050 17th Street, N.W.
Suite 900

Washington, D.C. 20036

CITIES SERVICE OIL AND GAS
CORPORATION

Carmen Chidester Farrell
P.O. Box 300
Tulsa, Oklahoma 74102

CONOCO INc.

Ernest J. Altgelt, III
Carolyn S. Hazel
William G. Robb

P.O. Box 2197
McLean Building
Houston, Texas 77252

EXXON CORPORATION

Douglas W. Rasch
P.O. Box 2180
Houston, Texas 77001

GULF OIL CORPORATION

Anthony V. Sorrentino
David R. Stevenson
P.O. Box 3725
Houston, Texas 77253

MOBIL OIL CORPORATION

MOBIL OIL EXPLORATION &
PRODUCING SOUTHEAST INC.

MOBIL PRODUCING TEXAS &
NEW MEXxIco INC.

THE SUPERIOR OIL COMPANY

Robert D. Haworth
Robert A. Luettgen
Jay G. Martin

Nine Greenway Plaza
‘Suite 2700

Houston, Texas 77046

Carroll L. Gilliam

J. Paul Douglas

Kevin M. Sweeney

Grove, Jaskiewicz, Gilliam
and Cobert

1730 M Street, N.W.

Washington, D.C. 20036

MONSANTO OIL COMPANY

Kenneth R. Satterly
Walter L. Brignon
5051 Westheimer
1300 Post Oak Tower
Housten, Texas 77056

PENNZOIL COMPANY

John M. Young

John B. Chapman
Pennzoil Company
P.O. Box 2967
Houston, Texas 77001

PHILLIPS PETROLEUM COMPANY
PHILLIPS OIL COMPANY
C.J. Roberts
Larry Pain
Jennifer A. Cates
1258 Adams Building
Bartlesvilie, Oklahoma 74004

PLACID OIL COMPANY

Ronald D. Hurst
3900 Thanksgiving Tower
Dallas, Texas 75201

SHELL OFFSHORE INC.
SHELL WESTERN E&P INC.

Thomas G. Johnson
Eugene V. Callaway
One Shell Plaza

P.O. Box 2463
Houston, Texas 77001

SUN EXPLORATION AND
PRODUCTION COMPANY

Charles L. Spann
P.O. Box 2880
Dallas, Texas 75221-2880

TENNECO OIL COMPANY
HOUSTON OIL & MINERALS
CORPORATION

Glen E. Taylor
Phyllis G. Rainey
P.O. Box 2511
Houston, Texas 77001

TEXACO INC.

Karen A. Berndt
P.O. Box 52332
Houston, Texas 77052

UNION OIL COMPANY OF
CALIFORNIA

Lois Ellen Gold

Albert Sylvia III

P.O. Box 7600

Los Angeles, California
90051

QUESTIONS PRESENTED

1. Whether a court of appeals may use a motion filed
under the All Writs Act as a method of circumventing
the statutorily prescribed procedures for review of agency
orders.

2. Whether the court of appeals, by ignoring the statu-
tory procedures governing orderly judicial review, has
contravened the mandate of Section 506(a) of the Nat-
ural Gas Policy Act, 15 U.S.C. § 3416(a), and of 28
U.S.C. § 2112, which require review of orders of the Fed-
eral Energy Regulatory Commission on the record and
preclude piecemeal review of such orders in different
courts of appeals.

3. Whether the court of appeals, in circumventing stat-
utory procedures and reviewing only one aspect of an
agency order and leaving all other aspects of that order
subject to review in a separate proceeding in a separate
court of appeals, denied petitioners here their due process
rights to be heard at a meaningful time and in a mean-
ingful manner.

4. Whether the court of appeals impermissibly in-
truded upon the discretion of the Federal Energy Regu-
latory Commission to prescribe refund remedies and,
without the benefit of the complete agency record, va-
cated refund procedures prescribed by that agency to
effect such remedies.

ii

LIST OF PARTIES TO THE PROCEEDING

The petitioners filing in this petition for a writ of
certiorari are: Amoco Production Company; ARCO Oil
and Gas Company, Division of Atlantic Richfield Com-
pany; Champlin Petroleum Company; Chevron U.S.A. Ine. ;
Cities Service Oil and Gas Corporation; CONOCO Inc.;
Exxon Corporation; Gulf Oil Corporation; Mobil Oil Cor-
poration; Mobil Oil Exploration & Producing Southeast
Inc.; Mobil Producing Texas & New Mexico Inc.; Pennzoil
Company; Phillips Oil Company; Phillips Petroleum Com-
pany; Placid Oil Company; Shell Offshore Inc.; Shell
Western E&P Inc.; Sun Exploration and Production
Company; Tenneco Oil Company; Texaco Inc.; The Su-
perior Oil Company; and Union Oil Company of Cali-
fornia.*

The respondents are American Iron and Steel Insti-
tute; American Paper Institute, Inc.; Associated Gas
Distributors; E] Paso Natural Gas Compar.; Interstate
Natural Gas Association of America; Laclede Gas Com-
pany; Lone Star Gas Company; Louisiana Land & Ex-
ploration Company; Michigan Wisconsin Pipeline Com-
pany (now ANR Pipeline Company); Mississippi River
Transmission Corporation; Natural Gas Pipeline Com-
pany of America; Northern Natural Gas Company;
Process Gas Consumers Group; Texas Gas Transmis-
sion Corporation; Transcontinental Gas Pipeline Corpo-
ration; United Gas Pipe Line Company; Valero Trans-
mission Company; and the Federal Energy Regulatory
Commission.

* Pursuant to Sup. Ct. Rule 28.1, a list of all parent companies,
subsidiaries (other than wholly-owned subsidiaries), and affiliates
of Petitioners is included in the Appendix at 153a-165a. This list is
limited to entities with stock or debt securities publicly traded in
the United States or Canada.

TABLE OF CONTENTS

Page
py se iy yt yy | -. en epee iv
Sr I I nc ac icasicichises ina Sia dui seca caoneietniohegbhcianal 1
IT UII sss benstdieicaeniepiteccdcetconisnrausasmebasiaideammsteiumbdccal 2
Se NU steiciinicsgsbicias dah Nicanceedihsindiccdebldeateagpleticciean Ce ial cle 2
STATEMENT OF THE CASB..Q.......c.cccsecencencesesses 2
REASONS FOR GRANTING THE WRIT .................... 7

A. The Decision Below Conflicts With Statutory
Provisions Governing Judicial Review and Well-
Settled Principles Approved By This Court And
The Courts Of Appeals ....................-..c.ccc-cccc-c0.. 10

B. The Action Of The Court Of Appeals Results In
Piecemeal Review Of The Same Agency Order
In Different Courts Of Appeals, In Contraven-
tion Of The Statute And The Interests Of Judi-

I IN haciicdibeceee eae oe 15
C. The Action Of The Court Of Appeals Denied
Producers Due Process Of Law .................. 19

D. The Court Of Appeals Failed To Defer To The
FERC’s Discretionary Authority To Fashion

Sune: OOO oo 21
i: Ree Geo e. 21
2. The court of appeals improperly substituted
its judgment for that of the agency 22
SSRN Scchlctinecesdsereiciuaise tee eter eee on 24
SUPPLEMENTAL APPENDIX ..................0. lb
(iii)

iv

TABLE OF CITATIONS

Cases

Aetna Life Insurance Co. v. Haworth, 300 U.S.
A a calicsonsstencantecsnenssiamnicneinmnsancensnntenscasanh
American Farm Lines v. Black Ball Freight Serv-
Se BT TEE, GOR CID TO) nea ccennrinencnscercsrserissvscceeseenn
American Public Gas Association v. FPC, 555 F.2d
BE CE, GU. BTID eens snsccesesccasenessinnssaseinbincrcennses
Boston Gas Co. v. FERC, 575. F.2d 975 (1st Cir.
ao snes naieinananniiananinbadgtana
Buckley v. Valeo, 424 U.S. 1 (1976) ....................--,
Burlington Truck Lines Inc. v. United States, 371
Bi > MEER... snareninnnnmshinsennsnenseanniapannaanenn
CARB v. Delta Airlines, Inc., 367 U.S. 316 (1961)....
California Co. v. FPC, 411 F.2d 720 (D.C. Cir.
I nL scans celine pieenneelgaaieaiogs
Cerro Wire & Cable Co. v. FERC, 677 F.2d 124
1 a E.R er ee ee eer ere eure.
Cities of Anaheim and Riverside v. FERC, 692
pf hy ai © oll 3. ) EES EmeCrrr Es Deeeenes
Citizens te Preserve Overton Park, Inc. v. Volpe,
I a leseneabannans
City of Tacoma v. Taxpayers of Tacoma, 357 U.S.
I saa buansananaetens
Cleveland Board of Education v. Loudermill, ——
US. , 105 S.Ct. 1487 (1985) —._.____..
Dayton Power & Light Co. v. FPC, 251. F.2d 875
TI cc scalded
Department of Fish and Game v. FPC, 359 F.2d
165 (9th Cir.), cert. denied, 385 U.S. 932
a lenlae
Ecee, Inc. v. FERC, 611 F.2d 554 (5th Cir. 1980}...
Estate of French v. FERC, 603 F.2d 1158 (5th
i aS cep neaiaminedabenbuadilis
FPC v. Colorado Interstate Gas Co., 348 U.S. 492
EE ce one en ne eR
FPC v. Metropolitan Edison Co., 304 U.S. 375
i ll emia niainns
FTC v. Standard Oil Co. of Calif., 449 U.S. 232
OE SRE RE a IO oe Be Oe ert
General American Oil Co. of Texas v. FPv, 409
F.2d 597 (5th Cir. 1969)

Page

5, 13

12, 13

Vv
TABLE OF CITATIONS—Continued

Page
Goldberg v. Kelly, 397 U.S. 254 (1970) _............... 19
Interstate Natural Gas Association of America v.
FERC, 716 F.2d 1 (D.C. Cir. 1983), cert. denied,
—- US. , 104 S.Ct. 1615 (1984) _.............. passim
Interstate Natural Gas Ass’n of America v. FERC,
. £ BB BS yal Se: EA Recenpemcemen 6
Jordan v. United States District Court for Dist. of
Col., 233 F.2d 362 (D.C. Cir. 1956) ................... 14
Kerr v. United States District Court, 426 U.S. 394
2 BAAR IRR NERS ..<c (SAREE tng en 22
Mathews v. Eldridge, 424 U.S. 319 (1976) 19
Mazaleski v. Treusdell, 562 F.2d 701 (D.C. Cir.
DUET anictinisasathaceainndeates adeiiea tices taastuacaiinath cael tae a 19
Michigan Consolidated Gas Co. v. FPC, 167 F.2d
en MO 12
Mobil Oil Corp. v. FPC, 417 U.S. 283 (1974) ........ 22, 23

Motor Vehicle Manufacturers Association v. State

Farm Mutual Automobile Insurance Co., 463

ME BPRRIS Ma Rprrcmoertes Ne eae RP BO cine ees 20
National Organization for Reform of Marijuana

Laws v. Ingersoll, 497 F.2d 654 (D.C. Cir.

I Sa i a 14, 20
North Carolina v. Rice, 404 U.S. 244 (1971) _...... 18
Pan American Petroleum Corp. v. FPC, 268 F.2d

I A I, a 11
Pennzoil Co. v. FERC, 742 F.2d 242 (5th Cir.

i TERCERA SASS ar oe Peg LCE Te in TRE 16
Permian Basin Area Rate Cases, 390 U.S. 747

RRP EIR arc Re SARI SEC rence ROI eect LNG are 22
Public Service Comm’n of N.Y. v. FPC, 543 F.2d

ee i I I incite chkcictele ct iet 12
Southern Union Gathering Co. v. FERC, 687 F.2d

I a I 11
United States v. Green, 499 F.2d 538 (D.C. Cir.

Aaa REA REE ee ee Peo ON eT Om 14
United States ex rel. McLannan v. Wilbur, 283

I 20, 22
Utah Power & Light Co. v. FPC, 339 F.2d 436

i MPR E en NER Dk ee ee 11

Vermont Yankee Nuclear Power Corp. v. NRDC,
435 U.S. 519 (1978) 00... 23

vi

TABLE OF CITATIONS—Continued

Page
Whitney National Bank v. Bank of New Orleans
& Trust Co., 379 U.S. 411 (1965) -....... eaidientoa 12
Will v. Calvert Five Insurance Co., 437 U.S. 655
ESN AEE Eek ae eo ne ee ee 22
Will v. United States, 389 U.S. 90 (1967) _............. 22
Statutes
Federal Power Act, 16 U.S.C. § 791, et seq.
RE I RN 5 RCAC eR CR Ae 7,8
Section $318, 16 U.S.C. § S208 ............................ 1l
Section 313(b), 16 U.S.C. § 8257(b) —........... 8
Natural Gas Act, 15 U.S.C. § 717, et seq. (1982).... 3, 7,8
RR BE oR: RES na 13
Section 19(b), 15 U.S.C. § 717r(b) —.......... 8, 12,15
Natural Gas Policy Act, 15 U.S.C. § 3301-3432
RUTTEN chien nics cieacetiniidlnscagiedhaiacepaliaddanindatteceeainscitaitisiin tin 3
Section 102-109, 15 U.S.C. §§ 3312-3319 _........ 3
Section 116, 15 U.S.C. § SBR0 .............................. 4
Section 504, 15 U.S.C. § 3414 ow. 17
Section 506(a), 15 U.S.C. § 3416 (a) —.............. passim

Section 506(a) (2), 15 U.S.C. § 3416 (a) (2) ....passim
Section 506(a) (4), 15 U.S.C. § 3416 (a) (4) ....passim

Section 506(b), 15 U.S.C. § 3416(b) —............. passim
Title 28, United States Code

ik FoR G tt) | SeneeeemneenN 2

The All Writs Act, 28 U.S.C. § 1651 (1982) ....passim

28 U.S.C. $2112(a) (1962) ............................... passim

28 U.S.C. $2112(b) (1962) ............................... 16, 23

Administrative Authorities and Regulations

Final Rules for Part 270, et al., 46 Fed. Reg. 49077
(July 23, 1980) (Order No. 93), on reh’g, 46 Fed.
Reg. 24537 (May 1, 1981) (Order No. 93-A),
reh’g denied, 47 Fed. Reg. 614 (Jan. 6, 1982),
vacated in part, Interstate Natura! Gas Associa-
tion of America v. FERC, 716 F.2d 1 (D.C. Cir.
1983), cert. denied, —— U.S. ——, 104 S.Ct.
EE SEITE isc sacshaticeehiptudanaesannidianipaphsaiicnetiniandibalsaegilingipaiio 2

vii

TABLE OF CITATIONS—Continued
Page

Interpretative Rule For Btu. Measurement Stand-
ard Under The Natural Gas Policy Act of 1978,
Order No. 356, 49 Fed. Reg. 3072 (Jan. 25,
IEEE tech daaledesnleaieddeeincapibnaiiaddeanttce tate a ices ee Lee 3
Refunds Resuiting From Btu Measurement Ad-
justments, Order No. 399, 49 Fed. Reg. 37735
(Sept. 26, 1984), on reh’g, Order No. 399-A, 49
Fed. Reg. 46353 (Nov. 26, 1984), petitions for
review pend’g sub nom. Mobil Oil Exploration &
Producing Southeast Inc., et al. v. FERC, No.
tS ER ee pent ee passim

IN THE
Supreme Court of the United States

OCTOBER TERM, 1985

No. 85- —_——

PENNZOIL COMPANY, et al.,
Petitioners,
V.

ASSOCIATED GAS DISTRIBUTORS, et al.,
Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COU ‘T OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Petitioners Pennzoil Company, et al. (“Producers’’)
pray that a writ of certiorari issue to review the decision
of the United States Court of Appeals for the District of
Columbia Circuit in Nos. 81-1690, et al., entered on
March 5, 1985.

OPINIONS BELOW

The opinion of the court of appeals (App. la-15a) is
reported at 756 F.2d 166 (D.C. Cir. 1985). The orders
denying rehearing (App. 132a-135a (Scalia, J., dissent-
ing) ) and suggestions for rehearing en banc (App. 136a
(Bork, Tamm, and Wright, J.J., not participating) ) are
not reported.

The orders of the Federal Energy Regulatory Commis-
sion (“FERC”) (App. 16a-80a and 81la-126a) are re-

2

ported at 49 Fed. Reg. 37735 (Sept. 26, 1984) and 49
Fed. Reg. 46353 (Nov. 26, 1984).’

JURISDICTION

The judgment of the court of appeals (App. 130a-
131a) was entered on March 5, 1985. The court of ap-
peals denied petitions for rehearing on May 6, 1985
(App. 132a-185a (Scalia, J., dissenting) ) and sugges-
tions for rehearing en danc on May 15, 1985 (App. 136a
(Bork, Tamm, and Wright, J.J., not participating) ).

The jurisdiction of this Court is invoked under 28
U.S.C. § 1254(1) (1982) and 15 U.S.C. § 3416(a) (4)
(1982).

STATUTES

Sections 506(a) and (b) of the Natural Gas Policy
Act (NGPA), 15 U.S.C. §$ 3416(a) & (b) (1982), gov-
ern judicial review of FERC orders issued under the
NGPA; those provisions are set forth at App. 141a-144a.’
The All Writs Act, 28 U.S.C. § 1651 (1982), and 28
U.S.C. § 2112 (1982) also are germane to the instant
case and are reproduced at App. 144a-148a.

The regulations affected by the decision of the court of
appeals below are set forth at App. 53a-56a, 120a.

STATEMENT OF THE CASE

This case involves an instance in which a court of ap-
peals utilized a motion filed under the All Writs Act to
effect judicial review. In so doing, it undertook prema-
ture review at the request of a party that had no statu-
tory standing to invoke the jurisdiction of the court as to
issues that were not ripe for judicial review.

1 Refunds Resulting From Btu Measurement Adjustments, Order
No. 399, 49 Fed. Reg. 37735 (Sept. 26, 1984), on reh’g, Order No.
399-A, 49 Fed. Reg. 46353 (Nov. 26, 1984), petitions for review
pend’a sub nom. Mobil Oil Exploration & Producing Southeast Inc.,
et al. v. FERC, No. 84-4775 (5th Cir.).

2 The NGPA is codified at 15 U.S.C. §§ 3301-3432 (1982).

3

The orders reviewed by the court of appeals arose in
the aftermath of the D.C. Circuit’s decision in Jnter-
state Natural Gas Association of America v. FERC
(“INGAA I’).* There, the court of appeals vacated
FERC’s regulation allowing the heat (Btu) content of
natural gas to be determined on a “dry” basis for pur-
poses of applying the maximum lav,ful prices prescribed
in Sections 102-109 of the NGPA, 15 U.S.C. §§ 3312-
3319.4

Thereafter, the FERC amended its regulations in ac-
cordance with the court’s order;* no challenge to that
amendment is presented here. The FERC also issued
Order No. 399, directing that producers make refunds of
any amounts coliected pursuant to its vacated regulations.

Pursuant to Section 506(a)(2) of the NGPA, 15
U.S.C. § 3416(a) (2), various parties, including Produc-
ers, filed applications for rehearing of Order No. 399.
Producers objected to, inter alia, the method adopted by
the FERC for effecting refunds and the procedure for

3716 F.2d 1 (D.C. Cir. 1983), cert. denied, U.S. , 104
S. Ct. 1615 (1984), vaacting in part Final Rules For Part 270, et al.,
45 Fed. Reg. 49077 (July 23, 1980) (Order No. 93), on reh’g, 46 Fed.
Reg. 24537 (May 1, 1981) (Order No. 93-A), reh’g denied, 47 Fed.
Reg. 614 (Jan. 6, 1982).

*716 F.2d at 4, 16. The NGPA prescribes maximum lawful prices
on heat content basis, i.e., in amounts per “MMBtu” (million
Btu’s). A question arose whether, for applying the NGPA’s
maximum lawful prices, the heat content should be determined on
the “wet” (water saturated) basis used to adjust ceiling rates es-
tablished under the Natural Gas Act or on a “dry” basis, which
reflected the actual, higher Btu content of the gas when delivered.
In Order No. 93, the FERC concluded that the Btu content of gas
should be determined on the “dry” basis. The court of appeals re-
versed the FERC, holding that the “wet” method must be employed.

5 Interpretative Rule For Btu Measurement Standard Under The
Natural Gas Policy Act of 1978, 49 Fed. Reg. 3072 (Jan. 25, 1984)
(Order No. 356).

4

calculating the amount of those refunds. Respondent As-
sociated Gas Distributors (“AGD”’) did not file an appli-
cation for rehearing of Order No. 399.°

In Order No. 399-A, the FERC denied in part and
granted in part the applications for rehearing that had
been filed by the Producers and others. The FERC
granted these applications for rehearing in part by pro-
viding that Btu refund obligations could be offset against
sum-certain debts owed to producers under rulemaking
orders prescribing adjustments to applicable maximum
lawful prices for production-related costs.’ In so acting,
the FERC did not reduce the refund obligations; rather,
it provided more flexible procedures for satisfying those
obligations by permitting offsets of mutual debts in lieu
of cash transfers. App. 90a-9la, 106a.

On the day that Order No. 399-A was issued, Mobil
Oil Exploration & Producing Southeast Inc., one of the
Producers, filed a timely petition for review of Order
Nos. 399 and 399-A with the Fifth Circuit. Mobil Oil
Exploration & Producing Southeast Inc. v. FERC, No.
84-4775 (5th Cir.) (“Mobil”). No party disputes that
Mobil’s petition was the first timely filed petition for re-
view of Order Nos. 399 and 399-A; indeed, the court of
appeals below acknowledged this in its opinion. App. 9a.

6 AGD is an informal association of approximately forty local
distribution companies that sell and distribute natural gas in the
eastern United tates. AGD’s members purchase most of their
supplies of natural gas from interstate pipelines, which, in turn,
purchase most of their supplies from numerous sellers, including
Producers.

7In a series of rulemakings, the FERC adopted regulations im-
plementing Section 110 of the NGPA, 15 U.S.C. § 3320 (1982).
Under those regulations, producers are entitled to collect from their
purchasers reimbursement for “production related costs” as an addi-
tion to the maximum lawful price.

5

On the next day, AGD filed with the D.C. Circuit a
“Motion for Order Directing Compliance with Mandate”
(“Motion”). In its Motion, AGD argued that the offset
mechanism adopted in Order No. 399-A constituted a re-
fusal by the FERC to implement the mandate of that
court of appeals in INGAA J. AGD urged the court of
appeals to exercise its extraordinary power under the All
Writs Act, 28 U.S.C. § 1651 (1982), to issue a writ of
mandamus directed against the FERC to compel it to
implement what AGD viewed as the mandate of the
court of appeals in the earlier case.

When it filed its Motion, AGD had not applied for re-
hearing of either Order No. 399 or Order No. 399-A.
Thereafter, AGD filed with the Commission a timely
application for rehearing of Order No. 399-A. The FERC
then issued an order granting, inter alia, AGD’s and
other applications for rehearing for purposes of further
consideration.* App. 127a-129a. Notwithstanding that
its application for rehearing was then still pending be-
fore the FERC, AGD on January 18, 1985 filed a peti-
tion for review of Order No. 399-A in the D.C. Circuit.°

Producers, the Interstate Natural Gas Association of
America, and the FERC filed responses in opposition to
AGD’s Motion before the D.C. Circuit. In their re
sponses, they addressed the lack of merit of AGD’s re-

8 Such an order tolls the statutory time established for denying
rehearing and is not a final, reviewable order. See, e.g., California
Co. v. FPC, 411 F.2d 720 (D.C. Cir. 1969).

® Associated Gas Distributors v. FERC, No. 85-1043 (D.C. Cir.).
Conoco Inc., one of the parties to the proceedings before the Com-
mission, the D.C. Circuit, and the Fifth Circuit, filed a motion in the
D.C. Circuit, pursuant to 28 U.S.C. § 2112 (1982), to transfer AGD’s
petition to the Fifth Circuit where the first petition for review of
Order No. 399-A had been filed by Mobil. On May 17, after denying
rehearing, the court of appeals dismissed AGD’s petition for review
as duplicative of AGD’s Motion, which was the subject of the
March 5 opinion.

6

quest for a mandamus against implementation of the
offset mechanism. The court of appeals never requested
full briefing on the merits of all challenges to Order Nos.
399 and 399-A. Further, the court cf appeals gave no
notice that AGD’s Motion would be treated as a petition
for judicial review rather than as an emergency motion
under the All Writs Act. Nor had the agency record
been filed with the court, a prerequisite to judicial re-
view under Section 506(a) (4) of the NGPA.”

On March 5, 1985, the court of appeals acted upon
AGD’s Motion and issued a decision vacating the offset
refund mechanism of FERC Order No. 399-A. Interstate
Natural Gas Association of America v. FERC, 756 F.2d
166 (D.C. Cir. 1985). App. la-15a. Therein, the court
of appeals did not address the merits of AGD’s Motion
under the All Writs Act. Rather, it determined that it
would treat AGD’s Motion as a petition for judicial re-
view of Order No. 399-A under Section 506(a) of the
NGPA, stating:

We need not enter the debate over the propriety of
resort to mendamus in this case, because, in any
event, Associated Gas Distributors’ motion to en-
force the mandate may be treated as a petition to
review that order.

. . . Because the parties to the instant case have
amply addressed the merits, no one will be preju-
diced by considering Associated Gas Distributors’
motion to enforce the mandate as a petition for re-
view.

App. 9a, lla.

Timely petitions for rehearing and suggestions for
rehearing en banc were filed by Producers, the Interstate

10 The FERC had not filed the record with a court of appeals be-
cause the Fifth Circuit—the court of first filing—had deferred the
filing of the agency record pending the D.C. Circuit’s disposition of
AGD’s All Writs Act motion. App. 137a.

7

Natural Gas Association of America, and the FERC. On
May 6, 1985, the panel denied those petitions in a per
curiam order. App. 132a & 135a. Circuit Judge Scalia,
who had originally concurred in the opinion of the court,
withdrew his concurrence and entered a dissent in its
place. In his dissent, Judge Scalia concluded that a writ
of mandamus did not lie because the mandate of the
court in INGAA I did not prescribe a particular refund
| mechanism, leaving the manner of effecting refunds to
the FERC’s discretion; that the petition for writ of man-
damus could not be treated as a petition for review be-
cause AGD had not met the express and unequivocal
statutory prerequisites to its seeking judicial review, as
set out in NGPA Section 506(a) (2); and that if the
petition for a writ were treated as a valid petition for
review, it had to be transferred to the Fifth Circuit,
where the first petition for judicial review of the orders
had been filed. App. 133a-135a.

Thereafter, on May 15, 1985, the court of appeals
denied the suggestions for rehearing en banc. App. 186a.
Circuit Judges Wright, Tamm and Bork did not partici-
pate in the consideration of the suggestions for rehearing
en bane.

On July 18, 1985, the FERC issued Order No. 399-B,
attached hereto as a supplemental appendix. In that Or-
der, issued in response to the D.C. Circuit’s opinion, the
FERC granted AGD’s application for rehearing of Order
No. 399-A. On that same day, one of the Producers,
Mobil Producing Texas & New Mexico Inc., filed the first
timely petition for review in the Fifth Circuit in No.
85-4485.

REASONS FOR GRANTING THE WRIT

The decision of the court of appeals subverts the integ-
rity of the prescribed statutory procedure for obtaining
judicial review of FERC orders issued under the NGPA,
as well as under the Natural Gas Act and the Federal
Power Act. These statutes require a party to file an

EEE TTT

8

application for rehearing with the FERC and to have it
denied, at least in part, as jurisdictional prerequisites to
that party seeking judicial review. Thus, these statutes
give the FERC the first opportunity to address a party’s
objections to its orders before a court of appeals may
consider that party’s petition for review.

Upon the filing of a petition for judicial review, fur-
ther statutory provisions govern venue as between the
several courts of appeals. Pursuant to 28 U.S.C. § 2112
(a), the agency “shall file the record in that [court] in
which a proceeding with respect to [the agency’s] order
was first instituted.” The filing of the full agency record
with a particular court of appeals, under Section 506(a)
of the NGPA, as well as equivalent provisions of the
Natural Gas Act and the Federal Power Act, vests that
court with exclusive jurisdiction and venue to review the
agency’s order, which review must be had on the basis
of the record made before the agency.'! Thereby, review
ean only occur in a single court of appeals; piecemeal
review of a single agency order is statutorily precluded.

The court of appeals below ignored these statutory
limits to its jurisdiction in order to impose its will on an
administrative agency in a proceeding of interest to the
court. In so doing, it granted judicial review to a party
‘ that had no statutory standing, to the prejudice of those
who had properly perfected their right to judicial review
before another court of appeals.

Under the decision of the court of appeals, a party
seeking review of FERC orders under either the Natural
Gas Act, the Federal Power Act, or the NGPA may now
simply file a motion under the All Writs Act. It need
not apply for rehearing before the agency; it need not

1115 U.S.C. § 3416(a) (4), id. at § 717r(b), 16 U.S.C. § 8251 (b).
28 U.S.C. § 2112(a) gives the court in which exclusive jurisdiction
and venue vests discretion to transfer the petition to another court
of appeals where convenience of the parties or the interest of justice
so requires.

9

await the agency’s denial of the application; it need
not have statutory standing to seek judicial review; it
need not file a formal petition for review; and it need
not await the filing of the agency record upon which
review must be undertaken. Once filed, the All Writs
Act motion takes precedence over all otherwise timely
and proper petitions for review filed by parties having
proper standing in other courts of appeals, and grants
the filing party substantive review of its challenge wholly
independent of the consideration of other parties’ chal-
lenges. Further, by using the All Writs Act motion to
effect review of the agency order, a court of appeals can
evade the statutory requirements that (i) such review
must be based on the record compiled before the agency,
and (ii) such review of the agency’s order must be un-
dertaken by a single court of appeals.

The decision of the court of appeals, however, is not
limited to those three acts administered by the FERC.
Exhaustion of administrative remedies is a generally ap-
plicable principle of administrative law. Similarly ap-
plicable are the provisions of 28 U.S.C. § 2112, which in-
vest a single court of appeals with the authority to re-
view agency decisions on the record. Under the decision
of the court of appeals, a party can secure preferential,
substantive review of its particular challenge to an
agency order by filing an All Writs Act motion, irrespec-
tive of the ripeness of the challenge or the potential for
piecemeal review.

If this is to be the law, then all parties will, perforce,
seek judicial review pursuant to the All Writs Act prior
to exhaustion of their administrative remedies to ensure
that their statutory right to judicial review is not fore-
closed by similar motions of other parties. If the decision
below is allowed to stand, it will fundamentally change
the relationships among federal agencies and reviewing
courts, among the various courts of appeals, and among
parties before agencies. Thus, its result will have a

10

broad, deleterious effect on judicial review of adminis-
trative decisions generally.

Further, the court below violated the due process
rights of the Producers. Producers have properly pre-
served challenges to the amount of refunds ordered by
the FERC and have those objections pending before the
Fifth Circuit. The court of appeals here granted prefer-
ential review of one party’s objections to the agency’s or-
ders. Based upon that selective:and limited review, the
court below ordered the agency to amend its orders to
require additional cash payments by Producers. Thereby,
Producers were deprived of their property rights by the
order of the court of appeals without a meaningful and
timely opportunity to be heard in accordance with the
statutory requirements on all matters relating to whether
such additional cash payments should be ordered.

Finally, the court of appeals impermissibly encroached
upon the discretionary authority of the FERC to struc-
ture refund plans. The court of appeals ordered the
FERC, which was considering on rehearing the very
objection to its order that was being urged by AGD
before the court, to replace its refund procedures with
a procedure that the court of appeals preferred, even
though the court never had before it the complete record
that the FERC had considered.

This Court should issue a writ of certiorari and review
the decision below in order to maintain the integrity
of the explicit statutory procedures and the continued
viability of the controlling precedent relating to review
of agency orders.

A. The Decision Below Conflicts With Statutory Provi-
sions Governing Judicial Review And Well-Settled
Principles Approved By This Court And The Courts
Of Appeals.

Sections 506(a) (2) and (4) of the NGPA, 15 U.S.C.
$§ 3416(a) (2) and (4), prescribe the procedure for ob-

11

taining judicial review of FERC orders issued under
that Act.’? Section 506(a) (2) provides in pertinent part:

No person may bring an action under this section to
obtain judicial review of any order of the Commis-
sion unless— :

(A) such person shall have made application
to the Commission for a rehearing under this
subsection; and

(B) the Commission shall have finally acted
with respect to such application.

Section 506(a) (4) then provides that judicial review is
to be obtained by filing a written petition for review with
an appropriate court of appeals “within 60 days after
the final action of the Commission on the application for
rehearing required under paragraph (2)[,]” and that
“'njo objection to such order of the Commission shall
be considered by the Court if such objection was not
urged before the Commission in the application for
rehearing....” 15 U.S.C. § 3416(a) (4).

The courts of appeals have consistently “recognized
that a petition for rehearing is a jurisdictional prerequi-
site to judicial review of both NGPA and NGA [Natural
Gas Act] claims.” '* Even the D.C. Circuit, until now,

12 Section 506(b), 15 U.S.C. §3416(b), provides for judicial re-
view of rulemaking orders like Order Nos. 399 and 399-A. Both the
District of Columbia Circuit and the Fifth Circuit have held that
the procedures set forth in Sections 506(a) (2) and (4) govern judi-
cial review of such rulemaking orders. JNGAA I, supra, 716 F.2d
at 15; Ecee, Inc. v. FERC, 611 F.2d 554 (5th Cir. 1980).

13 Southern Union Gathering Co. v. FERC, 687 F. 2d 87, 91 (5th
Cir. 1982). Accord, e.g., Ecee, Inc. v. FERC, supra, 611 F.2d at
565-66; Boston Gas Co. v. FERC, 575 F.2d 975 (1st Cir. 1978) ;
Pan American Petroleum Corp. v. FPC, 268 F.2d 827 (10th Cir.
1959). See also, e.g., Utah Power & Light Co. v. FPC, 339 F.2d 486,
487-438 (10th Cir. 1964) (construing similar provisions of Section
318 of the Federal Power Act, 16 U.S.C. § 8251).

Le a

12

has embraced this proposition of law and has recognized
that it lacks jurisdiction to review a FERC order unless
the petitioner has strictly observed the rehearing re-
quirement.**

Unless statutory prerequisites for review have been
satisfied, a court has no jurisdiction to undertake review
of administrative orders. In Whitney Nat’l Bank v. Bank
of New Orleans & Trust Co., 379 U.S. 411, 420 (1965),
this Court stated: “{W]here Congress has provided stat-
utory review procedures designed to permit agency ex-
pertise to be brought to bear on particular problems,
those procedures are to be exclusive.” Accord, City 0°
Tacoma v. Taxpayers of Tacoma, 357 U.S. 320, 336
(1958) (Federal Power Act); FPC v. Colorado Inter-
state Gas Co., 348 U.S. 492, 497, 499 (1955) (Natural
Gas Act).

In the case below, the party seeking review, AGD, had
not followed the prescribed statutory procedure. Rather
than first filing an application for rehearing of Order
No. 399-A and waiting for the Commission to deny that
application, as required by Sections 506(a) (2) and (4),
AGD immediately sought judicial review under the aegis
of an All Writs Act motion. It then sought agency re-
hearing.

Because AGD’s Motion was not predicated upon an
application for rehearing that had been denied by the
FERC, the statutory provisions expressly precluded the
court of appeals from treating AGD’s Motion as a peti-

14 See, e.g., Cerro Wire & Cable Co. v. FERC, 677 F.2d 124 (D.C.
Cir. 1982); Public Service Comm'n of N.Y. v. FPC, 543 F.2d 757
(D.C. Cir. 1974) ; Dayton Power & Light Co. v. FPC, 251 F.2d 875
(D.C. Cir. 1958) ; Michigan Consolidated Gas Co. v. FPC, 167 F.2d
264 (D.C. Cir. 1948).

13

tion for review.” In these circumstances, both AGD’s
motion and its later filed petition for review were pre-
mature and jurisdictionally defective attempts to obtain
judicial review of Order No. 399-A. Therefore, they
“should [have been] dismissed.’ *®

The statutory review procedures set out in Section
506(a) of the NGPA codify the well-established principle
of administrative law repeatedly enunciated by this Court
that:

an administrative order is net “final,” for the pur-
poses of judicial review, until outstanding petitions
for reconsideration have been disposed of. See, e.g.,
Outland v. Civil Aeronautics Board, 109 U.S. App.
D.C. 90, 284 F.2d 224; Braniff Airways, Inc. v. Civil
Aeronautics Board, 79 U.S App. D.C, 341, 147 F.2d
152."

More recently, in American Farm Lines v. Black Ball
Freight Service, 397 U.S. 582, 541 (1970), this Court
reiterated that: “[u]nless Congress provides otherwise,

15 The corollary of the rehearing requirement in NGPA Section
506(a) (2) is the principle set out in Section 506(a) (4) that an
objection not raised or considered on rehearing may not be raised
before a court of appeals on review. This Court has held that the
provisions of Section 19 of the Natural Gas Act, 15 U.S.C. § 717r
(the basis for Sections 506(a) (2) and (4) of the NGPA), and
the related exhaustion doctrine preclude the courts of appeals
from considering objections to an order that have not been pre-
sented to, and passed on by, the FERC. FPC v. Colorado Inter-
state Gas Co., supra, 348 U.S. at 498-500. The Court there held that
even sua sponte consideration is precluded because it “would seri-
ously undermine the purpose of the explicit requirements of § 19(b)
that objections must first come before the Commission.” Jd. at 499.

16 California Co. v. FPC, supra, 411 F.2d at 722; General Amer-
ican Oil Co. of Texas v. FPC, 409 F.2d 597, 599 (5th Cir. 1969).

17 CAB v, Delta Airlines, Inc., 367 U.S. 316, 326 (1961) (emphasis
in original). Accord, FTC v. Standard Oil Co. of Calif., 449 U.S.
232, 242-48 (1980); FPC v. Metropolitan Edison Co., 304 U.S. 375,
388-386 (19388).

14

‘fw]here a motion for rehearing is in fact filed there
is no final action until the rehearing is denied.’ ”

Here, Congress has not provided otherwise. To the
contrary, NGPA Sections 506(a) (2) and (4) specifically
provide that a party may not seek judicial review until
after the FERC has finally denied that party’s applica-
tion for rehearing.

The court of appeals attempted to validate its treat-
ment of AGD’s Motion as a petition for review by citing
other cases where courts of appeals had done so. How-
ever, none of the cases cited by the court of appeals in
support of its treatment of AGD’s motion as a petition for
review arose under a statute like the NGPA, which re-
quires final agency action denying a party’s application
for rehearing as a jurisdictional prerequisite to that party
seeking judicial review. Rather, because the party in each
of those cases could have initiated a review proceeding
under the governing statute when it filed a petition for
a writ of mandamus, its mandamus petition was treated
as sufficient to constitute a notice of appeal under the
governing statute.’®

Here, however, AGD could not have filed a valid peti-
tion for review when it filed its Motion. Thus, AGD’s
Motion under the All Writs Act could not, under the

18 For example, the court below cited National Organization for
Reform of Marijuana Laws v. Ingersoll, 497 F.2d 654 (D.C. Cir.
1974) (“NORML’’). There, a petition for mandamus filed within the
time specified for seeking judicial review was treated as a petition
for review under 21 U.S.C. § 877; Section 877 does not require an
application for rehearing and agency action thereon as jurisdictional
prerequisites to judicial review. The other cases relied upon by the
court below were both criminal cases and have no possible applica-
tion to review of agency determinations. See United States v.
Green, 499 F.2d 538, 540 n.5 (D.C. Cir. 1974) (a petition for
mandamus is adequate as a notice for appeal), and Jordan v. United
States District Court for Dist. of Col., 283 F.2d 362, 365 (D.C.
Cir.), vacated on other grounds, 352 U.S. 904 (1956) (a petition for
mandamus filed by a pro se criminal defendant is adequate as a
notice of appeal).

15

cases cited by the court below, be treated as a petition
for judicial review under the NGPA.”

In sum, the court of appeals below ignored the express
statutory restrictions on judicial review under the NGPA
| and well-settled principles announced by this Court and
the courts of appeals. A court of appeals is not free to
disregard statutory procedures for judicial review, to the
prejudice of petitioners who have followed such proce-
dures, simply to impose its will upon an administrative
agency in a proceeding of interest to it.°° Whether the
courts of appeals must observe explicit statutory and
judicial principles governing judicial review of agency or-
ders is an issue appropriate for this Court’s consideration.

B. The Action Of The Court Of Appeals Results In Piece-
meal Review Of The Same Agency Order In Different
Courts Of Appeals, In Contravention Of The Statute
And The Interests Of Judicial Economy.

Section 506(a) of the NGPA establishes a procedure
whereby FERC orders properly subject to judicial re-
view are reviewed on the record by a single court of
appeals. This statutory scheme for effecting orderly stat-
utory review is complemented by the venue provisions of
28 U.S.C. § 2112(a). The decision of the court of appeals

19 Cf. American Public Gas Ass’n v. FPC, 555 F.2d 852 (D.C. Cir.
1976). There, the court below recognized the limitations on treating
a petition for a writ of mandamus as a petition for review. The
court he'd that a mandamus petition filed by a party prior to denial
by the agency of its application for rehearing could not be treated
as a petition for judicial review for purposes of 28 U.S.C. § 2112(a)
in determining the first filed petition for judicial review under
Section 19(b) of the Natural Gas Act, 15 U.S.C. §717r(b). Thus,
under that court’s own precedent, AGD’s Motion could not be
treated as the equivalent of a petition for review.

2» That the issue presented was whether the FERC had complied
with the court’s earlier mandate in INGAA I did not relieve AGD of
the statutory rehearing requirements. Cf. Department of Fish and
Game v. FPC, 359 F.2d 165 (9th Cir.), cert. denied, 385 U.S. 932
(1966).

16

below violated the mandatory requirements of both statu-
tory provisions.

Section 506(a) (4) grants the court of appeals in which
_ the agency record is filed exclusive jurisdiction and venue
to review that order. Under 28 U.S.C. § 2112(a), the
agency, in the first instance, must file the record in that
court in which the first timely petition for judicial re-
view of the agency’s order was filed. The record must
include the “order sought to be reviewed” and the plead-
ings, evidence, and other documents filed with the agency.
28 U.S.C. § 2112(b) (1982).

The courts of appeals, including the court of appeals
below, have recognized “the importance of avoiding judi-
cial review of ‘piecemeal proceedings’ and having ‘one
comprehensive judicial review proceeding, based on a
full record.’ ” Cities of Anaheim and Riverside v. FERC,
692 F.2d 773, 779 (D.C. Cir. 1982). Accord, Pennzoil
Co. v. FERC, 742 F.2d 242 (5th Cir. 1984). Indeed, the
procedure for judicial review crafted by Congress in
NGPA Section 506(a) and 28 U.S.C. §2112(a) pre-
cludes piecemeal review of a single agency order. Yet the
decision of the court of appeals in this case compels such
piecemeal review, in direct contravention of the statu-
torily prescribed procedure and applicable precedents.

The first petition for review of Order Nos. 399 and
399-A was filed in the Fifth Circuit. The objections of
the Producers to those orders are still pending before
that court. Nevertheless, the D.C. Circuit undertook judi-
cial review of only the objections raised by AGD to only
one aspect of the refund orders without affording Pro-
ducers any opportunity to argue the merits of their
objections on appeal, and without undertaking any re-
view on the basis of the agency record. Thereby, as a
matter of law, the court of appeals violated the provi-
sions of Section 506(a) of the NGPA and of 28 U.S.C.

17

§ 2112(a). Thus, as Judge Scalia observed in his dissent
(App. 135a):

The majority’s action frustrates the Congressional
policy of preventing piecemeal review and placing
review in the court of first filing.. If we do not dis-
miss this case as a meritless petition for mandamus
(as we should), we must transfer the so-called ap-
peal to the Fifth Circuit.

The piecemeal review compelled by the action of the
court of appeals also violates fundamental policy consid-
erations crucial to the administration of cases by the fed-
eral courts. Three basic objections have been presented
to Order Nos. 399 and 399-A by different petitioners—
or “deemed“ petitioners such as AGD. The first objec-
tion to the orders, raised by Pitts Oil Company, is the
question of whether refunds should have been ordered by
the FERC at all. The second objection, raised by Pro-
ducers, is whether the FERC has correctly determined,
as a matter of law, the amount of refunds due.** The
third objection, raised by AGD, is whether, assuming the
amount of refunds determined by the FERC to be due
is correct the method of payment for those refunds estab-
lished by the FERC is appropriate—+.e., the offset issue.

In an orderly review proceeding before a single court
of appeals, the first objection would be decided, then
the second, then the third. This order is required because
a decision on the second and third objections could be
rendered unnecessary if the first objection is sustained.
Similarly, in the circumstances here presented, sustain-
ing the objections of the Producers could largely, if not
totally, moot the third objection.

21 Producers have challenged the legality of FERC’s refund cal-
culation. Section 504 of the NGPA, 15 U.S.C. § 3414 (1982), pro-
hibits the FERC from ordering refunds of amounts collected which
do not exceed the applicable maximum lawful price, plus all allowed
adjustments and add-ons. Producers in their challenge have raised
the issue of whether the FERC has attempted to order such repay-
ments here.

18

The result is that the decision of the court of appeals
below may be nothing mure than an advisory opinion,
depending upon the Fifth Circuit’s resolution of the first
two objections. At the same time, the court’s decision
could taint the review proceedings before the Fifth Cir-
cuit because the D.C. Circuit already has determined that
refunds are to be made in cash, perhaps thereby im-
plicitly predetermining the Fifth Circuit’s consideration
of the first two issues. This situation has been aggra-
vated now that the FERC has, in light of the D.C. Cir-
cuit’s opinion, granted AGD’s request for rehearing and
ordered immediate cash payments, plus interest, by Pro-
ducers.

The rendering of such an advisory opinion, particularly
in light of its potentially prejudicial impact on another
court’s consideration of the remaining merits of the case,
not only is inconsistent with sound principles of judicial
administration but also violates the “case or controversy”
requirements of Article III of the Constitution.** By com-
parison, effecting review of ail objections to an order
of the FERC before a single court of appeals in con-
formance with the requirements of Section 506(a) of

22 In their “Application for a Stay of Enforcement of a Judgment
of the United States Court of Appeals for the District of Columbia
Circuit” filed with Chief Justice Burger on May 23, 1985, in No.
A-885, Producers argued that the decision of the court of appeals
could foreclose their right to obtain judicial review on their objec-
tions at all. In response, as well as in subsequent pleadings filed
with the Fifth Circuit, AGD argued that the D.C. Circuit’s decision
had not foreclosed Producers’ opportunity to present their objec-
tions on appeal to the Fifth Circuit. If so, this is the very type of
piecemeal review proscribed by the statutes. However, if AGD is
wrong in its assertions, then a fundamental denial of Producers’ due
process rights has occurred. See Part C, infra.

23 Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 241 (1937)
(jurisdiction of federal courts is limited to cases which present “a
real and substantial controversy admitting of relief through a
decree of a conclusive character, as distinguished from an opinion
advising what the law would be upon a hypothetical state of facts’’).
See Buckley v. Valeo, 424 U.S. 1, 13 (1976); North Carolina v.
Rice, 404 U.S. 244, 246 (1971).

19

the NGPA and 28 U.S.C. § 2112(a) eliminates any po-
tential violation of either sound judicial policy or the
Constitution.

C. The Action Of The Court Of Appeals Denied Producers
Due Process Of Law.

The Due Process Clause of the Fifth Amendment guar-
antees all persons an opportunity to be heard at a mean-
ingful time and in a meaningful manner before being
deprived of any property right.2* This Court only re-
cently reiterated that “the root requirement” of due
process is a meaningful opportunity to be heard before
being “deprived of any significant property interest.” *°
Moreover, as the D.C. Circuit has noted, where statutory
or regulatory procedures designed to afford timely and
meaningful review are in place, due process requires
“scrupulous compliance” with those procedures.”®

As previously set out, the court of appeals did not fol-
low the procedures prescribed in Section 506 of the
NGPA and 28 U.S.C. § 2112(a) for review of FERC or-
ders. This failure to observe statutoriiy mandated proce-
dures governing judicial review has infringed won
Producers’ Fifth Amendment right to secure meaningful
and timely review of Order Nos. 399 and 399-A.?"

*4 Mathews v. Eldridge, 424 U.S. 319, 333 (1976); Goldh-rg v.
Kelly, 397 U.S. 254, 266 (1970).

25 Cleveland Board of Education v. Loudermill, US. , 105
S.Ct. 1487, 1493 (1985).

26 Mazaleski v. Treusdell, 562 F.2d 701, 719 (D.C. Cir. 1977).

27 Whether due process rights have been violated frequently in-
volves an ad hoc balancing of private and governmental interests,
weighing the procedural protections that may be afforded to sub-
stantive private interests against the costs such protections would
impose upon governmental interests. See Mathews v. Eldridge, su-
pra, 424 U.S. at 335-36. However, in enacting Section 506 of the
NPGA, Congress itself has weighed the competing interests and has
declared that specified statutory procedures are required to protect
the procedural interests of litigants, agencies and reviewing courts.
Therefore, this Court should not countenance any departure from
this statutory scheme.

20

The court of appeals attempts to gloss over this denial
by baldly asserting that “because the parties to the in-
stant case have amply addressed the merits, no one will
be prejudiced by considering Associated Gas Distributors’
motion to enforce the mandate as a petition for review.”
App. lla. However, this attempt must fail.

Pending before the court was a motion under the All
Writs Act claiming that Order No. 399-A violated the
mandate of the court of appeals in INGAA I. The Pro-
ducers and others—including the FERC—responded and
opposed AGD’s Motion, arguing that relief under the All
Writs Act did not lie. The focus of the legal issues ad-
dressed by such response was substantively different
from the legal issues that would have to be briefed under
Section 506(a) of the NGPA in determining whether the
FERC order must be sustained under standards governing
review of agency orders.** Indeed, the limited focus of
the motion papers is underscored by the fact that the
court of appeals never had before it the full agency rec-
ord, precluding by definition substantive review on that
record as required by NGPA Section 506(a) (4).

Further, the fundamental fairness required by due
process was not afforded Producers by reviewing only the

28 Compare United States ex rel. McLannan v. Wilbur, 283 U.S.
414, 420 (1931) (setting out the standards for obtaining All Writs
Act relief) with Motor Vehicle Mfrs. Ass’n v. State Farm Mutual
Automobile Ins. Co., 463 U.S. 29 (1983), and Burlington Truck
Lines Inc. v. United States, 371 U.S. 156, 168 (1962) (setting out
general standards for review of agency orders).

22In NORML, relied upon by the court below as supporting the
proposition that a “petition for mandamus can do service as a peti-
tion for review” (App. 1la), the court of appeals treated a petition
for mandamus as sufficient to effect an appeal only after first deny-
ing mandamus and ordering further consideration of the motion as
. a petition for judicial review. NORML, 497 F.2d at 656 n.3, 660.
_ Thus, the court of appeals there implicitly acknowledged what it
here refuses to admit: consideration of mandamus papers is not
adequate to dispose of a case on the merits.

MPL eh ami

hn 06s hl hea thet nh tn bi nas par

ae ae ee ee ee Ut Seer eee eae

21

objection of one party to the FERC’s order. Based on
this selective review, the court of appeals required the
FERC to amend its orders and to provide for additional
cash refunds in lieu of offsets. Producers were given no
meaningful opportunity to be heard at that time on
their objections, which if sustained would largely negate,
if not totally eliminate, the basis for an order for addi-
tional refunds by them of some $450 million. In denying
Producers a timely opportunity to be heard, the court of
appeals deprived them of their property rights without
due process of law.

Accordingly, the decision of the court of appeals re-
quiring Producers and others to make cash payments in
lieu of offsets, without affording Producers any oppor-
tunity to be heard at a meaningful time and in a mean-
ingful manner in accordance with the statutory require-
ments of Section 506 of the NGPA and 28 U.S.C.
$ 2112(a), constituted a denial of their fundamental due
process rights in contravention of the Fifth Amendment.

D. The Court Of Appeals Failed To Defer To The FERC’s
Discretionary Authority To Fashion Refund Pro-
cedures.

The court of appeals could not have issued a writ of
mandamus in the instant case. This is not an instance
where the court of appeals, in harmless error, simply
misnamed the action that it was taking. Rather, seeing
that mandamus did not properly lie, the court improperly
attempted to secure the same result indirectly by vacat-
ing FERC’s Order No. 399-A offset provisions under a
“deemed” petition for judicial review. However, without
regard to whether the court’s action is viewed as arising
under the All Writs Act or under a petition for review,
the court impermissibly intruded upon the broad discre-
tion of the FERC to devise refund remedies.

1. Mandamus did not lie.

This Court has held that a writ of mandamus will not
issue when the person to whom the writ is to be directed

22

has discretion to act.*°° The writ cannot be used to com-
pel adoption of a particular remedy when the agency
possesses broad discretion to determine what remedy, if
any, is appropriate.*! Because nothing in INGAA I either
directed the FERC to order refunds or established the
method for effecting any refunds ultimately ordered by
the FERC, resort to mandamus was legally precluded.

Congress has invested in the FERC broad discretion-
ary authority to regulate the natural gas industry. As
this Court stated in Permian Basin Area Rate Cases,
390 U.S. 747, 790 (1968) :

[T]he breadth and complexity of the Commission’s
responsibilities demand that it be given every rea-
sonable opportunity to formulate methods of regula-
tion appropriate for the solution of its intensely
practical difficulties.

This Court has affirmed that FERC’s discretion is equally
broad in the specific context of its power to fashion ap-
propriate procedures to effect the manner and timing of
refunds.”

As observed by Judge Scalia in his dissent, AGD’s
request for mandamus was without merit because the
FERC “retains discretion to determine both the amount
and the manner of the refund.” App. 133a. Nothing in

30 Will v. Calvert Fire Insurance Co., 437 U.S. 655, 661-662, 665-
666 (1978) ; Kerr v. United States District Court, 426 U.S. 394, 402-
403 (1976); Will v. United States, 389 U.S. 90, 95-96 (1967).

31 See, e.g., United States ex rel. McLannan v. Wilbur, supra, 283
U.S. at 420 (‘the writ of mandamus cannot be made to serve the
purpose of an ordinary suit. It will issue only where the duty to be
performed is ministerial and . . . plainly defined. The law must not
only authorize the demanded action but require it; the duty must
be clear and indisputable.”’).

82 See, e.g., Mobil Oil Corp. v. F PC, 417 U.S. 283, 314-17 (1974)
(FPC has great flexibility in ordering refunds; refund workoff
credit procedure is within agency discretion.). See also Estate of
French v. FERC, 603 F.2d 1158, 1162-63 (5th Cir. 1979) (“FERC
is to explore and give due weight to considerations of equity when
imposing refund obligations.”’).

Co me atin ORL at

23

INGAA I abridged this discretion. Accordingly, man-
damus did not lie.

2. The court of appeals substituted its judgment for
that of the agency.

This Court has admonished the reviewing courts that
they may not “substitute [their own] judgment for that
of the agency.” Citizens To Preserve Overton Park, Inc.
v. Volpe, 401 U.S. 402, 416 (1971). As this Court em-
phasized in Vermont Yankee Nuclear Power Corp. v.
NRDC, 435 U.S. 519, 549 (1978), the reviewing court
must “not stray beyond the judicial province to explore
the procedural format or to impose upon the agency its
own notion of which procedures are ‘best’ or most likely
to further some vague, undefined public good.” Further,
this Court has specifically emphasized the FERC’s dis-
cretion to design appropriate refund procedures. Mobil
Oil Corp. v. FPC, supra, 417 U.S. at 314-17.

By comparison, the court below ignored the admoni-
tion of this Court and, without foundation, intruded into
the discretion reserved to the FERC by ordering that the
FERC implement a refund remedy preferred by the
court of appeals, which the FERC has now done in Order
No. 399-B. This unfounded intrusion into the expertise
of the FERC is even more egregious when considered in
light of the absence of the full agency record before the
court of appeals.

Because the court of appeals did not follow the or-
derly, statutorily mandated procedures set forth in Sec-
tions 506(a) (2) and (4) of the NGPA and sua sponte
treated AGD’s Motion as a petition for review, the rec-
ord compiled before the FERC was never filed with the
court of appeals. Judicial review on the complete record
compiled before the FERC is required by Section 506
(a) (4), which provides that “[t]he finding of the Com-
mission as to the facts, if supported by substantial evi-
dence, shall be conclusive,” and by 28 U.S.C. § 2112(b).
Because the agency record had not been filed with it,

24

the court of appeals had no basis for determining the
propriety of the FERC’s orders.

Of equal importance, by failing to have the complete
record before it, and by failing to allow full briefing of
all relevant objections and issues, the court of appeals
resolved the issue of how refunds were to be undertaken
without first determining the legal validity of the refunds
ordered.** Thereby, the court’s decision was rendered in
a vacuum without consideration of the significant legal
issues that had to be addressed before the validity of
the FERC’s offset mechanism could ever be reached.

Accordingly, a writ of certiorari should issue in this
case to preserve the proper equilibrium between the au-
thority of FERC and that of the court of appeals. This
balance must be maintained to prevent the intrusion of
the court of appeals into matters squarely within the
expert discretion of administrative agencies.

CONCLUSION

Petitioners respectfully urge that a petition for writ
of ceritorari be granted and that the decision of the court
of appeals be vacated and remanded, with instructions to
transfer the case to the United States Court of Appeals
for the Fifth Circuit.

Respectfully submitted,

JOHN M. YOUNG CHARLES ALAN WRIGHT
JOHN B. CHAPMAN 727 East 26th Street
Pennzoil Company Austin, Texas 78705
Post Office Box 2967 (512) 471-5151
Houston, Texas 77001 R. Gorpon Goocu
(713) 546-8859 CHARLES M. DARLING, IV
GLEN E. TAYLOR THOMAS J. EASTMENT
PHYLLIS G. RAINEY BAKER & BOTTS
Tenneco Oil Company 1701 Pennsylvania Ave., N.W.
Post Office Box 2511 Washington, D.C. 20006
Houston, Texas 77001 (202) 457-5500

(713) 757-3961

33 See n. 21 & accompanying text, supra.

AND ON BEHALF OF:

William T. Benham
Attorney for

Amoco Production Company

Michael Maloney
Attorney for

ARCO Oil and Gas Company,

Division of Atlantic
Richfield Company
B.J. Zimmerman
Kerry R. Brittain

Constance D. Coleman
Attorneys for

Champlin Petroleum Company

James B. Atkin
Attorney for
Chevron U.S.A. Inc.
Carmen Chidester Farrell
Attorney for

Cities Service Oil and Gas

Corporation

Ernest J. Altgelt, ITI

Carolyn S. Hazel

William G. Robb
Attorneys for
CONOCO Inc.

Douglas W. Rasch
Attorney for
Exxon Corporation

Anthony V. Sorrentino
David R. Stevenson
Attorneys for
Gulf Oil Corporation

Robert D. Haworth
Robert A. Luettgen
Jay G. Martin

Carroll L. Gilliam

J. Paul Douglas

Kevin M. Sweeney
Attorneys for
Mobil Oil Corporation

Kenneth R. Satterly

Walter L. Brignon
Attorneys for
Monsanto Oil Company

C.J. Roberts

Larry Pain

Jennifer A. Cates
Attorneys for

Phillips Petroleum Company

Phillips Oil Company

Ronald D. Hurst
Attorney for
Placid Oil Company

Thomas G. Johnson
Eugene V. Callaway
Attorneys for
Shell Offshore Inc.
Shell Western E&P Inc.

Charles L. Spann
Attorney for
Sun Exploration and
Production Company

Karen A. Berndt
Attorney for
Texaco Inc.

Lois Ellen Gold
Albert Sylvia III
Attorneys for
Union Oil Company of
Califorinia

Mobil Oil Exploration &
Producing Southeast Inc.

Mobil Producing Texas &
New Mexico Inc.

The Superior Oil Company

SUPPLEMENTAL
APPENDIX

lb

UNITED STATES OF AMERICA
FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Raymond J. O’Connor, Chair-
man; A. G. Sousa and Charles
G. Stalon.

Docket Nos. RM84-6-015 through RM84-6-028

REFUNDS RESULTING FROM BTU
MEASUREMENT ADJUSTMENTS

ORDER NO. 399-B

ORDER ON DIRECTION OF THE COURT
VACATING, IN PART, ORDER NO. 399-A,
AND ON PETITIONS FOR REHEARING
AND RECONSIDERATION

(Issued July 18, 1985)

I. INTRODUCTION

The Federal Energy Regulatory Commission (Com-
mission) is implementing the court’s decision in /nter-
state Natural Gas Association of America v. Federal
Energy Regulatory Commission,’ by vacating the offset
mechanism required by Order No. 399-A? and by grant-
ing five petitions for rehearing. The Commission other-
wise denies all other petitions for rehearing, reconsidera-
tion and stay of Order No. 399-A.

1Interstate Natural Gas Association of America v. Federal
Energy Regulatory Commission, 756 F.2d 166 (D.C. Cir. 1985)
(INGAA-II).

2 Refunds Resulting from Btu Measurement Adjustments, 49
Fed. Reg. 46,353 (Nov. 26, 1984).

2b
II. BACKGROUND

On November 20, 1984, the Commission issued Order
No. 899-A, which granted rehearing in part of Order
No. 399.2 Order Nos. 399 and 399-A implemented the
decision of Interstate Natural Gas Association of Amer-
ica v. Federal Energy Regulatory Commission * by estab-
lishing refund procedures for overcharges resulting from
adjustments to the calculation of the Btu content of gas
sold under the Natural Gas Policy Act of 1978 (NGPA).
On March 5, 1985, the United States Court of Appeals
for the District of Columbia directed the Commission to
vacate the portion of Order No. 399-A that required first
sellers to offset Btu refunds against costs permitted un-
der section 110 of the NGPA.’ Order No. 399-A also
permitted first sellers to seek a waiver of that portion
of a first seller’s refund obligation to the extent it is
attributable to royalty interest owners and is uncollec-
tible. The Commission received nine timely petitions for
rehearing of Order No. 399-A.°

3’ Refunds Resulting from Btu Measurement Adjustments, 49 Fed.
Reg. 37,735 (Sept. 26, 1984) (issued Sept. 20, 1984) (Final Rule).

#716 F.2d 1 (D.C. Cir. 1983), cert. denied, 104 S. Ct. 1616
(1984) (INGAA-I) (charges for gas must be determined by
measurement of Btu’s (British thermal units) under “wet” condi-
tions rather than the “as delivered” basis promulgated by the
Commission).

5 See n.1, supra. 18 C.F.R. § 271.1104(e) (1984); see generally,
Regulations Implementing Section 110 of the Natural Gas Policy
Act of 1978 and Establishing Policy Under the Natural Gas Act,
48 Fed. Reg. 5152 (Feb. 3, 1983) (Order No. 94-A) (Final Rule and
Order on Rehearing of Order No. 94). Appeal pending sub nom.,
Texas Eastern Transmission Corp., et al. v. Federal Energy Regu-
latory Commission, No. 83-4390 (argued March 8, 1985, 5th Cir.).

® American Paper Institute, Inc., Industrial Users (i.e., Process
Gas Consumers Group and American Iron & Steel Institute),
Florida Cities, Pitts Oil Company, et u!., Stauffer Chemical Company,
Associatea Gas Distributors, Memphis Light, Gas & Water Division,
BTA Oil Producers, and a group of Indicated Producers.

The Commission also received five requests for an extension of the
deadline for large first sellers to make refunds and a request to

3b
III. DISCUSSION

A. The Court’s Decision Prohibiting the Offset of
Section 110 Allowances

The Court of Appeals quoted with approval the Com-
mission’s rationale in Order No. 399 for disallowing the
offset of Btu refund obligations and section 110 charges.
The court directed the Commission to vacate the offset
portion of Order No. 399-A.’

As required by Order No. 399-A, many first sellers
offset hundreds of millions of dollars of Btu refund obli-
gations against uncontested section 110 charges in pay-
ment of Btu refunds. The Commission is now reversing
that order, consistent with the instructions of the United
States Court of Appeals.* Those first sellers that paid
the Btu refund obligation by offsetting section 110
charges must now pay the Btu refund obligation in full.®

modify the refund procedures. The Commission did not extend the
deadline, or modify the refund procedures, because the petitions
failed to present sufficient grounds for an extension.

In addition, five petitioners sought a stay of Order No. 399-A.
These requests were not granted because the Commission did not
believe “justice so require[d],” 5 U.S.C. § 705 (1982).

TINGAA-II, supra, at 171. The American Paper Institute, In-
dustrial Users, Florida Cities, the Associate Gas Distributors and
Stauffer Chemical Company objected to the requirement that first
sellers’ undisputed billings to pipeline-purchasers for section 110
allowances be offset against the first sellers’ Btu refund obligation.
Since the Court of Appeals’ decision has afforded these petitioners
the relief they sought in their petitions for rehearing, the Commis-
sion grants these petitions.

8 The mandate issued May 20, 1985, the date of the Court of
Appeals denial of the “Indicated Producers” motion for a stay.
On June 3, 1985, Chief Justice Burger denied a petition for stay
of the mandate.

* This refund payment may be in the form of one or more cash
payments, or in the form of billing adjustments (if such billing
adjustments are agreed to by the first seller), or a combination of
these methods, as long as full payment is made by August 30, 1985.

4b

Refunds must be made by August 30, 1985.'° In all cases,
interest accrues on the amount to be refunded until the
date of payment, in accordance with Order No. 399."' In
addition, interstate and intrastate pipelines are required
to file refund reports similar to those required in Order
Nos. 399 and 399-A. These additional reports are neces-
sary to better monitor the payment of refunds by first
sellers and interstate pipelines.

B. Refund Obligations Attributable to Royalty Inter-
est Owners

Memphis Light, Gas and Water Division, (Memphis)
protests the Commission’s assertion of authority in Order
No. 399-A to waive payment by first sellers of that por-
tion of a Btu refund obligation attributable to royalty
interest owners that is uncollectible. Memphis argues
that the Commission lacks authority to waive the imposi-
tion of strict liability for the refund on first sellers. Al-
ternatively, Memphis argues that there is no reason to
waive this refund obligation because it derives from a
first seller’s payment of excessive royalties.

In Order No. 399, first sellers were made guarantors
of payment of the portion of the Btu refund obligation
attributable to royalty interest owners, primarily because
the first seller, not royalty interest owners, collected

10 The disallowance of offsets does not affect the right of first
sellers to defer payment of that portion of the Btu refund obliga-
tion attributable to royalty interest owners until actually collected
or until November 5, 1986, whichever occurs first.

11 The Indicated Producers argue that pipelines should pay the
same interest rate on section 110 charges as the interest rate ap-
plicable to the Btu refunds. This issue is also mooted by the deci-
sion in INGAA-II because Btu refunds must be paid separately
and distinct from section 110 charges. In any event, the interest
rate applicable to Btu refunds was set by the Commission based
upon public policy considerations. In contrast, the interest rate for
section 110 charges is set by contract. For this reason, these
interest rates may differ.

5b

prices in excess of NGPA ceiling prices. On review, the
Commission still believes it has discretion to waive pay-
ment of those portions of the refund obligation attributa-
ble to royalty interest owners, if the first seller demon-
strates that the refund is uncollectible.* As stated in
Order No. 399-A, the Commission will consider requests
for a waiver on a case-by-case basis.’*

C. Responsibility of Operators

Order No. 399 designated the operator as the one re-
sponsible for repayment of the entire refund for the
time period it operated a well.’* Specifically, the order
required operators to notify aii of the working interest
owners of their refund chbiigations and to collect the re-
funds and pay them over to the pipelines. In addition,
the Commission required operators to pay refunds owed
by a defaulting working interest owner.

The Indicated Producers complain about the imposi-
tion of strict liability on a first seller that is the operator
of a well for those refunds that are attributable to other
working interest owners. They argue that an operator
should not have to serve as a guarantor of refunds from
other working interest owners that default on their por-
tion of the refund.

The Commission recognizes that each working inter-
est owner is a first seller and individually liable for the
refund attributable to its interest in a well during the
time the refund obligation accrued, as well as that por-
tion of its refund obligation attributable to royalty inter-
est owners. But, after further consideration of the issue,
the Commission still believes it is necessary to designate

12 See Consumer Federation of America v. FPC, 515 F.2d 347,
359 (D.C. Cir. 1975).

13 As established in Order No. 399-A, to the extent a filing fee
exists for such a waiver, the Commission is waiving this filing fee.

1449 Fed. Reg. 37,735, 37,740 (Sept. 26, 1984).

6b

the operator as the one responsible for the payment of
the entire refund for the time period that the operator
operated a well in order to facilitate expeditious refunds
as required by the court in INGAA-I and INGAA-II.

D. Other issues

Pitts Oil Company, Sage Energy Company, and Clay-
ton W. Williams, Jr., Co. filed a petition requesting re-
consideration of the same issues on which they sought
rehearing of Order No. 399, asserting that Order No.
399-A and its predecessors failed to articulate a rea-
soned explanation for requiring refunds to implement the
court’s decision in INGAA-I.

As discussed in Order No. 399-A, the Commission be-
lieves that substantial equitable considerations support a
discretionary order of refunds. Primarily, the consumers
who paid excessive gas prices because of the incorrect
measurement of the Btu content of that gas should bene-
fit through the refund of overcharges. In any event, the
opinion of the Court of Appeals in INGAA-II leaves no
doubt that refunds were required to implement that
Court’s earlier decision in INGAA-I.*

To the extent petitioners have raised issues other than
discussed above, the Commission believes those issues
were previously considered and fully addressed in prior
orders in this proceeding.

IV. EFFECTIVE DATE AND CLEARANCE BY THE
OFFICE OF MANAGEMENT AND BUDGET

The refund reporting requirements established in this
rule are information collection requirements under the
Paperwork Reduction Act ** and subject to Office of Man-
agement and Budget (OMB) approval.’’ Hence, the re-

15 INGAA-II, supra at 171.
16 44 U.S.C. §$§ 3501-3520 (1982).
175 C.F.R. Part 1320 (1985).

7b

porting requirements established in paragraph (F) be-
low and § 154.38(h) (3) (viii) of the Commission’s regu-
lations are effective [insert date that is sixty days after
publication in the First Register]. If OMB clearance has
not been received by this effective date, the Commission
will issue a notice temporarily suspending the effective
date of ti.e refund reporting requirements. The remain-
ing portions of this order are effective [insert date that
is thirty days after publication in the Federal Register].

V. THE COMMISSION ORDERS:

(A) That portion of Order No. 399-A that required
the offset of Btu refund obligations and section 110
charges is vacated, and those petitions for rehearing that
requested this relief are granted.

(B) First sellers must make refund payments for those
amounts of Btu refund obligations that were previously
paid by means of offsetting section 110 charges, by Au-
2” . 80, 1985, in accordance with Order No. 399.

(C) The parties to the first sale transaction may
choose the method of payment of this refund, except that
pipelines and first sellers may not offset Btu refunds and
production-related costs permitted under section 110 of
the NGPA. Those pipelines that have already begun to
collect refunds by using billing adjustments without the
consent of the seller can continue this method of pay-
ment only if the seller agrees. If the parties cannot
agree, payment must be made in a lump-sum cash pay-
ment.

(D) Interest on Btu refunds must be calculated in ac-
cordance with §§ 154.102(c) and (d) of the Commis-
sion’s regulations, except that any interest on money
paid into escrow is the actual interest accrued in the
escrow account on the amount required to be refunded.

(E) Any filing fee applicable to a request for a waiver,
as described herein, is waived.

8b

(F) By October 15, 1985, interstate and intrastate
pipelines must file a refund report with the Commission
detailing (1) the first sellers that made refunds, the
refunded amounts that each pipeline has received, sep-
arately stated for each first seller, and indicating the
principal amount and interest; and (2) the first sellers
that have not made refunds, and the refund amounts due
but not received by the pipeline, for each first seller, sep-
arately stating the principal amount and interest due
from each first seller and the reason for nonpayment.
Intrastate pipelines must file a copy of this report with
the state regulatory agency having jurisdiction over such
pipeline.

(G) All other petitions for rehearing, reconsideration,
extension of time, and stay of Order No. 399-A are de-
nied.

(H) In consideration of the foregoing, Part 154, Chap-
ter I, Title 18, of the Code of Federal Regulations, is
amended as set forth below.

List of Subjects: 18 C.F.R. Part 154
Natural gas
By the Commission.
(SEAL)
/s/ Kenneth F. Plumb,

KENNETH F. PLUMB,
Secretary.

9b

1. The authority citation for Part 154 continues to
read as foliows:

AUTHORITY: Department of Energy Organization
Act, 42 U.S.C. §§ 7101-7352 (1982); Executive Order
12,009, 3 C.F.R. 142 (1978); Administrative Procedure
Act, 5 U.S.C. $§ 551-557 (1982); Natural Gas Act, 15
U.S.C. §$ 717-717w (1982); Federal Power Act, 16
U.S.C. $$ 791la-828e (1982); Natural Gas Policy Act, 15
U.S.C. §§ 3301-3432 (1982); Public Utility Regulatory
Policies Act, 16 U.S.C. $$ 2601-2645 (1982); Interstate
Commerce Act, 49 U.S.C. §§ 1-27 (1976).

2. In § 154.38(h), paragraph (h) (3) (viii) is redesig-
nated as paragraph (h) (3) (ix), and a new paragraph
(h) (8) (viii) is added to read as follows:

$ 154.88 Composition of rate schedule.

* * * *

(h) Pipeline recovery of Btu measurement adjustments.

x * * *

(3) * * *

(viii) The pipeline must submit, not later than Octo-
ber 15, 1985, a refund report describing, for each source
from which Btu refunds are obtained, those refunds
received or paid (including deferred amounts paid) since
filing the report under paragraph (h) (8) (vii) of this
section. For these refunds subject to this paragraph,
this report should show all the information enumerated
in paragraph (h) (3) (vi).

* * ” *

3. In § 154.38(h), newly-redesignated paragraph (h)
(3) (ix) is amended by removing the phrase “para-
graphs (h)(3)(vi) and (vii)”, and inserting, in its
place, the phrase “paragraphs (h) (3) (vi), (vii), and
(viii)”’.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385018_0500%3A1. Public record. Not legal advice.