1 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

GARY ELLIOT, derivatively on behalf of

ENERGY TRANSFER LP,

Plaintiffs, 

vs. 

LE GP, LLC, KELCY L. WARREN, THOMAS 

E. LONG, MARHSALL S. MCCREA, III,

BRADFORD D. WHITEHURST, JOHN W.

MCREYNOLDS, STEVEN R. ANDERSON,

RICHARD D. BRANNON, RAY C. DAVIS,

MICHAEL K. GRIMM, JAMES R. PERRY,

MATTHEW S. RAMSEY, and RAY

WASHBURNE

Defendants,

and

ENERGY TRANSFER LP, 

Nominal Defendant.

Case No.: 

DEMAND FOR JURY TRIAL

VERIFIED UNITHOLDER DERIVATIVE COMPLAINT

INTRODUCTION

Plaintiff Gary Elliot (“Plaintiff”), by his undersigned attorneys, derivatively and on behalf 

of Energy Transfer LP (“Energy Transfer” or the “Partnership”), files this Verified Unitholder 

Derivative Complaint against Defendants Kelcy L. Warren (“Warren”), Thomas E. Long

(“Long”), Marshall S. McCrea, III (“McCrea”), Bradford D. Whitehurst (“Whitehurst”), John W. 

McReynolds (“McReynolds”), Steven R. Anderson (“Anderson”), Richard D. Brannon 

(“Brannon”), Ray C. Davis (“Davis”), Michael K. Grimm (“Grimm”), James R. Perry (“Perry”), 

Matthew S. Ramsey (“Ramsey”), and Ray Washburne (“Washburne”) (collectively, the 

3:22-cv-1527

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“Individual Defendants”) and Defendant LE GP, LLC (“LE GP” or the “General Partner,” and 

together with the Individual Defendants, the “Defendants”) for Defendants’ breaches of fiduciary 

duties as controlling unitholder, directors and/or officers of LE GP, unjust enrichment, waste of 

corporate assets, abuse of control, and gross mismanagement. As for his complaint against the 

Defendants, Plaintiff alleges the following based upon personal knowledge as to himself and his

own acts, and information and belief as to all other matters, based upon, inter alia, the 

investigation conducted by and through Plaintiff’s attorneys, which included, among other things, 

a review of the Defendants’ public documents, conference calls and announcements made by 

Defendants, United States Securities and Exchange Commission (“SEC”) filings, wire and press 

releases published by and regarding Energy Transfer, legal filings, news reports, securities 

analysts’ reports and advisories about the Partnership, and information readily obtainable on the 

Internet. Plaintiff believes that substantial evidentiary support will exist for the allegations set 

forth herein after a reasonable opportunity for discovery. 

NATURE OF THE ACTION

1. This is a unitholder (i.e., shareholder) derivative action that seeks to remedy 

wrongdoing committed by LE GP and its officers, directors, and controlling unitholder that 

caused damage to Energy Transfer between April 13, 2017, and December 20, 2021 (the 

“Relevant Period”).1

2. Energy Transfer is a Dallas, Texas-based energy services company founded in 

2002 that primarily conducts its business activities in the U.S. The Partnership is organized as a 

Delaware limited partnership and operates as a subsidiary of the Partnership’s general partner, 

Defendant LE GP. Defendant LE GP manages, directs, and controls all of Energy Transfer’s 

1 As Energy Transfer is a limited partnership, shares of the Company’s equity, which are publicly 

traded, are referred to as units and the term unitholder is used instead of shareholder. 

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activities. According to the Partnership’s SEC filings, Energy Transfer does not have officers or 

directors—rather, it is managed by the Board of Directors (the “Board”) and executive officers 

of the General Partner. Consequently, “the executive officers of [the General Partner] are [Energy 

Transfer’s] executive officers.” See Partnership’s annual report filed with the SEC on Form 10-

K on February 18, 2022. The General Partner’s “directors and officers have fiduciary duties to 

manage [Energy Transfer’s] business in a manner beneficial to [Energy Transfer] and [its] 

Unitholders.”

3. The Partnership’s operations include inter/intrastate natural gas transportation and 

storage, natural gas liquids (“NGL”) transportation storage, fractionation services, crude, and 

refined oil transportation, and terminalling, acquisition, and marketing activities. Energy Transfer 

conducts these operations through its own subsidiaries, which include Energy Transfer Operating, 

L.P. (“ETO”) and Sunoco LP (“Sunoco”).

4. In connection with these operations, the Partnership owns approximately 21,600 

miles of intrastate and interstate natural gas transportation pipelines. The Partnership’s natural 

gas transportation systems are among the largest in the U.S. The Partnership also owns and 

operates three natural gas storage facilities in the state of Texas and two natural gas storage 

facilities in Oklahoma. The Partnership also owns and operates natural gas gathering including 

NGL pipelines, processing plants, treating facilities, and conditioning facilities in many states.

5. One of the Partnership’s NGL pipelines is the Rover Pipeline, a 700-mile-long 

natural gas pipeline extending from southeastern Ohio to southern Michigan. Rover Pipeline, 

LLC (“Rover”), a subsidiary of Energy Transfer, was responsible for the construction of the Rover 

Pipeline, which began in 2017.

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6. Throughout the construction of the Rover Pipeline, a drilling process known as 

horizontal directional drilling (“HDD”) was used to install pipes underground. The HDD was 

done by Pretec Directional Drilling, LLC (“Pretec”) and involved the use of drilling fluid for safe 

and efficient drilling.

7. On April 13, 2017, during HDD activity near the Tuscarawas River, there was an 

inadvertent release (an unintended leakage of drilling fluid into the surrounding environment) 

(the “April 13 Release”). Drilling fluid normally has little environmental impact when leaked; 

however, it was later discovered that the drilling fluid leaked in connection with the April 13 

Release contained toxic diesel fluid along with other unapproved additives.

8. It was also later revealed that onsite HDD crews were intentionally using diesel 

fuel and other unapproved additives in the drilling fluid to combat the loss of drilling fluid into 

the environment. The use of these unapproved and toxic additives helped drilling efficiency, 

allowing for the onsite crews to keep up with the strict and tight construction schedule imposed 

by Rover.

9. As a result, on April 20, 2017, the Ohio Environmental Protection Agency (“Ohio 

EPA”) issued a notice of violation to Rover for the April 13 Release.

10. In response, on April 27, 2017, in a weekly construction status report to the Federal 

Energy Regulatory Commission (“FERC”), Rover stated that the April 13 Release was a common 

occurrence and the drilling fluid leaked was a non-toxic naturally occurring clay.

11. On May 10, 2017, FERC’s Office of Energy Projects (“FERC OEP”) issued a 

letter to Rover, terminating Rover’s HDD activity in the area until further authorization was 

granted.

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12. On June 1, 2017, FERC issued a public statement stating that the Ohio EPA had 

found presence of diesel fuel in samples of drilling fluid associated with Rover’s HDD near the 

Tuscarawas River.

13. Only July 31, 2017, J.D. Hair & Associates, Inc. (“JDH&A”), an engineering firm 

brought in by FERC to analyze HDD activity related to the April 13 Release. JDH&A found that 

Pretec’s HDD activity made in connection with the April 13 Release were not up to HDD industry 

standard. 

14. On August 21, 2017, FERC’s Enforcement Staff began to conduct a non-public 

formal investigation into the April 13 Release. 

15. Between August 31, 2017, and May 31, 2018, Energy Transfer made several press 

releases reporting on the progress of the Rover Pipeline project but failed to disclose the formal 

investigation undertaken by FERC’s Enforcement Staff. 

16. The truth begins to emerge on August 8, 2019, two years after the formal 

investigation by FERC’s Enforcement staff began, Energy Transfer disclosed to its investors the 

non-public formal investigation that was ongoing by FERC’s Enforcement Staff, in its quarterly 

report for the period ended June 30, 2019 (the “2019 Q2 10Q”). Energy Transfer only disclosed 

that the investigation was happening and failed to disclose any preliminary findings of the 

investigation nor any language regarding the severity of the investigation. 

17. On this news, Energy Transfer’s unit price fell $0.65 per unit, or 4.6%, from 

$14.03 per unit at close on August 8, 2019, to $13.38 per unit at close on August 12, 2019, over 

the course of two trading days. 

18. Energy Transfer continued to make surface level disclosures without additional 

material information in following SEC filings. On February 21, 2020, Energy Transfer filed an 

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annual report with the SEC on Form 10-K for the fiscal year ended December 31, 2019 (the “2019 

10-K”). On February 19, 2021, Energy Transfer filed an annual report with the SEC on Form 10-

K for the fiscal year ended December 31, 2020 (the “2020 10-K”).

19. The truth full emerged on December 16, 2021, when FERC issued an Order to 

Show Cause and Notice of Proposed Penalty, providing details of the April 13 Release as a result 

of the investigation. The order alleged that Rover (1) used diesel fuel and other toxic and 

unapproved additives in their drilling fluid, (2) failed to monitor the right-of-way, and (3) failed 

to properly dispose of drilling fluid contaminated with diesel fuel and hydraulic oil. The order 

also proposed a $40 million civil penalty. 

20. On this news, Energy Transfer’s unit price fell $0.14 per unit, or 1.6%, from $8.49 

per unit at close on December 16, 2021, to $8.35 per unit at close on December 17, 2021. The 

unit continued to fall the following two trading day, dropping an additional $0.17 per unit, or 2%, 

to $8.18 per unit at close on December 21, 2021, and fell a total of $0.31 per unit, or 3.6% from 

the initial day.

21. During the Relevant Period, the General Partner and the Individual Defendants 

breached their fiduciary duties to Energy Transfer by allowing the Partnership to engage in illegal 

HDD activities, and by personally making and/or causing the Partnership to make to the investing 

public a series of materially false and misleading statements regarding the Partnership’s business, 

operations, and legal and regulatory compliance. Specifically, the General Partner and the 

Individual Defendants willfully or recklessly made and/or caused the Partnership to make false 

and misleading statements to the investing public that failed to disclose, inter alia, that: (1) Energy 

Transfer had failed to maintain internal controls and proper procedures to prevent contractors 

from engaging in illegal HDD activities; (2) the Partnership failed to mitigate known problems in 

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connection with the foregoing; (3) Energy Transfer, through Rover, hired third-party contractors 

who engaged in illegal HDD activities which caused massive pollution near the Tuscarawas 

River; and (4) the severity of the potential civil liabilities as a result of the FERC’s Enforcement 

Staff investigation into the April 13 Release. As a result of the foregoing, Energy Transfer’s 

public statements were materially false and misleading at all relevant times.

22. The General Partner and the Individual Defendants also breached their fiduciary 

duties by failing to correct and causing the Partnership to fail to correct these false and misleading 

statements and omissions of material fact to the investing public.

23. Additionally, in breach of their fiduciary duties, the General Partner and the 

Individual Defendants willfully or recklessly caused the Partnership to fail to maintain internal 

controls.

24. In light of the General Partner and the Individual Defendants’ misconduct, which 

has subjected the Partnership, the General Partner’s two Co-Chief Executive Officers (“CEO”), 

the General Partner’s Chief Financial Officer (“CFO”), the General Partner’s former CEO, and 

former President to being named as defendants in a federal securities fraud class action lawsuit 

pending in the United States District Court for the Southern District of New York (the “Securities 

Class Action”), the need to undertake internal investigations, the need to implement adequate 

internal controls, the losses from the waste of corporate assets, the losses due to the unjust 

enrichment of the Individual Defendants who were improperly over-compensated by the General 

Partner and/or who benefitted from the wrongdoing alleged herein, the Partnership will have to 

expend many millions of dollars.

25. In light of the breaches of fiduciary duty engaged in by Defendant LE GP, and of 

the substantial likelihood of LE GP’s liability in this derivative action and in the Securities Class 

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Action, and of it not being disinterested and/or independent, LE GP cannot consider a demand to 

commence litigation against itself and its officers and directors on behalf of the Partnership with 

the requisite level of disinterestedness and independence. 

JURISDICTION AND VENUE 

26. This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331 because 

Plaintiff’s claims raise a federal question pertaining to the claims made in the Securities Class 

Action based on violations of the Securities Exchange Act of 1934 (“Exchange Act”). 

27. This Court has supplemental jurisdiction over Plaintiff’s state law claims pursuant 

to 28 U.S.C. § 1367(a). 

28. This derivative action is not a collusive action to confer jurisdiction on a court of 

the United States that it would not otherwise have. 

29. The Court has personal jurisdiction over each of the Defendants because each 

Defendant is either a corporation conducting business and maintaining operations in this District, 

or he is an individual who has minimum contacts with this District to justify the exercise of 

jurisdiction over them. 

30. Venue is proper in this District pursuant to 28 U.S.C. §§ 1391 and 1401 because a 

substantial portion of the transactions and wrongs complained of herein occurred in this District, 

and the Defendants have received substantial compensation in this District by engaging in 

numerous activities that had an effect in this District. 

31. Venue is proper in this District because Energy Transfer and the Defendants have 

conducted business in this District, and Defendants’ actions have had an effect in this District. 

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PARTIES

Plaintiff

32. Plaintiff is a current unitholder of Energy Transfer. Plaintiff has continuously held

Energy Transfer common units since he purchased them in 2013. Plaintiff is a citizen of Texas.

Nominal Defendant Energy Transfer

33. Energy Transfer is a Delaware limited partnership with its principal executive 

offices located at 8111 Westchester Drive, Suite 600, Dallas, Texas 75225. Energy Transfer’s 

common units trade on the New York Stock Exchange (“NYSE”) under the ticker symbol “ET.” 

Defendant LE GP

34. LE GP is the general partner of Energy Transfer. 

35. Energy Transfer and LE GP are governed by the Partnership’s Partnership 

Agreement. Per the Partnership Agreement, the General Partner conducts, directs and manages 

all activities of the Partnership. All management powers over the business and affairs of the 

Partnership are exclusively vested in the General Partner. 

Defendant Warren

36. Defendant Warren is a co-founder of Energy Transfer and has served as Executive 

Chairman of the General Partner since 2007. He has also served as CEO from August 2007 

through December 2020. He is also the majority owner of the General Partner. 

37. According to the Partnership’s annual statement filed on Form 10-K on February 

18, 2022 (the “2021 10-K”), as of February 11, 2022, Defendant Warren beneficially owned 

279,049,984 units of the Partnership’s common units, representing 9.1% of the Partnership’s 

outstanding common units as of that date. Defendant Warren also beneficially owned 763,021,449 

units of the Partnership’s Class A units, representing 100% of the Partnership’s outstanding Class 

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A units2 as of that date. Defendant Warren’s combined ownership of common units and Class A 

units results in a 27.1% voting interest in the Partnership.3 Defendant Warren also has an 81.2% 

membership interest in the General Partner making him a majority interest-holder and a 

controlling unitholder. Given that the price of the Partnership’s common unit at the close of 

trading on February 11, 2022, was $10.30 per unit, Defendant Warren beneficially owned 

approximately $7.86 billion worth of Energy Transfer units.

38. For the fiscal year ended December 31, 2020 (the “2020 Fiscal Year”), Defendant

Warren received $6,392 in total compensation from the General Partner, consisting only of salary. 

For the fiscal year ended December 31, 2019 (the “2019 Fiscal Year”), Defendant Warren

received $6,156 in total compensation, consisting only of salary. For the fiscal year ended 

December 31, 2018 (the “2018 Fiscal Year”), Defendant Warren received $6,138 in total 

compensation from the General Partner, consisting only of salary. For the fiscal year ended 

December 31, 2017 (the “2017 Fiscal Year”), Defendant Warren received $5,926 in total 

compensation from the General Partner, consisting only of salary. Across the four years, 

Defendant Warren received $24,612 in total compensation from the General Partner.

39. The 2021 10-K stated the following regarding Defendant Warren:

Kelcy L. Warren. Mr. Warren serves as Executive Chairman of our general 

partner. Mr. Warren served as Chief Executive Officer from August 2007 through 

December 2020. He was appointed Co-Chairman of the Board of Directors of our 

general partner, effective upon the closing of our IPO, and in August 2007, he 

became the sole Chairman of the Board of our general partner and the Chief 

Executive Officer and Chairman of the Board of the general partner of ETO until 

its merger into Energy Transfer LP in April 2021. Prior to August 2007, Mr. 

Warren had served as Co-Chief Executive Officer and Co-Chairman of the Board 

of the general partner of ETO since the combination of the midstream and 

intrastate transportation storage operations of La Grange Acquisition, L.P., and the 

2 Energy Transfer Class A units are entitled to vote together with the Partnership’s common units but are not 

convertible into or exchangeable for Partnership common units, and otherwise have no economic attributes.

3 601, 076 common units and 100% of the Class A units are held by the General Partner, which Defendant Warren 

is deemed to own due to his ownership of 81.2% of the General Partner’s membership interests.

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retail propane operations of Heritage in January 2004. Mr. Warren also served as 

the Chief Executive Officer of PennTex Midstream Partners, LP’s general partner 

from November 2016 to July 2017. Mr. Warren was selected to serve as a director 

and as Executive Chairman because he previously served as Chief Executive 

Officer and has more than 30 years in the natural gas industry. Mr. Warren also 

has relationships with chief executives and other senior management at natural gas 

transportation companies throughout the United States and brings a unique and 

valuable perspective to the Board of Directors.

40. Upon information and belief, Defendant Warren is a citizen of Texas. 

Defendant Long 

41. Defendant Long has served as the General Partner’s Co-CEO since January 2021 

and has served as a director of the General Partner since April 2019. Prior, he served as CFO from 

February 2016 to January 2021. According to the 2021 10-K, as of February 11, 2022, Defendant 

Long beneficially owned 666,018 units of the Partnership’s common units. Given that the price 

of the Partnership’s common unit at the close of trading on February 11, 2022, was $10.30 per 

unit, Defendant Long beneficially owned approximately $6.86 million worth of Energy Transfer 

units. 

42. For the fiscal Year ended December 31, 2021 (the “2021 Fiscal Year”), Defendant 

Long received $19,730,203 in total compensation from the General Partner. This included 

$1,322,750 in salary, $15,224,039 in equity awards, $3,156,400 in non-equity incentive plan 

compensation, and $27,014 in all other compensation. For the 2020 Fiscal Year, Defendant Long 

received $3,425,935 in total compensation from the General Partner. This included $623,077 in 

salary, $2,781,255 in equity awards, and $21,603 in all other compensation. For the 2019 Fiscal 

Year, Defendant Long received 4,845,208 in total compensation. This included $570,869 in 

salary, $3,352,795 in equity awards, $900,000 in non-equity incentive plan compensation, and 

$21,544 in all other compensation. For the 2018 Fiscal Year, Defendant Long received 

$6,609,967 in total compensation, which consisted of $537,338 in salary, $1,000,000 in bonus, 

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$4,251,335 in equity awards, $800,000 in non-equity incentive plan compensation, and $21,294 

in all other compensation. For the 2017 Fiscal Year, Defendant Long received $3,644,220 in total 

compensation, which consisted of $480,846 in salary, $2,519,954 in equity awards, $625,100 in 

non-equity incentive plan compensation, and $18,320 in all other compensation. Across five 

years, Defendant Long received $38, 255,533 from the General Partner. 

43. The 2021 10-K stated the following about Defendant Long: 

Thomas E. Long. Mr. Long has served as the Co-Chief Executive Officer of our 

general partner since January 2021. Mr. Long served as Chief Financial Officer of 

Energy Transfer’s general partner from February 2016 until January 2021 and has 

been a director of our general partner since April 2019. Mr. Long also served as 

the Chief Financial Officer and as a director of PennTex Midstream Partners, LP’s 

general partner from November 2016 to July 2017. Mr. Long also served as Chief 

Financial Officer of ETO until its merger into Energy Transfer LP in April 2021 

and was previously Executive Vice President and Chief Financial Officer of 

Regency GP LLC from November 2010 to April 2015. Mr. Long served as a 

director of Sunoco LP from May 2016 until May 2021 and has served as Chairman 

of the Board of USAC since April 2018. Mr. Long was selected to serve on our 

Board of Directors because of his understanding of energy-related corporate 

finance gained through his extensive experience in the energy industry. 

44. Upon information and belief, Defendant Long is a citizen of Texas.

Defendant McCrea

45. Defendant McCrea has served as Co-CEO of the General Partnership since 

January 2021 and as a director of the General Partnership since December 2009. Prior, he served 

as the President and the Chief Commercial Officer (“CCO”) from October 2018 to December 

2020. According to the 2021 10-K, as of February 11, 2021, Defendant McCrea beneficially 

owned 2,752,342 units of the Partnership’s common units. Given that the price of the 

Partnership’s common unit at the close of trading on February 11, 2022, was $10.30 per unit, 

Defendant McCrea beneficially owned approximately $28.35 million worth of Energy Transfer 

units. 

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46. For the 2021 Fiscal Year, Defendant McCrea received $21,460,652 in total 

compensation from the General Partner, which consisted of $1,322,750 in salary, $3,225,000 in 

bonus, $13,734,458 in equity awards, $3,156,400 in non-equity incentive plan compensation, and 

$22,044 in all other compensation. For the 2020 Fiscal Year, Defendant McCrea received 

$7,572,984 in total compensation from the General Partner, which consisted of $1,157,423 in 

salary, $1,800,000 in bonus, $4,597,516 in equity awards, and $18,045 in all other compensation. 

For the 2019 Fiscal Year, Defendant McCrea received 11,601,341 in total compensation, which 

consisted of $1,094,260 in salary, $8,734,720 in equity awards, $1,750,817 in non-equity 

incentive plan compensation, and $21,544 in all other compensation. For the 2018 Fiscal Year, 

Defendant McCrea received $10,780,120 in total compensation, which consisted of $1,059,976

in salary, $7,834,782 in equity awards, $1,866,000 in non-equity incentive plan compensation, 

and $19,362 in all other compensation. For the 2017 Fiscal Year, Defendant McCrea received 

$11,722,575 in total compensation, which consisted of $1,027,846 in salary, $9,033,341 in equity 

awards, $1,644,554 in non-equity incentive plan compensation, and $16,834 in all other 

compensation. Across five years, Defendant McCrea received $63,137,672 from the General 

Partner.

47. The 2021 10-K stated the following about Defendant McCrea:

Marshall S. (Mackie) McCrea, III. Mr. McCrea has served as the Co-Chief 

Executive Officer of our general partner since January 2021. Prior to that he was 

the President and Chief Commercial Officer of our general partner, having served 

in that role since October 2018 following the merger of Energy Transfer Equity, 

L.P., and Energy Transfer Partners, L.P. Prior to that time, he had been the Group 

Chief Operating Officer and Chief Commercial Officer of the Energy Transfer 

family since November 2015. Mr. McCrea has served on the Board of Directors 

of our general partner since December 2009. Mr. McCrea was appointed as a 

director of the general partner of ETO in December 2009 and served in that 

capacity until ETO’s merger into Energy Transfer LP in April 2021. Prior to 

December 2009, he served as President and Chief Operating Officer of ETO’s 

general partner from June 2008 to November 2015 and President – Midstream 

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from March 2007 to June 2008. Previously he served as the Senior Vice President 

– Commercial Development since January 2004. In March 2005, Mr. McCrea was 

named President of La Grange Acquisition LP, ETO’s primary operating 

subsidiary, after serving as Senior Vice President-Business Development and 

Producer Services since 1997. Mr. McCrea also served as the Chairman of the 

Board of Directors of the general partner of Sunoco Logistics Partners L.P. from 

October 2012 to April 2017. Mr. McCrea was selected to serve as a director 

because he brings extensive project development and operational experience to the 

Board. He has held various positions in the natural gas business over the past 25 

years and is able to assist the Board of Directors in creating and executing the 

Partnership’s strategic plan.

48. Upon information and belief, Defendant McCrea is a citizen of Texas. 

Defendant Whitehurst

49. Defendant Whitehurst served as CFO of Energy Transfer since January 2021. 

Prior, he served as Executive Vice President – Head of Tax from August 2014 through December 

2020. According to the 2021 10-K, as of February 11, 2022, Defendant Whitehurst beneficially 

owned 436,512 units of the Partnership’s common units. Given that the price of the Partnership’s 

common unit at the close of trading on February 11, 2022, was $10.30 per unit, Defendant 

Whitehurst beneficially owned approximately $4.49 million worth of Energy Transfer units. 

50. For the 2021 Fiscal Year, Defendant Whitehurst received $4,897,867 in total 

compensation from the General Partner, which consisted of $605,413 in salary, $3,102,694 in 

equity awards, $1,174,000 in non-equity incentive plan compensation, and $15,760 in all other 

compensation. For the 2020 Fiscal Year, Defendant Whitehurst received $3,194,276 in total 

compensation from the General Partner, which consisted of $581,202 in salary, $2,596,850 in 

equity awards, and $16,224 in all other compensation. Across two years, Defendant Whitehurst 

received $8,092,143 from the General Partner.

51. The 2021 10-K stated the following about Defendant Whitehurst: 

Bradford D. Whitehurst. Mr. Whitehurst was appointed Chief Financial Officer 

of Energy Transfer in January 2021. From August 2014 through December 2020,

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he served as Executive Vice President – Head of Tax. Prior to joining Energy 

Transfer, Mr. Whitehurst was a partner in the Washington, DC office of Bingham 

McCutchen LLP and an attorney in the Washington, DC offices of both McKee 

Nelson LLP and Hogan & Hartson. Mr. Whitehurst has specialized in partnership 

taxation and has advised Energy Transfer and its subsidiaries in his role as outside 

counsel since 2006. He has served as a member of the board of directors of USAC 

since April 2019. 

52. Upon information and belief, Defendant Whitehurst is a citizen of Texas. 

Defendant McReynolds

53. Defendant McReynolds served as a director of the Partnership since August 2004. 

Prior, he has served as the President of the Partnership from March 2005 through October 2018. 

According to the 2021 10-K, as of February 11, 2022, Defendant McReynolds beneficially owned 

30,225,200 units of the Partnership’s common units. Given that the price of the Partnership’s 

common unit at the close of trading on February 11, 2022, was $10.30 per unit, Defendant 

McReynolds beneficially owned approximately $311.32 million worth of Energy Transfer units. 

54. For the 2018 Fiscal Year, Defendant McReynolds received $1,422,273 in total 

compensation, which consisted of $606,306 in salary, $800,000 in non-equity incentive plan 

compensation, and $15,967 in all other compensation. For the 2017 Fiscal Year, Defendant 

McReynolds received $1,367,413 in total compensation, which consisted of $587,928 in salary, 

$764,306 in non-equity incentive plan compensation, and $15,179 in all other compensation. 

Across two years, Defendant McReynolds received $2,789,686 from the General Partner.

55. The 2021 10-K stated the following about Defendant McReynolds: 

John W. McReynolds. Mr. McReynolds is a director of Energy Transfer LP, 

having served in that capacity since August 2004. Mr. McReynolds previously 

served as the President of Energy Transfer LP from March 2005 until October 

2018; at which time he became Special Advisor to the Partnership. Mr. 

McReynolds also previously served as our Chief Financial Officer from August 

2005 to June 2013. Prior to becoming President of Energy Transfer LP, Mr. 

McReynolds was a partner in the international law firm of Hunton & Williams 

LLP for over 20 years. As a lawyer, he specialized in energy related finance, 

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securities, partnerships, mergers and acquisitions, syndication, and litigation 

matters, and served as an expert in numerous arbitration, litigation, and 

governmental proceedings, including as an expert in special projects for boards of 

directors of public companies. Mr. McReynolds was selected to serve in the 

indicated roles with Energy Transfer because of this extensive background and 

experience, as well as his many contacts and relationships in the industry. 

56. Upon information and belief, Defendant McReynolds is a citizen of Texas. 

Defendant Anderson

57. Defendant Anderson has served as a director of the General Partner since June 

2018. He also serves as a member of the General Partner’s Audit Committee and Compensation 

Committee. According to the 2021 10-K, as of February 11, 2022, Defendant Anderson 

beneficially owned 1,550,656 units of the Partnership’s common units. Given that the price of the 

Partnership’s common unit at the close of trading on February 11, 2022, was $10.30 per unit, 

Defendant Anderson beneficially owned approximately $15.97 million worth of Energy Transfer 

units. 

58. For the 2021 Fiscal Year, Defendant Anderson received $222,503 in total 

compensation from the General Partner, which consisted of $122,500 in fees paid in cash and 

$100,003 in unit awards. For the 2020 Fiscal Year, Defendant Anderson received $222,497 in 

total compensation from the General Partner, which consisted of 122,500 in fees paid in cash and 

$99,997 in unit awards. For the 2019 Fiscal Year, Defendant Anderson received 222,498 in total 

compensation from the General Partner, which consisted of $122,500 in fees paid in cash and 

$99,998 in unit awards. For the 2018 Fiscal Year, Defendant Anderson received $135,960 in total 

compensation from the General Partner, which consisted of $91,760 in fees paid in cash and 

$44,200 in unit awards. Across the four years, Defendant Anderson received a total of $803,438 

from the General Partner.

59. The 2021 10-K stated the following about Defendant Anderson: 

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Steven R. Anderson. Mr. Anderson was elected to the Board of Directors of our 

general partner in June 2018 and serves on the audit committee and compensation 

committee. Mr. Anderson began his career in the energy business in the early 

1970’s with Conoco in the Permian Basin area. He then spent some 25 years with 

ANR Pipeline and its successor, The Coastal Corporation, as a natural gas supply 

and midstream executive. He later was Vice President of Commercial Operations 

with Aquila Midstream and, upon the sale of that business to Energy Transfer in 

2002, he became a part of the management team there. For the six years prior to 

his retirement from Energy Transfer in October 2009, he served as Vice President 

of Mergers and Acquisitions. Since that time, he has been involved in private 

investments and has served on the boards of directors of the St. John Health 

System and Saint Simeon’s Episcopal Home in Tulsa, Oklahoma, as well as 

various other community and civic organizations. Mr. Anderson also served as a 

member of the board of directors of Sunoco Logistics Partners L.P. from October 

2012 until April 2017. Mr. Anderson was selected to serve on our Board of 

Directors based on his experience in the midstream energy industry generally, and 

his knowledge of Energy Transfer’s business specifically. Mr. Anderson also 

brings recent experience on audit and compensation committees of another 

publicly traded partnership.

60. Upon information and belief, Defendant Anderson is a citizen of Texas.

Defendant Brannon 

61. Defendant Brannon has served as a director of the General Partner since March 

2016. He also serves as the Chairman of the General Partner’s Audit Committee. According to 

the 2021 10-K, as of February 11, 2022, Defendant Brannon beneficially owned 471,629 units of 

the Partnership’s common units. Given that the price of the Partnership’s common unit at the 

close of trading on February 11, 2022, was $10.30 per unit, Defendant Brannon beneficially 

owned approximately $4.86 million worth of Energy Transfer units. 

62. For the 2021 Fiscal Year, Defendant Brannon received $225,003 in total 

compensation from the General Partner, which consisted of $125,000 in fees paid in cash and 

$100,003 in unit awards. For the 2020 Fiscal Year, Defendant Brannon received $224,997 in total 

compensation from the General Partner, which consisted of 125,000 in fees paid in cash and 

$99,997 in unit awards. For the 2019 Fiscal Year, Defendant Bannon received 224,998 in total 

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compensation from the General Partner, which consisted of $125,000 in fees paid in cash and 

$99,998 in unit awards. For the 2018 Fiscal Year, Defendant Brannon received $294,225 in total 

compensation from the General Partner, which consisted of $194,225 in fees paid in cash and 

$100,000 in unit awards. For the 2017 Fiscal Year, Defendant Brannon received $183,956 in total 

compensation from the General Partner, which consisted of $83,965 in fees paid in cash and 

$99,991 in unit awards. Across the five years, Defendant Brannon received a total of $1,153,179 

from the General Partner.

63. The 2021 10-K stated the following about Defendant Brannon: 

Richard D. Brannon. Mr. Brannon was appointed to the Board of Directors of our 

general partner in March 2016 and has served as the Chairman of the audit 

committee since April 2016. Mr. Brannon is the CEO of CH4 Energy Six, LLC 

and Uinta Wax, LLC, both independent companies focused on horizontal oil and 

gas development. Mr. Brannon previously served on the board of directors of 

WildHorse Resource Development from its IPO in December 2016 until June 

2018. Mr. Brannon also formerly served on the Board of Directors and as a 

member of the audit committee and compensation committee of Sunoco LP, 

Regency, OEC Compression and Cornerstone Natural Gas Corp. He has over 35 

years of experience in the energy business, having started his career in 1981 with 

Texas Oil & Gas. The members of our general partner selected Mr. Brannon to 

serve as director based on his knowledge of the energy industry and his experience 

as a director and audit and compensation committee member for other public 

companies.

64. Upon information and belief, Defendant Brannon is a citizen of Texas.

Defendant Davis 

65. Defendant Davis is a co-founder of Energy Transfer and has served as a director 

of the General Partner since July 2018. Prior, he has served as a director of ETO from February 

2013 to February 2018. According to the 2021 10-K, as of February 11, 2022, Defendant Davis 

beneficially owned 90,114,776 units of the Partnership’s common units, representing 

approximately 2.9% of the Partnership’s total outstanding common units. Given that the price of 

the Partnership’s common unit at the close of trading on February 11, 2022, was 10.30 per unit, 

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Defendant Davis beneficially owned approximately $928.18 million worth of Energy Transfer 

units.

66. For the 2021 Fiscal Year, Defendant Davis received $200,003 in total 

compensation from the General Partner, which consisted of $100,000 in fees paid in cash and 

$100,003 in unit awards. For the 2020 Fiscal Year, Defendant Davis received $199,997 in total 

compensation from the General Partner, which consisted of 100,000 in fees paid in cash and 

$99,997 in unit awards. For the 2019 Fiscal Year, Defendant Davis received $199,998 in total 

compensation from the General Partner, which consisted of $100,000 in fees paid in cash and 

$99,998 in unit awards. For the 2018 Fiscal Year, Defendant Davis received $117,450 in total 

compensation from the General Partner, which consisted of $74,750 in fees paid in cash and 

$42,700 in unit awards. Across the four years, Defendant Davis received a total of $717,448 from 

the General Partner.

67. The 2021 10-K stated the following about Defendant Davis:

Ray C. Davis. Mr. Davis was appointed to the Board of Directors of the general 

partner of Energy Transfer LP in July 2018 and served on the Board of Directors 

of ETO from February 2018 until July 2018. From February 2013 until February 

2018, Mr. Davis was an independent investor. He has also been a principal owner, 

and served as co-chairman of the board of directors, of the Texas Rangers major 

league baseball club since August 2010. Mr. Davis previously served on the Board 

of Directors of Energy Transfer LP, effective upon the closing of its IPO in 

February 2006 until his resignation in February 2013. Mr. Davis also served as 

ETO’s Co-Chief Executive Officer from the combination of the midstream and 

transportation operations and the retail propane operations in January 2004 until 

his retirement from these positions in August 2007, and as the Co-Chairman of the 

Board of Directors of our general partner from January 2004 until June 2011. Mr. 

Davis also held various executive positions with Energy Transfer prior to 2004. 

Mr. Davis was selected to serve as director based on his over 40 years of business 

experience in the energy industry and his expertise in the Partnership’s asset 

portfolio.

68. Upon information and belief, Defendant Davis is a citizen of Texas.

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Defendant Grimm

69. Defendant Grimm has served as a director of the General Partner since October 

2018 and serves as a member of the General Partner’s Audit Committee and Compensation 

Committee. He has also served as a director of ETO since December 2005. According to the 2021 

10-K, as of February 11, 2022, Defendant Grimm beneficially owned 151,400 units of the 

Partnership’s common units. Given that the price of the Partnership’s common unit at the close 

of trading on February 11, 2022, was $10.30 per unit, Defendant Grimm beneficially owned 

approximately $1.56 million worth of Energy Transfer units. 

70. For the 2021 Fiscal Year, Defendant Grimm received $230,003 in total 

compensation from the General Partner, which consisted of $130,000 in fees paid in cash and 

$100,003 in unit awards. For the 2020 Fiscal Year, Defendant Grimm received $229,997 in total 

compensation from the General Partner, which consisted of 130,000 in fees paid in cash and 

$99,997 in unit awards. For the 2019 Fiscal Year, Defendant Grimm received $229,998 in total 

compensation from the General Partner, which consisted of $130,000 in fees paid in cash and 

$99,998 in unit awards. For the 2018 Fiscal Year, Defendant Grimm received $305,493 in total 

compensation from the General Partner, which consisted of $205,425 in fees paid in cash and 

$100,068 in unit awards. Across the four years, Defendant Grimm received a total of $995,491 

from the General Partner.

71. The 2021 10-K stated the following about Defendant Grimm: 

Michael K. Grimm. Mr. Grimm was appointed to the Board of Directors of our 

general partner in October 2018 and has served on the audit committee and 

compensation committee since that time. Prior to that time, Mr. Grimm served as 

a director of ETO’s general partner beginning in December 2005 and served on 

the audit and compensation committee during that time. Mr. Grimm is one of the 

original founders of Rising Star Energy, L.L.C., a privately held upstream 

exploration and production company active in onshore continental United States 

and served as its President and Chief Executive Officer from 1995 until 2006 when 

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it was sold. Mr. Grimm is currently President of Rising Star Petroleum, LLC. Mr. 

Grimm was formerly Chairman of the Board of RSP Permian, Inc. (NYSE: RSPP) 

from January 2014 until June 2018. From November 2018 until it was sold in 2019, 

Mr. Grimm served on the Board of Directors of Anadarko Petroleum Corporation. 

Prior to the formation of Rising Star, Mr. Grimm was Vice President of Worldwide 

Exploration and Land for Placid Oil Company from 1990 to 1994. Prior to joining 

Placid Oil Company, Mr. Grimm was employed by Amoco Production Company 

for thirteen years where he held numerous positions throughout the exploration 

department in Houston, New Orleans, and Chicago. Mr. Grimm has been an active 

member of the American Association of Professional Landmen, Dallas Wildcat 

Committee, Dallas Producers Club, and the All-American Wildcatters. He has a 

B.B.A. from the University of Texas at Austin. Mr. Grimm was selected to serve 

as a director because of his extensive experience in the energy industry and his 

service as a senior executive at several energy-related companies, in addition to 

his contacts in the industry gained through his involvement in energy related 

organizations. 

72. Upon information and belief, Defendant Grimm is a citizen of Texas.

Defendant Perry

73. Defendant Perry has served as a director of the General Partner since January 2020. 

According to the 2021 10-K, as of February 11, 2022, Defendant Perry beneficially owned 

120,020 units of the Partnership’s common units. Given that the price of the Partnership’s 

common unit at the close of trading on February 11, 2022, was $10.30 per unit, Defendant Perry 

beneficially owned approximately $1.23 million worth of Energy Transfer units. 

74. For the 2021 Fiscal Year, Defendant Perry received $200,003 in total 

compensation from the General Partner, which consisted of $100,000 in fees paid in cash and 

$100,003 in unit awards. For the 2020 Fiscal Year, Defendant Perry received $174,997 in total 

compensation from the General Partner, which consisted of $75,000 in fees paid in cash and 

$99,997 in unit awards. Across the two years, Defendant Perry received a total of $375,000 from

the General Partner.

75. The 2021 10-K stated the following about Defendant Perry: 

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James R. (Rick) Perry. Mr. Perry was appointed to the Board of Directors of our 

general partner in January 2020. He formerly served as U.S. Secretary of Energy 

from March 2017 until December 2019. Prior to that, he served as the Governor 

of the State of Texas from 2000 until January 2015. Mr. Perry served as Lieutenant 

Governor of Texas from 1998 to 2000, and as Agriculture Commissioner from 

1991 to 1998. Prior to 1991, he also served in the Texas House of Representatives. 

Mr. Perry previously served on the Board of Directors of ETO from February 2015 

until December 2016. Mr. Perry was selected to serve as a director because of his 

vast experience as an executive in the highest office of state government. In 

addition, Mr. Perry has been involved in finance and budget planning processes 

throughout his career in government as a member of the Texas House 

Appropriations Committee, the Legislative Budget Board and as Governor. 

76. Upon information and belief, Defendant Perry is a citizen of Texas.

Defendant Ramsey

77. Defendant Ramsey has served as a director of the General Partner since July 2012.

Prior, he served as the Chief Operating Officer (“COO”) of the General Partner from October 

2018 to April 2021. According to the 2021 10-K, as of February 11, 2022, Defendant Ramsey 

beneficially owned 568,077 units of the Partnership’s common units. Given that the price of the 

Partnership’s common unit at the close of trading on February 11, 2022, was $10.30, Defendant 

Ramsey beneficially owned approximately $5.85 million worth of Energy Transfer units. 

78. For the 2021 Fiscal Year, Defendant Ramsey received $2,103,955 in total 

compensation from the General Partner, which consisted of $708,788 in salary, $1,374,000 in 

non-equity incentive plan compensation, and $21,167 in all other compensation. For the 2020 

Fiscal Year, Defendant Ramsey received $3,975,257 in total compensation from the General 

Partner, which consisted of $723,390 in salary, $3,229,770 in equity awards, and $22,097 in all 

other compensation. For the 2019 Fiscal Year, Defendant Ramsey received $4,715,743 in total 

compensation from the General Partner, which consisted of $683,913 in salary, $3,123,186 in 

equity awards, $889,100 in non-equity inceptive plan compensation, and $19,544 in all other 

compensation. For the 2018 Fiscal Year, Defendant Ramsey received $4,400,195 in total 

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compensation from the General Partner, which consisted of $662,486 in salary, $2,818,415 in 

equity awards, $900,000 in non-equity incentive plan compensation, and $19,294 in all other 

compensation. For the 2017 Fiscal Year, Defendant Ramsey received $5,260,040 in total 

compensation from the General Partner, which consisted of $642,404 in salary, $3,763,893 in 

equity awards, $835,125 in non-equity incentive plan compensation, and $18,618 in all other 

compensation. Across the five years, Defendant Ramsey received a total of $20,455,190 from the 

General Partner.

79. The 2021 10-K stated the following about Defendant Ramsey:

Matthew S. Ramsey. Mr. Ramsey was appointed as a director of Energy Transfer’s 

general partner in July 2012 and served as a director of ETO’s general partner from 

November 2015 until its merger into Energy Transfer LP in April 2021. Mr. 

Ramsey has been the Chief Operating Officer or our general partner since October 

2018 following the merger of Energy Transfer Equity, L.P. and Energy Transfer 

Partners, L.P., and served as President and Chief Operating Officer of ETO’s 

general partner from November 2015 until its merger into Energy Transfer LP in 

April 2021. Mr. Ramsey also served as President and Chief Operating Officer and 

Chairman of the board of directors of PennTex Midstream Partners, LP’s general 

partner from November 2016 to July 2017. Mr. Ramsey is also a director of 

Sunoco LP, having served as chairman of Sunoco LP’s board since April 2015, 

and of USAC, having served on that board since April 2018. Mr. Ramsey 

previously served as President of RPM Exploration, Ltd., a private oil, and gas 

exploration partnership, and previously served as a director of RSP Permian, Inc. 

where he served on the audit and compensation committees. In addition to his 

work in the energy business, Mr. Ramsey serves on the board of directors of the 

National Association of Manufacturers and as a Trustee of the Southwestern 

Medical Foundation. He is the former Chairman of the University of Texas 

Chancellor’s Council. Mr. Ramsey holds a B.B.A. in Marketing from the 

University of Texas at Austin and a J.D. from South Texas College of Law. Mr. 

Ramsey was selected to serve based on vast experience in the oil and gas space 

and Energy Transfer believes that he provides valuable industry insight as a 

member of our Board of Directors.

80. Upon information and belief, Defendant Ramsey is a citizen of Texas.

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Defendant Washburne

81. Defendant Washburne has served as a director of the General Partner from April 

2019 to April 1, 2022. 

82. For the 2021 Fiscal Year, Defendant Washburne received $207,503 in total 

compensation from the General Partner, which consisted of $107,500 in fees paid in cash and 

$100,003 in unit awards. For the 2020 Fiscal Year, Defendant Washburne received $207,497 in 

total compensation from the General Partner, which consisted of 107,500 in fees paid in cash and 

$99,997 in unit awards. For the 2019 Fiscal Year, Defendant Washburne received $81,881 in total 

compensation from the General Partner, which consisted of $48,756 in fees paid in cash and 

$33,125 in unit awards. Across the three years, Defendant Washburne received a total of $496,881 

from the General Partner.

83. The 2021 10-K states the following about Defendant Washburne: 

Ray W. Washburne. Mr. Washburne was appointed to the Board of Directors of 

our general partner in April 2019. He is currently President and Chief Executive 

Officer of Charter Holdings, Inc., a Dallas-based investment company involved in 

real estate, restaurants, and diversified financial investments. In addition, he 

currently serves on the President’s Intelligence Advisory Board (PIAB). From 

August 2017 to February 2019, Mr. Washburne served as the President and Chief 

Executive Officer of the Overseas Private Investment Corporation (OPIC), the 

United States government’s development finance institution. From 2000 to 2017,

Mr. Washburne served on the board of directors of Veritex Holdings, Inc. (Nasdaq: 

VBTX), a Texas -based bank holding company that conducts banking activities 

through its subsidiary, Veritex Community Bank. He has also served as an adjunct 

professor at the Cox School of Business at Southern Methodist University. Mr. 

Washburne is also a member of the Republican Governors Association Executive 

Roundtable, the American Enterprise Institute, the Council on Foreign Relations, 

and is on the Advisory Board of the United States Southern Command. Mr. 

Washburne was selected to serve on the Board of Directors because of his 

expertise in international finance, his relationships in government, and his 

experience on the board of a publicly traded company. 

84. Upon information and belief, Defendant Washburne is a citizen of Texas.

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FIDUCIARY DUTIES OF THE DEFENDANTS

85. By reason of Defendant LE GP’s role as the general partner of Energy Transfer, 

and by reason of the Individual Defendants’ positions as controlling unitholder, officers, directors, 

and/or fiduciaries of the General Partner and the Partnership, and because of their ability to control 

the business and corporate affairs of Energy Transfer, Defendant LE GP and the Individual 

Defendants owed Energy Transfer and its unitholders fiduciary obligations of trust, loyalty, good 

faith, and due care, and were and are required to use their utmost ability to control and manage 

Energy Transfer in a fair, just, honest, and equitable manner. The General Partner and the 

Individual Defendants were and are required to act in furtherance of the best interests of Energy 

Transfer and its unitholders so as to benefit all unitholders equally. 

86. The General Partner, and each controlling unitholder, director and officer of the 

General Partner owes to Energy Transfer and its unitholders the fiduciary duty to exercise good 

faith and diligence in the administration of the Partnership and in the use and preservation of its

property and assets and the highest obligations of fair dealing. 

87. The General Partner, as well as the Individual Defendants, because of their 

positions of control and authority as controlling unitholder, directors and/or officers of the 

General Partner, were able to and did, directly or indirectly, exercise control over the wrongful 

acts complained of herein.

88. To discharge their duties, the General Partner, the controlling unitholder, the 

officers, and directors of the General Partner were required to exercise reasonable and prudent 

supervision over the management, policies, controls, and operations of the Partnership. 

89. Defendant LE GP, by virtue of its role as general partner of the Partnership, and 

each Individual Defendant, by virtue of his or her position as a control unitholder, director and/or 

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officer, owed to the Partnership and to its unitholders the fiduciary duties of loyalty, good faith, 

and the exercise of due care and diligence in the management and administration of the affairs of 

the Partnership, as well as in the use and preservation of its property and assets. The conduct of 

the Individual Defendants complained of herein involves a knowing and culpable violation of 

their obligations as directors and officers of the General Partner, the absence of good faith on their 

part, or a reckless disregard for their duties to the Partnership and its unitholders that the 

Individual Defendants were aware or should have been aware posed a risk of serious injury to the 

Partnership.

90. As general partner, and senior executive officers and directors of the general 

partner of a publicly-traded partnership whose common units were registered with the SEC 

pursuant to the Exchange Act and traded on the NYSE, the Defendants, including Defendant 

Warren as a controlling unitholder, had a duty to prevent and not to effect the dissemination of 

inaccurate and untruthful information with respect to the Partnership’s financial condition, 

performance, growth, operations, financial statements, business, products, management, earnings, 

internal controls, and present and future business prospects, including the dissemination of false 

information regarding the Partnership’s business, prospects, and operations, and had a duty to 

cause the Partnership to disclose in its regulatory filings with the SEC all those facts described in 

this Complaint that it failed to disclose, so that the market price of the Partnership’s common unit

would be based upon truthful and accurate information.

91. To discharge their duties, the General Partner and the officers and directors of the 

General Partner were required to exercise reasonable and prudent supervision over the 

management, policies, practices, and internal controls of the Partnership. By virtue of such duties, 

the officers and directors of the General Partner were required to, among other things:

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(a) ensure that the Partnership was operated in a diligent, honest, and prudent 

manner in accordance with the laws and regulations of Delaware and the United States, and 

pursuant to Energy Transfer’s own Code of Business Conduct and Ethics (the “Code of 

Conduct”);

(b) conduct the affairs of the Partnership in an efficient, business-like manner 

so as to make it possible to provide the highest quality performance of its business, to avoid 

wasting the Partnership’s assets, and to maximize the value of the Partnership’s unit;

(c) remain informed as to how Energy Transfer conducted its operations, and, 

upon receipt of notice or information of imprudent or unsound conditions or practices, to make 

reasonable inquiry in connection therewith, and to take steps to correct such conditions or 

practices;

(d) establish and maintain systematic and accurate records and reports of the 

business and internal affairs of Energy Transfer and procedures for the reporting of the business 

and internal affairs to the Board and to periodically investigate, or cause independent investigation 

to be made of, said reports and records;

(e) maintain and implement an adequate and functioning system of internal 

legal, financial, and management controls, such that Energy Transfer’s operations would comply 

with all applicable laws and Transfer’s financial statements and regulatory filings filed with the 

SEC and disseminated to the public and the Partnership’s unitholders would be accurate;

(f) exercise reasonable control and supervision over the public statements 

made by the Partnership’s officers and employees and any other reports or information that the 

Partnership was required by law to disseminate; 

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(g) refrain from unduly benefiting themselves and other Partnership insiders 

at the expense of the Partnership; and

(h) examine and evaluate any reports of examinations, audits, or other 

financial information concerning the financial affairs of the Partnership and to make full and 

accurate disclosure of all material facts concerning, inter alia, each of the subjects and duties set 

forth above. 

92. The General Partner and each of the Individual Defendants furthered owed to 

Energy Transfer and the unitholders the duty of loyalty requiring that each favor Energy 

Transfer’s interests and that of its unitholders over their own while conducting the affairs of the 

Partnership and refrain from using their position, influence, or knowledge of the affairs of the 

Partnership to gain personal advantage. 

93. At all times relevant hereto, the Individual Defendants were the agents of each 

other, of the General Partner, and of Energy Transfer and were at all times acting within the course 

and scope of such agency.

94. Because of their advisory, executive, managerial, directorial, and controlling 

unitholder positions with the General Partner, each of the Individual Defendants had access to 

adverse, non-public information about the Partnership. 

95. The Defendants, because of their positions of control and authority, were able to 

and did, directly or indirectly, exercise control over the wrongful acts complained of herein, as 

well as the contents of the various public statements issued by Energy Transfer. 

CONSPIRACY, AIDING AND ABETTING, AND CONCERTED ACTION

96. In committing the wrongful acts alleged herein, the Defendants have pursued, or 

joined in the pursuit of, a common course of conduct, and have acted in concert with and conspired 

with one another in furtherance of their wrongdoing. The Defendants caused the Partnership to 

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conceal the true facts as alleged herein. The Defendants further aided and abetted and assisted 

each other in breaching their respective duties.

97. The purpose and effect of the conspiracy, common enterprise, and common course 

of conduct was, among other things, to: (i) facilitate and disguise the General Partner and the 

Individual Defendants’ violations of law, including breaches of fiduciary duty, unjust enrichment, 

waste of corporate assets, gross mismanagement, and abuse of control; (ii) conceal adverse 

information concerning the Partnership’s operations, financial condition, legal compliance, future 

business prospects and internal controls; and (iii) to artificially inflate the Partnership’s unit price.

98. The Defendants accomplished their conspiracy, common enterprise, and common 

course of conduct by causing the Partnership purposefully or recklessly to conceal material facts, 

fail to correct such misrepresentations, and violate applicable laws. In furtherance of this plan, 

conspiracy, and course of conduct, the Defendants collectively and individually took the actions 

set forth herein.

99. The General Partner and each of the Individual Defendants aided and abetted and 

rendered substantial assistance in the wrongs complained of herein. In taking such actions to 

substantially assist the commission of the wrongdoing complained of herein, each of the 

Individual Defendants acted with actual or constructive knowledge of the primary wrongdoing, 

either took direct part in, or substantially assisted in the accomplishment of that wrongdoing, and 

was or should have been aware of his or her overall contribution to and furtherance of the 

wrongdoing.

100. At all times relevant hereto, each of the Individual Defendants was the agent of 

each of the other Individual Defendants, of the General Partner, and of Energy Transfer, and was 

at all times acting within the course and scope of such agency.

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ENERGY TRANSFER’S CODE OF CONDUCT

101. The Partnership’s Code of Conduct states the following with respect to its policy 

objectives:

LE GP, LLC (the “Company”), the general partner of Energy Transfer LP (the 

“Partnership”), has adopted a number of policies dealing with business conduct 

and ethics of the Company and the Partnership (collectively, the “Partnership 

Group”). We believe that strict adherence to these policies is not only right, but is 

in the best interest of the Company, its unitholders, its customers, and the industry 

in general. In all instances, the policies of the Company require that the business 

of the Partnership Group be conducted in a lawful and ethical manner. Every 

Employee acting on behalf of the Partnership Group must adhere to these 

policies. 

(Emphasis added). 

102. The Code of Conduct defines the term “Employee” as including “all employees of 

the Partnership Group who provide services to or for the benefit of the Partnership Group, and 

the officers and members of the Board of Directors of the Partnership.” 

103. In a section titled, “Compliance with Laws, Rules and Regulations,” the Code of 

Conduct states the following:

The ethical standards of the Partnership Group rest on obeying the law. 

Employees must respect and obey the laws of the cities, states, and countries in 

which the Partnership Group operates. This Code of Business Conduct and 

Ethics obviously cannot mention every law that might be applicable. Although not 

all individuals are expected to know the details of these laws, it is important for 

Employees to be familiar with the laws that apply to their respective areas of 

responsibility, and to know enough to determine when to seek advice from 

supervisors, managers, the Company’s President, or other appropriate personnel. 

Because the Company is the general partner of a publicly traded partnership, 

Employees should be aware of the laws regarding the trading of securities of the 

Partnership while in possession of material, non-public information relating to the 

Partnership. 

(Emphasis added). 

104. In a section titled, “Conflicts of Interest,” the Code of Conduct states the following, 

in relevant part: 

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A “conflict of interest” occurs when an individual’s private interest interferes in 

any way, or even appears to interfere, with the interests of the Partnership Group 

as a whole. A conflict situation can arise when an Employee takes actions or has 

interests that may make it difficult to perform his/her work for the Partnership 

Group objectively and effectively. Conflicts of interest also arise when an 

Employee, or a member of his/her family, receives improper personal benefits as 

a result of his/her position in the Partnership Group. Loans to, or guarantees of 

obligations of, such persons are of special concern. 

* * *

You must avoid conflicts of interest unless specific, written pre-approval has been 

obtained from the Company’s President. In the absence of pre-approval, you must 

abandon or forfeit the activity or interest that creates the conflict or seek a waiver 

pursuant to the provisions of this Code of Business Conduct and Ethics. Any preapproval for an executive officer must be obtained from the Board of Directors. 

105. In a section titled, “Sensitive Payments,” the Code of Conduct provides that 

Partnership funds may not be used to secure special treatment for the Partnership or the General 

Partner, stating the following:

It is against the policy of the Partnership Group to authorize payment of or to 

use Partnership Group funds or personal funds for Sensitive Payments or other 

similar payment, whether lawful or unlawful, designed to secure special 

treatment for the Partnership Group. It is also contrary to the policy of the 

Partnership Group to employ any intermediary to make such payments or to 

disguise such payment(s) as a commission, refund or in any other manner. Should 

an Employee become involved in any situation where (i) a request is made for any 

Sensitive Payment or any bribe, kickback or other payment the propriety of which 

is questionable, or where (ii) the Employee has any knowledge of payments being 

made to an agent which are in excess of reasonable fees for services rendered, it is 

the Employee’s responsibility to report the situation immediately to his/her 

immediate supervisor.

(Emphasis added).

106. The Code of Conduct defines the term “Sensitive Payments” as including:

a) receipts from or payments to governmental officials or employees;

b) commercial bribes or kickbacks;

c) amounts received with an understanding that rebates or refunds will 

be made in contravention of the laws of any jurisdiction, either directly or 

through a third party; 

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d) corporate political contributions; and 

e) payments or commitments (whether cast in the form of 

commissions, payments or fees for goods or services received or 

otherwise) made with the understanding or under circumstances that would 

indicate that all or part thereof is to be paid by the recipient to governmental 

officials or employees, or as a commercial bribe, influence payment or 

kickback.

107. In a section titled, “Protection and Proper Use of Assets and Proprietary 

Information,” the Code of Conduct provides the following, in relevant part:

All Employees should protect the assets of the Partnership Group and ensure their 

efficient use. Theft, carelessness, and waste have a direct impact on the Partnership 

Group’s profitability. All assets of the Partnership Group should be used only for 

legitimate business purposes. The use of Company equipment, property, or 

proprietary information in violation of this Code, or for any use other than its 

intended business use, is prohibited unless otherwise authorized. 

108. In a section titled, “Ethical Behavior,” the Code of Conduct states the following, 

in relevant part:

Every Employee is expected to act with honesty and integrity, in good faith, 

responsibly, with due care, competence and diligence, without misrepresentation 

or omission of material facts, and without compromising their independent 

judgment. Each Employee is required to adhere to the highest ethical standards 

in fulfilling our responsibilities to, and on behalf of the Partnership Group and 

its investors. Each Employee is required to deal fairly and honestly with other 

employees, customers, vendors and third parties. Each Employee should actively 

encourage ethical conduct among his or her fellow officers, directors, and 

employees. When collecting information or other data on competitors of the 

Partnership Group, Employees must use only legitimate resources and not take any 

actions that are illegal, unethical or could cause embarrassment to the Partnership 

Group. 

(Emphasis added).

109. In a section titled, “Financial Record Keeping,” the Code of Conduct states the 

following:

It is our policy that all books and records of the Partnership Group fully and fairly 

reflect the assets, liabilities, receipts, and expenditures of the Partnership Group. 

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Attempts to create false or misleading records are forbidden. No undisclosed 

funds or accounts shall be established for any purpose. Knowledge of secret cash 

funds or slush funds should be reported to the Company’s President or to the Audit 

Committee of the Board.

(Emphasis added).

110. In a section titled, “Report Preparation,” the Code of Conduct states the following:

Accounting and reporting standards and procedures established by the Partnership 

Group must be followed to ensure that assets are protected and properly used, and 

that financial records and reports are accurate and reliable. Financial statements 

published by the Partnership Group must fairly present its operating results and 

financial position. Improper or fraudulent accounting, documentation or financial 

reporting are in violation of our policy and may also be in violation of applicable 

laws. All internal records supporting the financial statements of the Partnership 

Group must be prepared accurately, completely, and properly.

(Emphasis added).

111. In a section titled, “Full, Fair, Accurate and Timely Disclosure for SEC Filings,” 

the Code of Conduct states the following:

The Partnership Group has established policies and procedures that help to ensure 

that each SEC report and public communication (including press releases) contains 

information that is full, fair, accurate, timely and understandable. Every Employee 

must follow these policies and procedures to ensure that this information is 

timely, accurate, consistent, and credible.

(Emphasis added).

112. In a section titled, “Concealment of Information from Auditors,” the Code of 

Conduct states the following:

It is our policy for Employees to provide the Company’s Chief Financial Officer 

and his/her accounting staff and outside auditors with any and all information they 

request. Since the audit function is a vital tool of management in the conduct of 

the affairs of the Partnership Group, the concealment of information, whether 

financial or operational, or allowing misleading information to be provided to the 

internal accounting staff or outside auditors could result in inaccurate evaluations 

and improper decisions concerning the activities of the Partnership Group.

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113. In a section titled, “Reporting Suspected Violations of this Code,” the Code of 

Conduct provides that all officers and directors must report violations or suspected violations of 

the Code of Conduct, including violations pertaining to the securities laws, breaches of fiduciary 

duty, and the Partnership’s internal controls. The Code of Conduct states the following:

Every Employee shall first report violations or potential violations of this Code to 

his or her supervisor(s), or the appropriate officer of the Partnership Group, of the 

Employee’s complaint or concerns. Every officer and director of the Partnership 

Group, regardless of whether such person is also an Employee, shall report 

violations or potential violations of this Code to another officer or director of the 

Partnership Group to whom such person is required to report, one of the Chief 

Financial Officer, the President, or the Audit Committee, and if appropriate, to 

the Board of Directors. Because Employees may be reluctant or unable to report 

such violations or potential violations dealing with a material violation of the 

securities laws, breach of fiduciary duty or that relate to accounting, internal 

accounting controls and auditing matters, the Audit Committee has also 

established procedures providing for the confidential and anonymous reporting of 

violations to the Audit Committee or such other committee or department 

established by the Audit Committee for receiving and reviewing reports of 

violations. Retaliation against any employee who in good faith reports a suspected 

violation will not be tolerated. All reports of suspected violations will be evaluated 

by the Audit Committee or persons designated by it to investigate such reports. 

An investigation of the reported violation will be conducted if the evaluation 

indicates that there is a likelihood that a problem exists. All Employees are obliged 

to cooperate with such investigations and to be truthful and forthcoming in the 

course of such investigations. Persons violating the standards in this Code, 

including failure to report fraud, will be subject to appropriate disciplinary 

action, which may include written notice of a violation, censure by the Board, 

demotion, suspension, loss of pay, termination, referral for criminal prosecution, 

and restitution to the Partnership or others for any losses or damages resulting from 

the violation

(Emphasis added).

114. The General Partner and the Individual Defendants violated the Code of Conduct 

by engaging in or permitting the scheme to allow the Partnership to engage in illegal HDD

activities, and to issue materially false and misleading statements to the public and to facilitate 

and disguise the Defendants’ violations of law, including breaches of fiduciary duty, unjust 

enrichment, abuse of control, gross mismanagement, and waste of corporate assets, and failing to 

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report the same. Moreover, in violation of the Code of Conduct, the Defendants failed to maintain 

the accuracy of Partnership records and reports, comply with laws and regulations, conduct 

business in an honest and ethical manner, and properly report violations of the Code of Conduct.

ENERGY TRANSFER’S SUPPLEMENTAL CODE OF ETHICS

115. Additionally, the Partnership maintains a Code of Ethics for Senior Financial 

Officers (the “Code of Ethics”), which states that it applies to the General Partner’s CEO and 

CFO and provides that the obligations of the Code of Ethics “supplement, but do not replace, the 

Code of Business Conduct and Ethics applicable to all employees of the Partnership and its 

subsidiaries, as well as the Partnership’s officers and directors.” 

116. The Code of Ethics states that the General Partner’s CEO and CFO must:

Act with honesty and integrity, avoiding actual or apparent conflicts of interest 

with the Company and the Partnership in professional relationships that would 

likely be viewed as materially impairing the Senior Financial Officer's exercise 

of judgment on behalf of the Company or the Partnership. Avoid actual or 

apparent conflicts of interest in all cases unless a specific, case‐by‐case 

exception has been made after review and approval of specific circumstances by 

the Board of Directors. Prohibited conflicts of interests for Senior Financial 

Officers include significant work for an outside employer, or transactions between 

the Company or the Partnership and any other enterprise in which the Senior 

Financial Officer has an interest (other than owning a de minimis amount of 

publicly traded securities), including those in which a family member of a Senior 

Financial Officer has an interest. 

Take reasonable steps to cause the Partnership to provide fair, accurate, timely, 

and understandable disclosure in reports and documents that the Partnership 

files with, or submits to, the Securities and Exchange Commission (the “SEC”) 

and in other public communications, including taking reasonable steps to cause 

the employees providing services to the Partnership to follow its internal 

accounting controls at all times.

Not violate applicable laws, rules and regulations of federal, state, and local 

governments, and other appropriate private and public regulatory agencies. 

Although no single individual is expected to know the details of all laws, rules,

and regulations, it is important to take reasonable steps to ensure familiarity with 

all such laws, rules, and regulations and to know enough to determine when to 

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seek advice or guidance through the retention of qualified legal, financial, and 

accounting experts, or other means. 

* * * 

Establish and maintain disclosure controls and procedures that ensure that 

material information is included in each periodic report during the period in 

which the periodic report is being prepared. 

* * * 

Bring to the attention of the Chairman of the Audit Committee of the Board of 

Directors matters that could compromise the integrity of the Partnership’s 

public filings and communications, disagreements on accounting matters and 

violations of any part of this Code. 

(Emphasis added). 

117. Defendants Long, McCrea, and Whitehurst violated the Code of Ethics by 

engaging in or permitting the scheme to cause the Partnership to allow the Partnership to engage 

in illegal HDD activities, and to issue materially false and misleading statements to the public and 

to facilitate and disguise the Defendants’ violations of law, including breaches of fiduciary duty, 

unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets, and 

failing to report the same. Moreover, in violation of the Code of Ethics, Defendants Long, 

McCrea, and Whitehurst failed to maintain the accuracy of Partnership records and reports, 

comply with laws and regulations, conduct business in an honest and ethical manner, and properly 

report violations of the Code of Ethics. 

ENERGY TRANSFER’S CORPORATE GOVERNANCE GUIDELINES

118. The Partnership also maintains Corporate Governance Guidelines that provide 

governance guidelines adopted by the Board defining the Board’s responsibilities to the 

Partnership, also known as the “Partnership.” Specifically, the governance guidelines outline in 

relevant part that:

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[t]he functions of the Board is to provide guidance to and controls on the activities 

of the Partnership, in the exercise of the business judgment of each individual 

director. In discharging that obligation, directors should be entitled to rely on the 

honesty and integrity of the senior management of the General Partner and the 

Partnership and their outside advisors and auditors. 

119. In a section titled “Chief Executive Officer Evaluation: Management Succession” 

the governance guidelines provide that: 

A. CEO Evaluation. The Compensation Committee will conduct an annual review 

of the Chief Executive Officer’s performance, as provided in its charter. The 

Board of Directors will review the Compensation Committee’s report with a view 

to ensuring that the Chief Executive Officer is providing appropriate leadership 

for the Partnership Group in the long- and short-term. 

(Emphasis added). 

INDIVIDUAL DEFENDANTS’ MISCONDUCT

Background 

120. Energy Transfer is a Dallas, Texas-based energy services company, primarily 

doing business in the U.S. The Partnership is organized as a Delaware limited partnership and

operates as a subsidiary of the Partnership’s general partner, Defendant LE GP. Defendant LE GP 

manages and directs all of Energy Transfer’s activities, and the officers and directors of Defendant 

LE GP function as the officers and directors of Energy Transfer. The Partnership was founded in 

2002 and formerly operated under the name, Energy Transfer Equity, L.P. The Partnership

changed its name in October 2018. 

121. With respect to Defendant LE GP’s control over the Partnership’s activities, the 

2018 10-K states the following: 

Our general partner, LE GP, LLC, manages and directs all of our activities. The 

officers and directors of ET are officers and directors of LE GP, LLC. The 

members of our general partner elect our general partner’s Board of Directors. The 

board of directors of our general partner has the authority to appoint our executive 

officers, subject to provisions in the limited liability company agreement of our 

general partner. Pursuant to other authority, the board of directors of our general 

partner may appoint additional management personnel to assist in the management 

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of our operations and, in the event of the death, resignation or removal of our chief 

executive officer, to appoint a replacement.

122. Energy Transfer itself possesses several subsidiaries, including ETO and Sunoco,

through which the Partnership conducts its business and operations. The Partnership’s operations 

include natural gas transportation and storage, NGL transportation, storage, and fractionation 

services, crude, and refined oil transportation, and terminalling, acquisition, and marketing 

activities. In connection with these operations, the Partnership owns approximately 21,600 miles 

of intrastate and interstate natural gas transportation pipelines. The Partnership’s natural gas 

transportation systems are among the largest in the U.S. The Partnership also owns and operates 

three natural gas storage facilities in the state of Texas and two natural gas storage facilities in 

Oklahoma. The Partnership also owns and operates natural gas gathering including NGL 

pipelines, processing plants, treating facilities, and conditioning facilities in many states.

123. The Rover Pipeline project was a proposed interstate natural gas pipeline system, 

spanning 711 miles, intended to transport natural gas from processing facilities located in Ohio, 

Pennsylvania, and West Virginia to markets in the Midwest and Southeast United States as well 

as eastern Canada. FERC approved this project in February 2017.

124. Rover a subsidiary of Energy Transfer, was responsible for the construction of the 

Rover Pipeline, including hiring and management of contractors necessary for the construction. 

Rover contracted with Prevision Pipeline LLC (“Precision”), an infrastructure and utility 

contractor ultimately responsible for a majority of the installation of the Rover Pipeline. Precision 

subcontracted with Pretec, a company specializing in horizontal directional drilling.

125. Horizontal directional drilling (“HDD”), also known as directional boring, is a low 

impact installation method for underground utilities, such as pipes, conduit, or cables. The benefit 

to directional boring as opposed to the traditional cut-and-cover utility installation method is the 

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minimal surface disruption, cut-and-cover installation requires digging a trench, laying utilities,

and then recovering, process that is not practical when installing through roads, railways, rivers, 

or urban areas.

126. Horizontal directional drilling is split into three stages, the pilot hole, pre-reaming, 

and pipe pullback. The pilot hole stage involves using a small diameter drill bit to drill a horizontal 

hole underneath any obstacles along a predetermined design path. The pre-reaming stage involves 

enlarging the initial hole to a sufficient size to install the necessary pipeline, this is done by pulling 

progressively larger reamers back and forth through the bore (the hole that is being drilled). The 

final pipe pullback stage involves installing the product pipe into hole by pulling it from the exit 

pit back towards the entry pit.

127. To aid the drill bit, for both initial pilot hole and subsequent reamers, in cutting 

through soil and rock, drilling fluid is pumped through the drill pipe, where it exits the drill bit 

through nozzles. The purpose of the drilling fluid is to cool and lubricate the drill bit, control 

formation pressures, removing cuttings from the bore, sealing permeable formations encountered 

while drilling, and most importantly stabilizing the bore. A constant supply of drilling fluid is 

necessary to the success of horizontal directional drilling as the drill bit requires constant 

lubrication to prevent damage and the bore requires stabilization that the fluid provides.

128. Under normal conditions, the drilling fluid, after being pumped out of the drill bit, 

will mix with the soil and any bedrock cuttings and flow back to containment pits at the entry or 

exit points, where the cuttings will be removed, and the drill fluid recycled for immediate reuse. 

Sometimes, the drilling fluid can leak out of the bore and into fractures and caverns of the 

surrounding earth. In severe cases, the drilling fluid may leak further, emerging at the surface, or 

even entering undesirable locations such as nearby bodies of water or wetlands, also known as an 

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inadvertent release. In these situations, the loss of drilling fluid to the surrounding environment 

creates a situation where drilling fluid is pumped into the bore but less is returning to be recycled 

requiring the onsite team to mix additional drilling fluid to be used. When there is little to no 

drilling fluid loss, the same drilling fluid will be constantly filtered and reused creating for a very 

efficient drilling process. However, when loss of drilling fluid is high, replacement of the drilling 

fluid becomes a very labor-intensive. Onsite workers must cut open and mix clay with water to 

create new drilling fluid, if drilling fluid loss is high, the drilling may be stopped to await the 

delivery of additional clay and water to mix drilling fluid. This creates a situation where onsite 

workers may feel tempted to add unlawful additives, such as diesel fuel, into the drilling fluid 

mixture to speed up the process and keep up with a tight schedule. If this were to be followed by 

an inadvertent release, then the drilling fluid containing unlawful additives would be leaked into 

the surrounding environment causing environmental damage and contamination. This occurred 

during the horizontal directional drilling of the Rover Pipeline project.

129. On February 2, 2017, the Rover Pipeline project was approved by FERC in an 

order issuing certificates. The order also imposed forty-five environmental restrictions. The 

following day, on February 3, 2017, Rover filed a statement accepting the FERC’s order issuing 

certificates.

130. On March 3, 2017, Rover filed a request for immediate issuance of a notice to 

proceed with FERC. On the same day, FERC issued a notice to proceed with construction, 

marking the beginning of the construction of the Rover pipeline. On March 18, 2017, Pretec’s 

crew began the horizontal directional drilling process at the construction site near the Tuscarawas 

River.

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131. On April 13, 2017, during the horizontal drilling process there was a large 

inadvertent release (the “April 13 Release”). It was later uncovered that nearly 2 million gallons 

of drilling fluid had been leaked, contaminating the west side of the Tuscarawas River.

132. Following this incident, on April 20, 2017, the Ohio EPA issued a notice of 

violation to Rover. Also, in response to the April 13 Release, on May 10, 2017, FERC OEP issued 

a letter to Rover, terminating Rover’s horizontal directional drilling activity until further 

authorization is granted. 

133. On June 1, 2017, FERC issued a public statement stating that Ohio EPA had 

informed them of the presence of diesel fuel in the samples of drilling fluid associated with 

Rover’s Tuscarawas River HDD. The public statement further stated that the presence of diesel 

fuel is inconsistent with Rover’s commitments within the approval certificate and would fully 

support FERC OEP’s investigation into the issue. 

134. Throughout the course of the investigation, Energy Transfer, and Individual 

Defendants, fully aware of the gravity of their misconduct, made false and misleading statements 

and omissions regarding the severity of this legal proceeding in an attempt to conceal the truth 

from public investors. 

Materially False and Misleading Statements Issued During the Relevant Period

April 27, 2017, Weekly Report

135. On April 27, 2017, in a weekly construction and environmental status report filed 

with FERC, Rover stated, in connection with the April 13 Release, that “[d]ue to the subsurface 

conditions and other environmental conditions of the locations,” the April 13 Release was “a 

common and normal component of executing directional drilling operations[.]” This was a gross 

understatement as to the severity of environmental harm that was being caused. Rover continued 

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by stating that the leaked drilling fluid was “a non-toxic, naturally occurring bentonite clay water 

slurry that [was] safe for the environment[.]” It was later discovered that Pretec’s HDD workers 

had encountered losses of drilling fluid since the first day of HDD activity and that from April 2, 

2017 through April 13, 2017, they “intentionally and routinely” added toxic diesel fuel along with 

other unapproved lubricants to overcome drilling difficulties and drilling fluid loss in order to 

keep up with Rover’s management’s tight construction schedule.

JDH&A Report

136. On July 31, 2017, JDH&A, an engineering firm brought in by FERC to study the 

April 13 Release, released a report (the “JDH&A Report”). The JDH&A Report revealed that:

[Pretec] did not provide documentation in their daily reports as to any other drilling 

practices, such as adjusting drilling fluid properties, or mixing a thick bentonite 

plug in an attempt to seal the formation. In addition, they did not document 

procedures or measures for minimizing the risk of an IR while continuing without 

drilling fluid circulation. Due to the lack of operational details and commentary in 

[Pretec]’s reports, it is not possible for JDH&A to provide a firm opinion with 

respect to whether or not [Pretec]’s operational measures to restore circulation or 

their drilling procedure to minimize the risk of IR’s met HDD industry standards. 

If [Pretec] performed no other measures than what is indicated in their reports, 

then it is the opinion of JDH&A that they did fall short of common HDD 

industry practices used to restore drill fluid circulation as outlined in Drilling 

Fluids in Pipeline Installation by Horizontal Directional Drilling.

(Emphasis added).

Although the JDH&A Report did not discuss the discovery of diesel fuel within the drilling fluid 

at the Tuscarawas River, the JDH&A Report’s comments regarding Pretec’s conduct falling short 

of HDD industry practices would definitely concern investors.

August 4, 2017, Response Letter

137. In response to the JDH&A Report, on August 4, 2017, Rover sent a letter to FERC, 

in an attempt to mitigate negative public perception of its misconduct, rejected the idea that the 

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diesel fuel was mixed into its drilling fluid and cited alternative theories as to the cause of the 

diesel fuel. Specifically, the letter stated, in relevant part:

Rover theorizes that these diesel concentrations could have been caused by an 

inadvertent and unreported spill or leak from equipment operating during the 

clean-up of the IR, or it could have been the deliberate or malicious act of 

individuals opposed to the project. Given the extensive inspection and oversite at 

this and other site along the project, it is difficult to imagine that this occurred 

from an unreported spill or leak.

(Emphasis added).

138. On August 21, 2017, FERC’s Enforcement Staff began to conduct a non-public, 

formal investigation into the presence of diesel fuel in the drilling fluid found in the Tuscarawas 

River in connection with the April 13 Release.

August 31, 2017, to May 1, 2018, Press Releases

139. After this, Energy Transfer made several press releases announcing the continued 

progress of the Rover Pipeline project and approvals made by FERC, but materially omitted to 

mention the formal on-going investigation being conducted by FERC’s Enforcement Staff.

140. On August 31, 2017, Energy Transfer issued a press release titled, “Energy 

Transfer Announces FERC Approval to Put Phase 1A of the Rover Pipeline in Service.” The 

press release stated, in relevant part:

Energy Transfer Partners (NYSE: ETP) announced today that the Federal Energy 

Regulatory Commission (FERC) approved its request to put Phase 1A of the Rover 

Pipeline into service. Phase 1A, the 212-mile section from Cadiz, Ohio to 

Defiance, Ohio, will begin natural gas service on August 31, 2017.

141. On September 19, 2017, Energy Transfer issued a press release titled, “Energy 

Transfer Partners Announced Pricing of $2.25 Billion of Senior Notes.” The press release stated, 

in relevant part:

Energy Transfer Partners (NYSE:ETP) is pleased to announce that the Federal 

Energy Regulatory Commission (FERC) has approved the Partnership’s request 

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to resume Horizontal Directional Drilling (HDD) operations along the Rover 

Pipeline Project. Drilling operations on nine HDD locations approved by the 

FERC are expected to begin within the week with an emphasis on the Captina 

Creek HDD in Belmont County, Ohio. The completion of the Captina Creek HDD 

will allow the full Phase 1 portion of Rover from Seneca, Ohio, to Defiance, Ohio, 

to be placed into service by the end of the year. Phase 1a of the Rover Project from 

Cadiz, Ohio, to Defiance, Ohio, was successfully put into service on August 31, 

2017.

142. On December 15, 2017, Energy Transfer issued a press release titled, “Energy 

Transfer Announces FERC Approval to Place Rover Pipeline’s Phase 1B into Service.” The press 

release stated, in relevant part:

Energy Transfer Partners, L.P. (NYSE: ETP) announced today that Rover 

Pipeline, LLC received approval from the Federal Energy Regulatory Commission 

(FERC) to place Phase 1B of the Rover Pipeline project into service, bringing the 

713-mile pipeline closer to its 3.25 billion cubic feet per day design total. With the 

addition of the Phase 1B facilities, the project is now capable of transporting up to 

1.7 billion cubic feet per day of natural gas. Rover shippers now have access to six 

additional receipt points from Seneca thru Clarington areas of the Marcellus and 

Utica supply basins with an incremental receipt capacity of 2.45 billion cubic feet 

per day. Rover has been in partial service from Cadiz, Ohio, to Defiance, Ohio 

since August 31, 2017, capable of transporting 1 billion cubic feet per day of 

natural gas.

143. On May 1, 2018, Energy Transfer issued a press release titled, “Energy Transfer 

Announces FERC Approval to Place Additional Facilities on Rover Pipeline’s Phase 2 into 

Service.” The press release stated, in relevant part:

Energy Transfer Partners, L.P. (NYSE: ETP) announced today that Rover 

Pipeline, LLC received approval from the Federal Energy Regulatory Commission 

(FERC) to place additional Phase 2 facilities into service. Last week, FERC 

granted Rover permission to place a segment of Phase 2, which included Mainline 

Compressor Station 3 located in Crawford County, Ohio, and a section of the line 

between Mainline Compressor Station 2, in Wayne County, Ohio, and Mainline 

Compressor Station 3, in service for additional throughput opportunity. The 

approval from FERC granted today allows for the full commercial operation 

capability of the Market Zone North Segment.

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144. On May 31, 2018, Energy Transfer issued a press release titled, “Energy Transfer 

Announces FERC Approval to Place Rover Pipeline’s Full Mainline B into Service.” The press 

release stated, in relevant part:

Energy Transfer Partners, L.P. (NYSE: ETP) announced today that Rover 

Pipeline, LLC received approval from the Federal Energy Regulatory Commission 

(FERC) to commence service of the Supply Connector B and full Mainline B 

pipeline segments. This latest approval allows for 100 percent of Rover’s mainline 

capacity, 3.25 billion cubic feet per day of natural gas, to be placed into service.

145. While omitting material information regarding the investigation from the press 

releases, executives at Energy Transfer and Rover, disclosed by a FERC order at a later date, were 

busy “preserving” their documents and data in response to FERC’s subpoenas. For example, on 

October 3, 2017, Joey Mahmoud, Executive Vice President of Engineering and Construction for 

Rover, in an affidavit to FERC Enforcement Staff, stated that he had accidentally deleted all the 

data stored within his phone and was unable to preserve the data in accordance with preservation 

notices. In November 2017, FERC Enforcement Staff issued an additional subpoena with Rover’s 

production to be completed in March 2018. However, in May 2018, Rover produced over 4,000 

previously withheld or redacted documents not included in their privilege claims.

February 23, 2018, Form 10-K

146. On February 23, 2018, Energy Transfer filed its annual report on Form 10-K with 

the SEC for the fiscal year ended December 31, 2017 (the “2017 10-K”), signed by Defendants 

Warren, Long, McCrea, McReynolds, Brannon, and Ramsey. The 2017 10-K discussed the 

capacity of the partially completed Rover Pipeline, stated in relevant part:

The Rover Pipeline is a new 713-mile natural gas pipeline designed to transport 

3.25 Bcf/d of domestically produced natural gas from the Marcellus and Utica 

Shale production areas to markets across the United States as well as into the 

Union Gas Dawn Storage Hub in Ontario, Canada, for redistribution back into the 

United States or into the Canadian market. Currently under construction, portions 

of the pipeline are in service transporting gas from processing plants in Eastern 

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Ohio for delivery to other pipeline interconnects in Eastern Ohio as well as the 

Midwest Hub near Defiance, Ohio, where the gas will be delivered for distribution 

to markets across the United States. The Rover Pipeline Phase 1A and 1B are in 

service with a capacity of approximately 1.7 Bcf/d.

147. The 2017 10-K also makes mention of Rover’s compliance with FERC 

requirements, stating in relevant part:

In addition, on May 10, 2017, the FERC prohibited Rover from conducting HDD 

activities at 27 sites in Ohio. On July 31, 2017, the FERC issued an independent 

third party assessment of what led to the release at the Tuscarawas River site and 

what Rover can do to prevent reoccurrence once the HDD suspension is lifted. 

Rover notified the FERC of its intention to implement the suggestions in the 

assessment and to implement additional voluntary protocols. In response, FERC 

authorized Rover to resume HDD activities at certain sites. On January 24, 2018, 

FERC ordered Rover to cease HDD activities at the Tuscarawas River HDD site 

pending FERC review of additional information from Rover. Rover continues to 

correspond with regulators regarding drilling operations and drilling plans at the 

HDD sites where Rover has not yet completed HDD activities, including the 

Tuscarawas River HDD site. The timing or outcome of this matter cannot be 

reasonably determined at this time. We do not expect there to be a material impact 

to its results of operations, cash flows or financial position.

(Emphasis added.)

148. Attached to the 2017 10-K as Exhibits 31.1, 31.2, 32.1, and 32.2 were certifications 

pursuant to the Sarbanes-Oxley Act of 2002 (“SOX”) signed by Defendants Long and 

McReynolds, certifying that “[the 2017 10-K] does not contain any untrue statement of a material 

fact or omit to state a material fact necessary to make the statements made [...] not misleading” 

and that “the information contained in the [2017 10-K] fairly presents, in all material respects, the 

financial condition and results of operations of the Partnership.”

149. However, the 2017 10-K failed to disclose material information, such as the 

FERC’s Enforcement Staff formal investigation into the April 13 Release as well as JDH&A 

Report’s assessment of Pretec’s HDD practices of drilling fluid circulation, used in connection 

with the April 13 Release, were not up to HDD industry standards.

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May 10, 2018, Form 10-Q

150. On May 10, 2018, Energy Transfer filed its quarterly report on Form 10-Q with 

the SEC for the period ended March 31, 2018 (the “2018 Q1 10-Q”), signed by Defendant Long. 

Attached to the 2018 Q1 10-Q as exhibits were certifications pursuant to SOX signed by 

Defendants McReynolds and Long, certifying that “[the 2018 Q1 10-Q] does not contain any 

untrue statement of a material fact or omit to state a material fact or omit to state a material fact 

necessary to make the statements made [...] not misleading” and that “the information contained 

in the [2018 Q1 10-Q] fairly presents, in all material respects, the financial condition and results 

of operations in the Partnership.” However, the 2018 Q1 10-Q failed to disclose material 

information, such as the FERC’s Enforcement Staff formal investigation into the April 13 Release 

as well as JDH&A Report’s assessment of Pretec’s HDD practices of drilling fluid circulation, 

used in connection with the April 13 Release, were not up to HDD industry standards.

August 9, 2018, Form 10-Q

151. On August 9, 2018, Energy Transfer filed its quarterly report on Form 10-Q with 

the SEC for the period ended June 30, 2018 (the “2018 Q2 10-Q”), signed by Defendant Long. 

Attached to the 2018 Q2 10-Q as exhibits were certifications pursuant to SOX signed by 

Defendants McReynolds and Long, certifying that “[the 2018 Q2 10-Q] does not contain any 

untrue statement of a material fact or omit to state a material fact or omit to state a material fact 

necessary to make the statements made [...] not misleading” and that “the information contained 

in the [2018 Q2 10-Q] fairly presents, in all material respects, the financial condition and results 

of operations in the Partnership.” However, the 2018 Q2 10-Q failed to disclose material 

information, such as the FERC’s Enforcement Staff formal investigation into the April 13 Release 

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as well as JDH&A Report’s assessment of Pretec’s HDD practices of drilling fluid circulation, 

used in connection with the April 13 Release, were not up to HDD industry standards.

November 8, 2018, Form 10-Q

152. On November 8, 2018, Energy Transfer filed its quarterly report on Form 10-Q 

with the SEC for the period ended September 30, 2018 (the “2018 Q3 10-Q”). Attached to the 

2018 Q3 10-Q as exhibits were certifications pursuant to SOX signed by Defendants Warren and 

Long, certifying that “[the 2018 Q3 10-Q] does not contain any untrue statement of a material 

fact or omit to state a material fact or omit to state a material fact necessary to make the statements 

made [...] not misleading” and that “the information contained in the [2018 Q3 10-Q] fairly 

presents, in all material respects, the financial condition and results of operations in the 

Partnership.” However, the 2018 Q3 10-Q failed to disclose material information, such as the 

FERC’s Enforcement Staff formal investigation into the April 13 Release as well as JDH&A 

Report’s assessment of Pretec’s HDD practices of drilling fluid circulation, used in connection 

with the April 13 Release, were not up to HDD industry standards.

February 22, 2019, Form 10-K

153. On February 22, 2019, Energy Transfer filed its annual report on Form 10-K with 

the SEC for the fiscal year ended December 31, 2018 (the “2018 10-K”), signed by Defendants 

Warren, Long, McCrea, McReynolds, Ramsey, Anderson, Brannon, Davis, and Grimm. Attached 

to the 2018 10-K as exhibits were certifications pursuant to SOX signed by Defendants Warren 

and Long, certifying that “[the 2018 10-K] does not contain any untrue statement of a material 

fact or omit to state a material fact necessary to make the statements made [...] not misleading” 

and that “the information contained in the [2018 10-K] fairly presents, in all material respects, the 

financial condition and results of operations of the Partnership.” However, the 2018 10-K failed 

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to disclose material information, such as the FERC’s Enforcement Staff formal investigation into 

the April 13 Release as well as JDH&A Report’s assessment of Pretec’s HDD practices of drilling 

fluid circulation, used in connection with the April 13 Release, were not up to HDD industry 

standards.

May 9, 2019, Form 10-Q

154. On May 9, 2019, Energy Transfer filed its quarterly report on Form 10-Q with the 

SEC for the period ended March 31, 2019 (the “2019 Q1 10-Q”). Attached to the 2019 Q1 10-Q 

as exhibits were certifications pursuant to SOX signed by Defendants Warren and Long, 

certifying that “[the 2019 Q1 10-Q] does not contain any untrue statement of a material fact or 

omit to state a material fact or omit to state a material fact necessary to make the statements made 

[...] not misleading” and that “the information contained in the [2019 Q1 10-Q] fairly presents, 

in all material respects, the financial condition and results of operations in the Partnership.” 

However, the 2019 Q1 10-Q failed to disclose material information, such as the FERC’s 

Enforcement Staff formal investigation into the April 13 Release as well as JDH&A Report’s 

assessment of Pretec’s HDD practices of drilling fluid circulation, used in connection with the 

April 13 Release, were not up to HDD industry standards.

155. From as early as January 2021, FERC Enforcement Staff issued a letter to Rover. 

The letter stated that there would be a recommendation to FERC to issue an Order to Show Cause 

and Notice of Proposed Penalty to Rover. The order provided an opportunity for Rover to explain 

why it should not be the subject of an enforcement proceeding and pay a penalty. Energy Transfer 

made no disclosures regarding this material information to investors.

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The Truth Begins to Emerge

August 8, 2019, Form 10-Q

156. On August 8, 2019, Energy Transfer filed its quarterly report on Form 10-Q with 

the SEC for the period ended June 30, 2019 (the “2019 Q2 10-Q”). Two years after the formal 

investigation by the Enforcement Staff began, Energy Transfer finally disclosed that the FERC 

Enforcement Staff had initiated a formal investigation “regarding allegations that diesel fuel may 

have been included in the drilling mud at the Tuscarawas River HDD” (emphasis added). The 

2019 Q2 10-Q continued to state, in relevant part:

Rover and the Partnership are cooperating with the investigations. Enforcement 

Staff has provided Rover its non-public preliminary findings regarding those 

investigations. The company disagrees with those findings and intends to 

vigorously defend against any potential penalty. Given the stage of the 

proceedings, and the non-public nature of the investigation, the Partnership is 

unable at this time to provide an assessment of the potential outcome or range of 

potential liability, if any.

(Emphasis added.)

157. On this news, Energy Transfer’s unit price fell $0.65 per unit, or 4.6%, from 

$14.03 per unit at close on August 8, 2019, to $13.38 per unit at close on August 12, 2019, over 

the course of two trading days.

158. Aside from the minor disclosure that the Enforcement Staff investigation had been 

occurring, the 2019 Q2 10-Q failed to disclose information regarding the preliminary findings 

provided to Rover by the Enforcement Staff nor did it provide any notice or language regarding 

the severity of the on-going Enforcement Staff investigation. As a result of Individual Defendant’s 

continued false and misleading statements and omissions the Partnership’s unit continued to trade 

at artificially inflated prices throughout the Relevant Period.

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February 21, 2020, Form 10-K

159. On February 21, 2020, Energy Transfer filed its 2019 10-K, signed by Defendants 

Warren, Long, McReynolds, McCrea, Ramsey, Anderson, Brannon, Davis, Grimm, Perry, and 

Washburne. Attached to the 2019 10-K as exhibits were certifications pursuant to SOX signed by 

Defendants Warren and Long, certifying that “[the 2019 10-K] does not contain any untrue 

statement of a material fact or omit to state a material fact necessary to make the statements made 

[...] not misleading” and that “the information contained in the [2019 10-K] fairly presents, in all 

material respects, the financial condition and results of operations of the Partnership.” Energy 

Transfer continued to make the same surface level disclosures, stated, in relevant part:

In mid-2017, FERC Enforcement Staff began a non-public investigation regarding 

allegations that diesel fuel may have been included in the drilling mud at the 

Tuscarawas River horizontal directional drilling (“HDD”) operations. Rover and 

the Partnership are cooperating with the investigations. Enforcement Staff has 

provided Rover its non-public preliminary findings regarding those 

investigations. The company disagrees with those findings and intends to 

vigorously defend against any potential penalty. Given the stage of the 

proceedings, and the non-public nature of the investigation, the Partnership is 

unable at this time to provide an assessment of the potential outcome or range of 

potential liability, if any.

(Emphasis added.)

160. On this news, Energy Transfer’s unit price fell $0.99 per unit, or 7.8%, from 

$12.54 per unit at close on February 20, 2020, to $11.55 per unit at close on February 24, 2020,

over the course of two trading days.

161. Aside from the minor disclosure that the Enforcement Staff investigation had been 

occurring, the 2019 10-K failed to disclose information regarding the preliminary findings 

provided to Rover by the Enforcement Staff nor did it provide any notice or language regarding 

the severity of the on-going Enforcement Staff investigation. As a result of Individual Defendant’s 

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continued false and misleading statements and omissions the Partnership’s unit continued to trade 

at artificially inflated prices throughout the Relevant Period.

February 19, 2021, Form 10-K

162. On February 19, 2021, Energy Transfer filed its 2020 10-K, signed by Defendants 

Warren, McCrea, Long, Whitehurst, Ramsey, Anderson, Brannon, Davis, Grimm, McReynolds, 

Perry, and Washburne. Attached to the 2020 10-K as exhibits were certifications pursuant to SOX 

signed by Defendants Warren and Long, certifying that “[the 2020 10-K] does not contain any 

untrue statement of a material fact or omit to state a material fact necessary to make the statements 

made [...] not misleading” and that “the information contained in the [2020 10-K] fairly presents, 

in all material respects, the financial condition and results of operations of the Partnership.” 

Energy Transfer continued to make the same surface level disclosures, stated, in relevant part:

In mid-2017, FERC Enforcement Staff began a non-public investigation regarding 

allegations that diesel fuel may have been included in the drilling mud at the 

Tuscarawas River horizontal directional drilling (“HDD”) operations. Rover and 

the Partnership are cooperating with the investigations. Enforcement Staff has 

provided Rover its non-public preliminary findings regarding those 

investigations. The company disagrees with those findings and intends to 

vigorously defend against any potential penalty. Given the stage of the 

proceedings, and the non-public nature of the investigation, the Partnership is 

unable at this time to provide an assessment of the potential outcome or range of 

potential liability, if any.

(Emphasis added.)

163. Aside from the minor disclosure that the Enforcement Staff investigation had been 

occurring, the 2020 10-K failed to disclose information regarding the preliminary findings 

provided to Rover by the Enforcement Staff nor did it provide any notice or language regarding 

the severity of the on-going Enforcement Staff investigation. As a result of Individual Defendant’s 

continued false and misleading statements and omissions the Partnership’s unit continued to trade 

at artificially inflated prices throughout the Relevant Period.

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164. The statements identified in ¶¶ 137, 139, 142-158, 160-161, 163-165 were 

materially false and misleading, and failed to disclose material facts necessary to make the 

statements made not false and misleading. Specifically, the Defendants improperly failed to 

disclose, inter alia, that: (1) Energy Transfer had failed to maintain internal controls and proper 

procedures to prevent contractors from engaging in illegal HDD activities; (2) the Partnership

failed to mitigate known problems in connection with the foregoing; (3) Energy Transfer, through 

Rover, hired third-party contractors who engaged in illegal HDD activities which caused massive 

pollution near the Tuscarawas River; and (4) the severity of the potential civil liabilities as a result 

of the FERC’s Enforcement Staff investigation into the April 13 Release. As a result of the 

foregoing, Energy Transfer’s public statements were materially false and misleading at all 

relevant times.

The Truth Fully Emerges

December 16, 2021, FERC Order

165. On December 16, 2021, FERC issued an Order to Show Cause and Notice of 

Proposed Penalty (the “FERC Order”) to Rover. This order provided Rover 30 days to respond 

and show why it should not receive a $40 million civil penalty for the conduct in relation to the 

April 13 Release. The alleged misconduct provided within the order were that: (1) “Rover HDD 

crews intentionally used diesel fuel and other toxic substances and unapproved additives in the 

drilling mud”; (2) “Rover HDD crews [had] failed to monitor the right-of-way; and (3) “Rover 

HDD crews failed to properly dispose of IR mud contaminated with diesel fuel and hydraulic oil.

166. The December 16, 2021, order also revealed that, on March 18, 2017, when 

Pretec’s crew was commencing HDD near the Tuscarawas River, the crew began to experience 

large losses of drilling fluid. Rover HDD crew members have admitted under oath with 

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corroborating stories that from April 2, 2017, to April 13, 2017, several members of the HDD 

crew intentionally and routinely added toxic diesel fuel, hydraulic oil, contaminated containment 

fluids, and non-toxic but unapproved lubricants into the drilling fluid to fight drilling difficulties. 

The crew has admitted that the intention behind doing so, was to maintain speed to keep up with 

the tight construction schedule as they were under heavy pressure from Rover’s management. 

Specifically, the order states, in relevant part:

Contemporaneous evidence demonstrates that these violations were the product of 

a corporate culture—one that equally infected the executives managing the 

Tuscarawas River HDD and the onsite HDD crew—that favored speed and 

construction progress over regulatory compliance. This culture was fueled by 

Rover’s execution of a $1.5 billion “time is of the essence” contract with a prime 

construction contractor—which constituted 35% of Rover’s initial cost estimate 

for the Project.8 It was also fueled by Rover’s self-imposed four-month schedule 

to complete over 500 miles of the pipeline construction. In addition to the contract 

requirements, Rover’s Executive Vice President of Engineering and Construction, 

Yousif (Joey) Mahmoud, continually applied direct pressure on the Vice President 

of its prime contractor, Bobby Poteete, to speed up construction, which funneled 

down to its subcontractor and HDD crews onsite.

167. The FERC Order also disclosed that on October 3, 2017, Joey Mahmoud 

(“Mahmoud”), Executive Vice President of Engineering and Construction of Rover, submitted an 

affidavit to the FERC Enforcement Staff addressing his failure to adhere to OEP and Enforcement 

Staff’s preservation notices. The affidavit stated that Mahmoud was locked out of his phone, 

requiring him to reset it, which deleted all of the data stored on it. An additional subpoena was 

issued by FERC Enforcement Staff in November of 2017 requesting Rover produce additional 

documents. Rover’s procurement of documents was reportedly completed in March 2018, 

however, on May 21, 2018, Rover procured an additional 4,000 documents that were previously 

withheld or redacted and were not included in their privilege claims. Rover’s procurement of the 

documents was nearly a year after the original data request and eight months from the subpoena 

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deadlines. Since June 2017, FERC Enforcement Stall has reviewed more than 25,000 documents 

provided by Rover and other third parties, along with the testimony of 24 witnesses. 

168. The FERC Order further revealed that on January 19, 2021, the Enforcement Staff 

issued a notice to Rover stating that it would be recommending that FERC issue the FERC Order. 

The Partnership failed to disclose this information to the investing public. 

169. On this news, Energy Transfer’s unit price fell $0.14 per unit, or 1.6%, from $8.49 

per unit at close on December 16, 2021, to $8.35 per unit at close on December 17, 2021. The 

unit continued to fall the following two trading day, dropping an additional $0.17 per unit, or 2%, 

to $8.18 per unit at close on December 21, 2021, and fell a total of $0.31 per unit, or 3.6% from 

the initial day.

DAMAGES TO ENERGY TRANSFER

170. As a direct and proximate result of the General Partner and the Individual 

Defendants’ conduct, Energy Transfer will lose and expend many millions of dollars. 

171. Such expenditures include, but are not limited to, costs and legal fees associated 

with defending the illegal HDD conduct and the Securities Class Action filed against the 

Partnership and certain of the Individual Defendants, and any internal investigations, and amounts 

paid to outside lawyers, accountants, and investigators in connection thereto. 

172. As a direct and proximate result of the General Partner and the Individual 

Defendants’ conduct, Energy Transfer has also suffered and will continue to suffer a loss of 

reputation and goodwill, and a “liar’s discount” that will plague the Partnership’s unit in the future 

due to the Partnership’s and their misrepresentations and the Individual Defendants’ breaches of 

fiduciary duties and unjust enrichment. 

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DERIVATIVE ALLEGATIONS

173. Plaintiff brings this action derivatively and for the benefit of Energy Transfer to 

redress injuries suffered, and to be suffered, as a result of the Defendants’ breaches of their 

fiduciary duties as general partner, controlling unitholder, directors and/or officers of Energy 

Transfer, gross mismanagement, abuse of control, waste of corporate assets, unjust enrichment, 

as well as the aiding and abetting thereof. 

174. Energy Transfer is named solely as a nominal party in this action. This is not a 

collusive action to confer jurisdiction on this Court that it would not otherwise have. 

175. Plaintiff is and has been since before the beginning of the Relevant Period, a

unitholder of Energy Transfer. Plaintiff will adequately and fairly represent the interests of Energy

Transfer in enforcing and prosecuting its rights, and, to that end, has retained competent counsel, 

experienced in derivative litigation, to enforce and prosecute this action. 

DEMAND FUTILITY ALLEGATIONS

176. Plaintiff incorporates by reference and re-alleges each and every allegation stated 

above as if fully set forth herein. 

177. A pre-suit demand on the General Partner is futile and, therefore, excused. 

Demand is excused as to the General Partner because Defendant LE GP faces a substantial 

likelihood of liability as a result of its knowing engagement in the scheme to allow the Partnership

to engage in illegal HDD activities, and to cause the Partnership to make false and misleading 

statements and omissions of material fact to the investors and the general public that falsely 

represented the Partnership’s performance and value. As the direct beneficiary and the primary 

controller of the above-alleged scheme, the General Partner benefited at the expense of the 

Partnership. As the General Partner breached its fiduciary duties to the Partnership, it faces a 

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substantial likelihood of liability, and it is not independent or disinterested, and thus demand on 

the General Partner is futile.

178. Additionally, as the Partnership admitted in its 2021 10-K, the General Partner and 

its affiliates have conflicts of interests, which may cause them to favor their own interests to the 

detriment of the Partnership and its unitholders. The 2021 10-K stated the following: 

Conflicts of interest may arise among our general partner and its affiliates, on the 

one hand, and us, on the other hand. As a result of these conflicts, our general 

partner may favor its own interests and the interests of its affiliates over our 

interests.

179. As a result of the foregoing, the General Partner breached itsfiduciary duties, faces

a substantial likelihood of liability in this Action, is not disinterested, and demand upon it is futile, 

and thus excused.

180. Additional reasons that demand on the General Partner is futile follow.

181. First, all the directors on the Board of the General Partner have fiduciary duties to 

the General Partner, and in controlling the General Partner, they would cause it not to consider a 

demand fairly because granting the demand would hurt it.

182. Second, the majority of the Board of the General Partner is not independent or 

disinterested, as each of them either knowingly or recklessly participated in the conduct alleged 

herein, in complete abdication of their fiduciary duties to the Partnership, which renders them 

unable to impartially investigate the charges and decide whether to pursue action against 

themselves and the General Partner. At the time of filing of this action, the Board of directors of 

the General Partner consisted of Defendants Warren, Long, Anderson, Brannon, Davis, Grimm, 

McCrea, McReynolds, Perry, and Ramsey (collectively, the “Director-Defendants”).

183. Additional reasons that Defendant Warren is not independent or disinterested 

follow. Defendant Warren is a co-founder of the Partnership, has served as the General Partner’s 

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Executive Chairman since 2007, and served as CEO from August 2007 through December 2020.

He is also the majority owner of the General Partner. Thus, as the Partnership admits, he is a nonindependent director. As a controlling unitholder with control over the General Partner, 

Defendant Warren was ultimately responsible for all of the false and misleading statements and 

omissions that were made, including those contained in the SEC filings referenced herein, all of 

which he signed or authorized the signing of. As the General Partner’s controlling interest-holder 

and as a trusted Director, he conducted little, if any, oversight of the scheme to allow the 

Partnership to engage in illegal HDD activities, and to make false and misleading statements, 

consciously disregarded his duties to monitor such controls over reporting and engagement in the 

scheme, and consciously disregarded his duties to protect corporate assets. Furthermore, 

Defendant Warren signed, and thus personally made the false and misleading statements in the 

2017 10-K, the 2018 10-K, the 2019 10-K, and the 2020 10-K. Moreover, Defendant Warren is a 

defendant in the Securities Class Action. For these reasons, Defendant Warren breached his

fiduciary duties, faces a substantial likelihood of liability, is not independent or disinterested, and 

thus would not cause the General Partner to consider a demand fairly.

184. Additional reasons that Defendant Long is not independent or disinterested follow. 

Defendant Long has served as the General Partner’s Co-CEO since January 2021, CFO from 

February 2016 through January 2021, and has served as a director of the General Partner since 

April 2019. Thus, as the Partnership admits, he is a non-independent director. The General Partner 

provides Defendant Long with his principal occupation, and he receives handsome compensation, 

including $19,730,203 in 2021 for his services and has received a total of $38,225,533 throughout

the Relevant Period. As such, Defendant Long is beholden to the General Partner. As the General 

Partner’s Co-CEO and as a trusted Director, he conducted little, if any, oversight of the scheme

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to allow the Partnership to engage in illegal HDD activities, and to make false and misleading 

statements, consciously disregarded his duties to monitor such controls over reporting and 

engagement in the scheme, and consciously disregarded his duties to protect corporate assets. 

Furthermore, Defendant Long signed, and thus personally made the false and misleading 

statements in the 2017 10-K, the 2018 10-K, the 2019 10-K, and the 2020 10-K. Moreover, 

Defendant Long is a defendant in the Securities Class Action. For these reasons, Defendant Long

breached his fiduciary duties, faces a substantial likelihood of liability, is not independent or 

disinterested, and thus would not cause the General Partner to consider a demand fairly.

185. Additional reasons that Defendant McCrea is not independent or disinterested 

follow. Defendant McCrea has served as the Co-CEO of the General Partnership since January 

2021, served as President and CCO of the General Partner from October 2018 through December 

2020, and has served as a director of the General Partner since December 2009. Thus, as the

Partnership admits, he is a non-independent director. The General Partner provides Defendant 

McCrea with his principal occupation, and he receives handsome compensation, including 

$21,460,652 in 2021 for his services and received a total of $63,137,672 throughout the Relevant 

Period. As such, Defendant McCrea is beholden to the General Partner. As the General Partner’s 

Co-CEO, and as a trusted Director, he conducted little, if any, oversight of the scheme to allow 

the Partnership to engage in illegal HDD activities, and make false and misleading statements, 

consciously disregarded his duties to monitor such controls over reporting and engagement in the 

scheme, and consciously disregarded his duties to protect corporate assets. Furthermore, 

Defendant McCrea signed, and thus personally made the false and misleading statements in the

2017 10-K, the 2018 10-K, the 2019 10-K, and the 2020 10-K. Moreover, Defendant McCrea is 

a defendant in the Securities Class Action. For these reasons, Defendant McCrea breached his 

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fiduciary duties, faces a substantial likelihood of liability, is not independent or disinterested, and 

thus would not cause the General Partner to consider a demand fairly.

186. Additional reasons that Defendant McReynolds is not independent or disinterested 

follow. Defendant McReynolds served as the President of the General Partner from March 2005 

until October 2018; on which date he became Special Advisor to the General Partner. He has also 

served as a director of the General Partner since August 2005. Thus, as the Partnership admits, he 

is a non-independent director. The General Partner provides Defendant McReynolds with his 

principal occupation, and he receives handsome compensation, having received a total of 

$2,789,686 throughout the Relevant Period for his services. As such, Defendant McReynolds is 

beholden to the General Partner. As the General Partner’s trusted director, he conducted little, if 

any, oversight of the scheme to allow the Partnership to engage in illegal HDD activities, and 

make false and misleading statements, consciously disregarded his duties to monitor such controls 

over reporting and engagement in the scheme, and consciously disregarded his duties to protect 

corporate assets. Furthermore, Defendant McReynolds signed, and thus personally made the false 

and misleading statements in the 2017 10-K, 2018 10-K, 2019 10-K, and the 2020 10-K.

Moreover, Defendant McReynolds is a defendant in the Securities Class Action. For these 

reasons, Defendant McReynolds breached his fiduciary duties, faces a substantial likelihood of 

liability, is not independent or disinterested, and thus would not cause the General Partner to 

consider a demand fairly.

187. Additional reasons that Defendant Anderson is not independent or disinterested 

follow. Defendant Anderson has served as a director of the General Partner since June 2018. He 

also serves as a member of the Audit Committee as well as the Compensation Committee. 

Defendant Anderson has received and continues to receive compensation for his roles with the 

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Partnership as described above. As a trusted Director, he conducted little, if any, oversight of the 

scheme to allow the Partnership to engage in illegal HDD activities, and make false and 

misleading statements, consciously disregarded his duties to monitor such controls over reporting 

and engagement in the scheme, and consciously disregarded his duties to protect corporate assets.

Furthermore, Defendant Anderson signed, and thus personally made the false and misleading 

statements in the 2018 10-K, 2019 10-K, and the 2020 10-K. For these reasons, Defendant 

Anderson breached his fiduciary duties, faces a substantial likelihood of liability, is not 

independent or disinterested, and thus would not cause the General Partner to consider a demand 

fairly.

188. Additional reasons that Defendant Brannon is not independent or disinterested 

follow. Defendant Brannon has served as a director of the General Partner since March 2016. He 

also serves as chair of the Audit Committee. Defendant Brannon has received and continues to 

receive compensation for his roles with the Partnership as described above. As a trusted Director, 

he conducted little, if any, oversight of the scheme to allow the Partnership to engage in illegal 

HDD activities, and to make false and misleading statements, consciously disregarded his duties 

to monitor such controls over reporting and engagement in the scheme, and consciously 

disregarded his duties to protect corporate assets. Furthermore, Defendant Brannon signed, and 

thus personally made the false and misleading statements in the 2017 10-K, the 2018 10-K, the 

2019 10-K, and the 2020 10-K. For these reasons, Defendant Brannon breached his fiduciary 

duties, faces a substantial likelihood of liability, is not independent or disinterested, and thus 

would not cause the General Partner to consider a demand fairly.

189. Additional reasons that Defendant Davis is not independent or disinterested 

follow. Defendant Davis is a co-founder of the Partnership and has served as a director of the 

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General Partner since July 2018. He is also a member of the Audit Committee. Defendant Davis

has received and continues to receive compensation for his roles with the Partnership as described 

above. As a trusted Director, he conducted little, if any, oversight of the scheme to allow the 

Partnership to engage in illegal HDD activities, and to make false and misleading statements, 

consciously disregarded his duties to monitor such controls over reporting and engagement in the 

scheme, and consciously disregarded his duties to protect corporate assets. Furthermore, 

Defendant Davis signed, and thus personally made the false and misleading statements in the 

2018 10-K, the 2019 10-K, and the 2020 10-K. For these reasons, Defendant Davis breached his 

fiduciary duties, faces a substantial likelihood of liability, is not independent or disinterested, and 

thus would not cause the General Partner to consider a demand fairly.

190. Additional reasons that Defendant Grimm is not independent or disinterested 

follow. Defendant Grimm has served as a director of the General Partner since October 2018. He 

also serves as Chair of the Compensation and as a member of the Audit Committee. Defendant 

Grimm has received and continues to receive compensation for his roles with the Partnership as 

described above. As a trusted Director, he conducted little, if any, oversight of the scheme to 

allow the Partnership to engage in illegal HDD activities, and to make false and misleading 

statements, consciously disregarded his duties to monitor such controls over reporting and 

engagement in the scheme, and consciously disregarded his duties to protect corporate assets.

Furthermore, Defendant Grimm signed, and thus personally made the false and misleading 

statements in the 2018 10-K, the 2019 10-K, and the 2020 10-K. For these reasons, Defendant 

Grimm breached his fiduciary duties, faces a substantial likelihood of liability, is not independent 

or disinterested, and thus would not cause the General Partner to consider a demand fairly.

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191. Additional reasons that Defendant Perry is not independent or disinterested follow.

Defendant Perry has served as a director of the General Partner since January 2020. Defendant 

Perry has received and continues to receive compensation for his role with the Partnership as 

described above. As a trusted Director, he conducted little, if any, oversight of the scheme to 

allow the Partnership to engage in illegal HDD activities, and to make false and misleading 

statements, consciously disregarded his duties to monitor such controls over reporting and 

engagement in the scheme, and consciously disregarded his duties to protect corporate assets. 

Furthermore, Defendant Perry signed, and thus personally made the false and misleading 

statements in the 2019 10-K and the 2020 10-K. For these reasons, Defendant Perry breached his 

fiduciary duties, faces a substantial likelihood of liability, is not independent or disinterested, and 

thus would not cause the General Partner to consider a demand fairly.

192. Additional reasons that Defendant Ramsey is not independent or disinterested 

follow. Defendant Ramsey has served as a director of the General Partner since July 2012 and as 

the COO of the General Partner from October 2018 through April 2021. Thus, as the Partnership

admits, he is a non-independent director. The General Partner provides Defendant Ramsey with 

his principal occupation, and he receives handsome compensation, including $2,103,955 in 2021

for his services and received a total of $20,455,190 throughout the Relevant Period. As such, 

Defendant Ramsey is beholden to the General Partner. As the General Partner’s COO and as a 

trusted Director, he conducted little, if any, oversight of the scheme to allow the Partnership to 

engage in illegal HDD activities, and to make false and misleading statements, consciously 

disregarded his duties to monitor such controls over reporting and engagement in the scheme, and 

consciously disregarded his duties to protect corporate assets. Furthermore, Defendant Ramsey

signed, and thus personally made the false and misleading statements in the 2017 10-K, the 2018 

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10-K, 2019 10-K, and the 2020 10-K. For these reasons, Defendant Ramsey breached his 

fiduciary duties, faces a substantial likelihood of liability, is not independent or disinterested, and 

thus would not cause the General Partner to consider a demand fairly.

193. Additional reasons that the Director-Defendants are not independent or 

disinterested follow.

194. The Director-Defendants, who are named as defendants in this action, control the 

General Partner and have longstanding business and personal relationships with each other and 

the Individual Defendants that preclude them from acting independently.

195. In violation of the Code of Conduct, the Director-Defendants conducted little, if 

any, oversight of the Partnership’s internal controls over public reporting and of the Partnership’s 

engagement in the scheme to allow the Partnership to engage in illegal HDD activities, and to

issue materially false and misleading statements to the public and to facilitate and disguise the

Defendants’ violations of law, including breaches of fiduciary duty, unjust enrichment, abuse of 

control, gross mismanagement, and waste of corporate assets. In violation of the Code of Conduct, 

the Director-Defendants failed to comply with the law. Thus, the Director-Defendants face a 

substantial likelihood of liability and are not independent or disinterested.

196. In violation of the Code of Ethics, Defendants Long, McCrea, and Whitehurst

conducted little, if any, oversight of the Partnership’s internal controls over public reporting and 

of the Partnership’s engagement in the scheme to allow the Partnership to engage in illegal HDD 

activities, and to issue materially false and misleading statements to the public and to facilitate 

and disguise the Defendants’ violations of law, including breaches of fiduciary duty, unjust 

enrichment, abuse of control, gross mismanagement, and waste of corporate assets. In violation 

of the Code of Ethics, Defendants Long, McCrea, and Whitehurst failed to comply with the law. 

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Thus, Defendants Long, McCrea, and Whitehurst face a substantial likelihood of liability and are 

not independent or disinterested.

197. Energy Transfer has been and will continue to be exposed to significant losses due 

to the wrongdoing complained of herein, yet the General Partner has not filed any lawsuits against 

itself or others who were responsible for that wrongful conduct to attempt to recover for Energy 

Transfer any part of the damages Energy Transfer suffered and will continue to suffer thereby. 

Thus, any demand upon the General Partner would be futile.

198. The Defendants’ conduct described herein and summarized above could not have 

been the product of legitimate business judgment as it was based on bad faith and intentional, 

reckless, or disloyal misconduct. Thus, none of the Director-Defendants can claim exculpation 

from their violations of duty pursuant to the Partnership’s Partnership Agreement (to the extent 

such a provision exists). As a majority of the Director-Defendants face a substantial likelihood of 

liability, they are self-interested in the transactions challenged herein and cannot be presumed to 

be capable of exercising independent and disinterested judgment about whether to cause the 

General Partner to pursue this action on behalf of the unitholders of the Partnership. 

199. The acts complained of herein constitute violations of fiduciary duties owed by 

the General Partner and its officers and directors, and these acts are incapable of ratification.

200. The Director-Defendants may also be protected against personal liability for their 

acts of mismanagement and breaches of fiduciary duty alleged herein by directors’ and officers’

liability insurance if they caused the Partnership to purchase it for their protection with corporate 

funds, i.e., monies belonging to the unitholders of Energy Transfer. If there is a directors’ and 

officers’ liability insurance policy covering the Director-Defendants, it may contain provisions 

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Defendants, known as, inter alia, the “insured-versus-insured exclusion.” As a result, if the 

Director-Defendants were to cause the General Partner to sue themselves or certain of the officers 

of the General Partner, there would be no directors’ and officers’ insurance protection. 

Accordingly, the Director-Defendants cannot be expected to cause the General Partner to bring 

such a suit. On the other hand, if the suit is brought derivatively, as this action is brought, such 

insurance coverage, if such an insurance policy exists, will provide a basis for the Partnership to 

effectuate a recovery. Thus, demand on the General Partner is futile and, therefore, excused.

201. If there is no directors’ and officers’ liability insurance, then the DirectorDefendants will not cause General Partner to sue the Defendants named herein, since, if they did, 

they would face a large uninsured individual liability. Accordingly, demand is futile in that event, 

as well.

202. Thus, for all of the reasons set forth above, the General Partner cannot consider a 

demand with disinterestedness and independence. Consequently, a demand upon the General 

Partner is excused as futile. 

FIRST CLAIM 

Against Defendants for Breach of Fiduciary Duties

203. Plaintiff incorporates by reference and re-alleges each and every allegation set 

forth above, as though fully set forth herein. 

204. Defendants owed to the Partnership the duty to exercise candor, good faith, and 

loyalty in the management and administration of Energy Transfer’s business and affairs. 

205. Defendants violated and breached their fiduciary duties of candor, good faith, 

loyalty, reasonable inquiry, oversight, and supervision. 

206. Defendants’ conduct set forth herein was due to their intentional, reckless, or 

negligent breach of the fiduciary duties they owed to the Partnership, as alleged herein. 

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Defendants intentionally, recklessly, or negligently breached or disregarded their fiduciary duties 

to protect the rights and interests of Energy Transfer.

207. In breach of their fiduciary duties owed to Energy Transfer, Defendants willfully 

or recklessly caused the Partnership to engage in illegal HDD activities, and make false and 

misleading statements and omissions of material fact that failed to disclose that: (1) Energy 

Transfer had failed to maintain internal controls and proper procedures to prevent contractors 

from engaging in illegal HDD activities; (2) the Partnership failed to mitigate known problems in 

connection with the foregoing; (3) Energy Transfer, through Rover, hired third-party contractors 

who engaged in illegal HDD activities which caused massive pollution near the Tuscarawas 

River; and (4) the severity of the potential civil liabilities as a result of the FERC’s Enforcement 

Staff investigation into the April 13 Release. As a result of the foregoing, the Partnership’s public 

statements were materially false and misleading at all relevant times.

208. Defendants failed to correct and/or caused the Partnership to fail to rectify any of 

the wrongs described herein or correct the false and/or misleading statements and omissions of 

material fact referenced herein, rendering them personally liable to the Partnership for breaching 

their fiduciary duties.

209. Also, in breach of their fiduciary duties, Defendants failed to maintain an adequate 

system of oversight, disclosure controls and procedures, and internal controls.

210. Defendants had actual or constructive knowledge that they had caused the 

Partnership to improperly engage in the fraudulent scheme set forth herein and to fail to maintain 

adequate internal controls. Defendants had actual knowledge that the Partnership was engaging 

in the fraudulent scheme set forth herein, and that internal controls were not adequately 

maintained, or acted with reckless disregard for the truth, in that they caused the Partnership to 

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improperly engage in the fraudulent scheme and to fail to maintain adequate internal controls, 

even though such facts were available to them. Such improper conduct was committed knowingly 

or recklessly and for the purpose and effect of artificially inflating the price of Energy Transfer’s 

units and benefitting third parties. 

211. These actions were not a good-faith exercise of prudent business judgment to 

protect and promote the Partnership’s corporate interests.

212. As a direct and proximate result of Defendants’ breaches of their fiduciary 

obligations, Energy Transfer has sustained and continues to sustain significant damages. As a 

result of the misconduct alleged herein, Defendants are liable to the Partnership. 

213. Plaintiff on behalf of Energy Transfer has no adequate remedy at law. 

SECOND CLAIM

Against Defendants for Unjust Enrichment

214. Plaintiff incorporates by reference and re-alleges each and every allegation set 

forth above, as though fully set forth herein. 

215. By their wrongful acts, violations of law, and false and misleading statements and 

omissions of material fact that they made and/or caused to be made, the Defendants were unjustly 

enriched at the expense of, and to the detriment of, Energy Transfer. 

216. The Defendants either benefitted financially from the improper conduct, including 

from the receipt of bonuses, unit options, or similar compensation from the General Partner that 

was tied to the performance or artificially inflated valuation of Energy Transfer, or received 

compensation that was unjust in light of the Defendants’ bad faith conduct. 

217. Plaintiff, as a unitholder and a representative of Energy Transfer, seeks restitution 

from the Defendants and seeks an order from this Court disgorging all profits, including from

benefits and other compensation, including any performance-based or valuation-based 

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compensation, obtained by the Defendants due to their wrongful conduct and breach of their 

fiduciary and contractual duties. 

218. Plaintiff on behalf of Energy Transfer has no adequate remedy at law.

THIRD CLAIM

Against Defendants for Abuse of Control 

219. Plaintiff incorporates by reference and re-alleges each and every allegation set 

forth above, as though fully set forth herein. 

220. Defendants’ misconduct alleged herein constituted an abuse of their ability to 

control and influence Energy Transfer, for which they are legally responsible. 

221. As a direct and proximate result of Defendants’ abuse of control, Energy Transfer 

has sustained significant damages. As a direct and proximate result of Defendants’ breaches of 

their fiduciary obligations of candor, good faith, and loyalty, Energy Transfer has sustained and 

continues to sustain significant damages. As a result of the misconduct alleged herein, 

Defendants are liable to the Partnership. 

222. Plaintiff on behalf of Energy Transfer has no adequate remedy at law.

FOURTH CLAIM

Against Defendants for Gross Mismanagement 

223. Plaintiff incorporates by reference and re-alleges each and every allegation set 

forth above, as though fully set forth herein. 

224. By its actions alleged herein, Defendants, either directly or through aiding and 

abetting, abandoned and abdicated their responsibilities and fiduciary duties with regard to 

prudently managing the assets and business of Energy Transfer in a manner consistent with the 

operations of a limited partnership. 

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225. As a direct and proximate result of Defendants’ gross mismanagement and 

breaches of duty alleged herein, Energy Transfer has sustained and will continue to sustain 

significant damages.

226. As a result of the misconduct and breaches of duty alleged herein, Defendants are

liable to the Partnership. 

227. Plaintiff on behalf of Energy Transfer has no adequate remedy at law.

FIFTH CLAIM

Against Defendants for Waste of Corporate Assets 

228. Plaintiff incorporates by reference and re-alleges each and every allegation set 

forth above, as though fully set forth herein. 

229. As a result of the foregoing, and by failing to properly consider the interests of the 

Partnership and its public unitholders, Defendants have caused Energy Transfer to waste valuable 

corporate assets, to incur many millions of dollars of legal liability and costs to defend unlawful 

actions, to engage in internal investigations, and to lose financing from investors and business 

from future customers who no longer trust the Partnership and its products. 

230. As a result of the waste of corporate assets, the Defendants are each liable to the 

Partnership. 

231. Plaintiff on behalf of Energy Transfer has no adequate remedy at law.

PRAYER FOR RELIEF

FOR THESE REASONS, Plaintiff demands judgment in the Partnership’s favor against 

all Defendants as follows:

(a) Declaring that Plaintiff may maintain this action on behalf of Energy 

Transfer, and that Plaintiff is an adequate representative of the Partnership; 

(b) Declaring that the Defendants have breached their fiduciary duties to 

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Energy Transfer;

(c) Determining and awarding to Energy Transfer the damages sustained by it 

as a result of the violations set forth above from each of the Defendants, jointly and severally, 

together with pre-judgment and post-judgment interest thereon; 

(d) Directing Energy Transfer and the Defendants to take all necessary actions 

to reform and improve its corporate governance and internal procedures to comply with applicable 

laws and to protect Energy Transfer and its unitholders from a repeat of the damaging events 

described herein, including, but not limited to, putting forward for unitholder vote the following 

resolutions for amendments to the Partnership’s Partnership Agreement and the following actions 

as may be necessary to ensure proper corporate governance policies:

1. a proposal to strengthen Defendant LE GP’s Board’s supervision of 

operations and develop and implement procedures for greater unitholder input into 

the policies and guidelines of the Board;

2. a provision to permit the unitholders of Energy Transfer to nominate at 

least five candidates for election to the Board; and

3. a proposal to ensure the establishment of effective oversight of compliance 

with applicable laws, rules, and regulations.

(e) Awarding Energy Transfer restitution from Defendants, and each of them;

(f) Awarding Plaintiff the costs and disbursements of this action, including 

reasonable attorneys’ and experts’ fees, costs, and expenses; and

(g) Granting such other and further relief as the Court may deem just and 

proper.

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JURY TRIAL DEMANDED

Plaintiff hereby demands a trial by jury. 

Dated: July 14, 2022, Respectfully submitted,

COCHRAN LAW PLLC

/s/ Stuart L. Cochran 

Stuart L. Cochran 

State Bar No.: 24027936 

8140 Walnut Hill Lane, Suite 250 

Dallas, TX 75230 

Telephone: (469) 333-3405 

Email: stuart@scochranlaw.com 

 Liaison Counsel for Plaintiff

THE BROWN LAW FIRM, P.C.

Timothy Brown

767 Third Avenue, Suite 2501 

New York, NY 10017 

 Telephone: (516) 922-5427 

 Email: tbrown@thebrownlawfirm.net 

 Counsel for Plaintiff

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