Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-06-01042/USCOURTS-caDC-06-01042-0/pdf.json

Parties Involved:
Burlington Resources Inc.
Petitioner
Federal Energy Regulatory Commission
Respondent
Northern Natural Gas Company
Intervenor
Panhandle Eastern Pipe Line Company
Intervenor

Document Text:

United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 11, 2007 Decided January 22, 2008 

No. 06-1042 

BURLINGTON RESOURCES INC.,

PETITIONER

v. 

FEDERAL ENERGY REGULATORY COMMISSION, 

RESPONDENT

PANHANDLE EASTERN PIPE LINE COMPANY AND

NORTHERN NATURAL GAS COMPANY, 

INTERVENORS

On Petition for Review of Orders of the 

Federal Energy Regulatory Commission 

Thomas J. Eastment argued the cause for petitioner. With 

him on the briefs was Bruce A. Connell. 

Judith A. Albert, Attorney, Federal Energy Regulatory 

Commission, argued the cause for respondent. With her on 

the brief were John S. Moot, General Counsel, and Robert H. 

Solomon, Solicitor. 

Frank X. Kelly argued the cause for intervenors. With 

him on the brief were Steve Stojic and James F. Moriarty.

USCA Case #06-1042 Document #1093528 Filed: 01/22/2008 Page 1 of 15
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Before: SENTELLE and GARLAND, Circuit Judges, and 

WILLIAMS, Senior Circuit Judge. 

Opinion for the Court filed by Senior Circuit Judge

WILLIAMS. 

WILLIAMS, Senior Circuit Judge: Burlington Resources 

Inc. (which, with its predecessors-in-interest, we will call 

“Burlington”) is a producer of natural gas. Three years ago, in 

Burlington Resources Oil & Gas Co. v. FERC (“Burlington 

I”), 396 F.3d 405 (D.C. Cir. 2005), it challenged orders of the 

Federal Energy Regulatory Commission requiring it to return 

part of the money collected in long-past gas sales from two 

pipeline gas purchasers, Northern Natural Gas Co. and 

Panhandle Eastern Pipe Line Co. Burlington argued that it 

had settled all disputes with the two pipelines over these sales 

many years before, and that the Commission erred by failing 

to give effect to its settlements (the “Burlington Settlements”). 

We remanded for a more adequate explanation of FERC’s 

position, particularly in light of its decision to approve similar 

settlements between the two pipelines and other gas producers 

(the “Omnibus Settlements”). Id. at 406, 412. 

On remand, the Commission reaffirmed its orders, 

proposing a number of distinctions between the Burlington 

Settlements and the Omnibus Settlements. Burlington Res. 

Oil & Gas. Co. (“Remand Order”), 112 FERC ¶ 61,053, reh’g 

denied (“Rehearing Order”), 113 FERC ¶ 61,257 (2005). 

Burlington again petitions for review. Because the 

Commission’s distinctions ultimately prove illusory, we grant 

the petition and vacate the orders. We need not reach 

Burlington’s alternative request for equitable adjustment of its 

obligations under § 502(c) of the Natural Gas Policy Act 

(“NGPA”) of 1978, 15 U.S.C. § 3412(c). 

USCA Case #06-1042 Document #1093528 Filed: 01/22/2008 Page 2 of 15
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* * * 

Burlington’s alleged liability arose under § 601 of the 

NGPA, which for many years imposed maximum lawful price 

ceilings on first sales of natural gas. 15 U.S.C. § 3431 (1982) 

(amended effective 1993, as part of Congress’s repeal of the 

NGPA price ceilings). The statute allowed producers to 

charge above the maximum, however, to recoup the cost of 

any state “severance, production, or similar tax.” NGPA 

§ 110(a), (c), 15 U.S.C. § 3320(a), (c) (1982) (repealed 

effective 1993). The Commission at first interpreted this 

provision to allow recoupment of the Kansas ad valorem

property tax, though not certain other state taxes; in a 1988 

decision we required the Commission to justify this difference 

in treatment. Colorado Interstate Gas Co. v. FERC, 850 F.2d 

769, 770, 774-75 (1988). 

In 1993 the Commission ruled that reimbursements for 

the Kansas tax could not be added to the maximum price, and 

it required first sellers of gas to refund some of the tax-related 

revenues they had collected. Colorado Interstate Gas Co., 65 

FERC ¶ 61,292, at 62,372 (1993). (“First sellers” is a 

technical term, but for our purposes here is equivalent to gas 

producers.) In Public Service Co. of Colorado v. FERC, 91 

F.3d 1478 (D.C. Cir. 1996), we upheld this decision (with a 

tweak as to retroactivity). The Commission took action in 

1997, ordering the pipelines purchasing Kansas gas to serve 

first sellers with a “Statement of Refunds Due” for the period 

from 1983 to 1988. Pub. Serv. Co. of Colorado, 80 FERC 

¶ 61,264, at 61,955 (1997), aff’d in relevant part, Anadarko 

Petroleum Corp. v. FERC, 196 F.3d 1264, 1271 (D.C. Cir. 

1999), reh’g, 200 F.3d 867 (D.C. Cir. 2000). 

To avoid litigation, the Commission encouraged Kansas 

gas producers to settle their refund disputes with pipelines. In 

2000 and 2001 the Commission approved Omnibus 

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Settlements for Northern and Panhandle, respectively, under 

which the settling producers paid only a portion of their 

refund liabilities, and the two pipelines waived any claim to 

further refunds. Northern Natural Gas Co. (“Northern 

Omnibus”), 93 FERC ¶ 61,311, at 62,075 (2000); Panhandle 

E. Pipe Line Co. (“Panhandle Omnibus”), 96 FERC ¶ 61,274, 

at 62,039-40 (2001). 

Burlington, however, refused to join these agreements. 

During the period of uncertainty between our remand in 

Colorado Interstate Gas and the Commission’s 1993 order 

requiring refunds, Burlington had entered into settlements of 

its contract disputes with the two pipelines. The settlements 

had focused primarily on the problems posed by “take-or-pay” 

purchase obligations that the pipelines had found extremely 

onerous in the market conditions of the mid-1980s, but 

included language seeming to dispose of all claims relating to 

the contracts in question. See Northern 1989 Settlement 

Agreement para. 5, at 3 (releasing the parties “from any and 

all liabilities, claims, and causes of action, whether at law or 

in equity, and whether now known and asserted or hereafter 

discovered, arising out of, or in conjunction with, or relating 

to [the] said Contracts”); accord Panhandle 1992 Settlement 

Agreement para. 7, at 2. After the Commission resolved the 

uncertainty and required refunds of the Kansas tax 

reimbursements, Burlington denied any ad valorem tax 

liability to the two pipelines, arguing that its earlier 

settlements had released it from such claims. Notice of 

Petition for Adjustment, Burlington Res. Oil & Gas. Co., 

FERC Docket No. SA99-1-000 (Nov. 12, 1998); Request for 

Resolution, Burlington Res. Oil & Gas Co., FERC Docket No. 

GP99-15 (May 12, 1999). 

The Commission eventually ordered hearings in the 

matter, Northern Natural Gas Co., 102 FERC ¶ 61,003 (2003); 

Panhandle E. Pipe Line Co., 102 FERC ¶ 61,002 (2003), and 

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ruled in favor of the pipelines, finding the Burlington 

Settlements to be unlawful and unenforceable, Burlington Res. 

Oil & Gas Co. (“Northern Order”), 103 FERC ¶ 61,005, 

reh’g denied (“Northern Rehearing”), 104 FERC ¶ 61,317 

(2003); Panhandle E. Pipe Line Co., 103 FERC ¶ 61,007, 

reh’g denied, 105 FERC ¶ 61,141 (2003). Because the NGPA 

forbids a purchaser from paying more than the maximum 

price for a first sale of gas, the Commission reasoned, it 

equally barred a post-hoc settlement agreement if “the 

producer [would] be permitted to retain the excess over the 

[maximum price ceiling].” Northern Order, 103 FERC 

¶ 61,005, at 61,018 P 28 (emphasis added); see also id. at 

61,017-18 PP 27-30. It ordered Burlington to refund the 

excess revenues the company had collected, resulting in the 

petition we granted in Burlington I. 

* * * 

Before examining the Commission’s proffered distinction 

between the Burlington and the Omnibus settlements, we must 

consider the actual meaning of the Burlington Settlements. 

On remand the Commission noted correctly that the 

Burlington Settlements’ main purpose was to exchange 

immediate payments for a reduction in the pipelines’ future 

“take-or-pay” obligations. It proceeded to announce that ad 

valorem liabilities “could not be eliminated in any take-or-pay 

settlement,” Remand Order, 112 FERC ¶ 61,053, at 61,388 

P 52, especially through the “boilerplate” language that 

Burlington employed, Rehearing Order, 113 FERC ¶ 61,257, 

at 62,020 P 69. 

But we held in Burlington I that “the contract language 

does not reasonably permit exclusion of any claim that relates 

to payments made under the contracts,” including “Northern’s 

and Panhandle’s refund claims against Burlington.” 396 F.3d 

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at 411. Whether or not the ad valorem liabilities were within 

the main purpose of the settlements, they were within their 

language, written at a time when, as the background described 

above makes clear, the law was deeply unsettled and the 

parties would have had reason to seek accord. Northern 

suggests that we revisit our holding in Burlington I, portraying 

our construction as dictum and asking that the Commission, 

with the benefit of extrinsic evidence, be allowed to construe 

its settlement language first. But if Northern (which 

intervened in Burlington I) thought that any of our essential 

reasoning was in error, it should have petitioned for 

reconsideration, which it did not. Burlington I’s construction 

has thus become law of the case, which Northern cannot 

challenge here. See LaShawn A. v. Barry, 87 F.3d 1389, 1393 

(D.C. Cir. 1996) (en banc). 

* * * 

Burlington I required the Commission to explain why, if 

it considered the Burlington Settlements to be unlawful and 

unenforceable, it had approved the ostensibly similar 

Omnibus Settlements. 396 F.3d at 411-12. The producers 

joining the Omnibus Settlements paid only a portion of their 

full refund liability to the pipelines, and in some cases their 

liabilities were forgiven entirely. Thus, they too had been 

allowed to retain excess revenues over the maximum price 

ceiling. In its initial effort (prior to our decision) to 

distinguish the two groups of settlements, the Commission 

attributed the differential treatment to the “prosecutorial 

discretion” the agency wields “in determining how to expend 

its resources in the enforcement of [the NGPA’s] ceiling 

prices.” Northern Rehearing, 104 FERC ¶ 61,317, at 62,191 

P 26. Rather than take this assertion at face value, we 

charitably interpreted it in Burlington I as “betray[ing] a 

recognition that . . . the NGPA does not render unlawful all 

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private agreements allowing a producer to retain funds 

collected pursuant to unlawfully high prices.” 396 F.3d at 

411. We then remanded to the Commission for an 

explanation of which agreements were prohibited and why. 

See id. at 406, 411. 

The Commission, however, appears too proud to accept 

such interpretive charity. It insists that “all such 

agreements”—including, it seems, the Omnibus Settlements—

“are unlawful and unenforceable.” Remand Order, 112 FERC 

¶ 61,053, at 61,385 P 30; see also FERC Br. 7. 

We find this line of argument no less baffling than we did 

in Burlington I. The Commission’s approval of the Omnibus 

Settlements betrayed no hint that the agreements might be 

unlawful. Rather, the Commission found the settlements a 

“reasonable compromise,” was “heartened by the parties’ 

success,” and “encourage[d] similar efforts to settle the ad 

valorem tax refund claims.” Northern Omnibus, 93 FERC 

¶ 61,311, at 62,076; see also Panhandle Omnibus, 96 FERC ¶ 

61,274, at 62,044 (“We are also hopeful that all of the 

remaining disputes on the Panhandle system will be resolved 

through settlements in the near future.”). We doubt any 

agency could coherently find a settlement “fair and reasonable 

and in the public interest” and “unlawful and unenforceable” 

all at the same time. Remand Order, 112 FERC ¶ 61,053, at 

61,384 P 25, 61,385 P 30. 

A second, and more important, reason for our disbelief is 

that the Commission enjoys prosecutorial discretion only 

when it acts as a prosecutor, which it is not doing here. Both 

in approving the Omnibus Settlements and in denying effect 

to the Burlington Settlements, it acted as an adjudicator, 

determining the merits of a legal controversy among adverse 

parties. While the Commission had ordered the pipelines to 

initiate proceedings against the producers (through the filing 

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of Statements of Refunds Due), the proceedings inevitably 

took the form of an adjudication, with adverse parties and 

competing claims of right. See, e.g., Panhandle Omnibus, 96 

FERC ¶ 61,274, at 62,039 (“In accordance with procedures 

established by the Commission, Panhandle sought refunds 

from 836 operators . . . .”). The Commission was not itself a 

party to the Omnibus Settlements, but rather approved and 

accepted them as terminating proceedings among private 

parties. In the present case, moreover, the Commission 

affirmatively imposed liability on Burlington. 

At most, the Commission may employ prosecutorial 

discretion in settling its own claims, by deciding “not to take 

additional enforcement actions” against private parties. 

Remand Order, 112 FERC ¶ 61,053, at 61,385 P 27. The 

Commission has power to initiate enforcement actions under 

the NGPA, and when the governing statutes are “utterly silent 

on the manner in which the Commission is to proceed against 

a particular transgressor,” it may also refrain from initiating 

such actions. Balt. Gas & Elec. Co. v. FERC, 252 F.3d 456, 

461 (D.C. Cir. 2001). Similarly, the Commission may settle a 

prosecution based in part on “whether a ‘particular 

enforcement action requested best fits the agency’s overall 

policies, and, indeed, whether the agency has enough 

resources to undertake the action at all.’” Id. (quoting Heckler 

v. Chaney, 470 U.S. 821, 831 (1985)). 

But the Omnibus Settlements were not merely a 

“termination of Commission enforcement actions,” Remand 

Order, 112 FERC ¶ 61,053, at 61,385 P 30; they also 

purported to cancel or release the settling parties’ own private 

claims. See Northern Omnibus, 93 FERC ¶ 61,311, at 62,075; 

Panhandle Omnibus, 96 FERC ¶ 61,274, at 62,040. Thus, in 

approving the settlements, the Commission exercised authority 

beyond that of a prosecutor and more akin to that of a court. 

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By exercising dispositive authority, it correspondingly 

narrowed its discretion. 

* * * 

Without prosecutorial discretion to rely on, the 

Commission must—as we said last time—either “recog[nize] 

that . . . the NGPA does not render unlawful all private 

agreements allowing a producer to retain funds collected 

pursuant to unlawfully high prices,” Burlington I, 396 F.3d at 

411, or accept that it erred by approving the Omnibus 

Settlements. In a simple case of inconsistency, the ordinary 

course would be to remand to the Commission, so that it may 

decide whether to abandon its earlier position or its new one. 

See, e.g., Motor Vehicle Mfrs. Ass’n of U.S. v. State Farm 

Mut. Auto Ins. Co., 463 U.S. 29, 57 (1983); Exxon Mobil 

Corp. v. FERC, 315 F.3d 306, 308-09, 311 (D.C. Cir. 2003). 

Here, however, such reconsideration would be pointless, since 

we find the Commission’s current position to be unsupported 

by law. 

It is common ground that, by imposing a price ceiling on 

first sales of natural gas, the NGPA in a general sense 

invalidated any private agreement to pay more than the 

maximum lawful price. The Commission now reads this rule 

to prohibit any settlement agreement over past gas sales, even 

one reached in good faith and at arm’s length, that allows a 

party to retain past payments that might later be construed 

(based on a rather special idea of how consideration is 

assessed) to embody prices exceeding the statutory price 

ceiling. See Northern Order, 103 FERC ¶ 61,005, at 61,017-

18 PP 27-30; Remand Order, 112 FERC ¶ 61,053, at 61,387-

88 PP 45-47; Rehearing Order, 113 FERC ¶ 61,257, at 

62,016-17 PP 47-48. Thus, the Commission would forbid 

private parties from settling claims of uncertain value, if those 

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settlements turn out—once the uncertainty is resolved—to 

have left “excess” revenues in the seller’s hands.

Such a reading goes far beyond the precedents on which 

the Commission relies. Under the filed rate doctrine the 

Supreme Court applied in Arkansas Louisiana Gas Co. v. Hall

(“Arkla”), 453 U.S. 571 (1981), the rate filed with the 

Commission supersedes any price that private purchasers may 

have contractually agreed to pay. Id. at 582. We applied 

Arkla in Southern Union Co. v. FERC, 857 F.2d 812 (D.C. 

Cir. 1988), which concerned an agreement that accidentally 

misstated the nature of the gas to be delivered, describing it as 

intrastate gas not subject to the federal price ceiling. When 

the buyer realized the mistake and refused to pay above the 

maximum price, the seller sued in state court for negligent 

misrepresentation, obtaining an award of the difference 

between the price ceiling and the higher intrastate price that 

“should have been paid.” Id. at 817 (emphasis omitted). We 

held this award invalid, as it directly enforced a contractual 

price term higher than the federal price ceiling: because the 

state judgment was “based upon, and ha[d] the effect of 

awarding, a price for interstate gas that . . . exceeds federal 

guidelines,” the agreement was “simply . . . a bargain that the 

state has no power to enforce.” Id. at 818. 

Both Arkla and Southern Union, then, applied the same 

rule to prospective private agreements for the sale of gas: one 

cannot create a legal obligation, whether sounding in contract 

or in tort, to make a payment for future sales of more than the 

lawful price. Southern Union merely extended Arkla to 

contracts offering the parties a second means of recovery—

through tort law. See generally Gregory Klass, Contracting 

for Cooperation in Recovery, 117 Yale L.J. 2 (2007). 

Whereas Arkla invalidated an agreement of the form, “I agree 

to pay more than the lawful price for gas,” Southern Union

did the same for an agreement of the form, “I agree to pay 

USCA Case #06-1042 Document #1093528 Filed: 01/22/2008 Page 10 of 15
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more than the lawful price for gas, and you represent 

(negligently or not) that this gas is not within the scope of the 

price ceiling.” It would have driven a rather large hole in the 

interstate price ceiling regime if a contractually created 

alternative legal theory had allowed the recovery of a supralawful price. 

Neither Arkla nor Southern Union, however, laid down 

any rule with respect to retrospective settlement agreements 

concerning past payments for gas. Although the contract 

terms discussed in Southern Union were contained in a 

“settlement agreement,” the terms (insofar as they were 

relevant to our decision) addressed future sales, and they were 

located in such an agreement only as part of the consideration 

for a release of unrelated claims. See Southern Union, 857 

F.2d at 814-15 (declining to reach issues concerning a refund 

for past sales); see also Southern Union Co., 35 FERC 

¶ 61,359, at 61,818-19 (1986) (indicating that past sales were 

addressed through the refund). The Burlington Settlements, 

by contrast, create no liabilities for future gas sales, but 

merely resolve disputes over liabilities already accrued. 

These agreements to settle claims of past price-ceilingviolation are not the same as agreements to violate the price 

ceiling. Whereas for future deliveries of gas a buyer might 

well have an incentive to bid above the ceiling price (in order 

to secure the gas), no such motive seems likely to infect a 

bargain over past sales—and FERC makes no claim of any 

improper motive here. 

Because of its misinterpretation of Southern Union, the 

Commission reasoned that a settlement of past ad valorem tax 

disputes is invalid unless one can determine “precisely what 

consideration, if any, Burlington may have given for the 

specific purpose of satisfying its [Kansas ad valorem tax] 

refund obligations.” Rehearing Order, 113 FERC ¶ 61,257, at 

62,017 P 52 (citing Williams Natural Gas Co. v. FERC, 3 

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F.3d 1544 (D.C. Cir. 1993)). The Commission evidently 

supposed that one would then have to compare this 

“precisely” calculated consideration with the (ultimately 

determined) maximum lawful price; only agreements 

providing consideration “equal to [the] refund obligation” 

would be valid. See id. at 62,017 P 49. 

The Commission’s theory completely miscomprehends 

the nature of settlements negotiated under conditions of 

uncertainty. It is true that for each past overpayment, the 

maximum-price rule provides the purchaser with a right to a 

full refund. But the law does not prevent purchasers from 

later exchanging those accrued rights for other valuable 

consideration. Even in a settlement purporting to settle a 

single issue, the Commission cannot insist that the exchange 

match the parties’ exact obligations as ultimately determined; 

that would ignore the costs of formally resolving all 

uncertainties—costs that the Commission recognized when it 

spoke on remand of “the strong public policy that supports 

settling complex matters that thereby avoids the costs and 

burdens of litigation and mitigates administrative burdens.” 

Remand Order, 112 FERC ¶ 61,053 at 61,384 P 25. 

Moreover, our decision in Williams, which FERC 

invokes, considered a completely different question. There 

the pipeline claimed that it was entitled to pass along to 

customers the sums it had paid to gas producers in settlement 

of disputes over take-or-pay claims and certain gas pricing 

matters. Under the applicable rules, a pipeline could pass on 

all of its lawful payments for gas, but only some of its take-orpay buy-out expenses. The settlements in Williams did not 

differentiate between the two sources of the aggregate 

amounts, and the Commission ruled that, in the absence of 

such pinpointing, the pipeline could not use the 100% 

recovery mechanism applicable to payments for gas. Though 

finding “merit” in the pipeline’s argument that FERC’s 

USCA Case #06-1042 Document #1093528 Filed: 01/22/2008 Page 12 of 15
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distinction “elevate[d] the form of settlement payments over 

their substance,” 3 F.3d at 1553, we nonetheless found the 

rule within FERC’s discretion. Williams therefore involved 

FERC’s responsibility to protect customers, non-parties to the 

settlements, from the adverse effects of transactions between 

pipelines and producers. It bears no apparent relevance to the 

present dispute between the pipelines and a producer over the 

enforceability of their agreed-upon settlement. 

By contrast, while the NGPA presumably invalidated 

collusive settlements, there is no allegation that the Burlington 

Settlements were collusive in any way: Burlington and the 

pipelines appear to have negotiated in good faith and at arm’s 

length, with every incentive to enforce their legal rights and 

with no apparent detriments to third parties. The parties had 

constructive notice that the Commission would soon revisit its 

treatment of the ad valorem taxes, and they were in a state of 

genuine legal uncertainty as to whether those taxes could be 

recouped. 

In essence, the Commission holds that parties in such 

straits are forbidden from settling their disputes. Yet we have 

held in Panhandle Eastern Pipe Line Co. v. FERC, 95 F.3d 62 

(D.C. Cir. 1996)—a case with remarkably similar facts—that 

the filed rate doctrine does no such thing. In Panhandle, as a 

result of a legal error on the Commission’s part, a gas pipeline 

had billed a purchaser using a method that was later held to be 

unlawful under the filed rate doctrine. During a period of 

uncertainty, after a remand from this court but before the 

Commission had established a new standard, the parties 

attempted to settle their respective liabilities for a fixed sum. 

Id. at 65-67. The Commission subsequently disapproved the 

settlement, reasoning that if the purchaser had litigated the 

issue, the filed rate doctrine (correctly applied) would 

necessarily have required a larger refund than the settlement 

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provided. Id. at 67, 74. We described this as a “startling 

abuse” of the Commission’s powers: 

[T]hat [the purchaser] would have fared better by fighting 

than by settling . . . is not a sufficient basis upon which to 

conclude that approving the settlement would be unfair, 

unreasonable, or contrary to the public interest. Parties 

settle in order to avoid the risk that they might do worse 

by litigating, both because they might lose and because 

winning might come at a high cost; both parties to a 

settlement accept the risk that they might have done 

better by fighting. It is perverse, therefore, to reject a 

settlement because later developments make one party’s 

decision appear unwise. Rejecting a settlement upon such 

a flimsy ground only diminishes the incentive of future 

disputants to settle their cases. 

Id. at 74. 

Panhandle’s reasoning is equally applicable here. The 

pipelines would indeed have done better by preserving their 

claims, for (as it turned out) they were legally entitled to full 

ad valorem refunds. But the law does not prevent them from 

exchanging this entitlement for other goods. 

Nor do the pipelines’ second thoughts render the 

Burlington Settlements “contested,” or their enforcement 

“coercive,” as compared to the “uncontested” Omnibus 

Settlements, see Remand Order, 112 FERC ¶ 61,053 at 

61,387-88 PP 43, 48-49, for the Burlington Settlements too 

were uncontested when they were signed. Just because 

Burlington now presents the settlements as defenses to 

liability, and the pipelines contest their meaning and legality, 

does not make the settlements “contested” within the meaning 

of the Commission’s procedures for contested or uncontested 

settlement offers under 18 C.F.R. § 385.602. See Remand 

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Order, 112 FERC ¶ 61,053 at 61,387 P 43. Indeed, the 

factors on which the Commission justified its approval of the 

Omnibus Settlements are equally applicable to the Burlington 

Settlements, which at the time addressed complex claims, 

avoided future litigation, and resulted in an immediate 

exchange of consideration for the parties. The only difference 

is that the Burlington Settlements were made long ago, and 

with the advantage of hindsight one side now wants out. As 

we said in Panhandle, however, this is hardly a reason to 

disregard an otherwise lawful settlement. 

* * * 

As before, in the absence of a “reasoned and consistent 

explanation” for rejecting Burlington’s defense, Burlington I, 

396 F.3d at 412 (quoting Associated Gas Distribs. v. FERC, 

893 F.2d at 349, 361 (D.C. Cir. 1989)), we grant the petition, 

vacate the orders under review, and remand the case to the 

Commission for it to proceed with the adjudication in 

accordance with this opinion. 

So ordered. 

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