Heartland Regional Medical Center et al v. Oneok, Inc. et al

Filing 38

ORDER Granting Motion to Dismiss. Defendant Duke Energy Corporation terminated. Signed by Judge Philip M. Pro on 02/23/09. (Copies have been distributed pursuant to the NEF - SRK)

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UNITED STATES DISTRICT COURT D IS T R IC T OF NEVADA *** IN RE: WESTERN STATES ) W H O L E S A L E NATURAL GAS ) A N T IT R U S T LITIGATION ) ___________________________________ ) ) H E A R T L A N D REGIONAL MEDICAL ) C E N T E R , et al., ) ) P la in tif f s , ) ) v. ) ) ONEOK, INC., et al., ) ) Defendants. ) ) M D L 1566 2 :0 3 -C V -0 1 4 3 1 -P M P -P A L B A S E FILE

2 :0 7 -C V -0 0 9 8 7 -P M P -P A L

O R D E R RE: DEFENDANT'S MOTION T O DISMISS (Doc. #1299)

P re se n tly before this Court is Defendant Duke Energy Carolinas, LLC's Motion to Dismiss Plaintiffs' Amended Complaint for Damages for Lack of Personal Jurisdiction (D o c . #1299).1 Plaintiffs filed an Opposition (Doc. #1458) and supporting exhibits (Doc. # 1 4 5 9 , #1471). Defendant filed a Reply (Doc. #1487). I. BACKGROUND A . Procedural Background T h is case is one of many in consolidated Multidistrict Litigation arising out of the e n e rg y crisis of 2000-2001. Plaintiffs originally filed the above action in the Circuit Court o f Buchanan County, Missouri. (Notice of Removal, Compl. [2:07-CV-00987-PMP-PAL, D o c . #1].) Defendants removed the case to the United States District Court for the Western D is tric t of Missouri. (Id.) The Judicial Panel on Multidistrict Litigation entered a Transfer

Document numbers refer to the base file, 2:03-CV-01431-PMP-PAL, unless otherwise noted.

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O rd e r pursuant to 28 U.S.C. § 1407 centralizing the foregoing action in this Court for c o o rd in a te d or consolidated pretrial proceedings. (Conditional Transfer Order [2:06-CV1 3 5 1 -P M P -P A L , Doc. #8].) In this litigation, Plaintiffs seek to recover damages on behalf of natural gas rate p a ye rs . In the Complaint, Plaintiffs allege Defendants engaged in anti-competitive a c tiv itie s with the intent to manipulate and artificially increase or control the price of n a tu ra l gas for consumers. (Am. Compl. (Doc. #1260) at 28-37.) Specifically, Plaintiffs a lle g e Defendants knowingly delivered false reports concerning trade information and e n g a g e d in wash trades, in violation of Missouri Antitrust Law, R.S. Mo. § 416.010, et seq. ( I d .) Plaintiffs Heartland Regional Medical Center and Prime Tanning Corp. are M is s o u ri non-profit companies with their principal places of business in Missouri. (Id. at 3 .) Plaintiffs allege they purchased natural gas directly from one or more Defendants, and f ro m other natural gas sellers in the State of Missouri, during the past six years. (Id.) According to the Complaint, Defendants are natural gas companies that buy, sell, transport, a n d store natural gas, including their own and their affiliates' production, in the United S ta te s and in the State of Missouri. (Id. at 3-27.) T h e Amended Complaint's allegations are directed generally at two types of D e f e n d a n ts: the natural gas companies that actually engaged in natural gas sales and the re la te d reporting of allegedly manipulated gas prices to the trade indices, and those c o m p a n ie s ' parent corporations. The Amended Complaint does not allege the parent c o m p a n y Defendants themselves engaged in natural gas trading and price reporting. Rather, the Amended Complaint alleges these Defendants are the parent companies of s u b s id ia rie s which engage in such activity generally, and which also made natural gas sales in Missouri during the relevant time period. /// 2

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P la in tif f s seek to establish personal jurisdiction over the parent company D e f e n d a n ts based on their out-of-forum activities directed at Missouri along with their s u b s id ia rie s ' and affiliates' contacts within Missouri. According to the Amended C o m p la in t, the parent company Defendants dominated and controlled their respective s u b s id ia rie s and the parent company Defendants "entered into a combination and c o n s p ira c y . . . which tended to prevent full and free competition in the trading and sale of n a tu ra l gas, or which tended to advance or control the market prices of natural gas." (Id. at 3 , 6, 10, 12, 14, 16, 18, 22, 24-25.) Plaintiffs allege the parent company Defendants in te n d e d their actions to have a direct, substantial, and foreseeable effect on commerce in th e State of Missouri. (Id. at 4, 6, 10, 12, 14-16, 18, 22, 24-25.) According to the Amended C o m p la in t, the parent company Defendants "made strategic marketing policies and d e c is io n s concerning natural gas and the reporting of natural gas trade information to re p o rtin g firms for use in the calculation of natural gas price indices that affected the market p ric e s of natural gas, and those policies and decisions were implemented on an operational le v e l by affiliates . . . in the United States and in Missouri." (Id. at 4, 7, 10-11, 13, 15-16, 1 9 , 22, 24-26.) Defendant Duke Energy Carolinas, LLC ("DEC") now moves to dismiss, arguing th is Court lacks personal jurisdiction over it. According to DEC, it conducts no business in M is s o u ri and has no other contacts supporting general or specific jurisdiction. DEC also a rg u e s it cannot be subject to jurisdiction in Missouri based on its subsidiary's contacts with th e forum because its subsidiary is not its agent or alter ego. DEC thus argues exercising p e rs o n a l jurisdiction in this case would violate constitutional due process requirements. Plaintiffs respond that DEC's subsidy has submitted to jurisdiction in Missouri a n d DEC is subject to personal jurisdiction through agency and alter ego principles based o n its subsidiary's contacts with the forum. Additionally, Plaintiffs request the Court to d e la y ruling on the jurisdictional question until merits discovery is completed because the 3

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ju ris d ic tio n a l questions are intertwined with the merits. B . Facts Related to Personal Jurisdiction D E C is a North Carolina limited liability company formerly known as Duke E n e rg y Corporation, a North Carolina corporation. (Renewed Mot. to Dismiss for Lack of P e rs . Juris. (Doc. #872) ["DEC Mot."], Ex. A at 2.) Duke Energy Corporation converted to a limited liability company and renamed itself DEC in April 2006. (Id.) DEC primarily e n g a g e s in the business of generating, transmitting, distributing, and selling electric energy in North and South Carolina. (Id. at 3.) D E C does not maintain offices, conduct business, have employees, own property, p a y taxes, or maintain a bank account in Missouri. (Mot. to Dismiss for Lack of Pers. Juris (D o c . #1299) ["DEC Heartland Mot."], Ex. A at 1, Ex. B at 2.) DEC has not purchased, s o ld , or transported natural gas in Missouri. (DEC Heartland Mot., Ex. C at 2.) DEC has n o t applied for or received a certificate of authority to transact business in Missouri and has n o registered agent for service of process in Missouri. (DEC Heartland Mot., Ex. E at 2.) DEC wholly owns Duke Capital Corporation, which in turn wholly owns Pan E n e rg y Corp. (App. to Pls.' Joint Opp'n to Duke Energy Carolinas, LLC's Mot. to Dismiss f o r Lack of Pers. Juris. (Doc. #1084) ["Pls.' App."], Ex. F.) Pan Energy Corp. wholly owns D u k e Energy Services, Inc., which wholly owns Duke Energy Natural Gas Corporation. (Id.) Duke Energy Natural Gas Corporation wholly owns DETMI Management, Inc. (Id.) DETMI Management, Inc. owns a sixty percent interest in Duke Energy Trade and M a rk e tin g , LLC ("DETM"), a Defendant in this action and the subsidiary whose contacts w ith Missouri Plaintiffs seek to attribute to DEC. (DEC Mot., Ex. C at 2.) Mobil Natural G a s , Inc. ("MNGI"), an indirect subsidiary of Exxon Mobil Corporation, owns the other f o rty percent of DETM. (Id. at 2-3.) /// /// 4

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D E T M was created in 1996 as a Delaware limited liability company pursuant to a lim ite d liability company agreement and limited partnership agreement. (Pls.' App., Ex. E a t 34-35; App. of Docs. Filed Under Seal (Doc. #1125) ["Sealed App."], Ex. L at D E M D L 0 0 0 3 8 3 ; Separate Vol. of Evid. in Supp. of the Separate App. of Facts Regarding D u k e Energy Carolinas, LCC (Doc. #968) ["Separate Vol. Evid."], Ex. 7.) The company n o w known as DETM originally was called PanEnergy Trading and Marketing Services, L L C , and was created by an agreement between PTMSI Management, Inc. and MNGI. (Separate Vol. Evid., Ex. 7 at 1, 6, 7, 10.) PTMSI Management, Inc.'s parent company at th e time was PanEnergy Corp. (Id. at 7, 10.) PanEnergy Corp. was acquired by Duke E n e rg y Corporation in 1997 and PanEnergy Trading and Marketing Services, LLC was re n a m e d to DETM. (Separate Vol. Evid., Ex. 9 at 2.) DETM is engaged in the purchase a n d sale of natural gas and electricity at wholesale. (DEC Mot., Ex. C at 3.) DETM c o n c e d e s personal jurisdiction in this action. (App. to Pls.' Opp'n to Duke Energy C a ro lin a s , LLC's Mot. to Dismiss for Lack of Pers. Juris (Doc. #1459) ["Heartland App."], E x . A at 2.) D E T M is run by a Management Committee consisting of three representatives f ro m the Duke Energy side and two representatives from the Exxon Mobil side. (Sealed A p p ., Ex. L at DEMDL000400.) The Management Committee acts through the delegation o f certain responsibilities and authority to the managing member, which in 2001 and 2002 w a s DETMI Management, Inc. (Id.) Although DETMI Management, Inc. was the m a n a g in g member, and through its majority status on the committee could outvote the M N G I members on certain matters, the limited liability company agreement mandated that s o m e actions required unanimous approval by the Management Committee. (Separate Vol. E v id ., Ex. 7 at 17, 24, 26-27.) In at least one instance, the MNGI members refused to agree to a business plan supported by the DETMI Management, Inc. members. (Pls.' App., Ex. E a t 67-69.) 5

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N o DEC director serves as an officer or director for DETM. (DEC Mot., Ex. A a t 4.) During the 2000 to 2002 time frame, only one DEC officer also served as a DETM o f f ic e r, and that person did so only for approximately three months. (DEC Heartland Mot., E x . E at 3.) In DEC's 2000 annual report, DEC identified a "management team" which in c lu d e s Jim W. Mogg ("Mogg"), Chief Executive Officer of Duke Energy Field Services; K irk B. Michael ("Michael"), Vice President and Chief Financial Officer for Finance and P la n n in g ; James Donnell ("Donnell"), President and Chief Executive Officer for Duke E n e rg y North America; and Ronald Green ("Green"), President and Chief Executive O f f ic e r for Duke/Fluor Daniel. (Pls.' App., Ex. B at DEMDL001901.) Mogg, Michael, D o n n e ll, and Green were members of the DETM Management Committee at one point or a n o th e r. (Sealed App., Ex. L at DEMDL001702, DEMDL001706, DEMDL001711.) DEC and DETM maintain separate corporate records. (DEC Mot., Ex. A at 4.) DEC provided corporate services to DETM, including administering employee health in s u ra n c e , human resources, computer technology, legal services, and credit risk m a n a g e m e n t. (Pls.' App., Ex. A at 4-5.) Throughout the relevant time period, DETM re g u la rly used, and was permitted to use, the "Duke Energy" and "Mobil" logos. (Id. at 5.) DETM did not have any agency agreements or power of attorney for DEC, and did not re g is te r to do business on DEC's behalf in Missouri during the relevant time period. (Heartland App., Ex. A at 6.) DETM was financed through a $150 million funding facility, of which DETMI M a n a g e m e n t, Inc. provided sixty percent and MNGI funded the other forty percent. (Separate Vol. Evid., Ex. 3 at 35.) In DETM's financial statements, it twice indicated that D E C was responsible for providing operational interest-free contributions, on a p ro p o rtio n a te basis with Exxon Mobil, to fund DETM's operations. (Sealed App., Ex. L at D E M D L 0 0 3 8 3 , DEMDL00400.) According to Richard McGee ("McGee"), former general c o u n s e l for energy services for DEC and current president of DEC's international business, 6

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th e s e statements were a mistake, as PanEnergy Corp., not DEC, is responsible for making c o n trib u tio n s under the funding facility agreement. (Pls.' App., Ex. E at 6, 138-40.) DEC's c o n s o lid a te d financial reports reflected sixty percent of DETM's profits and losses during th e relevant time period. (Pls.' App., Ex A at 6.) D E C describes itself, collectively with its subsidiaries, as "an integrated energy a n d energy services provider with the ability to offer physical delivery and management of b o th electricity and natural gas throughout the U.S. and abroad." (Pls.' App., Ex. B at D E M D L 0 0 1 8 4 6 .) DEC provides these services through various "business segments," one o f which includes DETM's natural gas trading. (Id.) DEC describes its business strategy as " d e v e lo p [ in g ] integrated energy businesses in targeted regions where Duke Energy's e x te n s iv e capabilities in developing energy assets, operating electricity, natural gas and N G L plants, optimizing commercial operations and managing risk can provide c o m p re h e n s iv e energy solutions for customers and create superior value for shareholders." (Id.) DEC has created "[c]omprehensive risk management polices" to monitor and m a n a g e market, commodity price, credit, and other risks to which DEC and its subsidiaries a re exposed. (Id. at DEMDL001854-55.) As part of its risk management policies, DEC m o n ito rs certain metrics, such as value-at risk ("VAR") and daily earnings at risk ("DER") o n a daily basis. (Id. at DEMDL001855.) DEC has several committees which perform risk m a n a g e m e n t, including the Corporate Risk Management Committee, the Energy Risk M a n a g e m e n t Committee, and the Financial Risk Management Committee. (Pls.' App., Ex. E at 80.) DEC appointed the members of each of these committees. (Id.) Through these p o lic e s and committees, DEC sets overall risk guidelines for its subsidiaries. For example, DEC adopted a Code of Business Ethics which applied to every D E C subsidiary. (Pls.' App., Ex. J, Ex. E at 100-01.) This policy mandated compliance w ith applicable antitrust laws. (Pls.' App., Ex. J at 12.) This policy was implemented and 7

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s u p e rv is e d by DEC's Corporate Compliance Committee. (Id. at 15.) The Corporate C o m p lia n c e Committee was responsible for updating the code, establishing education p ro g ra m s for employees about ethics and compliance issues, providing guidance under the c o d e , monitoring and auditing compliance, reporting periodically to management and the A u d it Committee of DEC's Board of Directors, and reporting violations to the appropriate g o v e rn m e n ta l authorities. (Id.) DETM either incorporated this policy by reference or a d o p te d a similar policy. (Pls.' App., Ex. E at 115-16.) D E C also has a Corporate Credit Risk policy. (Sealed App., Ex. L at D E M D L 0 0 1 3 8 2 , DEMDL001388.) Under this policy, DEC's Chief Risk Officer chairs the R is k Management Committee. (Id.) The Risk Management Committee meets at least m o n th ly and is responsible for reviewing business trends and credit exposure, monitoring c o m p lia n c e with the policy, identifying where new policies are needed, and ensuring " c o n s is te n t and mutually reinforcing credit and market risk management strategies through v a rio u s corporate risk policies and associated guidelines for implementing policy." (Id.) The policy also sets forth the duties of the Chief Credit Officer, which includes the ability to "stop business activity that would increase credit exposure, as is necessary, to protect D u k e Energy's balance sheet." (Id.) The Chief Credit Officer reports to the Chief Risk O f f ic e r. (Id.) DEC has a Corporate Risk Management Committee consisting of DEC's chief f in a n c ia l officer and DEC Policy Committee members. (Id. at DEMDL001488.) This C o m m itte e establishes "comprehensive risk management policies to monitor and control id e n tif ie d risks." (Id.) DEC's Corporate Risk Management Committee delegates some re s p o n s ib ilitie s to the Energy Risk Management Committee and the Financial Risk M a n a g e m e n t Committee, but retains oversight responsibilities. (Id.) The Energy Risk M a n a g e m e n t Committee has responsibility for overseeing energy risk management p ra c tic e s and recommending energy commodity exposure limits, subject to approval by the 8

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C o rp o ra te Risk Management Committee. (Id.) The Financial Risk Management C o m m itte e is responsible for managing risks related to interest rates, foreign currency, and c re d it. (Id.) Within DETM, "[u]ltimate risk control responsibility resides with the DETM M a n a g e m e n t Committee." (Id. at DEMDL001489.) The DETM Management Committee o v e rs e e s the risk management and control function and approves policies and controls for D E T M . For example, DETM adopted its own Risk Management and Trading Policies and C o n tro ls . (Id. at DEMDL001484.) DETM's Management Committee "delegates the dayto -d a y overview of the risk management and control function" to the DEC Energy Risk M a n a g e m e n t Committee. (Id. at DEMDL001489.) "However, overall responsibility for D E T M 's performance targets, business plans and approved risk levels remains with the M a n a g e m e n t Committee." (Id.) Although DETM's Risk Management and Trading P o lic ie s and Controls states that the Management Committee delegates "day-to-day o v e rv ie w " to the DEC Energy Risk Management Committee, it describes the Energy Risk M a n a g e m e n t Committee's functions as meeting "at least monthly" to establish risk m a n a g e m e n t policies, controls, and practices, and overseeing and approving excesses of o v e ra ll limits. (Id. at DEMDL001489-90.) When it comes to operational control, the policy v e s ts that authority in DETM Senior Management. (Id. at DEMDL001490.) DETM Senior M a n a g e m e n t is responsible for "[d]evelopment of trading strategies; [a]ctive management o f trading within overall limits; [a]llocation of limits to traders and/or books; [e]nforcing th e risk control environment; [a]dvocating new limits and products; and [a]dvocating e x c e p tio n s or revisions to policy when appropriate." (Id.) Beneath DETM Senior M a n a g e m e n t, the origination and trading groups actually conduct the transactions with c u s to m e rs . (Id.) D E C 's Energy Risk Management Committee is not responsible for managing e n e rg y price risk for DETM. (Separate Vol. Evid., Ex. 10 at DEMDL001569.) Instead, 9

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D E T M manages its own energy price risk pursuant to its own risk management policy. (Id.) However, that policy is subject to approval by the Corporate Risk Management Committee. (Id.) In similar fashion, DETM decides whether to extend credit, subject to the Financial R is k Committee's Credit Quality Guidelines. (Id. at DEMDL001495.) According to M c G e e , DEC's risk management policies "would have applied to DETM only to the extent th a t . . . the management committee of DETM had adopted a policy that was similar to this o r [DETMI,] in discharging its responsibilities as a managing member of DETM . . . a d o p t[ e d ] policies that it saw fit in connection with discharging those duties." (Pls.' App., E x . E at 100.) These policies "were either largely consistent with or in some cases maybe id e n tic a l to some of" DEC's policies. (Id.) A t a July 2000 DETM management committee meeting, the MNGI representative e x p re s s e d some concern that certain personnel now working for DETM would be shared b e tw e e n DETM and Duke Energy North America, LLC. (Sealed App., Ex. L at D E M D L 0 0 1 7 0 7 .) Specifically, the MNGI representative was concerned that because D E T M senior managers "would have dual responsibilities, working for both DETM and D u k e Energy or Duke affiliates, [they] would face conflicts because their compensation is b a s e d on performance of two entities with differing Duke ownership shares." (Id.) At a S e p te m b e r 2001 DETM management committee meeting, the Exxon Mobil representative " o b je c te d to the way the business had been run including a perceived lack of separation b e tw e e n [Duke Energy North America] and DETMI." (Id. at DEMDL001718.) In May 2002, DETM's outside auditor, Deloitte & Touche, sent a letter to the D E T M management committee highlighting certain areas of concern. (Id. at D E M D L 0 0 2 6 8 7 .) Among the concerns Deloitte & Touche highlighted was that DETM's o p e ra tio n s were "highly integrated into the overall strategy of Duke Energy North America (`D E N A '). There are instances where the distinctiveness between DETM and other /// 10

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affiliates of its owners could be enhanced."2 (Id. at DEMDL002692.) In September 2003, the Commodity Futures Trading Commission ("CFTC") e n te re d into a settlement with DETM regarding allegations that DETM manipulated the n a tu ra l gas market. (DEC Heartland Mot., Ex. G.) The CFTC found that from January 2 0 0 0 through August 2002, DETM's Houston office reported to price reporting firms false p ric e and volume information regarding natural gas transactions. (Id. at 2-3.) As part of the s e ttle m e n t, DETM agreed to cease and desist from any future violations, and agreed to pay a $28 million fine. (Id. at 5.) Additionally, both DETM and Duke Energy Corporation (D E C 's predecessor) agreed to cooperate in any future investigations arising out of this in v e s tig a tio n , to preserve records, to produce documents when requested, and to provide a s s is ta n c e in locating and contacting any prior employees. (Id.) DETM and Duke Energy C o rp o ra tio n also agreed not to publicly deny the CFTC's findings of fact. (Id. at 6.) DEC a tto rn e ys and senior executives participated in internal investigations into DETM's price re p o rtin g activities. (Pls.' App., Ex. A at 6.) In April 2003, DEC announced that two of its subsidiaries, Duke Energy North A m e ric a and Duke Energy Merchants, would cease proprietary trading of natural gas and p o w e r. (DEC Mot., Ex. G.) DETM also ceased speculative natural gas trading in 2003. (Pls.' App., Ex. A at 5.) After that time, DETM continued to buy and sell natural gas "for th e purpose of meeting and hedging its obligations to supply gas-fired power plants owned b y Duke Energy North America, Inc. and other affiliates and to meet natural gas supply c o m m itm e n ts it has made." (Id.) By the end of 2004, DEC "made substantial progress on w in d in g down" the DETM joint venture with Exxon Mobil, and had "completed or signed tra n s a c tio n s to sell about 90 percent of that business." (Pls.' App., Ex. G.)

DEC objects to the admission of the Deloitte & Touche letter as inadmissible hearsay. Because consideration of the letter does not affect the outcome of this decision, the Court will deny DEC's objection. 11

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T h e parties now dispute the significance of these contacts under the Missouri lo n g -a rm statute. The parties also dispute whether this Court's exercise of personal ju ris d ic tio n over DEC would violate constitutional due process requirements. II. PERSONAL JURISDICTION " W h e n a defendant moves to dismiss for lack of personal jurisdiction, the p la in tif f bears the burden of demonstrating that the court has jurisdiction over the d e f e n d a n t." Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th Cir. 2006). To meet this b u rd e n , a plaintiff must demonstrate that personal jurisdiction over a defendant is (1) p e rm itte d under the applicable state's long-arm statute and (2) that the exercise of ju ris d ic tio n does not violate federal due process. Id. The Court must analyze whether p e rs o n a l jurisdiction exists over each defendant separately. Harris Rutsky & Co. Ins. S e rv s ., Inc. v. Bell & Clements Ltd., 328 F.3d 1122, 1130 (9th Cir. 2003). Where the issue is before the Court on a motion to dismiss based on affidavits a n d discovery materials without an evidentiary hearing, the plaintiff must make "a prima f a c ie showing of facts supporting jurisdiction through its pleadings and affidavits to avoid d is m is s a l." Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d 1114, 1 1 1 9 (9th Cir. 2002). The Court accepts as true any uncontroverted allegations in the c o m p la in t and resolves any conflicts between the facts contained in the parties' evidence in th e plaintiff's favor. Id. However, for personal jurisdiction purposes, a court "may not a s s u m e the truth of allegations in a pleading which are contradicted by affidavit." Alexander v. Circus Circus Enters., Inc., 972 F.2d 261, 262 (9th Cir. 1992) (quotation o m itte d ). In diversity cases such as this, "a federal court applies the personal jurisdiction ru le s of the forum state provided the exercise of jurisdiction comports with due process." Scott v. Breeland, 792 F.2d 925, 927 (9th Cir. 1986). However, "federal law is controlling o n the issue of due process under the United States Constitution." Data Disc, Inc. v. Sys. 12

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T e c h . Assoc., Inc., 557 F.2d 1280, 1286 n.3 (9th Cir. 1977); see also Dole Food Co., Inc. v. W a tts , 303 F.3d 1104, 1110 (9th Cir. 2002). Therefore, the Court will apply law from the U n ite d States Court of Appeals for the Ninth Circuit in deciding whether jurisdiction is a p p ro p ria te under the Due Process Clause. See In re Korean Air Lines Disaster of Sept. 1, 1 9 8 3 , 829 F.2d 1171, 1174 (D.C. Cir. 1987) (concluding that "the transferee court [should] b e free to decide a federal claim in the manner it views as correct without deferring to the in te rp re ta tio n of the transferor circuit"); Menowitz v. Brown, 991 F.2d 36, 40 (2d Cir. 1 9 9 3 ) (holding that "a transferee federal court should apply its interpretations of federal la w , not the constructions of federal law of the transferor circuit"). To satisfy federal due process standards, a nonresident defendant must have " m in im u m contacts" with the forum state so that the assertion of jurisdiction does not o f f e n d traditional notions of fair play and substantial justice. Pebble Beach Co., 453 F.3d at 1 1 5 5 (citing Int'l Shoe Co. v. Washington, 326 U.S. 310, 315 (1945)). A federal district c o u rt may exercise either general or specific personal jurisdiction. See Helicopteros N a c io n a le s de Colombia, S.A. v. Hall, 466 U.S. 408, 414-15 (1984). T o establish general personal jurisdiction, the plaintiff must demonstrate the d e f e n d a n t has sufficient contacts to "constitute the kind of continuous and systematic g e n e ra l business contacts that `approximate physical presence.'" Glencore Grain, 284 F.3d a t 1124 (quoting Bancroft & Masters, Inc. v. Augusta Nat'l Inc., 223 F.3d 1082, 1086 (9th C ir. 2000), modified, Yahoo! Inc. v. La Ligue Contre Le Racisme Et L'Antisemitisme, 433 F .3 d 1199, 1207 (9th Cir. 2006)). Courts consider such factors as whether the defendant m a k e s sales, solicits or engages in business in the state, serves the state's markets, d e s ig n a te s an agent for service of process, holds a license, or is incorporated there. Bancroft, 223 F.3d at 1086. "[A] defendant whose contacts are substantial, continuous, and s ys te m a tic is subject to a court's general jurisdiction even if the suit concerns matters not a risin g out of his contacts with the forum." Glencore Grain, 284 F.3d at 1123 (citing 13

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H e lic o p te ro s , 466 U.S. at 415 n.9). A nonresident defendant's contacts with the forum state may permit the exercise o f specific jurisdiction if: (1) the defendant has performed some act or transaction within th e forum or purposefully availed himself of the privileges of conducting activities within th e forum, (2) the plaintiff's claim arises out of or results from the defendant's forumre la te d activities, and (3) the exercise of jurisdiction over the defendant is reasonable. Pebble Beach Co., 453 F.3d at 1155-56. "If any of the three requirements is not satisfied, ju ris d ic tio n in the forum would deprive the defendant of due process of law." Omeluk v. L a n g ste n Slip & Batbyggeri A/S, 52 F.3d 267, 270 (9th Cir. 1995). Under the first prong of the "minimum contacts test," the plaintiff must establish e ith e r that the defendant "(1) purposefully availed himself of the privilege of conducting his a c tiv itie s in the forum, or (2) purposefully directed his activities toward the forum." Pebble B e a c h Co., 453 F.3d at 1155. "Evidence of availment is typically action taking place in the f o ru m that invokes the benefits and protections of the laws in the forum." Id. Evidence of d ire c tio n usually consists of conduct taking place outside the forum that the defendant d ire c ts at the forum. Id. at 1155-56. The purposeful direction aspect of the first prong is satisfied when a foreign act is b o th aimed at and has effect in the forum. Id. In other words, the defendant "must have (1) c o m m itte d an intentional act, which was (2) expressly aimed at the forum state, and (3) c a u s e d harm, the brunt of which is suffered and which the defendant knows is likely to be s u f f e re d in the forum state." Id. To satisfy the third element of this test, the plaintiff must e s ta b lis h the defendant's conduct was "expressly aimed" at the forum; a "mere foreseeable e f f e c t" in the forum state is insufficient. Id. The "express aiming" requirement is satisfied w h e n the defendant is alleged to have engaged in wrongful conduct "individually targeting a known forum resident." Bancroft, 223 F.3d at 1087. /// 14

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T h e second prong of the specific jurisdiction test requiring that the contacts c o n s titu tin g purposeful availment or purposeful direction give rise to the current action is m e a s u re d in terms of "but for" causation. Id. at 1088. "If the plaintiff establishes both p ro n g s one and two, the defendant must come forward with a `compelling case' that the e x e rc ise of jurisdiction would not be reasonable." Boschetto v. Hansing, 539 F.3d 1011, 1 0 1 6 (9th Cir. 2008) (quotation omitted). Plaintiffs are not contending this Court may assert personal jurisdiction over D E C based on REI's own contacts with Missouri. (Pls.' Opp'n to Duke Energy Carolinas, L L C 's Mot. to Dismiss for Lack of Pers. Juris. (Doc. #1458) at 3.) Consequently, DEC is s u b je c t to personal jurisdiction in Missouri only if the forum acts of its subsidiary, DETM, a re attributable to it through alter ego or agency principles.3 A . Alter Ego A "parent-subsidiary relationship alone is insufficient to attribute the contacts of th e subsidiary to the parent for jurisdictional purposes." Harris Rutsky & Co. Ins. Servs., In c ., 328 F.3d at 1134. However, a subsidiary's contacts may be imputed to its parent for p e rs o n a l jurisdiction purposes where the subsidiary is the parent's alter ego. Id. T o demonstrate a parent and its subsidiary are alter egos, the plaintiff must e s ta b lis h a prima facie case that the two companies share "such unity of interest and o w n e rsh ip " that the companies' separateness no longer exists and "failure to disregard [ th e ir separate identities] would result in fraud or injustice." Doe v. Unocal Corp., 248 F.3d 9 1 5 , 926 (9th Cir. 2001) (quotation omitted). To demonstrate a unity of interest warranting d is re g a rd of corporate separateness, the plaintiff must show the parent controls its s u b s id ia ry to such a degree as to render the subsidiary a "mere instrumentality" of its parent. Id. (quotation omitted). Typically, this would involve showing the parent controls the The Court will assume that if DETM's forum-related acts are attributable to DEC, the Missouri long-arm statute is satisfied. 15
3

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s u b s id ia ry's internal affairs or daily operations. Kramer Motors, Inc. v. British Leyland, L td ., 628 F.2d 1175, 1177 (9th Cir. 1980).4 A parent corporation may be involved directly in certain aspects of its wholly o w n e d subsidiary's affairs without subjecting itself to alter ego status. For example, a p a re n t may provide financing to its subsidiary so long as it maintains corporate formalities a n d properly documents loans and capital contributions to its subsidiaries, and it may act as its subsidiary's guarantor. Doe, 248 F.3d at 927-28. Additionally, a parent may refer to its s u b s id ia rie s as divisions of the parent in annual reports. Id. at 928. Further, a parent may re v ie w and approve major decisions, place its own directors on the subsidiary's board, and s h a re offices and staff with its wholly owned subsidiary without being considered its alter e g o . Id.; Harris Rutsky & Co. Ins. Servs., Inc., 328 F.3d at 1135. In sum, a parent may involve itself directly in its subsidiary's activities without b e c o m in g an alter ego "so long as that involvement is consistent with the parent's investor s ta tu s ." Harris Rutsky & Co. Ins. Servs., Inc., 328 F.3d at 1135 (quotation omitted). Activities consistent with investor status include "`monitoring of the subsidiary's p e rf o rm a n c e , supervision of the subsidiary's finance and capital budget decisions, and Missouri employs a similar alter ego test. Under Missouri law, "when a corporation is so dominated by a person as to be a mere instrument of that person and is indistinct from the person controlling it, then the court will disregard the corporate form if to retain it would result in injustice." East Attucks Cmty. Housing, Inc. v. Old Republic Sur. Co., 114 S.W.3d 311, 321-22 (Mo. Ct. App. 2003) (quotation omitted). The party seeking to pierce the corporate veil must show such "complete domination" that "the corporate entity as to this transaction had at the time no separate mind, will or existence of its own." Real Estate Investors Four, Inc. v. Am. Design Group Inc., 46 S.W.3d 51, 56 (Mo. Ct. App. 2001) (quotation omitted). Additionally, the party seeking to pierce must show the corporation used such control to commit a fraud or wrong, to violate statutory or other positive legal duties, or to perpetrate a dishonest and unjust act in contravention of plaintiff's legal rights. Id. Finally, the party must show "[t]he control and breach of duty" proximately caused the injury. Id. (quotation omitted). To the extent Missouri would look to the law of the state of incorporation to determine alter ego status, see In re Bridge Info. Sys., Inc., 325 B.R. 824, 830-31 (Bankr. E.D. Mo. 2005), North Carolina has similar requirements. See State ex rel. Cooper v. Ridgeway Brands Mfg., LLC, 666 S.E.2d 107, 112-15 (N.C. 2008); East Market Street Square, Inc. v. Tycorp Pizza IV, Inc., 625 S.E.2d 191, 196-201 (N.C. Ct. App. 2006). 16
4

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a rtic u la tio n of general policies and procedures[.]'" Doe, 248 F.3d at 926 (quoting United S ta te s v. Bestfoods, 524 U.S. 61, 72 (1998)). In addition to showing lack of corporate separateness, the plaintiff also must s h o w that failure to disregard the corporate form would promote fraud or injustice. The f ra u d or injustice must relate to the forming of the corporation or abuse of the corporate f o rm , not a fraud or injustice generally. Laborers Clean-Up Contract Admin. Trust Fund v. U ria rte Clean-Up Serv., Inc., 736 F.2d 516, 524-25 n.12 (9th Cir. 1984). For example, u n d e rc a p ita liz a tio n at the subsidiary's inception may be evidence of the parent's fraudulent in te n t. Id. However, a corporation that once was capitalized adequately but "subsequently f e ll upon bad financial times" does not support a finding of fraud or injustice. Id. at 525. Further, evidence that the corporation existed as an ongoing enterprise engaged in le g itim a te business suggests no fraudulent intent or injustice to support piercing the c o rp o ra te veil. Seymour v. Hull & Moreland Eng'g, 605 F.2d 1105, 1113 (9th Cir. 1979). An inability to collect on a judgment "does not, by itself, constitute an inequitable result." Id. P la in tif f s have failed to establish a prima facie case of personal jurisdiction based o n DETM being DEC's alter ego. DEC indirectly owns only sixty percent of DETM. DETM thus is neither DEC's direct subsidiary nor its wholly owned subsidiary. The c o m p a n ie s did not share offices and had virtually no overlapping officers or directors. That o th e r officers and directors of other DEC subsidiaries may have overlapped or that DEC id e n tif ie d certain DETM Management Committee members as part of an overall " m a n a g e m e n t team" does not indicate a lack of separateness between DEC and DETM. Likewise, the fact that MNGI and/or Deloitte & Touche perceived a possible lack of s e p a ra te n e s s between DETM and Duke Energy North America does not establish a lack of s e p a ra te n e s s between DETM and DEC. Nor does the possibility that DEC was responsible f o r making contributions under the funding facility or that DEC provided corporate 17

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s e rv ic e s , such as legal or human resources support. Plaintiffs have presented no evidence that DEC controlled DETM's daily o p e ra tio n s . Under the limited liability company agreement, DETMI Management, Inc. was th e managing agent, not DEC. And as to DETMI Management, Inc., it did not have c o m p le te control over DETM as the MNGI representatives' approval was required for any m a te ria l decisions. In at least one instance, DETMI Management, Inc. was unable to im p le m e n t the business plan it desired because it could not obtain the approval of the M N G I representatives on the Management Committee. D E C 's promulgation of general policies for its subsidiaries is consistent with its in d ire c t investor status. DEC, as an investor up the corporate chain, is entitled to monitor D E T M 's performance. Consequently, any daily reporting of information from DETM to D E C is in accord with DEC's investor oversight role. No evidence suggests DEC gave d a ily control commands to DETM or even to DETMI Management, Inc. Rather, the record d e m o n s tra te s that, consistent with its investor status, DEC set general policies and g u id e lin e s regarding best policies and practices, as well as certain overall limits, such as lim its on credit risk. However, DEC's broad policies applied to DETM only to the extent D E T M 's Management Committee adopted those policies, in whole or in part, through D E T M I Management, Inc.'s status as a majority member. Moreover, DETM's delegation of certain risk management oversight to DEC's E n e rg y Risk Management Committee does not demonstrate daily control. The Energy Risk M a n a g e m e n t Committee meets "at least monthly," and is responsible for establishing risk m a n a g in g practices and controls, monitoring daily reports, and overseeing and approving a n y excesses of a risk limit. (Sealed App., Ex. L at DEMDL001490.) The Energy Risk M a n a g e m e n t Committee thus established broad guidelines under which DETM operated a n d became involved, if ever, only when overall limits were exceeded. Actual operational d e c is io n s , such as developing trading strategy, actively managing trading within overall 18

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lim its , allocating limits among traders, and enforcing risk control, were the responsibility of D E T M Senior Management. F u rth e r, with respect to DETM's day-to-day conduct of its business within these g u id e lin e s , Plaintiffs present no evidence DEC had any role. For example, with respect to n a tu ra l gas trading, while DEC set overall limits on certain metrics, DEC had no role in m a k in g the day-to-day decisions of who DETM was to trade with, when, for what amount o f natural gas, and at what price. Plaintiffs also present no evidence DEC had any role in D E T M 's price reporting to indices. Plaintiffs present evidence that DEC policies granted D E C 's chief credit officer with veto power over any DETM business activity, but Plaintiffs p re s e n t no evidence that authority ever was exercised over DETM generally or particularly w ith respect to any natural gas trades in Missouri or anywhere else. Even if Plaintiffs had established a lack of corporate separateness, Plaintiffs have n o t established a fraud or injustice would result if the Court failed to pierce the corporate v e il. Plaintiffs contend it would be unjust to permit DEC to reap the benefits of DETM's a lle g e d unlawful behavior by enjoying profits from DETM's trading activities while e s c a p in g liability for DETM's alleged misconduct. However, the alleged illegal price m a n ip u la tio n cannot itself constitute the fraud or injustice necessary to pierce the corporate v e il. Rather, DEC must have had some fraudulent intent at DETM's inception or some later a b u s e of the corporate form such that failing to treat the entities as one would be in e q u ita b le . Plaintiffs present no evidence DETM was undercapitalized at its inception. DEC was not involved in forming DETM and became its indirect parent through DEC's a c q u is itio n of DETM's ultimate parent, PanEnergy Corp. Further, the fact that DETM o p e ra te d as a legitimate business for years suggests a lack of fraudulent intent or p e rp e tra tio n of a fraud through use of the corporate structure on the parent's part. /// /// 19

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P la in tif f s ' fear that they may not be able to collect on a judgment in this action a g a in s t DETM does not constitute fraud or injustice to support piercing the corporate veil. The Court therefore finds Plaintiffs have not met their burden of establishing DETM is D E C 's alter ego, and the Court will not attribute DETM's contacts with Missouri to DEC f o r purposes of determining personal jurisdiction based on alter ego principles. B. Agency A subsidiary's contacts also may be imputed to its parent for personal jurisdiction p u rp o s e s where the subsidiary is the parent's general agent in the forum. Harris Rutsky & C o . Ins. Servs., Inc., 328 F.3d at 1134. A subsidiary is its parent's agent for purposes of a ttrib u tin g its forum-related contacts to the parent if the subsidiary "performs services that a re `sufficiently important to the foreign corporation that if it did not have a representative to perform them, the corporation's own officials would undertake to perform substantially s im ila r services.'" Doe, 248 F.3d at 928 (quoting Chan v. Society Expeditions, Inc., 39 F .3 d 1398, 1405 (9th Cir. 1994)). The ultimate inquiry is whether the subsidiary's presence in the forum "substitutes" for its parent's presence. Id. at 928-29 (quotation omitted). Where the parent is merely a holding company, the subsidiary's forum-related c o n ta c ts are not done as the parent's agent because the holding company "could simply hold a n o th e r type of subsidiary" as an investment and thus the subsidiary conducts business not a s the parent's agent but as its investment. Id. at 929. "Where, on the other hand, the s u b s id ia rie s are created by the parent, for tax or corporate finance purposes, there is no b a s is for distinguishing between the business of the parent and the business of the s u b s id ia rie s ." Id. (quotation omitted). The inquiry as to whether a subsidiary is its parent's g e n e ra l agent in the forum is "a pragmatic one." Gallagher v. Mazda Motor of Am., Inc., 7 8 1 F. Supp. 1079, 1085 n.10 (E.D. Pa. 1992). /// /// 20

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F o r example, where a Japanese parent company was engaged in the manufacture o f watches, its subsidiaries that acted as its sole sales agents in America were "almost by d e f in itio n . . . doing for their parent what their parent would otherwise have to do on its o w n ." Bulova Watch Co., Inc. v. K. Hattori & Co., Ltd., 508 F. Supp. 1322, 1342 (E .D .N .Y . 1981). The Bulova court thus attributed the subsidiaries' contacts to the parent c o m p a n y. Id.; see also Chan, 39 F.3d at 1405-06 (remanding to the district court for a d d itio n a l findings of fact regarding agency where the German parent corporation owned a n d operated cruise ships and its local subsidiary marketed cruises and chartered cruise s h ip s and sold the cruise ticket to the plaintiffs out of which the claims arose); Modesto City S c h s . v. Riso Kagaku Corp., 157 F. Supp. 2d 1128, 1135 (E.D. Cal. 2001) (holding s u b s id ia ry was parent's agent for personal jurisdiction purposes where subsidiary acted as s o le conduit for marketing and selling parent's products in the United States). In contrast, where the parent company owned a subsidiary mining company's s to c k but did not itself engage in the business of gold mining, imputing the subsidiary's f o ru m contacts to the parent was not appropriate. Sonora Diamond Corp. v. Superior Court, 9 9 Cal. Rptr. 2d 824, 840-41 (Ct. App. 2000). As the Sonora Diamond court explained, had th e parent company owned "the rights to the gold and used Sonora Mining as the operating a n d marketing entity," then perhaps general jurisdiction over the parent company would be a p p ro p ria te because under those circumstances the parent company "could not reap the b e n e f its of its rights unless it or someone else removed and sold the ore." Id. But where th e parent simply held the mining company as an investment, the subsidiary's forum-related c o n ta c ts could not be imputed to the parent company. Id. L ik e w is e , in Doe, the Ninth Circuit concluded a foreign company's subsidiaries w e re not its general agents in California because the plaintiffs presented no evidence that in th e absence of the California subsidiaries' involvement in petrochemical and chemical o p e ra tio n s , the parent would have conducted and controlled those operations. Doe, 248 21

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F .3 d at 929. The Court reached this conclusion even though the parent company issued c o n s o lid a te d reporting, referred to a subsidiary in an annual report as its "US unit," and s ta te d that use of the subsidiary "would enable it to expand its marketing network and p ro d u c e higher value-added specialty products in the United States." Id. Plaintiffs have failed to establish a prima facie case that DETM was DEC's g e n e ra l agent in Missouri. DEC's primary business is the generation and supply of e le c tric ity to end users in North and South Carolina. DEC also acts as a holding company, b u t it is not purely a holding company in the sense that it does not passively hold stock in c o m p a n ie s from an unrelated range of businesses. DEC has described itself as a "an in te g ra te d energy and energy services provider with the ability to offer physical delivery a n d management of both electricity and natural gas throughout the U.S. and abroad." (Pls.' A p p ., Ex. B at DEMDL001846.) In practice, DEC itself does not perform these activities beyond the generation a n d transmission of electricity in North and South Carolina, but holds the shares of various s u b s id ia rie s which either engage in those activities or which in turn own subsidiaries which p e rf o rm those business operations. Among these business operations was DEC's North A m e ric a n Wholesale Energy business segment, which included DETM's natural gas-related a c tiv itie s . (Id.) A lth o u g h DEC identifies natural gas trading and marketing as one of its business s e g m e n ts, Plaintiffs have not established that DETM's sales of natural gas in Missouri were s u f f ic ie n tly important to DEC that if DETM did not make the sales in Missouri, DEC would h a v e done so itself. DEC's primary business was electricity generation and transmission in N o rth and South Carolina. Natural gas trading activity was a separate, fragmented c o m p o n e n t of one of DEC's other business segments operated through an indirect, partially o w n e d subsidiary. Further, the fact that DETM subsequently ceased natural gas trading in 2 0 0 3 suggests that DETM's trading activities were not sufficiently important to DEC that it 22

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w o u ld perform the activities itself if DETM did not do so on its behalf. Moreover, Plaintiffs have presented no evidence that DETM's natural gas sales in Missouri in particular were sufficiently important to DEC's business that DEC would h a v e performed the sales in Missouri itself absent its subsidiary's representation in the f o ru m . See Modesto City Schs., 157 F. Supp. 2d at 1135 (noting twenty percent of parent's p ro d u c ts were sold through subsidiary which acted as parent's "sole conduit for marketing a n d selling its products in the United States"); Bulova Watch Co., Inc., 508 F. Supp. at 1344 (n o tin g that sixty percent of parent's products were sold as exports and the United States w a s the parent company's largest export market through its New York subsidiaries' sales in th e United States). Consequently, Plaintiffs have not shown that DETM's Missouri natural g a s sales played a significant role in DEC's "`organizational life'" such that it acted as a s u b s titu te for DEC in the forum.5 Bulova Watch Co., Inc., 508 F. Supp. at 1344. The Court th e re f o re will not attribute DETM's Missouri contacts to DEC for personal jurisdiction p u rp o s e s based on agency principles. C . Request for Deferred Decision P la in tif f s suggest that because the personal jurisdiction question is intertwined w ith the merits, the Court should defer ruling on the personal jurisdiction issue until after

The result would be the same under general Missouri agency law. In Missouri, an agency relationship, whether actual or apparent, exists when "the credible facts, taken as a whole, fairly disclose that a party is acting for or is representing another by the latter's authority." Motorsport Mktg, Inc. v. Wiedmaier, Inc., 195 S.W.3d 492, 498 (Mo. Ct. App. 2006) (quotation omitted). An agent has apparent authority when (1) the principal has manifested his consent to the agent exercising such authority or knowingly permitted the agent to exercise such authority; (2) a third person acting in good faith, "had reason to believe, and actually believed, the agent possessed such authority;" and (3) the third person "relying on the appearance of authority changed his position and will be injured or suffer loss if the transaction executed by the agent does not bind the principal." Id. (quotation omitted). Plaintiffs present no evidence of any manifestation by DEC to DETM that DETM may act on DEC's account. Although Plaintiffs have presented evidence DEC permitted DETM to market natural gas using the "Duke Energy" name and logo, Plaintiffs have not presented any evidence that any third party relied on an apparent agency between DEC and DETM. 23

5

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m e rits discovery is completed. Plaintiffs rely on Data Disc, Inc., 557 F.2d at 1285 n.2. However, Data Disc, Inc. states that where the jurisdictional issues are intertwined with the m e rits , the Court may require the plaintiff to establish "only . . . a prima facie showing of ju ris d ic tio n a l facts with affidavits and perhaps discovery materials." Id. As the Court is c o n s id e rin g the personal jurisdiction issue on the basis of affidavits and documentary e v id e n c e without holding an evidentiary hearing, the Court is following Data Disc, Inc. by h o ld in g Plaintiffs to this standard, and is not requiring Plaintiffs to meet the higher burden o f demonstrating personal jurisdiction by a preponderance of the evidence, as Plaintiffs w o u ld have to do at an evidentiary hearing or at trial. Id. M o re o v e r, Plaintiffs have not convinced the Court that further discovery would p ro d u c e a different result. DEC provided Plaintiffs with every DEC document which DEC p ro v id e d to the CFTC in conjunction with the CFTC's investigation of DETM's natural gas tra d in g activity in the relevant time period. (Mem. of Defs. Duke Energy Carolinas, LLC & D u k e Energy Trading & Marketing, LLC in Opp'n to Pls.' Mot. to Compel Disc. (Doc. # 9 3 5 ) ["Opp'n to Mot. Compel"], Ex. B at 2; Tr. of Proceedings (Doc. #1138) at 55.) The d o c u m e n ts provided to the CFTC consisted almost entirely of DETM documents. (Opp'n to Mot. Compel, Ex. B at 2; Tr. of Proceedings at 55.) The only DEC documents consisted o f general risk management policies and board of director meeting minutes, which DEC has p ro v id e d to Plaintiffs. (Opp'n to Mot. Compel, Ex. B at 2; Tr. of Proceedings at 55-56.) The Court therefore will decline Plaintiffs' request to defer the personal jurisdiction issue to b e resolved with the merits. The Court will not attribute DETM's contacts with the forum to DEC, and DEC h a s no contacts of its own sufficient to support personal jurisdiction. The Court therefore w ill grant DEC's motion to dismiss for lack of personal jurisdiction. /// /// 24

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III.

CONCLUSION IT IS THEREFORE ORDERED that Defendant Duke Energy Carolinas, LLC's

M o tio n to Dismiss Plaintiffs' Amended Complaint for Damages for Lack of Personal J u ris d ic tio n (Doc. #1299) is hereby GRANTED. Defendant Duke Energy Carolinas, LLC is hereby dismissed as a defendant in this action for lack of personal jurisdiction.

D A T E D : February 23, 2009

_______________________________ PHILIP M. PRO United States District Judge

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