Consolidated Edison Co. of New York, Inc. v. Abraham

314 F.3d 1299, 2002 WL 31841025
CourtCourt of Appeals for the Federal Circuit
DecidedDecember 20, 2002
DocketNo. 02-1134
StatusPublished
Cited by1 cases

This text of 314 F.3d 1299 (Consolidated Edison Co. of New York, Inc. v. Abraham) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Consolidated Edison Co. of New York, Inc. v. Abraham, 314 F.3d 1299, 2002 WL 31841025 (Fed. Cir. 2002).

Opinion

PER CURIAM.

On summary judgment, the . United States District Court for the District of Columbia held that the Department of Energy’s (DOE) Office of Hearings and Appeals (OHA) lawfully applied its 1992 eligibility rule for crude oil overcharge refunds. Consolidated Edison Company of New York, Inc. and eight other claimants for crude oil overcharge refunds (collectively, Con Edison) challenge the district court’s award to the Huntsman Corporation. Because the trial court correctly applied the rules for overcharge refunds, this court affirms.

I.

Huntsman, formerly El Paso Products Company, filed a claim for a crude ’ oil overcharge refund on March 25, 1988, pursuant to the Petroleum Overcharge Distribution and Restitution Act of 1986 (PO-DRA). Pub.L. No; 99-509, 100 Stat. 1881 (codified at 15 U.S.C. §§ 4501-07 (1994)). PODRA authorized DOE to collect overcharges for violation of crude oil price controls in force during the 1970s and to distribute the collected overcharges to injured parties. See Economic Stabilization Act of 1970(ESA), Pub.L. No. 91-379, 84 Stat. 799 (1970), as amended, Pub.L. No. 92-210, 85 Stat. 743 (1971) (codified at note following 12 U.S.C. § 1904 (1976)) (expired Apr. 30, 1974); Emergency Petroleum Allocation Act of 1973 (EPAA), Pub.L. No. 93-159, 87 Stat. 627 (1973) (codified at. 15 U.S.C. §§ 751-760 (1976)), -repealed by Energy Policy and Conservation Act of 1975, Pub.L. No. 94-163 § 401(b)(1), 89 Stat. 871, 946 (1975) (codified at 15 U.S.C. § 753 (1976)).

To. implement distribution to claimants, DOE promulgated an eligibility rule that was later revised in 1992. The 1992 eligibility rule states;

[DOE] will presume that a claimant incurred a crude oil overcharge in the purchase of a product during the relevant period if either that product was named as a covered product in regulations promulgated pursuant to the EPAA or (a) was purchased from a crude oil refinery or (b) originated in a crude oil refinery and was purchased from a reseller who did not substantially change its form.

Goodyear Tire & Rubber Co. v. Dep’t of Energy, 118 F.3d 1531, 1534 (Fed.Cir.1997) (quoting Notice of General Interest, 57 Fed.Reg. 30,731 (July 10, 1992)). Essentially, the 1992 eligibility rule presumed injury to end-users that purchased petrole[1302]*1302um products covered by the EPAA, but required proof of injury for claimants that purchased petroleum products not covered by the EPAA.

Huntsman based its claim on purchases of gasoline, diesel fuel, motor oil, aviation fuel, propane, butane, and benzene during the price control period. A group of states challenged Huntsman’s claim by filing an objection with OHA. Although each of the products for which Huntsman claimed a refund was covered by the EPAA, the states alleged that Huntsman was not entitled to the end-user presumption afforded by the 1992 eligibility. OHA determined that the stat.es’ allegations were “without substantiation” and, on June 22, 2000, DOE awarded Huntsman an overcharge refund of about $3.6 million.

Con Edison then challenged Huntsman’s award as unjustified in this district court action. Because DOE pays awards from the same pool of funds, Con Edison alleged that the unjustified award to Huntsman reduced Con Edison’s pro rata share of the pool. The district court granted summary judgment in favor of DOE, holding that DOE acted within the legal limits of its agency discretion in awarding Huntsman’s claim. Consol. Edison Co. of N.Y., Inc. v. Abraham, 167 F.Supp.2d 258, 265 (D.D.C.2001). Con Edison appeals. This court has jurisdiction pursuant to 28 U.S.C. § 1295(a)(ll), (12) (2000).

II.

This court reviews the district court’s grant of summary judgment without deference. Johns Hopkins Univ. v. Cellpro, Inc., 152 F.3d 1342, 1353 (Fed.Cir.1998). Review of the underlying agency decision, however, requires more deference. This court

“set[s] aside an EPAA/ESA agency action only if it is in excess of the agency’s authority, or is based upon findings that are not supported by substantial evidence. We recognize DOE’s administrative expertise, accord the agency’s determination great deference, and must approve the DOE decision if there is a rational basis for it.”

Goodyear, 118 F.3d at 1536 (citing Phoenix Petroleum Co. v. United States Fed. Energy Reg. Comm’n, 95 F.3d 1555, 1567 (Fed.Cir.1996)).

Con Edison argues that OHA did not investigate the source of three products for which Huntsman claimed refunds. Because propane, butane, and benzene can be produced from sources other than crude oil, Con Edison argues that OHA should have investigated the source of Huntsman’s propane, butane, and benzene before awarding the claim. The district court correctly determined that “OHA never required that all eligible products have crude oil as their source” and concluded that overcharge refunds were appropriate for “all products covered by the EPAA regardless of whether they were purchased from or originated in a crude oil-refinery.” Consol. Edison, 167 F.Supp.2d at 263.

As the district court correctly recognized, the 1992 eligibility rule requires investigation of the source of a claimant’s products only when the products are not covered by the EPAA. Because all of Huntsman’s claimed products in fact were covered by the EPAA, the 1992 eligibility rule entitled Huntsman to a presumption of injury. Thus, OHA was not required to investigate the source of Huntsman’s propane, butane, and benzene.

Con Edison next argues that OHA failed to investigate whether Huntsman was a crude oil refiner or related to a crude oil refiner that would have already recovered overcharge refunds during settlement of In re Dep’t of Energy Stripper Well Exemption Litig., 653 F.Supp. 108, 113 (D.Kan.1986). Con Edison argues that Huntsman was a wholly owned subsidiary [1303]*1303of El Paso Natural Gas Company, a company that may have also included a crude oil refiner as a subsidiary. In addressing Con Edison’s allegation, the district court stated that “[t]his argument fails to recognize, however, that Huntsman is entitled to an end-user presumption because its products are covered by the EPAA.” The- district court further found that Con Edison “only offer[ed] speculative theories” and “failed to provide any evidence” of a possible affiliation between Huntsman and a crude oil refiner. Consol. Edison, 167 F.Supp.2d at 264. Because nothing in the record rebuts the presumption that Huntsman was an end-user rather than a refiner or an affiliate of a refiner, this court agrees with the district court’s conclusion.

Con Edison also argues that OHA did not verify that Huntsman was in fact an end-user rather than a reseller of the purchased propane, butane, and benzene.

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