Case No. RG272-00891
March 10, 1997
DECISION AND ORDER
OF THE DEPARTMENT OF ENERGY
Decision and Order
Name of Applicant: HLR, Inc. (d/b/a Ryerson)
Date of Filing: June 5, 1995
Case Number: RG272-00891
This Decision and Order will consider an Application for Refund filed by HLR, Inc. (d/b/a Ryerson). The Application is based on the purchases of petroleum products made by Ryerson Concrete, Inc. (d/b/a Hank's Truck Service) during the period August 19, 1973 through January 27, 1981. HLR, Inc. has requested a refund from crude oil monies available for disbursement by the Office of Hearings and Appeals (OHA) of the Department of Energy pursuant to the Statement of Modified Restitutionary Policy In Crude Oil Cases, 51 Fed. Reg. 27899 (August 4, 1986).
In the past, purchasers of refined products were able to apply to the OHA for a refund from crude oil overcharge funds collected by the DOE. 51 Fed. Reg. 27899 (August 4, 1986). We have established refund procedures for these funds, which have been made available through consent orders between the DOE and numerous firms that sold crude oil during the price control period. E.g., Berry Holding Co., 16 DOE ¶ 85,405 (1987) (Berry); A. Tarricone, Inc., 15 DOE ¶ 85, 495 (1987); Mountain Fuel Supply Co., 14 DOE ¶ 85,475 (1986).
In order to receive a refund for crude oil overcharges, an Applicant generally must (1) document its purchase volumes and (2) show that it was injured by the overcharges. However, applicants that were end users of petroleum products and whose business was unrelated to the petroleum industry are presumed to have been injured. As such, they need not submit proof of injury to receive a refund in the Subpart V proceeding. City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987).
In the Application for Refund filed by HLR, Inc., the Applicant explains that "On November 30, 1994, the assets of Ryerson Concrete, Inc. and Ryerson Concrete, Inc., DBA: Hank's Truck Service, were acquired by HLR, Inc., DBA: Ryerson under a buy sell agreement." (1) At the request of the OHA, HLR, Inc. submitted a copy of the sale agreement, which confirms that the purchase made by HLR, Inc. involved only the assets of Ryerson Concrete, Inc. (d/b/a Hank's Truck Service); HLR, Inc. purchased none of the capital stock of Ryerson Concrete, Inc. (d/b/a Hank's Truck Service) pursuant to the 1994 agreement.(2)
We have a statutory duty to identify and provide restitution to injured persons. 15 U.S.C. § 4502 (b). We would be negligent in discharging that duty if we granted a refund to someone other than an identified injured person. Texaco/Huffy Gas, 22 DOE ¶ 85,220 at 88,586 n. 4. Under law, corporations are considered wholly separate "persons" from their stockholders. Therefore, under long-standing OHA precedent, corporations such as Ryerson Concrete, Inc. (d/b/a Hank's Truck Service), that suffered injury due to alleged crude oil overcharges during the refund period, are themselves considered "injured persons," while their stockholders are not. The refund procedures we have established provide that the right to receive a refund generally remains with the owner of a firm during the price control period. However, the right to receive a refund can be transferred to a subsequent owner of the firm if: (i) the firm is a corporation, the entire capital stock of which was purchased by the subsequent owner; or (ii) the firm's assets were sold under an agreement that indicated, either explicitly or implicitly, that potential refunds were being transferred. Mrs. M.B. Troy, 23 DOE ¶ 85,049 (1993).
HLR, Inc. (d/b/a Ryerson) has confirmed that it did not purchase the capital stock of Ryerson Concrete, Inc. (d/b/a Hank's Truck Service) when it purchased the assets of the corporation in 1994. A thorough review of the sale agreement submitted by HLR, Inc. (d/b/a Ryerson) does not show that the right to receive future crude oil refund monies due to the corporation Ryerson Concrete, Inc. (d/b/a Hank's Truck Service) was either explicitly or implicitly transferred pursuant to the sale agreement. As such, we have determined that the corporation Ryerson Concrete, Inc. (d/b/a Hank's Truck Service) did not relinquish the right to receive crude oil refund monies due to the corporation. We will therefore deny the Application for Refund submitted by HLR, Inc. (d/b/a Ryerson).
It Is Therefore Ordered That:
(1) The Application for Refund filed by HLR, Inc. (d/b/a Ryerson), Case No. RG272-00891, is hereby denied.
(2) This is a final Order of the Department of Energy.
George B. Breznay
Director
Office of Hearings and Appeals
Date: March 10, 1997
(1) See Letter from W.R. Hoffman, Jr., CEO of Ryerson, to OHA Staff Analyst Darcy Goddard, dated December 30, 1996.
(2) See Contract of Sale submitted by W.R. Hoffman to OHA Staff Analyst Darcy Goddard on January 28, 1997.