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CONSOLIDATED EDISON CO. OF NEW YORK v. BREZNAY

November 30, 1987

Consolidated Edison Co. of New York, Inc. et al., Plaintiffs,
v.
George B. Breznay, Director, Office of Hearings and Appeals, U.S. Dep't of Energy, et al., Defendants



The opinion of the court was delivered by: PENN

 JOHN GARRETT PENN, Judge

 This case is before the Court on the Plaintiffs' Motion for Summary Judgment and Defendants' Cross Motion for Summary Judgment. Plaintiffs, six electric utility companies seek relief from a determination by defendants, the Department of Energy's ("DOE") Office of Hearings and Appeals ("OHA") which denied them the right to participate in overcharge proceedings pending before OHA. For the reasons stated below, the Court grants summary judgment for the defendants.

 On March 5, 1985, the Economic Regulatory Administration ("ERA") issued a Proposed Remedial Order ("PRO") to Cities Service Oil and Gas Corporation ("Cities Service") alleging crude oil pricing violations in the amount of approximately $ 257 million. On April 15, 1985, Cities Service filed a Notice of Objection to the PRO, contesting the alleged violations and instituting an adjudicative proceeding before OHA.

 Pursuant to DOE regulations *fn1" , on May 10, 1985, plaintiffs' counsel, *fn2" filed a timely request on behalf of Philadelphia Electric Company ("PECO") to participate in the Cities Service proceeding. This request was granted on May 15, 1985. *fn3" PECO participated in the OHA proceedings in Cities Service, filing several pleadings asserting the deficiency of the theory of violation asserted by Cities and insufficiency in the amount of overcharges the ERA sought to recover. After seventeen months of participation in the proceedings, on October 17, 1986, PECO petitioned OHA for permission to withdraw from the Cities Service proceeding as required by the terms of a settlement agreement reached in an unrelated case, In Re: The Department of Energy Stripper Well Exemption Litigation, M.D.L. 378 (D. Kan). In accordance with its original request to participate, PECO sought only to withdraw its individual participation without prejudice to the other members of classes it sought to represent. Again, the defendants made no mention of the class representation issue in the grant of withdrawal to PECO by letter dated October 24, 1987.

  Five months later, on March 30, 1987, plaintiff utility companies moved to intervene in the Cities Service case. The purpose of this intervention was to advance the positions on liability issues previously articulated by PECO. Plaintiffs' request to participate in the Cities Service matter involved submitting a memorandum in sufficient time for Cities to respond in the same document in which it would respond to the ERA's final brief, and to participate in oral argument. The plaintiffs contend that their participation would in no way delay the Cities Services proceeding. *fn4" On April 9, 1987, OHA denied plaintiffs' belated request on the ground that it was both untimely and it also sought to present issues for adjudication which were no longer in the proceeding. *fn5" Plaintiffs sought reconsideration of OHA's decision on April 21, 1987, which was denied on April 27, 1987 for the reasons previously given. *fn6" This suit was filed two months later, asking the Court to order the Director and Deputy Director of OHA to grant plaintiffs the right to participate in the final phase of the Cities Service proceeding. *fn7"

 I.

 Plaintiffs assert that under Fort Pierce Utilities v. DOE, 503 F.Supp 1014 (D.D.C. 198O), this Court has implicitly held that the standard of intervention before OHA is easier to meet than under the Federal Rule of Civil Procedure because of strong public policy in favor of full participation before OHA. However defendants contend that Fort Pierce presents a different issue than the facts at bar. The Court agrees. In Fort Pierce, the plaintiffs complained that DOE permitted Exxon Corporation to participate in an enforcement proceeding as a potentially injured party but denied the same right to plaintiff public utilities who also claimed to be potentially injured parties. The district court found no basis for this disparate treatment, particularly since DOE "gave no reasons whatever for its denial of party status" to the public utilities. Id. at 1027. Further, the Court held that DOE "improperly exercised its discretion" under the regulations in denying full party status to the utilities. Id. In the instant case, there is no question that plaintiffs had standing to participate in the proceedings. Standing was accorded to an electric utility in 1985 when OHA granted PECO's timely application. Moreover, there is no indication that OHA improperly applied its rules when it denied plaintiffs request for participation.

 
TECA has twice specifically rejected motions to intervene by private parties in § 209 actions on the ground that the public and private enforcement devices must not be commingled. Exxon Corp., 773 F.2d at 1283; Cities Services, 715 F.2d at 574. The DOE enforcement action does not affect a private parties' right to recovery, and any restitutionary remedy ordered by a court to correct violations will not impair a legally cognizable interest. TECA's precedents demonstrate that private entities do not have the requisite interest in public enforcement actions brought under § 209 to intervene as of right.

 Id. Finally, plaintiffs did not have to rely on DOE's enforcement action to protect their interests with respect to any overcharges by Cities. They had an independent cause of action for treble damages under Section 210 of the Economic Stabilization Act, 12 U.S.C. § 1904 note, which they chose not to exercise. *fn8" See Cities Service Co. v. DOE, 715 F.2d 572, 573-574 (Temp.Emer.Ct.App. 1983).

 II.

 In regard to the untimely nature of their request, plaintiffs assert that their application for intervention is timely because decisional law permits another member or members of a class to take the position of the timely intervenor as if it had filed at the time the original intervenor had filed. Using plaintiffs argument, if one assumes that the decisions of OHA granting withdrawal to PECO are viewed as deferring the class certification issue by not mentioning it, then another member of the class may intervene in place of the withdrawing intervenor, specifically citing American Pipe & Construction Co. v. Utah, 414 U.S. 538, 38 L. Ed. 2d 713, 94 S. Ct. 756 (1974). In response, defendants point out that OHA's procedural rules for enforcement proceedings do not provide for class actions. See 10 C.F.R. § 205, Subpart O. Since plaintiffs' Motion for Summary Judgment states that "there is, indeed, ...


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