Concentrate On Facts
Wesley Heath is Of Counsel at Steptoe & Johnson LLP in the Energy, Financial Services, and Antitrust practices. Prior to joining Steptoe, he worked in FERC's Office of Enforcement from 2008 to 2018 and served as lead counsel for the agency in the FERC v. Barclays Bank PLC case discussed in this article.
Steptoe and Heath represent utilities, financial services companies, and other regulated entities before FERC, other agencies, and the courts. The views expressed are those of Heath alone and do not represent the views of Steptoe, any of its other attorneys, or its clients.
In FERC's litigated electric manipulation cases, courts are looking to securities law to help fill out FERC's enforcement program, often to FERC's benefit. Early factual development and an interdisciplinary skill set for lawyers will be necessary to defending these cases.
Since 2005, FERC has been building out its enforcement program. A critical aspect has been its litigated cases in federal court where securities law has played a vital role in four areas.
First, a court has considered whether the relationship between energy manipulation and securities law is constrained or flexible. Second, securities law has helped define what conduct is manipulative and what FERC must prove. Third, courts have looked to securities law in deciding if and when FERC can bring cases against individuals. Fourth, securities law has limited the success of attacks on FERC's anti-manipulation rule.
FERC's modern enforcement program traces its origins to the perceived market abuses in the Western Power Crisis in 2000-01. Congress responded with the Energy Policy Act of 2005, much like it passed the Securities Act of 1933 and Securities Exchange Act of 1934 (Exchange Act) to prevent securities market abuses seen as contributing to the Great Depression.