Law360 Publishes Brecher and Applebaum Article on FERC Manipulation Case
Law360 has published the article “FERC Market Manipulation Win Leaves Questions Unresolved,” written by Todd Brecher and David Applebaum, counsel and partner, respectively, in the energy regulation, markets and enforcement practice at Akin Gump. The article examines a ruling last month by a federal court in Virginia denying a motion by Powhatan Energy Fund to dismiss a Federal Energy Regulatory Commission market manipulation case against it.
Brecher and Applebaum write that the matter in question “is one of several manipulation cases FERC has brought or settled concerning allegedly fraudulent trading of ‘up-to congestion’ virtual trading products in the PJM Interconnection LLC wholesale electricity market.” Powhatan argued that most of the allegedly fraudulent activity occurred outside the five-year statute of limitations. FERC, meanwhile, countered that its claims did not accrue until the defendants failed to pay the assessed penalty within 60 days.
The court, as Brecher and Applebaum note, sided with FERC on both the statute of limitations issue and also on FERC’s ability “to order disgorgement of unjust profits, despite the [Federal Power Act] not including it as an authorized remedy.” The authors suggest that an appellate decision “would be welcome,” as further guidance on the issue is needed.