Cohen Milstein Sellers & Toll PLLC (Cohen Milstein) has been appointed Interim Co-Lead Counsel, along with three other law firms, in a class action lawsuit against Total Gas & Power North America, Inc. (TGPNA), alleging antitrust violations and violations of the Commodity Exchange Act.
On September 21, 2015, the Federal Energy Regulatory Commission (FERC) made a preliminary determination that TGPNA and two of its traders manipulated the prices of natural gas in the southwest United States between June 2009 and June 2012. In December 2015, the U.S. Commodity Futures Trading Commission also issued an order against TGPNA and one trader for attempting to manipulate natural gas futures prices, imposing a $3.6 million penalty and other sanctions.
Plaintiffs then brought the class action lawsuit on behalf of persons and entities who purchased physical natural gas as well as natural gas futures and other derivative natural gas contracts. The lawsuit alleges that TGPNA bought or sold large volumes of fixed-price natural gas at major trading hubs before and during bid-week (i.e., the last five business days in a month), transactions which call for the delivery of physical natural gas, despite TGPNA not having any material customers or physical assets near these hubs, such that TGPNA had no legitimate business need for these largely uneconomic transactions. Yet, during certain bid-weeks, these transactions accounted for an enormous proportion of the transactions at these hubs. Meanwhile, TGPNA took positions in natural gas contracts that were derivative of physical natural gas prices, such as futures, options, and swaps contracts. The lawsuit alleges that by reporting its uneconomic transactions to natural gas index publishers, TGPNA moved these index prices in directions that benefited their derivative positions.
As a consequence, the lawsuit alleges, other natural gas market participants bought and sold both physical and derivative natural gas contracts at artificial prices and were harmed.
Michael Eisenkraft of Cohen Milstein represent the class, as well as named plaintiff Public Utility District No. 1 of Clark County Washington (d/b/a Clark Public Utilities), a customer-owned utility providing electric and water service in Clark County, Washington.
The case name is: Anastasio v. Total Gas & Power North America, Inc. et al., No. 15-cv-09689, U.S. District Court, Southern District of New York.