Opinion ID: 172078
Heading Depth: 1
Heading Rank: 4

Heading: The Ashley Creek Litigation Post Closing

Text: Upon acquiring the pipeline, Simplot adopted the same tariff previously published by Chevron. In response, Ashley Creek filed an STB complaint against Simplot alleging various antitrust claims. Simplot retained Chevron's STB lawyer for representation before the STB, and it paid for this initial defense. The STB eventually consolidated Ashley Creek's cases against Simplot and Chevron. Simplot notified Chevron of its contractual duty to pay the expenses of the Ashley Creek litigation, proposing that Chevron reimburse [it] for all costs incurred to date in the [STB] proceedings and agree to assume all costs incurred in the future. 9 Aplt.App. at 2396. Simplot reasoned that this proposal conformed with the Pipeline Agreement [b]ecause all of the Ashley Creek proceedings revolve around the question of Chevron's compliance or noncompliance with [] [federal law]. Id. Chevron rejected Simplot's proposal, claiming it should not pay for additional costs, if any, related solely to [Simplot] obtaining [STB] approval for its tariff or allegations by Ashley Creek directed at [Simplot]. Id. at 2399. Ashley Creek also sued Simplot in district court. The court consolidated Ashley Creek's cases against Simplot and Chevron. Simplot asked Chevron to pay for its attorneys' fees, costs, losses, and liabilities incurred in connection with the district court case. As in the STB case, Chevron refused. Simplot and Chevron agreed to toll any claims against each other until the completion of the Ashley Creek litigation. Simplot and Chevron ultimately prevailed against Ashley Creek. The road to Ashley Creek's defeat began in 1996 when the STB issued its decision outlining the framework and methodology for calculating a reasonable tariff. Although the STB did not determine reasonableness, it did suggest the aggregate tariffs charged were likely unreasonable. The STB's implied solution was adoption of a tariff well below Simplot's operating costs to offset the higher tariffs charged during Chevron's period of ownership. Simplot did not publish a new, significantly reduced tariff until 1999. When it did so, its goal was to defeat Ashley Creek's claims by lowering the tariff to remove any argument that the tariff [wa]s preventing Ashley Creek from mining phosphate rock. 1 Aplt.App. at 264. Thereafter, the district court granted summary judgment in favor of Simplot and Chevron in the Ashley Creek litigation. The court held that Simplot's current and prior tariffs were not unreasonable or exclusionary. [2] Even if Chevron's higher tariffs were included in the analysis, the total tariff collections over the relevant time frame were not unreasonable because of Simplot's new, below market rates. Ashley Creek appealed, and we affirmed based on a lack of antitrust standing. See Ashley Creek Phosphate Co. v. Chevron USA, Inc., 315 F.3d 1245, 1261 (10th Cir.2003).