Thursday, May 28, 2015 9:49 am by Lowell Rothschild
Yesterday, the Obama administration finalized the waters of the US rule it proposed last spring. There’s a lot to be said about the final rule, and so this will be the first in a series of blog posts (just like for the proposal). But because the new rule creates a few immediate obligations, we’ll start this series with the punchline.
The rule remains broad, but is somewhat more clear (more…)
Category: Enforcement, Environmental, National Energy Law
Thursday, May 21, 2015 11:41 am by Tim Wilkins and Kevin Ewing
A new $1.3 million Clean Air Act penalty action by U.S. EPA and the Michigan Department of Environmental Quality against AK Steel Corporation has received significant public and media attention this week. The proposed consent decree, filed with the court and opened for public comment on May 19th, includes significant cash penalties and supplemental environmental project requirements, along with burdensome obligations to establish an environmental management system, perform third party audits, and install costly new pollution controls. Less often mentioned in this week’s stories about the consent decree is the fact that AK Steel just acquired the facility in question last year. (more…)
Category: Air Quality/Climate Change, Enforcement, Environmental
Tuesday, May 12, 2015 5:16 pm by Michael Weller
Senators Cory Booker (D-NJ) and John Hoeven (R-ND) recently introduced the Commercial UAS Modernization Act, legislation designed to streamline the integration of commercial unmanned aircraft systems (UAS) in the United States. The legislation would establish an interim rule governing small UAS operations, provide the Federal Aviation Administration (FAA) with some flexibility on issues like visual-line-of-sight (VLOS) operations, reduce the regulatory burden for commercial operators, create a new deputy administrator position at the FAA focused on UAS, and encourage maximum use of current FAA UAS test sites. (more…)
Category: Electric, Enforcement, Environmental, Master Limited Partnerships, Midstream, National Energy Law, Natural Gas/LNG, Power, Shale Development, Transmission, Upstream Energy
10:52 am by Philip Bezanson, Glen Kopp and Carolyn Robbs Bilanko
Attorneys from our white collar, internal investigations and regulatory enforcement team profile recent enforcement actions in the North African states of Morocco, Algeria, Tunisia, Libya, Sudan and Egypt. The report illustrates the need for ongoing caution from investors in the energy sector in the region.
- Morocco scored 39 on the Transparency International Corruption Perceptions Index for 2014 (hereafter the “International Corruption Index”), with 0 being “highly corrupt” and 100 being “very clean.” US regulators use the International Corruption Index as an indicator for directing investigation resources and for justifying countries that should receive additional scrutiny by corporate compliance departments.
- In its first FCPA enforcement action of the year, on January 22, 2015, the SEC reached a deferred prosecution agreement with The PBSJ Corporation. An officer for the Florida-based engineering and construction firm had offered to funnel funds to a company owned and controlled by a foreign official in order to secure two multi-million dollar Qatari government contracts for PBSJ in 2009. The foreign official subsequently provided the officer and PBSJ’s international subsidiary with access to confidential sealed-bid and pricing information that enabled the PBSJ subsidiary to tender winning bids for a hotel resort development project in Morocco and a light rail transit project in Qatar. The officer also offered employment to a second foreign official in return for assistance as the bribery scheme began to unravel and PBSJ lost the hotel resort contract. Once PBSJ uncovered the misconduct, it self-reported the incidents to the SEC, and agreed to pay $3.4 million in financial remedies.
- Political corruption and instability: Since ascending to the throne on July 23, 1999, King Mohammad VI has enacted a range of social, democratic, and economic reforms that have left Morocco more liberalized and stable than many of its neighbors. However, the royals retain control in a vast number of businesses in the area, and widespread corruption undermines investor sentiment and increases business costs.
Category: Enforcement, Regional Energy Law
Tuesday, May 5, 2015 1:23 pm by David Perlman, Michael Brooks, Robert E. Pease and Jennifer Lias
This report summarizes material notices from CME Group and ICE Futures, with a particular focus on energy. It is not intended to be a comprehensive review of each and every notice issued by these Exchanges.
On April 21, 2015, the CFTC announced via press release that charges had been filed against a resident of the United Kingdom (“UK”), Navinder Singh Sarao (“Sarao”), and his company, Nav Sarao Futures Limited PLC, for price manipulation and spoofing. The charges came after a comprehensive investigation of Sarao’s trading activity by the CFTC, which included assistance from the SEC, DOJ, FBI, the CME Group, the UK’s Financial Conduct Authority (“FCA”), and Scotland Yard. The DOJ unsealed its own criminal Complaint charging Sarao with willfully engaging in a scheme to defraud, knowingly manipulating the price of a commodity, and knowingly engaging in trading practices in violation of CME rules. Sarao was arrested by British authorities shortly before the CFTC and DOJ charges were unveiled. (more…)
Category: Commodities, Enforcement
8:18 am by Robert E. Pease
On May 1, 2015 the Federal Energy Regulatory Commission (FERC) assessed a $5 million civil penalty against Maxim Power Corporation (Maxim) and its affiliates and an additional $50,000 civil penalty against Kyle Mitton, an energy marketing analyst working for Maxim, for allegedly violating FERC’s anti-manipulation rule and a regulation against submitting false or misleading information to a market monitor. Specifically, FERC alleges that Maxim bid in its Pittsfield generating plant in the ISO-NE day ahead market on oil during certain hot summer days in 2010 when it actually ran on much cheaper natural gas. According to FERC, Maxim hoped to be paid the significantly higher oil price even though it actually ran on cheaper natural gas. FERC maintains that Maxim mislead the ISO-NE Independent Market Monitor (IMM) when its bidding was questioned, giving the IMM the impression that Maxim actually ran on oil. This misrepresentation, according to FERC, also constituted a fraud in violation of FERC’s anti-manipulation rule. Maxim, on the other hand, argued in response to FERC’s earlier Order to Show Cause that due to pipeline restrictions serving the Pittsfield plant, it bid conservatively to avoid running on a fuel costing more than it bid into the market. Maxim further states that it never provided false information to the IMM. FERC admits that Maxim did not make a false statement and that it eventually did disclose to the IMM that it ran on natural gas. In the end, Maxim was not paid the more expensive price for oil; instead the IMM mitigated the price Maxim was paid to run the Pittsfield plant, a mitigation $3 million. (more…)
Category: Electric, Enforcement, FERC, Natural Gas/LNG, Power