UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT FEDERAL ENERGY No. 22-15584 REGULATORY COMMISSION, D.C. No. Plaintiff-Appellee, 2:20-cv-00040- KJM-AC v. VITOL INC.; FEDERICO OPINION CORTEGGIANO,

Defendants-Appellants.

Appeal from the United States District Court for the Eastern District of California Kimberly J. Mueller, Chief District Judge, Presiding

Argued and Submitted February 14, 2023 San Francisco, California

Filed August 18, 2023 Before: Eric D. Miller, Gabriel P. Sanchez, and Salvador Mendoza, Jr., Circuit Judges.

Opinion by Judge Miller 2 FERC V. VITOL INC.

SUMMARY *

Federal Energy Regulatory Commission / Statute of Limitations

The panel affirmed the district court’s order denying Vitol, Inc.’s motion to dismiss, as untimely under the applicable statute of limitations, a complaint filed by the Federal Energy Regulatory Commission (FERC) that sought an order affirming the assessment of a civil penalty against Vitol and one of its traders, Federico Corteggiano, for making unlawful manipulative trades in the California energy market. When FERC believes that it has identified a violation of the Federal Power Act, 16 U.S.C. §§ 791a–828c, it initiates an administrative process that may culminate in a decision to assess a civil penalty, and must bring an action in federal district court to enforce that decision. Under the applicable statute of limitations, 28 U.S.C. § 2462, “an action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise, shall not be entertained unless commenced within five years from the date when the claim first accrued.” Thus, FERC must bring an action in federal district court for an order enforcing the assessment of a civil penalty within five years of “the date when the claim first accrued.” In measuring the limitations period, the critical question is when FERC’s claim “accrues.” Vitol contended that FERC’s federal district court action was untimely because * This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader. FERC V. VITOL INC. 3

FERC’s claim accrued as soon as the allegedly unlawful trading occurred. The panel rejected Vitol’s contention, and held that FERC’s claim accrued on the date that FERC assessed a civil penalty. The panel reasoned that FERC’s claim arises under 16 U.S.C. § 823b(d)(3)(B), which gives the agency a cause of action in federal court for “affirming the assessment of the civil penalty,” and that claim does not accrue until FERC has assessed a penalty. The panel also agreed with the district court’s conclusion that FERC’s administrative process for assessing a civil penalty is itself a “proceeding” that is subject to the five-year statute of limitations in 28 U.S.C. § 2462, and therefore FERC must initiate the proceeding by issuing a notice of proposed penalty within five years of any alleged wrongdoing.

COUNSEL Matthew D. McGill (argued), Helgi C. Walker, Jessica L. Wagner, and Jeff Liu, Gibson Dunn & Crutcher LLP, Washington, D.C.; Charles R. Mills, Bracewell LLP, Washington, D.C.; Paul J. Pantano Jr., and Abigail L. P. Edwards, Willkie Farr & Gallagher LLP, Washington, D.C.; for Defendants-Appellants. Kevin M. Dinan (argued), Nickolas Barber, Catherine C. Collins, John R. Matson III, Mark Koehn, Jennifer Vein, Beth G. Pacella, and Robert H. Solomon; Damon W. Taaffe, Enforcement Counsel; Jeremy Medovoy, Deputy Director, Office of Enforcement; Geo F. Hobday Jr., Director, Inves