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Learjet, Inc. v. Oneok, Inc.

ELR Citation: 43 ELR 20081
Nos. 11-16786 et al., (9th Cir., 04/10/2013)

The Ninth Circuit reversed in part and affirmed in part lower court orders in cases arising out of the energy crisis of 2000-2002 that were consolidated into a multidistrict litigation proceeding. Plaintiffs—retail buyers of natural gas—alleged that defendants—natural gas traders—manipulated the price of natural gas by reporting false information to price indices published by trade publications and engaging in wash sales. The lower court ruled that the Natural Gas Act (NGA) preempts the plaintiffs' state antitrust claims. It reasoned that defendants' status as FERC-regulated entities, combined with FERC's authority under §5(a) of the NGA to regulate "any rule, regulation, practice, or contract" affecting a jurisdictional rate, conferred exclusive jurisdiction on FERC to regulate the conduct at issue in this case. But the lower court's reading of §5(a) runs afoul of the canon of statutory construction that statutory provisions should not be read in isolation. The lower court's conclusion is also inconsistent with case law interpreting the provisions of §5(a) narrowly to define the scope of FERC's jurisdiction. The court, therefore, reversed the lower court's grant of summary judgment in favor of the defendants on this issue. Most of the other orders in the case were affirmed.