The federal government has decided not to appeal a legal defeat at the hands of 15 major oil companies, letting stand a Temporary Emergency Court of Appeals ruling that the government tried unfairly to change the interpretation of its own regulations after they had been set.
Exxon USA Senior Vice President O.L. Luper said the decision "supports our past position that the government's accusations of overcharges are often based on vague and complex regulations which are arbitrarily and even retroactively enforced."
But Department of Energy sources downplayed the significance of the apparent defeat, claiming that the case in question was brought in 1976, a full year before the DOE set up its Office of Special Counsel. That office has brought enforcement actions in dozens of cases, alleging more than $2.3 billion in overcharges by oil companies.
Sources inside DOE contend that another $3 billion in overcharges will be alleged, and further point to settlements already been made in connection with some cases. Kerr-McGee, for example, has agreed to pay more than $52 million as part of a settlement.
Still, a DOE official once described the case left unappealed yesterday as "easily the most important piece of enforcement litigation we have now against the oil companies."
The latest case was a consolidation of two separate cases in which the oil companies contended that they were following the rules as defined by %DOE's own auditors.
The appeals courts agreed with the industry, calling the complex set of federal pricing regulations "remarkably inept and self-contradictory."
DOE officials have said in the past, however, that the decision in this case would have little or no bearing on other cases being brought by the Office of Special Counsel.
The Temporary Emergency Court of Appeals was set up as part of the Economic Stabilization Act of 1970 to hear all appeals of cases involving government price-control regulations. CAPTION: Picture, Stockholders at Suburban Bankcorporation's annual meeting in Bethesda: Two chide company for its all-male board. By Gerald Martineau - The Washington Post