California ruling clears way for Sempra class action suit trial

Houston (Platts)--27Dec2004

A California appeals court decision has cleared the way for a $24-bil class
action lawsuit against Sempra Energy and two of its subsidiaries to go
forward, sources said. A three-judge panel of the Fourth Appellate District of
the California Court of Appeal on Dec 21 denied the defendants' writ of
mandate. Sempra Energy and two affiliates, Southern California Gas Co and San
Diego Gas & Electric, filed the writ on Oct 15 to appeal the denial by San
Diego Superior Court Judge Richard Haden of Sempra's motion for a summary
judgment. The case stems from California's energy crisis of 2000-01. As a
result of the ruling, Sempra is expected to face a jury trial in mid-2005 on
civil charges of conspiracy and market manipulation, Lance Astrella, an
attorney for the plaintiffs said. The suit, filed in September 2000, claims
that Sempra, SoCal Gas and SDG&E conspired with El Paso Natural Gas to prevent
competition for gas in the Southern California market, causing the energy
crisis. El Paso had settled the antitrust conspiracy charges against it in
December 2003, agreeing to pay $1.7-bil to the state of California. Sempra in
its appeal had argued that there was insufficient evidence of a conspiracy to
proceed to trial. Thomas Girardi, an attorney for Continental Forge Co, the
lead plaintiff in the case, said: "Sempra has now burned the last of its
available bridges in a desperate ploy to make this case disappear and hide its
outrageous conduct." Economists have estimated that plaintiffs in the case
suffered $9-bil in damages as a result of high gas prices during the energy
crisis. Under California anti-trust law, the amount would be automatically
trebled if the defendants were found liable for the damages. However, because
of the El Paso settlement and other factors, the amount of potential damages
Sempra and its affiliates face is $24-bil, a spokesman for the plaintiffs
said. In addition to Continental Forge, plaintiffs in the class action include
the people of the state of California; the city and county of Los Angeles; San
Bernardino County; the cities of Long Beach, Burbank, Glendale, Culver City,
Vernon and Upland, and numerous other companies and individuals.

Copyright © 2004 - Platts

Please visit:  www.platts.com

Their coverage of energy matters is extensive!!.