IN RE: United Gas Pipe Line Company Litigation

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C , «id SUL A ASUEan Deus 4 tesiiaay @
for the relinquishment of their § 57h = motion would be denied where the de- i
: rights, it is equitable and fair to meas- fendants had not yet filed answers and =
ure, the Class 4 Creditors’ collateral the complaints established that the vari- Cf
in these Chapter X proceedings infac- - ous allegations of breach of contract gave a
. cordance with going concern value of rise to factual issues predominantly en 3%
Banker's, and Northern based upon a unique to each particular plaintiff's re- xcapitalization of future earnings. See, lationship with the pipeline corporation. =
: Reconstruction Finance Corp. ¥7 Denver Motion denied without prejudice. | [IY
| RNIN BUS M8 SIE rion nage ome mond
is m fo Dutch Woodora£t7Shops 14 Pr himself and took no part in either thet, s . . . -
| Supp. 467 (W.D,Mich.1935); Meinhard, consideration or the decision of the mat
| Greeff & Co. VAs, 189 F.2d 792 © EIR -
(4th Cir. 1951); L Finletier, The Law : :	of Bankruptcy Redrganization 581-82 ° EY
(1939); 87 Harv.LRev. 1786, 1793-95 Cowrtse=2yiz
(1974). Sincethe valies determined by . Motion by pipeline corporation and Co
the experts inthis case are predicated on Pa former parent corporation fo trans- .the capitalization of futdye earnings of - er five actions Tor breach of contract . ): . of I brought against them by industrial cus- .
gong concerns, they are ei 197, for tomers of the pipeline to either the ’	! purpoges of valuation underA§ 197. . . eo. .. : .	7. . 3 . Eastern or Western Districts of Louisi-
Ii'light of the foregoing, the motions 5, was denied where the pipeline and its
a {o”strike are denied. \ parent had not yet filed answers and theJ ‘ . complaints indicated that the various al-
so legations of breach of contract gave rise
CT to factual “issues predominantly -unique
r : "to each particular plaintiff's relation-
. : ©. ship to the pipeline. 28 U.S.C.A. § 1407.
! 4 CT tC ee	— - } : 3 ha
1 UNITED GAS PIPE LINE . SER ; A N Nn re 'E BE y CL &~
COMPANY LITIGATION. OPINION AND ORDER . : RNNo. 190. Before ALFRED P. MURRAH, Chair- Co J
. . - : \ / ~ ¥% LT
* Judicial Panel on Multidistrict Litigation. EDWond prea PowA n- }Feb. 26, 1975. ROBSON, WILLIAM H. BECKER, JO- : :
. ’ SEPH S. LORD, III**, and STANLEY Sa
Motion was filed by natural gas A. WEIGEL **, Judges of the Panel. LRTpipeline corporation and its former : . Se
parent corporation for transfer to either PER CURIAM. . - oo - Ey
the Eastern or Western Districts of. . This litigation presently consists of I TR
Louisiana of five actions by pipeline cor- five actions that have been commenced =. <0 Sool
: poration’s industrial customers for in three districts: two in the District of ’ PRLS
breach of contract. The Judicial Panel the District of Columbia; two in the’ a Co J:
on Multidistrict Litigation held that the Southern District of Mississippi; ! and CE
* Judge Wisdotn recused himself and took no 1. One of the Mississippi actions was filed oo Co
part in either the consideration or desision only eight days days before the Panel hear- EE
of this matter. : ing and, therefore, under the customary pro- ;
: , . ** Aithough Judges Lord and Weigel were "cedures of the Pauel, was filed too late to :
- unable to attend the Panel hearing, they be included in the hearing. {All parties to - )
C have, with the consent of all parties, partici-+ that action, however, agreed to be bound by .	pated in this decision, "+ this decision. ’ Co . ) .

3 Case MDL No. 190 Document 2 Filed 05/01/15 Page 20f3 eT
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® Ree £03, Civ ta esha Ceaay a EE HFDYEIRS vu :ol i. Cite	ns 301 F.Supp.	774 (1975) : ={ . one in the Western District of Louisi- program would be an absolute defense - : .
: ana,? The plaintiffs in these actions to all actions for damages. FPC : /
- are industrial customers of United Gas Opinion No. 606, 46 F.P.C. 786 (1971); : 8
Pipe Line Co., an interstate gas pipeline FPC Opinion No. 606-A, 46 F.P.C. 1290 oo Bl
- corporation that is regulated by the Fed- (1971). - . Lo ER g" eral Power Commission (FPC). Plain- - On appeal, the United States Court of _- 8: , tiffs charge defendant United with Appeals for the Fifth Circuit character- Cabreach of contrdet in connection with _ ized the FPC’s “absolute defense” theory .
‘ - United's curtailment of natural gas a5 mere dicta and held that the validity
| deliveries to them. = Pennzoil Co. of a defense based on an FPC approved
| we United's former parent corporation, is priority plan was a question for judicial, :| - also named as a defendant in some of- not administrative, determination. The. =~i the actions and is accused of directing court remanded the proceedings to the :
. and approving the allegedly illegal cur- FPC for further consideration. Inter- Ea. “tailment program. In addition, it is al-® national - Paper. Company v. Federal
leged that Pennzoil and United conspired power Commission, 476 F.2d 121 (5thto create a fuel shortage. : Cir. 19783). i
Defendants United and Pennzoil joint- The FPC, following remand, once : : y
ly move the Panel for an order transfer- ‘again made findings almost identical to: ~~. Ting these actions to either the Eastern hose jt had reached in its initial opin- | :
: © or Western Districts of Louisiana. All" fons in the matter. FPC Opinion No.
| plaintiffs oppose transfer. We find that 647, 49 F.P.C. 179 (1973); FPC Opin-ER : the record before us in this litigation is ion No. 647-A, 49 F.P.C. 1211 (1973).
| EE : insufficient to establish the common Another appeal was thereafter taken and -
: questions of fact required by 28 U.S.C." the Court of Appeals for the Fifth Cir- oC
: ~~ § 1407 and, accordingly, we deny the MO" cuit, inter alia, reiterated its earlier :
tion without prejudice to the right of holding in International Puper that the .
any party to move for transfer at a “liability insulation issue was not proper- =
sa later time if it feels future developments ly before theFPC in these proceedings. : |: So warrant. ) State of Louisiana v. Federal Power
1 Backgrouna Commission, 503 F.2d 844 (5th Cir. - ..
: - : i 1974). During the Panel hearing, Unit-
CT Since November of 1970, United has . ed informed the Panel that it intends to
| curtailed deliveries of natural gas to its goa) a rehearing of this latest ruling of| industrial customers in five Southern the Court of Appeals. - So
Ch ak vacrore	Oy Delendants hve chained tas ot at |
i pursuant to an “order of priorities” for actions in this litigation pending final, h TT| . fuel allocation, which was established by. Judicial review of the FPC proceedings. REA §tariffs and direct sale contracts with These stays have been in effect through- Lied	: So . out the course of the legal skirmishes EE
1ts purchasers. before the FPC and the Court of Ap- EEE
: Shortly after the initiation of the cur- peals. Thus, defendants have not filed ns Sh ith: . tailment program, United petitioned the answers in any of the actions. } 5 Ll : fdFPC for a declaratory order approving 3 : . . © RESthe program. The FPC gave its approval II. The Question of Transfer - oo a]- and, in addition, held that a pipeline’s Defendants contend that these actions Sp
: adherence to an FPC ordered curtailment involve many common questions of fact I's
i - - 2. Three related actions had been pending in 3. Sinee the Panel hearing, it appears that :
! the Ilastern District of Louisiana but, prior United did indeed file a petition for a re-
. to the Panel hearing, were remanded -to Lou- hearing before the Court of Appeals for the .
isiana state court pursuant to 28 USC. § Fifth Circuit and that that petition has been ‘
. 1447(c). . denied. State of Louisiana v. Federal Power - .
C : : } Commission, 505 F.2d1304 (5th Cir., 1974). :

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® : 776 U5 AISI	BU DUS 4 lads CL
| relating to the following issues: wheth- - We recognize the possibility that at . ga
er United acted consistently with the some future time transfer of these ac- : ] Rr
“impairment of deliveries” clauses in its tions for coordinated or consolidated ol Lr
© + contracts with each of the plaintiffs; pretrial proceedings may be beneficial. ha Fork
| whether plaintiffs acted reasonably in Nonetheless, until we are persuaded that Ce FIO
i response to the curtailments; whether the statutory criteria of Section 1407 - * : a
| the shortages of natural gas were either are satisfied, transfer is inappropriate. CT Ban
| . intentionally or negligently created by Our denial of transfer, therefore, is with- Li
’ defendants; and whether plaintiffs suf- out prejudice to any party's right to’ —
Wie fered any damages as a result of these seek Section 1407 treatment if it feels
- 7 curtailments. ! future circumstances so require. Co Co
Co . We believe, however, that these ac- It is therefore ordered that the motion : oo
: "tions presently involve few, if any, com- to transfer the actions listed on the at- ~~
i mon questions of fact. Our decision is tached Schedule A be, and the same here- E
| necessarily influenced by the pleadings by is, denied without prejudice	to the Dos }	in these actions and since defendants right of any party to move for transfer -	i . . . . | EE
i : have not yet filed answers, we are forced at a later date. EEE
to focus primarily on the complaints. oo SCHEDULE A =. ; .
. Our review of these complaints leads us " pigrict of the District. Co - Cl
. to the conclusion that the various al- of Columbia vo : EE
legations of breach of contract give rise = Monsanto Co. v. United Gas Pipe = Civil Action co
eS : : : : Line Co. _ No. 2037-71 :
Lo j . Io Zactual 15sues predominantly unique Texas Gulf, Inc. v. United Gas ~ Civil Action ~~ . :Sn to each particular plaintiff's relation- pipe Line Co. © No. 2253-71 ° Co .
’ ship with defendant United. In addi-. = Westera District of Louisiana- REI. :
: tion, we note that defendants have had giinkeatt, Inc. v. United Gas Pipe Civil Action
se - ample opportunity over the course of Line Co. & Pennzoil Co. . No. 18243 -
| : this litigation to file answers in all but Southern	District of Mississippi : no :
. one of the actions now before us. Thus, Mississippi Power & Light Co. v. = Civil Action 3 N ~ :i . United Gas Pipe Line Co. & No. J74-185(C) . : : ’
we find that under the circumstances of pennzoit Co. SR oo :
this particular litigation, transfer at Mississippi Power Company v. Civil Action <n
’ . . 7, . i CL United Gas Pipe Line Company & No. S74-258(N) Co
: this time is unwarranted. : ~ Pennzoil Co. EE
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