CFTC v. Kraft Dispute Continues with CFTC on Defensive

Posted on: August 20, 2019 By: Michael Brooks, Bob Pease, Josh Robichaud
Following the August 15 2019 public announcement of a settlement between the Commodity Futures Trading Commission (CFTC) and Kraft Foods Group, Inc./Mondelez Global, LLC (together “Kraft”), the parties appeared on August 19 before the Honorable John Robert Blakey on a sealed motion for contempt, sanctions and other relief filed by Kraft. This controversy stems primarily from a provision included in the Consent Order that limits the parties’ ability to talk about the case except in legal proceedings, testimony, or by court order. [1] During the hearing, the CFTC appears to have agreed to...
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Commodities
CFTC
Litigation

Long-Awaited CFTC v. Kraft Settlement Resolves Manipulation Allegations

Posted on: August 15, 2019 By: Michael Brooks, Bob Pease, Josh Robichaud
UPDATE: The statements referenced and linked in this post have been removed from the CFTC’s public website in connection with an ongoing dispute . Today the legal battle between the Commodity Futures Trading Commission (CFTC) and Kraft Foods Group, Inc. (Kraft) over whether Kraft manipulated the wheat market in 2011 officially ended with the entering of a Consent Order in the U.S. District Court for the Northern District of Illinois. It was disclosed on March 25, 2019 that the parties reached a binding agreement, but the details have remained non-public until today. The settlement includes a...
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CFTC
Courts
Commodities

Ninth Circuit Sides with CFTC on Scope of Anti-Manipulation Authority

Posted on: August 2, 2019 By: Michael Brooks, Bob Pease, Ryan Eletto
Ninth Circuit Sides with CFTC on Scope of Anti-Manipulation Authority By Michael Brooks, Robert Pease, and Ryan Eletto A three-judge panel for the U.S. Court of Appeals for the Ninth Circuit recently issued a decision that revives claims by the Commodity Futures Trading Commission (CFTC) that Monex Deposit Company and two affiliates (Monex) violated the Commodity Exchange Act (CEA) by engaging in an alleged scheme to defraud investors in precious medals. CFTC v. Monex , No. 18-55815 (9 th Cir. 2019). While the opinion is expressly limited to leveraged retail commodity transactions, the CFTC...
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CFTC
Courts

FERC Revises Market-Based Rate Seller Requirements

Posted on: July 22, 2019 By: Paul Wight, Stephen Hug, Josh Robichaud
On July 18, 2019, the Federal Energy Regulatory Commission (“FERC”) issued two final rules—Order Nos. 860 and 861—adopting changes to the regulations and policies applicable to companies selling energy, capacity, or ancillary services at market-based rates (“MBR”). Collectively, the final rules make significant changes to the types of information that companies seeking to obtain or retain MBR authority will be required to provide to FERC as well as the manner in which this information is submitted to FERC. In Order No. 860, FERC: Requires sellers to submit market, asset, and ownership...
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Power
FERC

Finding New FPA Authority, FERC Makes Policy Change to Authorize Retroactive Surcharges (and Maybe More)

Posted on: July 17, 2019 By: David Perlman, Kathryn Penry, Annie Willet
Historically, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) has maintained a policy whereby it will not order refunds stemming from rate design and cost allocation rulings, reasoning that it was statutorily barred from instituting offsetting surcharges. [1] In June 2019, however, FERC altered this policy to allow it to grant such refunds. FERC based its policy change on its determination that, at least with respect to Federal Power Act (“FPA”) § 206 [2] proceedings, FPA § 309 grants the agency broad remedial authority to require retroactive surcharges. In Black Oak...
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FERC
Power
Organized Markets

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