# Petition for Writ of Certiorari — Consolidated Edison Co. v. Chevron U. S. A. Inc.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 2002
- **Citation:** 537 U.S. 949

## Text

Supreme Court, U.S.

ee FILED
02 207 AUG 92002
OFFICE OF THE GLERK

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
LONG ISLAND LIGHTING COMPANY, ORANGE AND
ROCKLAND UTILITIES INC.,SAN DIEGO Gas AND
ELECTRIC COMPANY, INTERNATIONAL PAPER COMPANY ,
CHAMPION INTERNATIONAL CORPORATION, WESTVACO
CORPORATION, and WEYERHAUSER COMPANY

PETITIONERS
V.

CHEVRON U.S.A. INC.
RESPONDENT

ON PETITION FOR WRIT OF CERTIORARI TO THE
COURT OF APPEALS FOR THE FEDERAL CIRCUIT

Philip P.. Kalodner

Attorney of Record for Petitioners
208 Righters Mill Rd.

Gladwyne PA 19035

(610) 649-8749

4 R VIEW

1. Has the practice of issuing unpublished
decisions not citable as precedent been so
misused here to avoid facing issues of
first impression so as to require reversal?

2. Do the varying standards of the Courts
of Appeals with regard to the use of
unpublished opinions and their citation as
precedent or for their persuasive effect
require this Court's consideration as to
the need for a uniform policy?

3. Has the refusal of the Court of Appeals
for the Federal Circuit here to honor the
language of prior decisions and its own
repeated assurance that a private cause of
action exists pursuant to the Economic
Stabilization Act ("ESA") to recover for
crude oil overcharges so far departed from
the usual course of judicial proceedings as
to call for an exercise of this Court's
Supervisory power?

4. Was the refusal of the Federal Circuit
here to apply a specific federal statute of
limitations for public enforcement actions
pursuant to ESA Section 209 to private
causes of action under ESA Section 210 for
the same violations in conflict with the
decisions of this Court?
(i)

LIST OF PARTIE RATE AF

The caption of the case contains the
names of all of the parties.

International Paper Company, Westvaco
Corporation and Weyerhauser Company are all
themselves publicly owned corporations and
have no parent corporation, nor is there
any publicly held corporation which owns
10% or more of their stock.

Consolidated Edison Company of New
York Inc. and Orange and Rockland Utilities
Inc. are wholly owned subsidiaries of a
publicly owned corporation, Consolidated
Edison Inc.; San Diego Gas & Electric
Company is a wholly owned subsidiary of a
publicly held corporation, Sempera Energy;
Champion International Corporation is a
wholly owned subsidiary of International
Paper Company. Long Island Lighting Company
is a wholly owned subsidiary of Long Island
Power Authority, a corporate municipal
instrumentality of the State of New York.

(ii)

TABLE OF CONTENTS

QUESTIONS PRESENTED FOR REVIEW (i)

LIST OF PARTIES AND CORPORATE

AFFILIATES (11)
TABLE OF CONTENTS (111)
TABLE OF CITED AUTHORITIES (vii)
CITATION OF REPORTS OF OPINIONS 1
JURISDICTION 1
STATUTES INVOLVED 1
STATEMENT OF THE CASE 2
ARGUMENT 12
I P TICE OF It N ISHED

EEO

CONCLUSION 30
APPENDIX

OPINIONS ENTERED IN CONJUNCTION
WITH JUDGMENT SOUGHT TO BE REVIEWED

OPINION OF U.S. COURT OF
APPEALS FOR THE FEDERAL
CIRCUIT, APRIL 5, 2002 la

STATUTES INVOLVED

DENIAL OF REHEARING
MAY 13, 2002 3a

MEMORANDUM OPINION OF THE
DISTRICT COURT FOR THE
DISTRICT OF COLUMBIA Sa

Economic Stabilization Act
Amendments of 1971, Pub. L.
92-210, 85 Stat. 743 (1971),
Sec. 209-211 (a) 16a

Emergency Petroleum

Allocation Act of 1973,

Pub. L. 93-159, 87

Stat. 627 (1973),

Sec. 5(a) (1) 19a

Petroleum Overcharge
Distribution and Restitution
Act 1986 (PODRA), Pub.L.
99-509, 100 Stat. 1881

(1986), 15 U.S.C. Sec. 4504 20a

Federal Courts Administration
Act of 1992, Pub. L. 102-572,
Sec. 102 (a)-(d),

106 Stat. 4506 (1992) 25a

(vi)

Cases

Agency Holding Corp. v. Malley-Duff ¢§

Associates Inc., 483 U.S. 143 (1987)...29
Arnson v. General Motors Corporation,

377 F. Supp. 209 (N.D. Ohio 1974)..-...17

Ashland Oil Co. of Cal. v. Union Oil Co.

of Cal., 567 F. 2d 984 (TECA | gg) ee 21
Bond v. Texaco, 647 F. Supp. 1135

OR | ren ee nner pn oe eee 11,29
~j lle-Mobile Gather; a
Edwards, 669 F. 2d 717 (TECA 1982),

cert. denied, 459 U.S. 877 (1982)...... 19

Consolidated Edison Co. of New York v.
O'Leary, 131 F. 3d 1475 (Fed. Cir.

RFE A recess e Vie wwe aes eke cua 10,26
Ww k v

O'Leary , 117 F. 3d 538 (Fed. Cir.

itis RET EE COE ee 27

(vii)

gE Bir Lj I At] :
Richfield Co., 609 F. 2d 497 (TECA
oy, ) ere rere eee ree ee ee ee 17-18, 26

Gulf Oil Corp. v. Dyke,

734 F. 2d 797 (TECA 1984) ..17-18,20, 25-26

Kellermyer v. Blue Flame Gas Corp.,

797 BP. 24 983 (THCA 1986) .....cccccccce 20

In Re The Department of Energy Stripper
1 Lit ("strs

Well"), 653 F. Supp. 108 (D. Kan. 1986..8

Lampf_ v. Gilbertson, 501 U.S. 350, 115 L.
Ed. 2d 321, 111 S. Ct. 2773 (1991)..28-30

Reed United T “Pe

488 U.S. 319, 102 L. Ed. 2d 665,
109 S. CO. 621 (1969)... ccc ccccscccecs 28

Sinclair Oil ¢ ' ; ;
Co., 720 F. Supp. 894 (D. Utah 1989)...21

Sousa v. BP Oil Inc.,
1995 WL 842003 (D. Mass. 1995)......... 20

(viii)

ani’ ain it and i al

Entitlements Program, 39 Fed. Reg.
42,246, formerly 10 CFR Sec.

Final Settlement Agreement in Stripper
Well, 7 Energy Mgmt. (CCH) par. 90,509..9
Notice of Proposed Remedial Order

to Chevron, 57 Fed. Reg. 20475 (May 13,
EE ae Ps oy as oe es bose ee Sead 9-10

Report of OHA to Stripper Well Court,

7 Energy Mgmt. (CCH) par. 90,507........ 6
The 2 : Uni F the Ci 1]
Field, 24 DOE (CCH) par. 81,035

Se eS 5 oh a 6 6 aca ie ae va eek cee becwdan 6
Statutes

Federal Courts Administration Act of
1992, Pub. L. 102-572, Sec. 102 (a) -
(dad), 106 Stat. 4506 (1992).............. 2

(ix)

Economic Stabilization Act Amendments of
1971, Pub. L. 92-210, 85 Stat. 743

+. 275 err errr eT ee eee ee ee eee 1, passim

Emergency Petroleum Allocation Act of
1973, Pub. L. 93-159,
BF Seat. GAT CASTS) occ cc vcsvecsvvsveses 1

Petroleum Overcharge Distribution and

Restitution Act of 1986,

15 U.S.C. Sec. 4504......... 2,10-11,13,21
rM ri

Law Library Journal, Vol. 93:4

"Unpublished Opinions as the Bulk of the

TCOEDETG" . 0. ccc cece rece rewecceesececes 23

Procedural Rules of the various
Circuit Courts of Appeals........... 22-24

(x)

ITATION OF REPORT F_ OPINION

Neither the Decision of the Court of
Appeals for the Federal Circuit nor the
District Court Opinion is reported
officially.

The Court of Appeals Decision is
reported unofficially at 2002 U.S. Appeals
LEXIS 7072 and at 32 Fed Appx. 588, and
the denial of rehearing is unofficially
reported at 2002 U.S. Appeals LEXIS 11815.

JURISDICTION

The Judgment sought to be reviewed
was entered April 5, 2002.

A timely filed Petition for Rehearing
was denied by Order entered May 13, 2002.

Jurisdiction of the Supreme Court is
pursuant to 28 U.S.C. Sec. 1254.

ES I L

The statutes involved, the pertinent
text of which is set forth in the appendix
are: Economic Stabilization Act Amendments
of 1971, Pub. L. 92-210, 85 Stat. 743
(1971), Sections 209-211 (a) ("ESA"),
Emergency Petroleum Allocation Act of
1973, Pub. L. 93-159, 87 Stat. 627 (1973),
Sec. 5 (a) (1) ("EPAA"), Petroleum

1

Overcharge Distribution and Restitution
Act of 1986 ("PODRA"), Pub. L. 99-509, 100
Stat. 1884 (1986) 15 U.S.C. Sec. 4504,
Federal Courts Administration Act of 1992,
Sec. 102 (a)-(d), 106 Stat. 4506 (1992).

STATEMENT OF THE CASE

Plaintiffs, four electric utility
companies ("Utilities") and four paper
manufacturers ("Manufacturers") sought in
this Complaint recovery for overcharges by
defendant, Chevron U.S.A.Inc. ("Chevron").
They sought such on their own behalf and
on behalf of similarly situated purchasers
of petroleum products during the period of
federal regulation of the price of crude
oil (August 1973 through January 1981)

Utilities and Manufacturers averred
that Chevron as a producer of -crude oil
had overcharged by recovering for price-
controlled "old" oil as if it were price-
uncontrolled "new oil," and that’ the
plaintiffs and the class had paid a pro
rata share of such overcharges. Relief was
sought pursuant to Economic Stabilization
Act ("ESA") Section 210 which provides for
recovery in a private cause of action.

Jurisdiction. of the District Court
was pursuant to ESA Section 211 (a).

Judge Richard W. Roberts of the
District Court for the District of

2

Columbia granted a Chevron motion to
dismiss on two grounds, that (i) even if
overcharged, the plaintiffs have no
Standing to sue because they had not
purchased from Chevron directly, and (ii)
the action is barred by the applicable
Statute of limitations.

An appeal was taken by Utilities and
Manufacturers to the Court of Appeals for
the Federal Circuit which, after briefing
and oral argument, entered per curiam
judgment with a single word decision, i.e.
"Affirmed." and a legend "NOTE: Pursuant
to Fed. Cir. R. 47.6 this disposition is
not citable as precedent. It is a public
record. This disposition will appear in
tables published periodically." A petition
for panel rehearing and for rehearing en
banc was "Denied."

1. The Principal Elements of the Chevron
Overcharge

Chevron's recertification of price
controlled "old oil" as price-uncontrolled
"new oil" was pursuant to a = program
authorized by the Department of Energy
("DOE") to encourage tertiary recovery,
i.e. infusion in an oil field in order to
recover additional oil. The program, known
as the Tertiary Incentive Program ("TIP")
permitted a producer of crude oil to
increase to the world price crude oil
which otherwise had a ceiling price. A

a

producer was permitted to so "recertify" a
volume of ceiling price crude oil to the
extent necessary to recover (i) 75% of its
expenses and anticipated expenses in the
TIP program it was implementing, and (ii)
the additional federal Windfall Profits
Tax and State Severance Taxes which would
result from such a recertification and the
resulting higher crude oil prices.

As to its January 1981 production,
Chevron accordingly raised its prices on
otherwise price-controlled oil sold to
itself as a refiner in the amount of $205
million, representing such as within the
TIP program authorized purposes..

The condition of the permission to
increase crude prices was a requirement
that to the extent such increase was
either not justified initially or became
unjustified by virtue of an abandonment of
the TIP program before its completion, the
amount of the unjustified increase was
required to be returned to those who had
paid it. In effect, to the extent the
increase was unjustified, it was an
overcharge, i.e. an unjustified avoidance
of the ceiling price.

The Complaint here charges that in a
number of important respects, the increase
in the price of crude oil either initially
was unjustified or became unjustified as a
result of a premature abandonment of the

+

TIP Program and a recovery from the U.S.
Treasury of a portion of the Windfall
Profits Tax actually paid, and from the
States of a portion of the Severance Tax
which had been paid and used as a
justification for the price increase.

Y 2 The Impact of the Chevron

Vv aintif
Class

The increased price of crude oil
recertified by a producer in order to
implement a TIP Program was charged by it
to the refiner purchasing its crude oil.
Pursuant to DOE regulations, it was then
passed on by the purchasing refiner to all
other domestic refiners of crude oil pro
rata, i.e. with each domestic refiner
reflecting in its crude oil costs a
percentage of the increased crude price
calculated by a fractiqn, the numerator of
which was the runs to stills of each
refiner and the denominator of which was
the runs to stills of all domestic
refiners in the month involved.

The mechanism by which the cost of
each refiner's crude oil was spread pro
rata to all domestic refiners was the
Entitlements Program promulgated by DOE's
predecessor in 1974. (39 Fed. Reg. 42,246,
formerly 10 CFR Sec. 211.67).

The Entitlements Program was adopted
to equalize the acquisition cost of crude

3

oil to all refiners; without such
equalization, some refiners would have had
a lower crude cost by virtue of having a
predominant supply of ceiling priced crude
Oil, while others would have a higher
crude cost because of a predominant supply
of unregulated imported crude.

In addition to spreading to all
refiners the costs of each refiner, and
indeed as a result of such spread, the
Entitlements Program left all refiners
with an approximately equal per gallon
cost of crude oil.

Such equalization of the acquisition
cost of crude oil had a further critical
effect. As the Department of Energy's
adjudicative body, the Office of Hearings
and Appeals ("OHA") found on two separate
occasions after hearing extensive expert
testimony, it enabled refiners to pass on
to their customers almost 95% of the
increased acquisition cost of crude oil,
absorbing only slightly more than 5% of
the increased cost. (Report to the Court
in In re The Department of Energy Stripper
Well Exemption Litigation, ("Report in
Stripper Well"), 7 Energy Mgmt. (CCH) par.
90,507; 341 Tract Unit of the Citronelle
Field, ("341 Citronelle"), 24 DOE (CCH)
par. 81,035 (OHA 1994).

As a result of this "pass through",
the purchasers of refined oil products,

6

such as the Utilities and Manufacturers,
paid to the refiners from whom they
purchased product all increases in the
acquisition cost of crude oil by any
refiner, including such increases as were
permitted by virtue of the adoption by any
or all refiners of a TIP Program.

When, as was the case here, it was
recognized that the TIP Program
participant (i) had not indeed incurred
some of the costs on the basis of which it
had increased its crude oil prices (such
as Windfall Profits Taxes never actually
paid because of the Net Income Limitation)
or (ii) later recovered some of the costs
on the basis of which it had increased its
crude oil prices (such as prepaid expenses
and inventory and Windfall Profits Taxes
and Severance Taxes paid), the increase in
prices which the TIP participant had
effectuated became to that extent
overcharges which had effected all
purchasers of refined product from all
refiners to the same per gallon extent.

Neither the defendant here, nor the
District Court, questioned the accuracy of
the above explanation of the impact of
overcharges by any producer on purchasers
of product from all refiners. Indeed, it
is the basis of OHA's unvarying practice
in the case of recovery in a public
enforcement action pursuant tc ESA Section

7

209 of allocating to all purchasers of
refined product recovered overcharges from
any crude oil producer, regardless of
whether their purchases were from the
refiner who paid the overcharge initially
or from a refiner who paid a pro rata
share of the overcharge by virtue of the
Entitlements Program.

Chevron's merit defense is that it
never received the benefit of the $205
million recertification because the
January 1981 Entitlements List was never
implemented because of deregulation, and
that accordingly it has no obligation to
make restitution to the extent to which
the recertification reflected overcharges.
Utilities and Manufacturers maintain that
(i) domestic refiners including Chevron
did indeed recover in January 1981 sales
the $205 million increase in price by
Chevron, and (iii) Chevron either did
receive or specifically waived the only
portion of the $205 million to which it
would have been entitled had the January
Entitlements Program been implemented in
the ordinary course, such having occurred
in the settlement of In re The Department

E z Stri Wel] z ;

Litigation, ("Stripper Well") 653 F. Supp.
108 (D. Kan. 1986).

Chevron's pro rata share of crude
oil refined by all domestic refiners was

8

8% (Final Settlement Agreement in Stripper
Well, 7 Energy Mgmt (CCH) par. 90,509 at
90,680). Accordingly, if, as plaintiffs
contend, the $205 million in Chevron's
increased price was recovered in January,
1981 by domestic refiners, only 8% of it
was recovered by Chevron itself, and 92%
by other domestic refiners; Chevron would
receive, and in plaintiffs' view did
receive, the 92% recovered by other
refiners in the implementation of the
Entitlements Program (through the Stripper
Well Settlement.)

If therefore, as the District Court
apparently believed, ESA Section 210
permits only those who purchased directly
from Chevron to recover, Chevron would be
obligated to make restitution under ESA
Sec. 210 only for 8% of its overcharges,
rather than the 100% for which it would
clearly be obligated to make restitution
in a public ESA Sec. 209 action.

3. The Facts With Regard to the
: . Limi L

The instant Complaint was filed March
25, 1998, less than six years following
the first public notice of the facts with
regard to the alleged overcharges; that
notice occurred as the result of a Federal
Register Notice on May 13, 1992 that the
DOE had, on March 26, 1992-issued a
Proposed Remedial Order ("PRO") initiating

9

a public enforcement action against
Chevron pursuant .to ESA Section 209 (57
Fed. Reg. 20475).

(Plaintiffs were, by intervention,
parties in the DOE public enforcement
action, and filed the instant Complaint
only after the DOE abandoned its
enforcement action, and after plaintiffs'
challenge to that abandonment was
dismissed on the basis that the DOE's
discretionary decision to drop the Section
209 enforcement action was not appealable
by potential beneficiaries of that action.
Consolidated Edison Co. of New York v.
O'Leary, 131 F. 3d 1475 (Fed. Cir. 1997);
had the DOE persisted in that public
enforcement action and succeeded, in
accordance with the ESA Section- 209
mandate that funds recovered in a public
enforcement action be used for
"restitution", plaintiffs and the class
would have recovered the amounts which
they seek in the instant private action.
In rejecting the plaintiffs' challenge to
the abandonment of DOE's public
enforcement action, the Federal Circuit
pointed out that the Utilities and
Manufacturers had available a private
cause of action under ESA Section 210.)

Prior to the enactment of the
Petroleum Overcharge Distribution and
Restitution Act ("PODRA") October 21,

10

+ 2 EES Ga

1986, 15 U.S.C.A. Section 4504, there was
no limitation period specified in federal
law for either Section 209 or Section 210
actions. The Courts imposed no limitation
on Sec. 209 actions, and applied "the most
closely analogous state statute of
limitations," in Section 210 cases. Bond
v. Texaco, 647 F. Supp 1135, 1137 (D.D.c.
1986). In doing so, in actions in the
District of Columbia, "The District of
Columbia recognizes the so-called
discovery rule as to the inception of the
limitations period, i.e. the cause of
action accrues for limitation purposes not
when the injury first occurred, but when
the plaintiff discovered, or by the
exercise of due diligence should have
discovered, the facts giving rise to the
claim." In Bond v. Texaco, the Court held
that the limitations period began, at the
earliest, at the time the DOE issued the
then-equivalent of a PRO. id

PODRA provided for a six year
limitation for public ESA Section 209
actions; it was silent as to Section 210
private actions. 15 U.S.C.A. Section 4504.
Were the six year statute of limitations
to be here applied to this Section 210
action and the "discovery rule" honored,
all elements of the Chevron overcharge
would be within the limitation period.

11

ARGUMENT

Here, a local rule permitting the
Court of Appeals to issue unpublished
dispositions not citable as precedent was
grossly misused to affirma District Court
decision as to matters of first impression
without binding the Court of Appeals to
the precedential impact of such decisions.

The characterization of such an
appellate determination as "not adding
significantly to the body of law," the
requisite under Federal Circuit Rule 47.6
for a non-precedential decision, is so
unjustified as to suggest a denial of the
right to appeal.

The misuse here of a rule permitting
a non-precedential disposition (i) should
be remedied, and (ii) provides a needed
opportunity for this Court to review the
use of similar rules by the various
federal Courts of Appeals.

This Court should preclude such non-
precedential disposition rules, inter alia
(i) because they eliminate the discipline
to decide cases on a consistent basis
which is imposed by the precedential
implications of Courts of Appeals’
dispositions, (ii) because of the variance
in the rules of the various Circuits with
regard to the persuasive impact of
unpublished dispositions , and (iii)

12

because of the significant variance in the
use of such rules by the various Circuits.

The District Court here faced, and
decided, whether knowingly or not, two
issues of first impression in private
actions pursuant to ESA Section 210 to
recover crude oil overcharges:

(i) whether there is indeed a private
cause of a action to recover crude oil
overcharges passed through all refiners,
or whether the provision for a private
cause of action pursuant to ESA Section
210 is ineffective to provide such, and

(ii) whether, in light of the
creation in PODRA, 15 U.S.C. Sec. 4504, of
a 6 year limitation period for parallel
public enforcement actions pursuant to ESA
Sec. 209, it is appropriate to adopt the
Same 6 year limitation period for private
actions under ESA Sec. 210.

By affirming the District Court
decision, the Court of Appeals. has
presumably affirmed either or both the
District Court holdings, i.e. (i) that the
private cause of action supposedly

13

a
®
‘ g

provided by ESA Section 210 is a toothless
tiger because end users of oil products
injured by crude oil overcharges passed on
to the refiner from whom they purchased
product cannot recover from the crude oil
producer who overcharged, and (ii) that
the private cause of action provided by
ESA Section 210 is available only within a
state limitation period shorter than that
available in the supposedly parallel ESA
Section 209 public enforcement action. In
the absence of a Court of Appeals opinion,
it is not possible to determine whether
the Court of Appeals agreed with the
District Court as to both holdings, or
only as to one, and if only as to one, to
which one. It is likely that the Court of
Appeals affirmed at least on the first of
these two holdings (i) in light of the
fact that it was this issue to which the
questions on oral argument were directed,
and (ii) in light of the fact that
elimination of the six year limitation
period alone would not have provided a
basis for dismissal of the Complaint; at
least one of the elements of violation
occurred within the three year District of
Columbia limitation period.

” E 1

with regard to crude oil overcharges

The District Court here interpreted
the Sec. 210 requirement that a private
cause of action is available only "against
any person renting property or selling
goods or services who is found to have
overcharged the plaintiff" as permitting
suit only by "direct purchasers of
Chevron's crude oil." (Appendix, p. 9a).

If literally applied. such an
interpretation would preclude any action
to recover crude oil overcharges by
private purchasers of refined product to
which, as OHA has found, 95% of the
increased price of crude oil was passed
through, because the direct purchaser of
Chevron's crude was Chevron itself. But
even if, as the Court would presumably
hold, direct purchasers from Chevron as a
refiner were permitted to seek recovery
for the affect on them of the Chevron
crude oil price increases, purchasers of
only 8% of the product affected would be
entitled to recover, inasmuch as Chevron
sold only 8% of the product which had been
uniformly affected by tthe additional
charges, with the balance being borne on
product sold by other domestic refiners.

Because no Court has ever faced the
issue of interpreting the statutory

a9

District Court relied on the
interpretation of the language in
connection with what are generally
referred to as "refined product" cases.

Refined product violations are
violations by refiners, resellers or
retailers as to refined product. e.g.
gasoline, home heating oil, residual fuel
oil etc., and affect only the customers of
the particular refiner, reseller or
retailer. For example, if a refiner sets a
price of gasoline in excess of the
applicable ceiling price and then sells
the gasoline, the only persons possibly
affected are the reseller, retailer and
end user customers purchasing such. I n
contrast, crude oil violations are
violations of the regulations by either a
producer of crude oil or a reseller of
crude oil. Because of the. Entitlements
Program, regardless of which refiner
initially purchases the crude oil, any
higher price is borne by all domestic U.S.
refiners in proportion to their percentage
of national refinery production.

Moreover, because the Entitlements
Program leaves all refiners with
essentially the same acquisition cost of
crude oil, and because the cost of crude
oil is the overwhelmingly important
component cost of refined product, as OHA
has found, the market price of refined oil

16

products reflected 95% of the essentially
uniform crude oil cost to all refiners, so
that 95% of the crude oil Overcharge was
borne by the purchasers of the refined
product made with such crude oil.

In the refined product cases, the
Courts have interpreted the Sec. 210
language permitting its use only against
persons "found to have overcharged the
plaintiff" as permitting suit only against
the immediate seller and have denied the
right of a purchaser to sue a remote
seller, albeit recognizing that if there
waS a cost-plus contract requiring pass-
through (Arnson Vv. General Motors
Corporation, 377 F. Supp. 209 (N.D. Ohio
1974)), a situation in which the impact of
overcharges on a "remote" purchaser could
be determinable in advance (Gulf Oil Corp.
v. Dyke, 734 F. 2d 797, 809 (TECA 1984) or
the functional equivalent of a —
contract (Eastern Air Lines Inc.
Atlantic Richfield Co., 609 F. 2d 497, ae
(TECA 1979), pass-through can be
recognized.

No court has faced or dealt with an
assertion in a Section 210 case involving
crude oil overcharges, as here made by
plaintiffs, that the Entitlements Program
was in fact the "functional equivalent" of
a cost-plus contract; it automatically
passed on the overcharges by any producer

17

to all refiners, and by virtue of
equalizing the acquisition cost of crude
oil to all refiners, assured that any
overcharge would (to the extent of some
95%) be passed on to end user purchasers.
The Entitlements Program met the
requirements for functional equivalence to
a cost-plus contract because, (i) unlike
the situation in Eastern Air Lines, it was
"pre-existing", i.e. it existed before the
recertification (rather than requiring
approval of an administrative agency, as
in Eastern Air Lines ), and (ii) unlike
the situation in Gulf Oil, the essentially
100% nature of the pass-through was
"capable of determination in advance"
(rather than requiring a case-by-case
determination as to whether the
competitive market situation was one in
which the overcharged party was able to
pass-through, as in Gulf Oil).

2. No Court, other than the District
5 ; ar :

In the period from the enactment of
ESA Sections 209 and 210 in 1971 and until

18

in
Bd
mo)
e
a
ei
Be
_

the enactment of PODRA in 1986, there was
no limitation period set forth in the
Statute either for Section 209 or 210

actions. The Courts treated Sec. 209
actions seeking either "injunctive relief"
or "restitution" as equitable actions not
subject to any statute of limitations,

Citronelle-Mobile Gathering Inc. Vv.
Edwards, 669 F. 2d 717, 721 (TECA 1982),
cert. denied 459 U.S. 877 (1982), and
"borrowed" state limitation periods as to
ESA Section 210 actions seeking to recover
the amount of "overcharge", characterizing
_ them as legal in nature. The distinction
made sense prior to the termination of
price regulation in January, 1981 when the
DOE pursuant to Section 209 could either
seek to enjoin the alleged illegal pricing
or could seek restitution by requiring the
violator to adjust its future prices so as
to refund the overcharge to its customers.
But with the end of regulation, an
enforcement action for restitution sought
the exact same damages as would be sought
in a private Section 210 action; the only
difference was that in a Section 209
action, the recovery went initially to the
DOE, and then by disbursement to the
injured end users, while in a Section 210
action the very same recovery went to the
end user plaintiffs directly. The proof of
the identity of the two actions here is

19

demonstrated by the fact that the items of
recovery sought: by the DOE in its
abandoned Section 209 action against
Chevron are precisely the same as that
sought in the instant Section 210 action.

Congress recognized this conversion
of what had been equitable actions under
Section 209 into actions for damages by
specifying a 6 year limitation period in
PODRA (15 U.S.C. Section 4504); its
failure to specify the same limitation
period for Section 210 actions presumably
reflected a view that such actions were
unlikely to be brought, both (i) because
it had been five years since deregulation,
and (ii) because of an assumption that DOE
would vigorously prosecute Section 209.
actions and that the same recoveries would
thereby be available to end users.

The use of state limitations for
Section 210 actions was never very
Satisfactory, as attested to by the
struggles which the courts had in
determining (i) which States' statute to
apply (e.g. Kellermyer v, Blue Flame Gas
Corp., 797 F. 2d 983 (TECA 1986), Gulf
Qil_v. Dyke, supra), (ii) which of the
limitation periods of the State to apply
(e.g. Sousa v. BP Oiid Inc,, 1995 WL 842003
(D. Mass. 1995), and (iii) whether, in
light of the provision permitting treble
damages in Section 210 actions, to apply a

20

penal or a "compensatory" limitation

period, or both (e.g. Sinclair Oil Corp.
v. Atlantic Richfield Co., 720 F. Supp.
894, 905-6 (D. Utah 1989), Ashland Oil Co.
of Cal. v. Union Oi] Co. of Cal., 567 F.

2d 984, 991 (TECA 1977).

No Court, to the best of Petitioners’
knowledge, has yet considered whether the
Six year period specified for 209 actions
in PODRA, 15 U.S.C.A. Sec. 4504, enacted
October 21, 1986, is now properly applied
to 210 actions, at least those involving
crude oil overcharges where, by virtue of
the Entitlements Program, the impact of
the alleged overcharges necessarily affect
every purchaser in every state.

B. By Barring the Citation of Its

If the Federal Circuit did indeed
decide one or both of the issues of first
impression before the Court, it misused
its own rule, and indeed, the purported
justification for un-published, non-
Citable decisions as promulgated by the
various Courts of Appeals, i.e. that, as

21

Federal Circuit Rule 47.6 puts it, the
decision is not one "adding significantly
to the body of law." (Indeed, in the Court
of Appeals for the District of Columbia
Circuit, the standards require publication
of an opinion in a "case of first
impression," the necessary inference being
that in such cases there should be a
written opinion, D.C. Circuit Rule 36.)

If, on the other hand, the Federal
Circuit decided the case on some other
basis, e.g. that despite the statutory
provision permitting an independent
private cause of action, it will not
permit such where DOE has determined not
to complete a public enforcement action,
it has violated the rule of law.

In either event, the Court has
avoided the discipline which stems from
the precedential effect of a decision.

The rules of the various Circuits

22

vary widely as to the standards for
publication. Thus, for example, the First
Circuit explicitly provides a preference
for publication, Rule 36, while other
Circuits do not, and the D.C. Circuit
rules suggest that there be opinions
written and published in cases of first
impression, Rule 36, while others do not.

Moreover, a recent study comparing
the percentage of decisions published in
the Eighth and Tenth Circuits during the
first six months of the year 2000 shows a
44% publication rate in the Eighth Circuit
and a 21% publication rate in the Tenth
Circuit. The study suggests clearly
different criteria for publication in the
two Circuits studied. ("'Unpublished'
Opinions as the Bulk of the Iceberg..."
Law Library Journal, Vol. 93:4 p. 589 et
seq.)

With regard to the citation of
unpublished decisions, at least five of
the Circuits permit the citation of
unpublished decisions, (1) for their
"persuasive" effect (Fifth Circuit Rule
47.5.4 and Tenth Circuit Rule 36.3), (ii)
because a party believes the unpublished
decision has "precedential value" (Sixth
Circuit, Rule 28 (g), and Fourth Circuit
Rule 36 (c)), and (ii) in the case of the
District of Columbia Circuit, after
January 1, 2002, unpublished decisions

23

"may be cited as precedent" (Rule 28).

In contrast, the Federal Circuit has
adopted the more restrictive rule,
precluding citation of any opinion or
order designated not to be cited as
precedent. (Federal Circuit Rule 47.6.)

It would seem self-evident that a
rule which precludes citation is less
likely to insure judicial self-discipline
than rules which provide that dispositions
can be cited as either precedential or
persuasive.

Even if non-publication is justified,
it is hard to see any justification for
precluding the citing of such decisions,
particularly in the current era when
"unpublished" opinions are in fact widely
and generally available.

In essence, the "non-citation" rule
of the Federal Circuit has converted an
appeal process into a certiorari process,
with the Court not bound by its own
determinations. Such significantly
impinges on the right to appeal which
Congress clearly recognized in providing
for appeal to the Federal Circuit as a
matter of right, ESA Section 211.

III THE EMASCULATION OF THE PRIVATE CAUSE

\\

CIRCUIT AND TECA'S REPEATED ASSURANCE OF
THE AVAILABILITY OF A PRIVATE CAUSE OF
ACTION _

Although the issue of the extent of
the availability of ESA Section 210 to
recover crude oil overcharges is, as above
noted, a matter of first impression, two
lines of decisions provide compelling
reasons for the reversal of the District
Court determination that those injured by
crude oil overcharges through the
mechanism of the Entitlements Program are
without the standing to bring a private
cause of action under Section 210.

A. TECA, the Federal Circuit's

In Gulf Oil] Corp. v. Dyke, supra, 734
F. 2d at 809, TECA articulated the

principle that the passing oon of
overcharges is properly recognized where
it occurred pursuant to a "pre-existing
functional equivalent of a cost-plus
contract" (i) pursuant to which the
immediate purchaser from the overcharger
"would necessarily pass through any
overcharge received", and (ii) by virtue

25

of which "the effect of the overcharge
to...(the remote purchaser) must be
capable of determination in advance,"
quoting its prior decision in Eastern
Airlines v. Atlantic Richfield Co,, 609 F.
2d 497, 498 (TECA 1979). 734 F. 2d at 809.

Plaintiffs here have alleged in their
Complaint the facts that establish that
the DOE's Entitlement Program was the
"functional equivalent of a cost-plus
contract", and that the "effect of the
overcharge...(on plaintiffs was) capable
of determination in advance," thus meeting
the requirement as set forth in Gulf Oil
Corp. v. Dyke. for an "indirect purchaser"
to recover overcharges by a remote
producer.

B. The Federal Circuit (and TECA

In Consolidated Edison Co, of New
York v. O'Leary, 131 F. 3d 1475 (Fed. Cir.
1997), the Federal* Circuit denied an
appeal by essentially the same Utilities
and Manufacturers from the dismissal by
OHA of an ESA Section 209 public
enforcement action initiated by the

26

Secretary of Energy's enforcement arm
against Chevron for the same alleged oil
overcharges which are the subject of the
instant action. In doing so, the Court
relied extensively on the availability of
the alternative remedy provided by ESA
Section 210 pursuant to which the
Utilities and Manufacturers could seek the
Same recoveries directly in a private
cause of action. To the same effect, see
; Lid i Edi : FN Yor]

O'Leary, 117 F. 3d 538, 544 (Fed. Cir.
1997) ("If plaintiffs have been injured by
(crude oil) overcharges, Congress created
a generous private remedy for private

litigants in Section 210"); Getty Oil Co.
v. Department of Energy, 865 F. 2d 270,
275 (TECA 1988) ("Since private would-be

intervenors (in a Section 209 proceeding
involving crude oil overcharges) are
afforded a statutory remedy under Section
210 to recover over-charges, they may not
intervene in DOE's enforcement...").

IV DECISIONS OF THIS COURT REOUTRE THE
UTILIZATION OF THE LIMITATION PERIOD
SPECIFIED FOR ESA SECTION 209 ACTIONS FOR
PRIVATE ACTIONS PURSUANT TO ESA SECTION
210 TO RECOVER CRUDE OTL OVERCHARGES

As this Court has noted, although the
state-borrowing doctrine may not be

27

lightly abandoned, the borrowing of a
federal statute of limitations may be
appropriate "when a rule from elsewhere in
federal law provides a closer analogy then
available state statutes, and when the
federal policies at stake and_ the
practicalities of litigation make that
rule a significantly more appropriate
vehicle for interstitial lawmaking". Reed
v. United Transportation Union, 488 U.S.
319, 324, 102 L. Ed. 2d 665, 109 S. Ct.
621 (1989), quoting DelCostello v.
Teamsters, 462 U.S. 151, 172, 76 L.Ed. 2d
476, 103 S.Ct. 2281 (1983).

In Lampf£ v. Gilbertson, 501 U.S. 350,
aee°S, 24335 &. BG. 26 Bad, 2131 8.Ce. 2773
(1991), this Court suggested "a

hierarchial inquiry for ascertaining the
appropriate limitations period for a
federal cause of action where Congress has
not set the time within which such an
action must be brought."

All three of the determinations
outlined by the Court in lLampf here
Support the selection of the federal six
year limitation period:

(i) because of the part contract,
part penalty nature of the cause of
action, reference “to state limitation
periods results in uncertainty as to the
applicable limitation period, with some
courts selecting a contract limitation

28

period, some a penalty limitation period,
and some a "catch-all" limitation period,

F. Supp. at 1138; the result is
inconsistency and lack of predictability;

(ii) "the geographic nature of the
claim" i.e. that in a crude oil overcharge
situation, because of the Entitlements
Program, the injury to consumers occurred
in all of the States; the result of
reference to State limitation periods
"would present the danger of forum
shopping" as well as the complexity of a
State determining whether it should look
to a State of violation and if so, to what

other State (See also Agency Holding Corp.
v. Malley-Duff & Associates Inc,, 483 U.S.
143, 154 (1987));

and (iii) "an analogous federal
source truly affords a 'closer fit' with
the cause of action than does any
available state-law source." It is hard to
imagine a closer fit than the parallel
public enforcement action under’ ESA
Section 209.

In Lampf v. Gilbertson, 501 U.S. 350,
357 (1981), the Court rejected reference
to a state statute of limitations for
private causes of action brought pursuant
to Section 10b of the Securities Exchange
Act of 1934 and utilized the federal

29

limitations period provided for public
enforcement actions under that Act, a
situation remarkably close to the one
presented here.

The Court in Lampf v. Gilbertson
identifies the relevant factors in
determining whether the federal source
affords a "closer fit" as "commonality of
purpose and similarity of elements" (501
U.S. at 358). The purpose of Section 209
in the post-regulatory period is the same
as of Section 210, i.e. the recovery of
overcharges and their restitution to those
injured, and the elements of the damage
claim are precisely the same. A "closer
fit" could hardly be imagined.

CONCLUSION

For the reasons above stated, a writ
of certiorari should be granted.

spe ully submitted,

E Kabhne,

Philip P. Kalodner
208 Righters Mill Rd.
Gladwyne PA 19035
(610) 649-8749

Attorney for Petitioners

30

NOTE: Pursuant to Fed. Cir. R. 47.6, this disposition is not
citable as precedent. It is a public record. This disposition
will appear in tables published periodically.

United States Court of Appeals
For the Federal Circuit
01-1565
CONSOLIDATED EDISON COMPANY OF NEW YORK,
INC., LONG ISLAND LIGHTING COMPANY, ORANGE
AND ROCKLAND UTILITIES, INC., SAN DIEGO GAS &
ELECTRIC COMPANY, INTERNATIONAL PAPER
COMPANY, CHAMPION INTERNATIONAL
CORPORATION, WESTVACO CORPORATION, and
WEYERHAUSER COMPANY,
Plaintiffs-Appellants,
V.
CHEVRON U:.S.A., INC.
Defendant-Appellee.

Judgment
ON APPEAL from the UNITED STATES DISTRICT
COURT FOR THE DISTRICT OF

COLUMBIA

InCASENO(S) _-98-CV-764

la

This CAUSE having been heard and considered, it is
ORDERED and ADJUDGED:
Per Curiam: (MAYER, Chief Judge, RADER and
DYK, Circuit Judges):

AFFIRMED. See Fed. Cir. R. 36.

ENTERED BY ORDER OF THE COURT

DATED: April 5, 2002

Jan Horbaly, Clerk

United States Court of Appeals
For the Federal Circuit

ORDER
A combined petition for panel rehearing and for
rehearing en banc having been filed by the APPELLANTS,
and the petition for rehearing having been referred to the
panel that heard the appeal, and thereafter the petition for
rehearing en banc having been referred to the circuit judges

who are in regular active service,
UPON CONSIDERATION THEREOF, it is

ORDERED that the petition for panel rehearing be,
and the same hereby is, DENIED and it is further

ORDERED that the petition for rehearing en banc be,
and the same hereby is, DENIED.

The mandate of the court will issue on May 20, 2002.
FOR THE COURT

Jan Horbaly
Clerk

Dated: May 13, 2002 Filed: May, 13, 2002

3a

cc: Philip P. Kalodner
Robert M. Westberg

CONSOLIDATED EDISON V CHEVRON, 01-1565
(DCT — 98-CV-764)

i Note: Pursuant to Fed. Cir. R. 47.6, this order is not
' citable as precedent. It is a public record.

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

CONSOLIDATED EDISON
COMPANY OF
NEW YORK, INC., ET AL.,

Plaintiffs,

Vv.
No.

ee a a a a

Civil Action

98-0764 (RWR)
CHEVRON U.S.A., INC.,

Defendant.

Nee ee ie ee”

MEMORANDUM OPINION

Plaintiffs sued Chevron U.S.A., Inc. (“Chevron”)
under section 210 of the Economic Stabilization Act
(ESA”),' for damages based on Chevron’s alleged

a

' Economic Stabilization Act Amendments of 1971, Pub. L.
92-210, 85 Stat. 743 (codified at 12 U.S.C. § 1904 note
(continued)

overcharges for crude oil. Chevron has moved to dismiss

plaintiffs’ complaint, asserting that plaintiffs lack standing,
that their claim is barred by the applicable statute of
limitations, and the plaintiffs’ allegations fail to state a claim
for relief under section 210. Because plaintiffs lack standing
and, alternatively, because plaintiffs’ claim is barred by the
applicable statute of limitations, the complaint will be
dismissed.”

(1976)), as incorporated in the Emergency Petroleum
Allocation Act of 1973 (“EPAA”), Pub. L. 93-159, 87 Stat.
627 (codified at 14 U.S.C. §§ 751-760h (1982)). Section 210
of the ESA provides a private right of action to any “person
suffering legal wrong because of any act or practice arising
out of the [ESA or EPAA] or any order or regulation issued
pursuant thereto.” See Consolidated Edison v. O’Leary, 131
F. 3d 1475, 1478 (D.C. Cir. 1997).

* Having concluded that plaintiffs do not have standing to
bring this section 210 claim against Chevron and,
alternatively, that the section 210 claim is time-barred, the
Court need not address the Rule 12 (b) (6) motion to dismiss
for failure to state a claim for relief under section 210.

BACKGROUND

The Economic Regulatory Administration (“ERA”),
an office in the Department of Energy (“DOE”), was
responsible for enforcing the mandatory price and allocation
regulations issued by the DOE under the EPAA and the ESA.
The ERA would investigate alleged EPAA violations and
issue proposed remedial orders (“PROS”) to firms or
individuals believed to have engaged in those violations. If
the recipient of a PRO contested the allegation of a violation,
it could obtain an evidentiary hearing before the Office of
Hearings and Appeals (“OHA”), the office with the authority
to evaluate PROs and determine whether the remedial order
should be issued.

In March 1992, the ERA issued a PRO to Chevron.
The PRO, which was published in the Federal Register in
May 1992, alleged that during the period of petroleum price
controls ending in 1981, Chevron had received excess
revenue from the DOE’s Tertiary Incentive Program (“TIP”)
and that Chevron should be required to disgorge the excess
revenue.2 Chevron contested the PRO and, after briefing and

3 Under the TIP, “oil producers were eligible for financial
benefits if they engaged in tertiary recovery projects, L.e.,
projects using methods such as thermal, chemical, or
miscible gas processes to recover crude oil that could not be
(continued)

Ta

an evidentiary hearing, the OHA concluded that the PRO
issued to Chevron could not be sustained and that no
remedial order should be issued to Chevron.*

The same companies who are plaintiffs in this case,
with the sole exception of Westvaco Corporation
(“Westvaco”), challenged the OHA’s decision by filing a
lawsuit in this district court seeking to compel DOE to issue
a remedial order. See Consolidated Edison Company of New
York, et al.. v. O’Leary, Civil Action No. 96-1149 (TPJ).
United States District Judge Thomas Penfield Jackson held
that plaintiffs as private parties lacked standing to challenge
the results of public enforcement proceedings, and he
dismissed that lawsuit. See Memorandum and Order entered
January 13, 1997, Exh. 1 to Chevron’s Reply (“Jackson
Opinion”). Judge Jackson’s decision was affirmed by the
United States Court of Appeals for the District of Columbia
Circuit. See Consolidated Edison v. O’Leary, 131 F. 3d 1475
(D.C. Cir. 1997). Plaintiffs, now joined by Westvaco, then

recovery techniques.” See Consolidated Edison, 131 F. 3d at
1477.

* The OHA’s decision is not binding in this proceeding.
“[{A]n enforcment proceeding under section 209 is neither a
prerequisite nor a bar to a private action under section 210.”
See Consolidated Edison, 131 F. 3d at 1478.

8a

(D.C. Cir. 1997). Plaintiffs, now joined by Westvaco, then
filed this lawsuit under section 210, and defendant moved to
dismiss.

DISCUSSION

1. STANDING

Defendant argues that plaintiffs do not have standing
to sue under section 210 because plaintiffs were not direct
purchasers of Chevron’s crude oil. “Section 210 (b) of the
ESA authorizes suits for overcharges ‘ . . . against any person
renting or selling goods or services who is found to have
overcharged the plaintiff.” Gulf Oil Corp. v. Dyke, 734
F.2d 797, 807 (Temp. Emer. Ct. App. 1984). An indirect
purchaser has no standing to sue under section 210. Id.; see
also Stertz v. Gulf Oil Corp., 685 F.2d, 1367, 1369 n.3
(Temp. Emer. Ct. App. 1981); Bond v. Texaco, Inc., 647 F.
Supp. 1135, 1137 (D.D.C. 1986).

Plaintiffs in this case were indirect purchasers.

Indeed, plaintiffs admitted as much in their prior lawsuit
before Judge Jackson. See Jackson Opinion, at 3 n.2
(“Plaintiffs contend that, as indirect purchasers of Chevron’s
products, they have no right of action under ESA § 210”).
Although it is undisputed that plaintiffs purchased refined
product from domestic refiners, plaintiffs now argue that they

9a

Chevron because “every refiner [is] an agent of the

overcharging producer.” See Plaintiff's Response, at 40.
Plaintiffs cite no factual basis or legal authority for their
current position, which is clearly inconsistent with the
position they took before Judge Jackson. Plaintiffs’
argument that they should be deemed direct purchasers with
standing under section 210 is without merit.

Plaintiffs also argue that they should be allowed to
sue Chevron under section 210 even if they were indirect
purchasers. Plaintiffs assert that none of the reported cases
holding that only direct purchasers have standing under
section 210 involved purchasers or crude oil. Plaintiffs cite
no case law which holds that indirect purchasers of crude oil
have standing under section 210. Indeed, the Temporary
Emergency Court of Appeals note in a case involving crude
oil purchases that only direct purchasers have standing to sue
under section 210. See Stertz v. Gulf Oil Corp., 783, F.2d
1064, 1066 n.2 (Temp. Emer. Ct. App. 1986).

The law is well-established that, as _ indirect
purchasers, plaintiffs lack standing to sue Chevron under
section 210. Plaintiffs’ arguments to the contrary are
unsupported by lega! precedent and are unpersuasive.

Il. STATUE OF LIMITATIONS

“Because the ESA [and] EPAA . . . do not contain
specific statutes of limitation, [the court] must apply the most

10a

closely analogous state of statute of limitations to causes of
action arising under the Acts.” Gulf Oil Corp. v. Dyke, 734

F.2d at 807 (citing Ashland Oil Co. of California v. Union
Oil Co. of California, 567 F.2d 984 (Temp. Emer. Ct. App.
1977)). The statute of limitations for section 210 lawsuits in
the District of Columbia is, at most, three years. See Bond,
647 F. Supp. At 1138 (§ 210 actions most analogous to
actions for a statutory penalty or forfeiture, actions on a

simple express or implied contract, or actions for which a
limitation is not otherwise specially prescribed).
Notwithstanding clear legal authority that the most
analogous state statue of limitations governs section 210
cases, plaintiffs argue that the six-year statute of limitations
for suits by the DOE under the Petroleum Overcharge
Distribution and Restitution Act (“PODRA”), 15 U.S.C. §
4501 et seq., should apply. Plaintiffs present no case law or
other legal authority to support their argument that the
PODRA statute of limitations should apply to a section 210
lawsuit. Instead, plaintiffs argue that no court has decided
whether the six-year statue of limitations from PODRA
should apply. See Plaintiffs’ Response, at 44. Although it
may be accurate that no court has specifically addressed
whether PODRA’s statute of limitations should apply to a
section 210 action, federal courts have continued to apply the
most analogous state statute of limitations since PODRA was
enacted in October 1986. See Ashland Oil Co. v. Cotton
Petroleum Corp., 808 F.2d 62, 63 (Temp. Emer. Ct. App.

lla

1986) (decided in December 1986); Stertz v. Gulf Oil Corp.,

1988 WL 83188, *2 (E.D.N.Y. 1988).

Additionally, “one of the goals of the national energy
policy [is] ‘to wind up regulation of the oil industry ....
Kellermyer v. Blue Flame Gas Corp., 797 F.2d 983, 985
(Temp. Emer. Ct. App. 1986) (quoting Johnson Oil Co. v.
Dept. of Energy, 690 F.2d 191, 196 (Temp. Emer. Ct. App.
1982)). Based on the national energy policy, the court in
Kellermyer held that a longer statue of limitations “would be
much more likely to frustrate the clearly expressed goals of
the federal statute than would the more restrictive [statue of
limitations].” Kellermyer, 797 F.2d at 986.

Plaintiffs also argue that, even if the three-year statute

999

of limitations applies, they were not aware of the precise
breakdown between principal and interest of Chevron’s
Windfall Profits Tax recoveries until less than three years
before they filed this lawsuit. Plaintiffs concede that the
PRO included sufficient information regarding the amounts
of prepaid expenses and severance tax refunds claimed by
plaintiffs in this case as overcharges. The PRO also
informed plaintiffs that the ERA proposed over $94 million
as an increase in tertiary incentive revenue, a decrease of
over $51 million in recoverable allowed expense, and a
proposed restitutionary penalty of $125 million.

Plaintiffs received additional information when the
OHA published an interlocutory order in August 1993 which
detailed an $84 million windfall profit tax credit taken by

12a

Chevron in 1983084. The interlocutory order was published
to the public and was not subject to confidentiality or other
restrictions.

“The District of Columbia recognizes the so-called
‘discovery’ rule as to the inception of the limitations period,
i.e., the cause of action accrues for limitations purposes not
when the injury first occurred, but when the plaintiff
discovered, or by the exercise of due diligence should have
discovered, the facts giving rise to a claim.” Bond, 647 F.
Supp. at 1139 (citing Kelton v. District of Columbia, 413
A.2d 919, 921 (D.C. 1980); Dawson v. Eli Lilly & Co., 543
F. Supp. 1330, 1333 (D.D.C. 1982)). As was the case in
Bond, plaintiffs in this case had sufficient knowledge of the

facts giving rise to their section 210 claim by no later than
the publication of the August 1993 interlocutory order.
Because plaintiffs did not file this lawsuit until more than
three years later, their claim is time-barred and must be
dismissed.”

> Plaintiffs argue that they could not have filed their lawsuit
until they knew the allocation of principal and interest for
each element of their overcharge claim because a plaintiff is
required to plead a “sum certain” for the alleged overcharge,
citing Dempsey v. Rhodes Oil Co., 620 F.2d 274 (Temp.
Emer. Ct. App. 1980). Plaintiffs’ reliance on Dempsey is
misplaced. In Dempsey, the court specifically excepted from
(continued)

13a

CONCLUSION

Plaintiffs are indirect purchasers of Chevron’s
products and, as a result, do not have standing under section
210. Even if plaintiffs had standing under section 210, their
claim would be barred by the three-year statute of limitations.
Defendant’s motion to dismiss will be granted by the
accompanying final order.

SIGNED this 5" day of July, 2001.

RICHARD W. ROBERTS
United States District Judge

the “sum certain” rule the situation in which “the seller has
information necessary to a determination of the total
overcharge, and this information is not available to the
buyer.” Id. At 277. To the extent that plaintiffs allege they
were unable to obtain certain information regarding elements
of the total overcharge, plaintiffs would benefit from the
Dempesy exception to the “sum certain” rule and, therefore,
would have been able to file their section 210 claim based on
the information they had in August 1993.

6 |

14a

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

CONSOLIDATED EDISON )
COMPANY OF )
NEW YORK, INC., ET AL., )
)
Plaintiffs, )
)
v. ) Civil Action No.
) 98-0764 (RWR)
CHEVRON U.S.A., INC., )
)
Defendant. )
)
FINAL ORDER

In accordance with the accompanying Memorandum
Opinion, it is hereby
ORDERD that defendant Chevron U.S.A., Inc.’s Motion to
Dismiss [6] be, and hereby is, GRANTED.
This is a final appealable order

SIGNED this 5" day of July, 2001.

RICHARD W. ROBERTS
United States District Judge

15a

ECONOMIC STABILIZATION ACT AMENDMENTS
OF 197]

“Sec. 209. Injunctions and other relief

“Whenever it appears to any person authorized by the
President to exercise authority under this title that any
individual or organization has engaged, is engaged, or is
about to engage in any acts or practices constituting a
violation of any order or regulation under this title, such
person may request the Attorney General to bring an action
in the appropriate district court of the United States to enjoin
such acts or practices, and upon a proper showing a
temporary restraining order or a preliminary or permanent
injunction shall be granted without bond. Any such court
may also issue mandatory injunctions commanding any
person to comply with any such order or regulation. In
addition to such injunctive relief, the court may also order
restitution of moneys received in violation of any such order
or regulation.
“Sec. 210. Suits for damages or other relief

“(a) Any person suffering legal wrong because of
any act or practice arising out of this title, or any order or
regulation issued pursuant thereto, may bring an action in a
district court of the United States, without regard to the
amount in controversy, for appropriate relief, including an
action for a declaratory judgment, writ of injunction (subject
to the limitations in section 211), and/or damages.

l6a

“(b) In any action brought under subsection (a)
against any person renting property or selling goods or
services who is found to have overcharged the plaintiff, the
court may, in its discretion, award the plaintiff reasonable
attorney’s fees and costs, plus whichever of the following
sums is greater:

“(1) an amount not more than three times the
amount of the overcharge upon which the action is
based, or

“(2) not less than $100 or more than $1,000;

except that in any case where the defendant establishes that
the overcharge was not intentional and resulted from a bona
fide error notwithstanding the maintenance of procedures
reasonably adapted to the avoidance of such error the liability
of the defendant shall be limited to the amount of the
overcharge: Provided, That where the overcharge is not
willful within the meaning of section 208(a) of this title, no
action for an overcharge may be brought by or on behalf of
any person unless such person has first presented to the seller
or renter a bona fide claim for refund or the overcharge and
has not received repayment of such overcharge within ninety
days from the date of the presentation of such claim.

(c) For the purposes of this section, the term
“overcharge’ means the amount by which the consideration
for the rental of property or the sale of goods or services
exceeds the applicable ceiling under regulations or orders
issued under this title.

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“Sec. 211. Judicial review

“(a) The district courts or the United States shall
have exclusive original jurisdiction of cases or controversies
arising under this title, or under regulations or orders issued
thereunder, notwithstanding the amount in controversy;
except that nothing in this subsection (h) of this section
affects the power of any court of competent jurisdiction to
consider, hear, and determine any issue by way of defense
(other than a defense based on the constitutionality of this
title or the validity of action taken by any agency under this
title) raised in any proceeding before such court. If in any
such proceeding an issue by way of defense is raised based
on the constitutionality of this title or the validity of agency
action under this title, the case shall be subject to removal by
either party to a district court of the United States in
accordance with the applicable provisions of chapter 89 of
title 28, United States Code.

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EMERGENCY PETROLEUM ALLOCATION
ACT OF 1973

Sec. 5(a) (1) Except as provided in paragraph (2), (A)
sections 205 through 207 and sections 209 through 211 of the
Economic Stabilization Act of 1970 (as in effect on
November 27, 1973) shall apply to the regulation
promulgated under section 753(a) of this title, to any order
under this chapter, and to any action taken by the President
(or his delegate) under this chapter, as if such regulation had
been promulgated , such order had been issued, or such
action had been taken under the Economic Stabilization Act
of 1970; and (B) section 212 (other than 212(b)) and 213 of
such Act shall apply to functions under this chapter to the
same extent such sections apply to functions under the
Economic Stabilization Act of 1970.

19a

PETROLEUM OVERCHARGE DISTRIBUTION AND
RESTITUTION ACT OF 1986

§ 4504. Statute of limitation
(a) In general

(1) Except as provided in subsection (b) of this section,
the commencement of a civil enforcement action shall be
barred unless such action is commenced before the later of —

(A) September 30, 1988; or

(B) six years after the date of the violation upon
which the action is based.

(2) For purposes. of paragraph (1), the term
“commencement of a civil enforcement action” means—

(A) the signing and issuance of a proposed remedial
order against any person for filing with the Office of
Hearings and Appeals of the Department of Energy; or

(B) the filing of a complaint with the appropriate

district court of the United States.

(3) For purposes of this section, the term “civil
enforcement action” means an administrative or judicial civil
action by the Secretary under the Emergency Petroleum
Allocation Act of 1973 [15 U.S.C.A. § 751 et seq.] or the
Economic Stabilization Act of 1970 (or the regulations issued
thereunder) for the enforcement of any violation of such Acts
or regulations.

(b) Exceptions

(1) In computing ‘the periods established in

subparagraphs (A) and (B) of subsection (a)(1) of this
section, there shall be excluded any period—

(A) during which any person who is or may become
the subject of a civil enforcement action is outside the
United States, has absconded or concealed himself, or is
not subject to legal process;

(B) during which facts material to the establishment
and maintenance of a civil enforcement action could not
be known;

(C)occurring before full compliance with any
subpoena or special report order issued to any person
under section 772 of this title, and such additional period
(not to exceed 12 calendar months) after such compliance
for the Secretary to consider the results thereof and
commence a civil enforcement action;

(D)during the pendency of any relevant criminal
action under the Acts or regulations described in
subsection (a)(1) of this section during which a civil
enforcement action is held in abeyance as a result of
prosecutorial discretion and with or without a stay, and
such additional period (not to exceed 12 calendar months)
after a final judicial order or dismissal of such criminal
action to commence a civil enforcement action;

(E) before the issuance of an order that constitutes
final agency action on a request for adjustment from any

2la

rule, regulation, or order under section 7194 of Title 42,
and such additional period (not to exceed 12 calendar
months) to commence a civil enforcement action; or

(F) of extension, to which the Secretary and the
defendant have consent in writing, before the expiration
of the time periods prescribed in subsection (a)(1) of this
section.

(2) The provisions of subsection (a) of this section shall
not affect or apply to any civil enforcement action
commenced before, on, or after October 21, 1986, and
remanded by the Office of Hearings and Appeals, the Federal
Energy Commission, or the court for further action of any
kind.

(3) The provisions of subsection (a) of this section shall
not apply to any agency orders issued under the Acts or
regulations described in subsection (a)(1) of this section or to
regulations issued under this chapter, other than a proposed
remedial order subject to this section.

(c) Expression of intent
(1) It is the intent of the Congress that—

(A)the Secretary and the Administrator of the
Economic Regulatory Administration shall, to the
greatest extent possible and within the time frames
specified on September 12, 1986, by such Administrator
to the Committee on Energy and Commerce of the House
of Representatives, commence civil enforcement actions

22a

with respect to all cases known by such Administrator as
of October 21, 1986, and designated by such
Administrator as “prelitigation cases,” unless such an

action is found not to be warranted;

(B) the Secretary and such Administrator not delay
civil enforcement actions so as to cause the limitation in
subsection (a)(1) of this section to apply to any such case;

(C)any negotiations for the purpose of settlement of
alleged violations not delay the commencement of a civil
enforcement action; and

(D)the Department of Justice cooperate in ensuring
that activities necessary, including the enforcement of
subpoenas, to commence civil enforcement actions are
carried out in a timely manner.

(2) Any failure to comply with the time frames described
in paragraph (1)(A) shall not be considered for any purpose
in any administrative or judicial proceeding subsequently
commenced.

(d) End of investigations and audits

Notwithstanding any other provisions of law, the
Secretary shall not initiate, after January 1, 1987, any audit or
investigation of alleged civil violations of the Acts or
regulations described in subsection (a)(1) of this section for
the purpose of commencement of any civil enforcement
action. Nothing in this subsection shall affect or apply to any
audit or investigation conducted with respect to any civil
enforcement action commenced (within the limitation

23a

established by subsection (a)(1) of this section) before, on, or
after October 21, 1986. Nothing in this subsection shall limit
the authority of the Secretary to continue any audit or
investigation initiated before January 1, 1987.

24a

FEDERAL COURTS ADMINISTRATION ACT
OF 1992

Sec. 102. Abolition of Temporary Emergency Court of
Appeals

(a) APPEALS UNDER ECONOMIC STABILIZATION
ACT—Section 211 of the Economic Stabilization Act of
1970 (Public Law 91-379; 84 Stat. 799) is amended by
striking subsections (b) through (h) and inserting the
following:

“(b) Appeals from orders or judgments entered by a
district court of the United States in cases and controversies
arising under this title shall be brought in the United States
Court of Appeals for the Federal Circuit if the appeal is from
a final decision of the district court or is an interlocutory
appeal permitted under section 1292 (c) of title 28, United
States Code.”

(b) JUDICIAL REVIEW OF EMERGENCY ORDERS
UNDER THE NATURAL GAS POLICY ACT—Section 506
(c) of the natural Gas Policy Act of 1978 (15 U.S.C. 3416 (c))
is amended—

(1) in the first sentence, by striking “the
Temporary Emergency Court of Appeals, established
pursuant to section 211(b) of the Economic Stabilization
Act of 1970,.as amended,” and inserting “the United
States Court of Appeals for the Federal Circuit”; and

25a

(2) by striking “Temporary Emergency Court of
Appeals” each place it appears and inserting “United
States Court of Appeals for the Federal Circuit.”

(c) CONFORMING AMENDMENTS—Section 1295 (a)
of title 28, United States Code, is amended—

(1) by striking “and” at the end of paragraph (9);

(2) by striking the period at the end of paragraph
(10) and inserting a semicolon; and

(3) by adding at the end of the following new
paragraphs:

“(11) of an appeal under section 211 of the

Economic Stabilization Act or 1970;

“(12) of an appeal under section 5 of the

Emergency Petroleum Allocation Act of 1973:

“(13) of an appeal under section 506 (c) of the

Natural Gas Policy Act of 1978; and

“(14) of an appeal under section 523 of the

Energy Policy and Conservation Act.”

(d) ABOLITION OF COURT—The Temporary
Emergency Court of Appeals created by section 21 1(b) of the
Economic Stabilization Act of 1970 is abolished, effective 6
months after the date of the enactment of this Act.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386015_0224%3A1. Public record. Not legal advice.