Case No. RF357-00001
February 13, 1997
DECISION AND ORDER
OF THE DEPARTMENT OF ENERGY
APPLICATION FOR REFUND
Name of Petitioner: Houston/Pasadena Apache Oil Co./
Tesoro Petroleum Corporation
Date of Filing: December 20, 1996
Case Number: RF357-00001
On November 19, 1996, the Office of Hearings and Appeals (OHA) of the Department of Energy (DOE) issued a Decision and Order instituting special refund procedures for distribution of a fund obtained by the DOE through a Stipulation for Compromise Settlement (Stipulation) entered into by Houston/Pasadena Apache Oil Company (Apache) and the Department of Justice (DOJ). See Houston/Pasadena Apache Oil Company, 26 DOE ¶ 85,019 (1996) (Apache). The Stipulation was executed on June 4, 1993. Under the terms of the Stipulation, Apache agreed to remit $30,000 to the DOE in order to settle all claims and disputes between Apache and DOE regarding Apache's compliance with DOE price regulations in sales of motor gasoline to specified wholesale customers during the period from October 1, 1979 through December 31, 1979 (the refund period).
The Stipulation settled an enforcement proceeding initiated when the DOE's Economic Regulatory Administration (ERA) audited Apache's business records. As a result of the audit the ERA issued a Proposed Remedial Order (PRO) to Apache which tentatively found that Apache overcharged certain of its motor gasoline customers. After the OHA considered and rejected Apache's challenge to the PRO the firm was ordered to refund $160,713 plus interest to its identified wholesale gasoline customers. See Houston/Pasadena Apache Oil Co., 19 DOE ¶ 83,001 (1989). Apache did not comply with OHA's order and the matter was referred to the DOJ for resolution. The Stipulation entered into by DOJ and Apache resulted in the payment of $30,000 to DOE.
This determination involves an Application for Refund in the Apache refund proceeding filed by Tesoro Petroleum Corporation (Tesoro), one of the overcharged Apache wholesale customers identified by the ERA audit of Apache.
In Apache, the DOE established procedures for the distribution of the funds held in the Apache escrow account. Applicants for refunds from that account must certify that they purchased motor gasoline from Apache during the refund period. The Apache Decision requires that applicants demonstrate that they were injured by Apache's pricing practices in order to receive a refund. In order to establish injury an applicant must show that the Apache overcharges were absorbed rather than simply passed along to the applicant's customers. However, the Apache Decision also provides that certain claimants need not submit a detailed demonstration of injury if they fall into one of two categories of purchaser for whom a presumption of injury has been established: (a) resellers of Apache motor gasoline whose refund claim is $10,000 or less, and (b) claimants who were end-users (consumers) of Apache motor gasoline. The Apache Decision also stated that Tesoro, the only reseller identified by the ERA audit whose potential refund exceeded the $10,000 small claims threshold, could also take advantage of the injury presumption provided the firm agreed to limit its refund claim to $10,000. 26 DOE at 88,037-38.
Tesoro, a petroleum products reseller located in San Antonio, Texas has elected to limit its refund claim to $10,000. Under these circumstances the firm need not provide a detailed demonstration of injury in order to receive a refund. In support of its refund claim Tesoro has submitted a purchase certification and sample invoices from Apache thereby satisfying the requirements set forth in Apache for a successful refund claim under the small claims injury presumption. Tesoro shall therefore be awarded a refund of $11,850 ($10,000 principal and $1,850 interest).
Although we have carefully scrutinized the Tesoro refund claim, certification and purchase claim documentation, the determination reached in this Decision and Order is based upon the presumed validity of the presentations made in the Tesoro Application for Refund. If the factual basis underlying our determination in this Decision is later shown to be inaccurate, this Office has the authority to order appropriate remedial action, including rescission or reduction of the refund ordered.
It Is Therefore Ordered That:
(1) The Application for Refund filed by Tesoro Petroleum Corporation (Case No. RF357-00001) is hereby granted as set forth in Paragraph (2) below.
(2) The Director of Special Accounts and Payroll, Office of the Controller, of the Department of Energy shall take appropriate action to disburse a total of $11,850 ($10,000 in principal and $1,850 in interest) from the DOE deposit fund escrow account maintained at the Department of the Treasury and funded by Houston/Pasadena Apache Oil Company, Consent Order No. 6E0H10074W, to:
Tesoro Petroleum Corporation
8700 Tesoro Drive
San Antonio, Texas 78217
Attention: Donald O. Fanning
(3) The determination made in this Decision and Order is based upon the presumed validity of statements and documentary material submitted by the applicant. This determination may be revoked or modified at any time upon a determination that the factual basis underlying the applicant's Application for Refund is incorrect.
(4) This is a final order of the Department of Energy.
George B. Breznay
Director
Office of Hearings and Appeals
Date: February 13, 1997