Ten points to remember for compliance and employee training.
Joseph Hall is a partner with Dorsey & Whitney and is Co-Chair of the firm’s Energy Industry Practice Group. Thomas Gorman is also a partner with Dorsey & Whitney and a member of the firm’s Government Enforcement and Corporate Investigations Practice Group. The authors acknowledge Rabeha S. Kamaluddin, Ruth M. Porter, and Philip J. Steger – each an associate with Dorsey & Whitney – who contributed to the writing of this article.
Few areas of the power industry regulation have received as much attention over the last decade as the enforcement authority exercised by the U.S. Federal Energy Regulatory Commission. FERC has invested significantly in its enforcement capabilities, sometimes reaching outside the electric utility industry to recruit career prosecutors to participate in (if not head) the commission's investigative program. The media has widely reported on some of the more high-profile cases, with some settlement or disputed amounts soaring into the hundreds of millions of dollars. However, beyond FERC's organic orders and policy statements, there are few if any cases interpreting the commission's authority over market manipulation.
Most FERC investigations settle. The few cases that are litigated tend often to be very fact-specific - complex and often confusing, to many. Consequently, many market participants struggle to evaluate the risks of participating in energy markets.