Exxon Defeats Antitrust Claim in Louisiana Pipeline Dispute

A Texas Business Court judge concluded that Texas courts couldn’t hear the competition claim because the alleged conduct occurred outside the state, Bloomberg Law reported Aug. 14. Exxon and co-defendant Denbury Carbon Solutions LLC had sought dismissal on that jurisdictional ground.

Judge Sofia Adrogué, however, declined to apply the same reasoning to the unfair-trade-practices claim brought by Clean Hydrogen Works LLC, according to Bloomberg Law. Her Aug. 12 opinion was made public Aug. 14.

The split decision gives Exxon and Denbury a significant victory on the antitrust portion of the litigation without ending the broader dispute. It also draws a distinction between the territorial limits applicable to the competition allegation and those governing the remaining trade-practices claim.

Related: Italy’s Antitrust Watchdog Raids Eni, Exxon Mobil’s Esso Over Price Hikes

According to Bloomberg Law, Exxon and Denbury relied on a roughly two-decade-old Texas Supreme Court precedent in arguing that Texas courts lacked authority to adjudicate allegations of anticompetitive conduct arising in another state. Adrogué accepted that position as to the antitrust claim but determined that the precedent didn’t require dismissal of the unfair-trade-practices allegation.

Clean Hydrogen Works’ surviving claim targets both Exxon and Denbury, Exxon’s carbon-capture business, in connection with the Louisiana pipeline dispute, Bloomberg Law reported. The ruling means the litigation can continue even though its antitrust component has been eliminated at this stage.

The case comes as carbon capture and transportation infrastructure takes on increasing commercial importance for energy companies seeking to manage industrial carbon emissions. Pipeline access can be particularly significant because captured carbon dioxide must generally be transported from industrial facilities to locations where it can be stored or otherwise used.

Source: Bloomberg Law