[Federal Register Volume 60, Number 25 (Tuesday, February 7, 1995)]
[Notices]
[Pages 7195-7197]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-3012]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Implementation of Special Refund Procedures
AGENCY: Office of Hearings and Appeals, Department of Energy.
ACTION: Notice of Implementation of Special Refund Procedures.
-----------------------------------------------------------------------
SUMMARY: The Office of Hearings and Appeals (OHA) of the Department of
Energy (DOE) announces the procedures for disbursement of $3,657.84,
plus accrued interest, in refined petroleum product violation amounts
obtained by the DOE pursuant to a September 30, 1981 Remedial Order
issued to Ed's Exxon, Case No. LEF-0078, and an April 27, 1982 Remedial
Order issued to Ron's Shell, Case No. LEF-0084. The OHA has determined
that the funds obtained from the above firms, plus accrued interest,
will be distributed to customers who purchased gasoline from them
during the following periods: August 1, 1979 through October 31, 1979
in the Ed's Exxon proceeding and August 1, 1979 through November 13,
1981 in the Ron's Shell proceeding.
DATES AND ADDRESSES: Applications must be filed in duplicate, addressed
to ``Ed's Exxon OR Ron's Shell Special Refund Proceeding'' and sent to:
Office of Hearings and Appeals, Department of Energy, 1000 Independence
Ave., S.W., Washington, DC 20585.
Applications should display a prominent reference to the case
number ``LEF-0078'' (for the Ed's Exxon proceeding) or ``LEF-0084''
(for the Ron's Shell proceeding).
FOR FURTHER INFORMATION CONTACT: Thomas O. Mann, Deputy Director, Roger
Klurfeld, Assistant Director, Office of Hearings and Appeals, 1000
Independence Avenue, S.W., Washington, D.C. 20585 (202) 586-2094
(Mann); 586-2383 (Klurfeld).
SUPPLEMENTARY INFORMATION: In accordance with 10 C.F.R. 205.282(b),
notice is hereby given of the issuance of the Decision and Order set
out below. The Decision and Order sets forth the procedures that the
DOE has formulated to distribute to eligible claimants $3,657.84, plus
accrued interest, obtained by the DOE pursuant to September 30, 1981
and April 27, 1982 Remedial Orders. In the Remedial Orders, the DOE
found that, during periods beginning August 1, 1979, the firms each had
sold motor gasoline at prices in excess of the maximum lawful selling
price, in violation of Federal petroleum price regulations.
The OHA has determined to distribute the funds obtained from the
firms in two stages. In the first stage, we will accept claims from
identifiable purchasers of gasoline from the firms who may have been
injured by overcharges. The specific requirements which an applicant
must meet in order to receive a refund are set out in Section III of
the Decision. Claimants who meet these specific requirements will be
eligible to receive refunds based on the number of gallons of gasoline
which they purchased from Ed's Exxon or Ron's Shell.
If any funds remain after valid claims are paid in the first stage,
they may be used for indirect restitution in accordance with the
provisions of the Petroleum Overcharge Distribution and Restitution Act
of 1986 (PODRA), 15 U.S.C. 4501-07.
Applications for Refund must be postmarked by August 31, 1995.
Instructions for the completion of refund applications are set forth in
the Decision that immediately follows this notice. Applications should
be sent to the address listed at the beginning of this notice.
Unless labelled as ``confidential,'' all submissions must be made
available for public inspection between the hours of 1 p.m. and 5 p.m.,
Monday through Friday, except federal holidays, in the Public Reference
Room of the Office of Hearings and Appeals, located in Room 1E-234,
1000 Independence Avenue, S.W., Washington, DC 20585.
Dated: January 27, 1995.
George B. Breznay,
Director, Office of Hearings and Appeals.
Decision and Order of the Department of Energy; Implementation of
Special Refund Procedures
January 27, 1995.
Names of Firms: Ed's Exxon, Ron's Shell
Date of Filing: July 20, 1993
Case Numbers: LEF-0078, LEF-0084
[[Page 7196]] On July 20, 1993, the Economic Regulatory
Administration (ERA) of the Department of Energy (DOE) filed a
Petition for the Implementation of Special Refund Procedures with
the Office of Hearings and Appeals (OHA), to distribute the funds
received pursuant to Remedial Orders issued by the DOE to Ed's Exxon
of Cotati, California, and Ron's Shell of Danville, California
(hereinafter jointly referred to as the remedial order firms). In
accordance with the provisions of the procedural regulations at 10
C.F.R. Part 205, Subpart V (Subpart V), the ERA requests in its
Petition that the OHA establish special procedures to make refunds
in order to remedy the effects of regulatory violations set forth in
the Remedial Order. This Decision and Order sets forth the OHA's
plan to distribute these funds.
I. Background
Each of the remedial order firms was a retailer of motor
gasoline during the periods relevant to this proceeding. The ERA
issued Proposed Remedial Orders (PROs) to each of the firms.1
The PROs alleged that, during separate periods beginning on August
1, 1979, the remedial order firms had:
\1\Ed's Exxon was issued a PRO on January 25, 1980; Ron's Shell
was issued a PRO on December 31, 1980.
---------------------------------------------------------------------------
charged more than the maximum lawful selling price for one or more
grades of gasoline in violation of 10 C.F.R. 212.93; failed to post
and maintain the maximum lawful selling price or a proper
certification in violation of 10 C.F.R. 212.129; failed to keep and
maintain books and records to support the lawfulness of the price
for gasoline on the audit date in violation of 10 C.F.R. 210.92 and
212.93; and/or engaged in unlawful or discriminatory business
practices in violation of 10 C.F.R. 210.62.
After considering and dismissing the firms' objections to the
PROs, the DOE issued final Remedial Orders. Ed's Exxon, 8 DOE
83,035 (1981); Alameda Chevron Service, et al., 9 DOE 83,027
(1982).2 Each of the firms has since remitted a specified
amount in compliance with the Remedial Orders, to which interest has
since accrued. These funds are being held in an interest-bearing
escrow account maintained at the Department of the Treasury pending
a determination regarding their proper distribution.
\2\A Remedial Order was issued to Ed's Exxon on September 30,
1981. A Remedial Order was issued to Ron's Shell on April 27, 1982.
---------------------------------------------------------------------------
II. Jurisdiction and Authority
The Subpart V regulations set forth general guidelines which may
be used by the OHA in formulating and implementing a plan of
distribution of funds received as a result of an enforcement
proceeding. The DOE policy is to use the Subpart V process to
distribute such funds. For a more detailed discussion of Subpart V
and the authority of the OHA to fashion procedures to distribute
refunds, see Petroleum Overcharge Distribution and Restitution Act
of 1986, 15 U.S.C. Secs. 4501 et seq., Office of Enforcement, 9 DOE
82,508 (1981), and Office of Enforcement, 8 DOE 82,597 (1981)
(Vickers).
We have considered the ERA's petition that we implement Subpart
V proceedings with respect to the above remedial order funds and
have determined that such proceedings are appropriate. This Decision
and Order sets forth the OHA's plan to distribute these funds.
III. Proposed Refund Procedures
On December 14, 1994, the OHA issued a Proposed Decision & Order
(PD&O) establishing tentative procedures to distribute the Remedial
Order funds. That PD&O was published in the Federal Register, and a
30-day period was provided for the submission of comments regarding
our proposed refund plan. See 59 Fed. Reg. 66029 (December 22,
1994). More than 30 days have elapsed and the OHA has received no
comments concerning these proposed refund procedures. Consequently,
the procedures will be adopted as proposed.
We will to implement a two-stage refund procedure for
distribution of the remedial order funds, by which purchasers of
gasoline from the remedial order firms during the period covered by
the Remedial Orders may submit Applications for Refund in the
initial stage. From our experience with Subpart V proceedings, we
expect that potential applicants generally will be limited to
ultimate consumers (``end-users''). Therefore, we do not anticipate
that it will be necessary to employ the injury presumptions that we
have used in past proceedings in evaluating applications submitted
by refiners, resellers, and retailers.3
\3\If a refiner, reseller, or retailer should file an
application in any of the refund proceedings, however, we will
utilize the standards and appropriate presumptions established in
previous proceedings. See, e.g., Starks Shell Service, 23 DOE
85,017 (1993); Shell Oil Co., 18 DOE 85,492 (1989).
---------------------------------------------------------------------------
A. First Stage Refund Procedures
In order to receive a refund, each claimant will be required to
submit a schedule of its monthly purchases of gasoline from the
remedial order firm during the period covered by the Remedial Order.
Our experience indicates that the use of certain presumptions
permits claimants to participate in the refund process without
incurring inordinate expense and ensures that refund claims are
evaluated in the most efficient manner possible. See Marathon
Petroleum Co., 14 DOE 85,269 (1986) (Marathon). Presumptions in
refund cases are specifically authorized by the applicable Subpart V
regulations at 10 C.F.R. Sec. 205.282(e). Accordingly, we will adopt
the presumptions set forth below.
1. Calculation of Refunds
First, we will adopt a presumption that the overcharges were
dispersed equally in all of the remedial order firms' sales of
gasoline during the period covered by the Remedial Orders. In
accordance with this presumption, refunds will be made on a pro-rata
or volumetric basis.\4\ In the absence of better information, a
volumetric refund is appropriate because the DOE price regulations
generally required a regulated firm to account for increased costs
on a firm-wide basis in determining its prices.
\4\If an individual claimant believes that it was injured by
more than its volumetric share, it may elect to forego this
presumption and file a refund application based upon a claim that it
suffered a disproportionate share of the remedial firm's
overcharges. See, e.g., Mobil Oil Corp./Atchison, Topeka and Santa
Fe Railroad Co., 20 DOE 85,788 (1990); Mobil Oil Corp./Marine Corps
Exchange Service, 17 DOE 85,714 (1988). Such a claim will only be
granted if the claimant makes a persuasive showing that it was
``overcharged'' by a specific amount, and that it absorbed those
overcharges. See Panhandle Eastern Pipeline Co./Western Petroleum
Co., 19 DOE 85,705 (1989). To the degree that a claimant makes this
showing, it will receive an above-volumetric refund.
---------------------------------------------------------------------------
Under the volumetric approach, a claimant's ``allocable share''
of a Remedial Order fund is equal to the number of gallons purchased
from the remedial order firm during the period covered by that
Remedial Order times the per gallon refund amount.\5\ We derived the
per gallon refund figures by dividing the amount of each Remedial
Order fund by the total volume of gasoline which each remedial order
firm sold during the period specified in that Remedial Order. An
applicant that establishes its eligibility for a refund will receive
all or a portion of its allocable share plus a pro-rata share of the
accrued interest.\6\
\5\The per gallon refund amount is $0.0251 for claimants
applying in the Ed's Exxon proceeding ($2,500 remitted/99,651
gallons sold), $0.0072 in the Ron's Shell proceeding ($1,157.84
remitted/160,777.9 gallons sold).
\6\As in previous cases, we will establish a minimum refund
amount of $15. We have found through our experience that the cost of
processing claims in which refunds for amounts less than $15 are
sought outweighs the benefits of restitution in those instances. See
Exxon Corp., 17 DOE 85,590, at 89,150 (1988) (Exxon).
---------------------------------------------------------------------------
In addition to the volumetric presumption, we will adopt a
presumption regarding injury for end-users.
2. End-Users
In accordance with prior Subpart V proceedings, we will adopt
the presumption that an end-user or ultimate consumer of gasoline
purchased from one of the remedial order firms whose business is
unrelated to the petroleum industry was injured by the overcharges
resolved by the Remedial Order. See, e.g., Texas Oil and Gas Corp.,
12 DOE 85,069 at 88,209 (1984) (TOGCO). Members of this group
generally were not subject to price controls during the period
covered by the Remedial Order, and were not required to keep records
which justified selling price increases by reference to cost
increases. Consequently, analysis of the impact of the overcharges
on the final prices of goods and services produced by members of
this group would be beyond the scope of the refund proceeding. Id.
End-users of gasoline purchased from the remedial order firms need
only document their purchase volumes from the firm during the period
covered by the Remedial Order to make a sufficient showing that they
were injured by the overcharges.
B. Refund Application Requirements
To apply for a refund from any of the Remedial Order funds, a
claimant should submit an Application for Refund containing all of
the following information: [[Page 7197]]
(1) Identifying information including the claimant's name,
current business address, business address during the refund period,
taxpayer identification number, a statement indicating whether the
claimant is an individual, corporation, partnership, sole
proprietorship, or other business entity, the name, title, and
telephone number of a person to contact for additional information,
and the name and address of the person who should receive any refund
check.\7\ If the applicant operated under more than one name or
under a different name during the price control period, the
applicant should specify those names;
\7\Under the Privacy Act of 1974, the submission of a social
security number by an individual applicant is voluntary. An
applicant that does not submit a social security number must submit
an employer identification number if one exists. This information
will be used in processing refund applications, and is requested
pursuant to our authority under the Petroleum Overcharge
Distribution Act of 1986 and the regulations codified at 10 C.F.R.
Part 205, Subpart V. The information may be shared with other
Federal agencies for statistical, auditing or archiving purposes,
and with law enforcement agencies when they are investigating a
potential violation of civil or criminal law. Unless an applicant
claims confidentiality, this information will be available to the
public in the Public Reference Room of the Office of Hearings and
Appeals.
---------------------------------------------------------------------------
(2) A monthly purchase schedule covering the relevant Remedial
Order period.\8\ The applicant should specify the source of this
gallonage information. In calculating its purchase volumes, an
applicant should use actual records from the refund period, if
available. If these records are not available, the applicant may
submit estimates of its gasoline purchases, but the estimation
method must be reasonable and must be explained.
\8\The Remedial Orders cover the following periods: August 1,
1979 through October 31, 1979 in the Ed's Exxon proceeding and
August 1, 1979 through November 13, 1981 in the Ron's Shell
proceeding.
---------------------------------------------------------------------------
(3) A statement whether the applicant or a related firm has
filed, or has authorized any individual to file on its behalf, any
other application in that refund proceeding. If so, an explanation
of the circumstances of the other filing or authorization should be
submitted;
(4) If the applicant is or was in any way affiliated with the
remedial order firm, it should explain this affiliation, including
the time period in which it was affiliated.\9\
\9\As in other refund proceedings involving alleged refined
product violations, the DOE will presume that affiliates of the
remedial order firm were not injured by the firm's overcharges. See,
e.g., Marathon Petroleum Co./EMRO Propane Co., 15 DOE 85,288
(1987). This is because the remedial order firm presumably would not
have sold petroleum products to an affiliate if such a sale would
have placed the purchaser at a competitive disadvantage. See
Marathon Petroleum Co./Pilot Oil Corp., 16 DOE 85,611 (1987),
amended claim denied, 17 DOE 85,291 (1988), reconsideration denied,
20 DOE 85,236 (1990). Furthermore, if an affiliate of the remedial
order firm were granted a refund, the remedial order firm would be
indirectly compensated from a Remedial Order fund remitted to settle
its own alleged violations.
---------------------------------------------------------------------------
(5) The statement listed below signed by the individual
applicant or a responsible official of the firm filing the refund
application:
I swear (or affirm) that the information contained in this
application and its attachments is true to the best of my knowledge
and belief. I understand that anyone who is convicted of providing
false information to the federal government may be subject to a
fine, a jail sentence, or both, pursuant to 18 U.S.C. Sec. 1001. I
understand that the information contained in this application is
subject to public disclosure. I have enclosed a duplicate of this
entire application which will be placed in the OHA Public Reference
Room.
All applications should be either typed or printed and clearly
labeled ``Ed's Exxon (Case No. LEF-0078) OR Ron's Shell (Case No.
LEF-0084) Special Refund Proceeding.'' Each applicant must submit an
original and one copy of the application. If the applicant believes
that any of the information in its application is confidential and
does not wish for that information to be publicly disclosed, it must
submit an original application, clearly designated ``confidential,''
containing the confidential information, and two copies of the
application with the confidential information deleted. All refund
applications should be postmarked on or before August 31, 1995 and
sent to: Ed's Exxon OR Ron's Shell Special Refund Proceeding, Office
of Hearings and Appeals, Department of Energy, 1000 Independence
Ave., S.W., Washington, D.C. 20585.
C. Refund Applications Filed by Representatives
We will adopt the standard OHA procedures relating to refund
applications filed on behalf of applicants by ``representatives,''
including refund filing services, consulting firms, accountants, and
attorneys. See, e.g., Starks Shell Service, 23 DOE 85,017 (1993);
Texaco Inc., 20 DOE 85,147 (1990); Shell Oil Co., 18 DOE 85,492
(1989). We will also require strict compliance with the filing
requirements as specified in 10 C.F.R. Sec. 205.283, particularly
the requirement that applications and the accompanying certification
statement be signed by the applicant.
The OHA reiterates its policy to scrutinize applications filed
by filing services closely. Applications submitted by a filing
service should contain all of the information indicated above.
Finally, the OHA reserves the authority to require additional
information before granting any refund in these proceedings.
Applications lacking the required information may be dismissed or
denied.
D. Distribution of Funds Remaining After First Stage
Any funds that remain after all first stage claims have been
decided shall be distributed in accordance with the provisions of
the Petroleum Overcharge Distribution and Restitution Act of 1986
(PODRA), 15 U.S.C. Sec. 4501-07. PODRA requires that the Secretary
of Energy determine annually the amount of oil overcharge funds that
will not be required to refund monies to injured parties in Subpart
V proceedings and make those funds available to state governments
for use in four energy conservation programs. The Secretary has
delegated these responsibilities to the OHA, and any funds in the
Remedial Order funds that the OHA determines will not be needed to
effect direct restitution to injured customers will be distributed
in accordance with the provisions of PODRA.
It Is Therefore Ordered That: (1) Applications for Refund from
the funds remitted to the Department of Energy by Ed's Exxon and
Ron's Shell pursuant to the Remedial Orders dated September 30, 1981
and April 27, 1982 may now be filed.
(2) Applications for Refund must be postmarked no later than
August 31, 1995.
Dated: January 27, 1995.
George B. Breznay,
Director, Office of Hearings and Appeals.
[FR Doc. 95-3012 Filed 2-6-95; 8:45 am]
BILLING CODE 6450-01-P