United States v. El Paso Natural Gas Company, Civ. A. No. C-2626.
| Decision Date | 30 August 1972 |
| Docket Number | Civ. A. No. C-2626. |
| Citation | 358 F. Supp. 820 |
| Parties | UNITED STATES of America, Plaintiff, v. EL PASO NATURAL GAS COMPANY and Pacific Northwest Pipeline Corporation, Defendants. |
| Court | U.S. District Court — District of Colorado |
COPYRIGHT MATERIAL OMITTED
Richard W. McLaren, Asst. Atty. Gen., John H. Dougherty, Joseph J. Saunders, Dept. of Justice, Washington, D. C., James L. Treece, U. S. Atty., Carolyn J. McNeill, Asst. U. S. Atty., Denver, Colo., for plaintiff.
Leon M. Payne, P. Dexter Peacock, Andrews, Kurth, Campbell & Jones, Houston, Tex., G. Scott Cuming, Gen. Counsel, El Paso Natural Gas Co., El Paso, Tex., E. G. Najaiko, Asst. Gen. Counsel, Houston, Tex., David F. Mackie, El Paso Natural Gas Co., El Paso, Tex., for defendants.
Gary Nelson, Atty. Gen., State of Ariz., Phoenix, Ariz., for intervenor State of Arizona ex rel. The Arizona Corp. Comm.
Nicholas H. Powell, Snell & Wilmer, Phoenix, Ariz., for intervenor Arizona Public Service Co.
A. Y. Holesapple, Holesapple, Conner, Jones, McFall & Johnson, Tucson, Ariz., for intervenor Tucson Gas & Electric Co.
Louis H. Callister, Callister, Kesler & Callister, Salt Lake City, Utah, for intervenors Arizona Public Service Co. and Tucson Gas & Electric Co.
John T. Miller, Washington, D. C., Frederic L. Kirgis, Gorsuch, Kirgis, Campbell, Walker & Grover, Denver, Colo., for intervenor State of Arizona ex rel. Arizona Corp. Comm., Arizona Public Service Co. and Tucson Gas & Electric Co.
Evelle J. Younger, Atty. Gen., Iver E. Skjeie, Deputy Atty. Gen., State of Cal., Sacramento, Cal., for intervenor People of the State of California.
James E. Faust, Salt Lake City, Utah, for intervenor California Pacific Utilities Co.
Sheldon Rosenthal, San Francisco, Cal., for intervenor Public Utilities Comm. of the State of California.
Richard B. Hooper, Wilbert C. Anderson, Jones, Grey, Kehoe, Bayley, Hooper & Olsen, Seattle, Wash., for intervenor Cascade Natural Gas Co.
Duke W. Dunbar, Atty. Gen., John E. Archibold, Robert E. Commins, Asst. Attys. Gen., Denver, Colo., for intervenor State of Colorado ex rel. Colorado Public Utilities Comm.
Paul W. Williams, Don B. Stookey, Cahill, Gordon, Sonnett, Reindel & Ohl, New York City, for intervenor The Committee of El Paso Natural Gas. Co. Institutional Bond and Debenture Investors.
W. Anthony Park, Atty. Gen., State of Idaho, Boise, Idaho, Idaho Public Utilities Commission c/o Marilyn Bourner, Secretary, Boise, Idaho, for State of Idaho ex rel. Idaho Public Utilities Comm.
Larry D. Ripley, Sp. Asst. Atty. Gen., Elam, Burke, Jeppesen, Evans & Boyd, Boise, Idaho, for intervenor, State of Idaho ex rel. Idaho Public Utilities Comm.
Claude Marcus, Marcus & Marcus, Boise, Idaho, for intervenor Intermountain Gas Co.
Joseph S. Jones, Salt Lake City, Utah, John Crawford, Jr., Secretary and Gen. Counsel, Mountain Fuel Supply Co., Salt Lake City, Utah, for intervenor Mountain Fuel Supply Co. Robert List, Atty. Gen., State of Nevada, Carson City, Nev., for intervenor Public Service Comm. of Nevada.
David L. Norvell, Atty. Gen., of New Mexico, Santa Fe, N. M., William J. Cooley, Joel B. Burr, Jr., Agency Asst. Attys. Gen., Farmington, N. M., for intervenor New Mexico Public Service Comm.
Harold W. Pierce, Portland, Or., for gon, Dept. of Justice, Salem, Or., Rich-
Lee Johnson, Atty. Gen., State of Oregon, Dept. of Justice, Salem, Or., Richard W. Sabin, Asst. Atty. Gen., State of Oregon, Salem, Or., for intervenor State of Oregon ex rel. The Public Utility Com'r of Oregon.
Malcolm H. Furbush, Daniel E. Gibson, Joseph S. Englert, Jr., Pacific Gas and Electric Co., San Francisco, Cal., for intervenor Pacific Gas & Electric Co.
David R. Pigott, Donald J. Richardson, Jr., Chickering & Gregory, San Francisco, Cal., for intervenor San Diego Gas & Electric Co.
Rollin E. Woodbury, Vice Pres. & Gen. Counsel, Rosemead, Cal., R. Clyde Hargrove, Shreveport, La., for Southern California Edison Co.
John Ormasa, W. H. Owens, Southern California Gas Co., Los Angeles, Cal., for intervenor Southern California Gas Co.
Charles H. McCrea, Vice Pres. and Gen. Counsel, Lawrence V. Robertson, Jr., Gen. Atty., Las Vegas, Nev., for intervenor Southwest Gas Corp.
Edward F. Richards, Gustin & Richards, Salt Lake City, Utah, for intervenor Utah Gas Service Co.
Vernon B. Romney, Atty. Gen., Joseph P. McCarthy, H. Wright Volker, Asst. Attys. Gen., Salt Lake City, Utah, for intervenor Utah Public Service Comm.
John W. Chapman, Cartano, Botzer & Chapman, Seattle, Wash., for intervenor Washington Natural Gas Co.
Slade Gorton, Atty. Gen., Frank P. Hayes, Robert E. Simpson, Asst. Attys. Gen., Olympia, Wash., for intervenor Washington Utilities and Transmission Comm.
Robert L. Simpson, Paine, Lowe, Coffin, Herman & O'Kelly, Spokane, Wash., A. Wally Sandack, Draper, Sandack & Saperstein, Salt Lake City, Utah, for intervenor Washington Water Power Co.
Don M. Empfield, Sp. Asst. Atty. Gen., State of Wyoming, Cheyenne, Wyo., for intervenor Public Service Comm. of Wyoming.
Gordon Gooch, Gen. Counsel, George P. Lewnes, Asst. Gen. Counsel, John P. Mathis, F. P. C., Washington, D. C., for Federal Power Comm., amicus curiae.
James D. Voorhees, Moran, Riedy & Voorhees, Denver, Colo., A. John Cressey, Vice Pres. and Gen. Counsel, Minneapolis, Minn., William R. Connole, Connole & O'Connell, Washington, D. C., for Banister Continental Corp.
David K. Watkiss, Pugsley, Hayes, Rampton & Watkiss, Salt Lake City, Utah, James D. McKinney, Jr., Ross, Marsh & Foster, Washington, D. C., C. H. McCall, Houston, Tex., John W. Hammett, Charles F. White, Oklahoma City, Okl., for The Alaska Interstate Apco-Gulf Tipperary Group.
Walter W. Sapp, Vice Pres. and Gen. Counsel, Colorado Springs, Colo., James L. White, Robert T. Connery, David G. Owen, Holland & Hart, Denver, Colo., for Colorado Interstate Corp.
Jefferson D. Giller, Howard Wolf, Fulbright, Crooker, Freeman, Bates & Jaworski, Houston, Tex., Jack Ware, Uvalde, Tex., for Copaco, Inc.
Marvin J. Bertoch, Ray, Quinney & Nebeker, Salt Lake City, Utah, George S. Dibble, Jr., c/o Husky Oil Ltd., Cody, Wyo., Royce H. Savage, Boone, Ellison & Smith, Tulsa, Okl., for Husky Oil Ltd.
C. Keefe Hurley, Earle C. Cooley, Hale & Dorr, Boston, Mass., Brigham E. Roberts, Rawlings, Roberts & Black, Salt Lake City, Utah, for Paradox Production Corp.
Benjamin H. Parkinson, Jr., Ackerman, Johnston, Norberg & Parkinson, San Francisco, Cal., Hugh J. McClearn, Van Cise, Freeman, Tooley & McClearn, Denver, Colo., J. Evans Attwell, Lynn R. Coleman, Vinson, Elkins, Searls & Smith, Houston, Tex., J. Donald Brinkerhoff, U. S. Natural Resources, Inc., Menlo Park, Cal., Edward O. Werner, Hardy, Peal, Rawlings & Werner, New York City, Robert Paradise, The Ralph M. Parsons Co., Los Angeles, Cal., for Western Sunset Transmission Co.
FINDINGS OF FACT, CONCLUSIONS OF LAW, OPINION and DECREE
This case was brought in the District of Utah, Central Division as Civil Action No. 143-57, upon motion by the State of Idaho. The Court, on October 7, 1970, entered an order for transfer of the action to the United States District Court for the District of Colorado, pursuant to Title 28 U.S.C. § 1404(a).
For the convenience of Court and counsel, we again briefly review the background of this litigation.
A more detailed account is found in three decisions of the Supreme Court: California v. Federal Power Commission, 369 U.S. 482, 82 S.Ct. 901, 8 L.Ed. 2d 54; United States v. El Paso Natural Gas Co. et al., 376 U.S. 651, 84 S.Ct. 1044, 12 L.Ed.2d 12; Cascade Natural Gas Corp. v. El Paso Natural Gas Co., et al., 386 U.S. 129, 87 S.Ct. 932, 17 L.Ed. 2d 814 (Referred to as Cascade).
Prior to the year, 1954, El Paso Natural Gas Company (El Paso) was engaged in the business of transporting natural gas interstate to the California border for sale to distributors who distributed the gas to users in Southern California. At that time, El Paso was the sole out-of-state supplier to the California market.
In 1954, Pacific Northwest (PNW) received the approval of the Federal Power Commission to construct and operate a pipeline from the San Juan Basin in New Mexico to the State of Washington to supply gas to the then unserved Pacific Northwest area. The pipeline was completed and service was begun in 1956.
PNW had obtained authorization to receive large quantities of Canadian gas and, in addition, had acquired Rocky Mountain gas reservoirs along its route and gas reserves in the San Juan Basin. In 1954, PNW tried to enter the rapidly expanding California market by transportation of Canadian gas to Pacific Gas & Electric Co. (PG & E) in Northern California, and the effort was renewed in 1955. In 1966, PNW negotiated with Southern California Edison Co. (Edison) to supply it with natural gas.
Although PNW had no pipeline into California and its efforts to enter the California market were unsuccessful, these efforts were a substantial competitive factor in the California market and led to a price reduction and other concessions to the ultimate benefit of Edison.
El Paso had been interested in acquiring PNW since 1954. The first offer from El Paso was in December 1955, an offer PNW rejected. Negotiations were resumed by El Paso in the summer of 1956, while PNW was still trying to obtain entry to the California market.
In November of 1956, El Paso offered to exchange El Paso shares for PNW shares. This offer was accepted by PNW directors and by May 1957, El Paso had acquired 99.8 percent of PNW's outstanding stock.
In July 1957, the Department of Justice filed suit against El Paso in the U. S. District Court for the District of Utah charging that the stock acquisition violated Section 7 of the Clayton Act.
In August 1957, El Paso applied to the Federal Power Commission for permission to acquire the assets of PNW, and on December 23, 1959, the Commission approved the merger of PNW...
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