IN RE WASH. PUBLIC POWER SUPPLY SYS. SEC. LIT., MDL No. 551.
| Decision Date | 05 September 1989 |
| Docket Number | MDL No. 551. |
| Citation | 720 F. Supp. 1379 |
| Parties | In re WASHINGTON PUBLIC POWER SUPPLY SYSTEM SECURITIES LITIGATION. |
| Court | U.S. District Court — District of Arizona |
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Paul M. Bernstein, Bernstein, Litowitz, Berger & Grossmann, Melvyn I. Weiss, Milberg, Weiss, Bershad, Specthrie & Lerach, New York City, James R. Irwin, Shidler, McBroom, Gates & Lucas, Seattle, Wash., Michael J. Meehan, Molloy, Jones & Donahue, Tucson, Ariz., for class plaintiffs.
Richard W. Clary, Cravath, Swaine & Moore, New York City, Michael Mines, Betts, Patterson & Mines, Seattle, Wash., H. Michael Clyde, Brown & Bain, Phoenix, Ariz., Harold R. Tyler, Jr., Patterson, Belknap, Webb & Tyler, New York City, for Chemical Bank.
Albert R. Malanca, Gordon, Thomas, Honeywell, Malanca Peterson & Daheim, Tacoma, Wash., for Washington Public Utilities Group and Certain Individuals.
Edwin J. Wheeler, Wheeler & Huss, Tacoma, Wash., for Town of Steilacoom, Wash.
James P. McNally, Ione, Wash., for Pend Oreille.
Richard A. Nelle, Blaine, Wash., for City of Blaine, Wash.
Jacob L. Smith, Smith & Rosellini, Lynden, Wash., for City of Sumas, Wash.
Edward B. O'Connor, O'Connor, Ludwigson, Thompson & Hayes, Bellingham, Wash., for Orcas Power & Light Co.
David F. Jurca, Helsell, Fetterman, Martin, Todd & Hokanson, Seattle, Wash., for Columbia defendants and Certain Individuals.
R.L. Marceau, Johnson, Marceau, Karnopp & Peterson, Bend, Or., for Central Elec. Co-op, Inc.
Dennis K. Bromley, Pillsbury, Madison & Sutro, San Francisco, Cal., for Snohomish Group.
Robert D. Stewart, Culp, Guterson & Grader, Seattle, Wash., Daniel R. Murdock, Donovan, Leisure, Newton & Irvine, New York City, for Washington Public Power Supply System.
Ralph K. Nickerson, Goldendale, Wash., for PUD # 1 of Klickitat County, Wash.
Larry S. Ganges, Lane, Powell, Moss & Miller, Seattle, Wash., Rockne Gill, Schwabe, Williamson, Wyatt, Moore & Roberts, Portland, Or., for Oregon Public Entities and Certain Individuals.
Ronald E. Bailey, R. Erick Johnson, Bullivant, Houser, Bailey, Pendergrass & Hoffman, Portland, Or., for Cities of McMinnville and Drain, or and Certain Individual.
Peter R. Mersereau, Rankin, VavRosky, Doherty, MacColl & Mersereau, Portland, Or., for Cities of Springfield & Milton-Freewater, Or.
Dwight A. Halstead, Prosser, Wash., for Benton Rural Elec. Ass'n.
Everett B. Clary, O'Melveny & Myers, Los Angeles, Cal., for Certain Individual Director defendants.
G. Edward Fitzgerald, Gibson, Dunn & Crutcher, Los Angeles, Cal., Michelle Coyle, Gibson, Dunn & Crutcher, Seattle, Wash., for Certain Participants' Committee Members.
John D. Lowery, Riddell, Williams, Bullitt & Walkinshaw, Seattle, Wash., for Small Utilities Group.
Herbert Gelman, Gelman, Courture & Pate, Tacoma, Wash., for Alder Mut. Light Co.
Malcolm S. Harris, Harris, Orr & Kinzer, Seattle, Wash., for PUDs No. 1 of Ferry & Kittitas Counties and Certain Individuals.
Camden M. Hall, Foster, Pepper & Shefelman, Seattle, Wash., for City of Seattle.
Joyce Cresswell, Civil Div., U.S. Dept. of Justice, Portland, Or., and J. Christopher Kohn, Director, Commercial Litigation Branch, U.S. Dept. of Justice, Washington, D.C., for U.S.-Bonneville Power Admin.
David A. Bennett, Bennett & Bigelow, Seattle, Wash., for Wood & Dawson.
Otto G. Klein, Heller, Ehrman, White & McAuliffe, Seattle, Wash., for Ebasco Services Inc.
Ralph G. Wellington, Schnader, Harrison, Segal & Lewis, Philadelphia, Pa., John F. Kruger, Karr, Tuttle Campbell, Seattle, Wash., for United Engineers & Contractors, Inc.
Peter J. Nickles, Covington & Burling, Washington, D.C., for Ebasco Services Inc. Roy J. Moceri, Reed, McClure, Moceri, Thonn & Moriarty, Seattle, Wash., for R.W. Beck & Associates.
James J. Hagan, Simpson Thacher & Bartlett, New York City, Jerry Edmonds, Margaret A. Sundberg, Williams, Kastner & Gibbs, Seattle, Wash., Thomas Chandler, Dan Cavett, Chandler, Tullar, Udall & Redhair, Tucson, Ariz., for Blyth Eastman Paine Webber Inc.
The parties to this action seek the Court's approval of settlement agreements entered into by Class Plaintiffs, Chemical Bank as Trustee and attorney-in-fact for Bondholders, and all defendants remaining in the MDL 551 (All Cases) Class Action litigation ("MDL 551" or "MDL"). In addition, the parties to the Western District of Washington Class Action entitled Mirotznik v. Ernst & Whinney, CV No. C85-1105, which was consolidated with the MDL 551 Class Action for purposes of settlement, also seek approval of a settlement arrived at in that action. Rule 23(e), Federal Rules of Civil Procedure, requires this Court's approval of the settlements of these class actions before they may become effective. Such a requirement does not exist in connection with the settlement of most private civil actions. For reasons that will become evident, after thorough deliberation of the exceptionally complex and difficult issues related to these settlement agreements, the Court approves the settlements of these actions and all relevant agreements.
It is neither possible nor desirable to attempt to capture in this Order the complete history of this massive litigation. The docket alone contains almost 4000 entries. The litigation has been complex and the Court is aware of a number of misunderstandings concerning the nature and scope of the action that have arisen or have been revealed as a result of these settlement agreements. In an effort to clarify just what this litigation did and did not involve, the following historic overview is presented.
In 1976 the Washington Public Power Supply System ("WPPSS," "the Supply System," or "the System") entered into agreements with eighty-eight public utilities in the Northwest ("Participants' Agreement"), under which each participant utility purchased a percentage of the "project capability" of two nuclear power projects ("Projects 4/5") and agreed to pay its percentage share of costs incurred by the Supply System to finance, construct and operate those Projects. During the next five years, the Supply System issued $2.25 billion in bonds to finance Projects 4/5. On January 22, 1982, prior to their completion, construction of the Projects was terminated. Terms of the Participants' Agreement would have obligated the Participants to commence payments to the Supply System one year later.
Within months of termination, however, various lawsuits were filed by ratepayers, certain utilities and Chemical Bank in its capacity as ...
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