Federal District Judge Robert R. Merhige, Jr. today stepped up his efforts to get Westinghouse Electric Corp. and a dozen major utilities, including the Virginia Electric and Power Co., to settle their uranium-supply contract disputes out of court.
Today, Judge Merhige directed lawyers for six of the utilities - none of them identified by name - to come up with position papers laying out what each would be willing to accept as the basis for fair and quitable settlements.Within 15 to 20 days, the lawyers are to submit their settlement proposals to a special court-appointed master, former senator William B. Spong, now dean of the William and Mary college law school.
Although the case is nearing the end of its second month in trial - with another two months in the offing - Judge Merhige, who is hearing the case without a jury, has never kept the secret his hope and even expectations that the utilities and Westinghouse would reach out of court settlements.
Since the trial began, however, only one utility - Alabama Power and Light, the utility with the smallest claim against Westinghouse - has negotiated an out of court settlement.
In this current litigation, nine utilities are seeking to force Westinghouse to deliver a total of 47 million pounds of uranium to them at prices ranging from $8 to $12 a pound called for in contracts Westinghouse told them two years ago it could not fulfill. The cases of three other utilities with claims for 15 million pounds are consolidated here for purposes of the trial but have been deferred for judgement at a later time and are not part of the proceeding.
Westinghouse contends it is excused from performing the contracts under a section of the Uniform Commercial Code because unforseeable events occurred making fulfullment "commercially impracticable," Westinghouse cites the Arab oil embargo, the operations of a world-wide uranium cartel and various governmental actions as the unforseen events that pushed the price of uranium to $26 a pount two years ago, when Westinghouse announced it could not fulfill the contracts.
The judge's directions to the parties came after Lewis T. Booker, the liaison attorney for the utilities, told Judge Merhige that six of the utilities in the case had agreed to a statement, declaring that it is "in the best interest of the public and of the parties" to settle all litigation, including this case, if it is possible to do so.
A seventh utility would agree only that a negotiated settlement is "usually" better, while five other utilities - three of them whose cases are not being heard in this current litigation - would not take a position on the statement.
The statement is the result of a meeting Judge Merhige held in his chambers Tuesday night with the lawyers, during which he directed the utility attorneys to come back with a statement of support for a negotiated settlement.
In court today, Judge Merhige said it "disturbed" him that not all the utilities would agree that a negotiated settlement, if it could be achieved, was in the best interest of all concerned. He said he was going to "make every effort" to try to settle as many or all of the cases as he could because "I think justice requires it." He also added, "nobody, in my view, has a locked case in this litigation."
William R. Jentes, lead counsel for Westinghouse, said Westinghouse is willing to negotiate settlements and has a legal obligation under the UCC to try to achieve them.