Lawyers representing thousands of Texas residents are asking a Houston judge to separate their lawsuits — which alleged a multibillion-dollar conspiracy in February 2021 to manipulate the Texas natural gas market — from the other wrongful death, personal injury and property damage cases involving Winter Storm Uri.
Data analytics firm CirclesX Recovery and attorneys representing as many as 20,000 people who suffered damages during the unprecedented winter storm 28 months ago want their cases returned to the original judges and not combined with the hundreds of other Winter Storm Uri-related lawsuits that have been consolidated in a multidistrict litigation in Houston before one judge.
The plaintiffs’ lawyers contend that their cases, alleging that some of the nation’s largest energy companies conspired during Winter Storm Uri to reduce natural gas supplies to artificially increase rates and thus profits, are very different from the cases currently assigned to the MDL, which are about the energy companies’ negligence to winterize to their operations.
“The defendants are trying to create the allusion that these cases are the same as those in the MDL and they are not,” Allan Kanner, lead lawyer for CirclesX and a partner at Kanner & Whiteley in New Orleans, told Harris County District Judge Sylvia Matthews on Wednesday. “We have two completely separate cases, and they cannot be coordinated with the other cases.”
Judge Matthews (pictured right), who was appointed by the Texas Supreme Court to oversee the Winter Storm Uri MDL, will decide in the next month whether the market manipulation cases should be separated from the more than 300 lawsuits with more than 20,000 plaintiffs currently pending before her.
The CirclesX lawsuits and a separate proposed class action, Linda Hawk, Esther Hernandez and Prime Eco Group v. Atmos Energy, Exxon Mobil, BP America, were filed in early February during the second anniversary of Winter Storm Uri. Both have since been added to the MDL. There are nine other similar market manipulation cases that have been filed that have not yet been added to the MDL.
Kanner said his clients have “completely conflicting arguments and discovery needs” from the plaintiffs in the other cases and that the arguments he makes will put him in “an adversarial posture” with those he would be required to work beside.
“In fact, the MDL plaintiffs would be better off if our cases are dismissed,” he told Judge Matthews. “It is going to create a mess, and adding our cases to the MDL add no convenience or efficiency or justice.”
A critical issue is that the new cases claim the natural gas companies conspired to withhold their product from the electric producers and providers. The problem is Judge Matthews has already dismissed claims against 60 natural gas companies from the MDL litigation because their conduct was too remote to have caused the plaintiffs’ injuries.
But none of those lawsuits contended that the natural gas companies were involved in market manipulation.
Vinson & Elkins partner Pat Mizell, who represents the energy company defendants, asked Judge Matthews to keep the new cases in the MDL because there is “significant overlap” in all the cases and that “the purpose of the MDL will be met” by consolidating the cases for pretrial purposes.
Mizell, a former state judge, said the market manipulation cases “present multiple common issues of fact, most fundamentally what caused the gas shortage and electrical outages during Winter Storm Uri and whether plaintiffs suffered some injury or damages because of wrongful conduct of the defendants.”
In a written brief to Judge Matthews, Hick Thomas partners Stephen Loftin and John Deis said the new cases fit within the MDL panel’s guidelines to consolidate all cases that “relate to the alleged wrongful conduct in causing or contributing to power shortages and outages during Winter Storm Uri.”
Deis and Loftin have led the litigation on behalf of the natural gas companies.
“Regardless of whether the alleged failure to supply gas is allegedly caused by a failure to winterize or market manipulation, the additional natural gas cases belong in this MDL because each relate to the alleged wrongful conduct of the defendants in causing or contributing to power shortages and outages during Winter Storm Uri.,” Loftin and Deis told Judge Matthews in written briefs.
“The only material difference between the additional natural gas cases and the claims previously dismissed by the court is that these plaintiffs now offer a competing — and contradictory — explanation for what caused the loss of power,” Loftin and Deis wrote. “The additional natural gas cases belong in this MDL because each relate to the alleged wrongful conduct of the defendants in causing or contributing to power shortages and outages during Winter Storm Uri.”
The lawyers representing CirclesX Recovery also include Kanner & Whitely lawyers Conlee Whiteley, Cynthia St. Amant, Ryan Casey, Meredith Madderra and Thuy N. Le.
The lawyers in the Linda Hawk lawsuit are Jason Itkin, Cory Itkin and Michael Darling of Arnold & Itkin in Houston.
There are more than 200 lawyers identified in the MDL docket as representing the energy company defendants, but the corporate lawyers who have worked on the CirclesX and Hawk litigation include V&E partners Stacey Vu and Quentin Smith, as well as Hicks Thomas lawyers Eric Grant, Diane Bounds and Colin Watterson.
Jackson Walker partner Tré Fischer is the lead liaison counsel for the corporate defendants.
The cases are CirclesX Recovery v. BP Energy (No. 2023-08628) and Linda Hawk v. Atmos Energy (No. 2023-09167).