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Contract analysis / letter-to-krd-protective-order.docx
letter-to-krd-protective-order.docx
1016-00005 · 46 clauses
High · 0 Medium · 21 Standard · 1
I. Introduction and Purpose Medium
⚑ Confidentiality undertaking
I. Introduction and Purpose This firm represents Ridgeline Midstream Services LLC ("Ridgeline") in the above-referenced proceeding before the Federal Energy Regulatory Commission ("FERC" or the "Commission"). I write to propose terms for a protective order governing the exchange of confidential and commercially sensitive business information between Ridgeline and your client, Appalachian Trunk Pipeline Company, LLC (
II. Background on Information Exchange Needs Medium
⚑ Liability cap to check against exposure
II. Background on Information Exchange Needs The interconnection cost allocation dispute at the center of Docket No. RP22-847-001 will require the exchange of substantial volumes of confidential and commercially sensitive information by both Ridgeline and ATPC. A brief summary of the dispute and the categories of information likely to be implicated is set forth below to provide context for the protective order terms
1. Detailed engineering cost estimates for the interconnection metering station, includin
1. Detailed engineering cost estimates for the interconnection metering station, including costs associated with ultrasonic flow meters (3-run, 12-inch configuration), gas chromatographs, Supervisory Control and Data Acquisition ("SCADA") system integration, and pig launcher/receiver facilities at the Wetzel County Interconnect;
2. ATPC system cost data, including capital costs, operating expenses, and throughput dat
2. ATPC system cost data, including capital costs, operating expenses, and throughput data for the 640-mile, 3.8 Bcf/d ATPC pipeline system, to the extent relevant to the cost allocation analysis and the relative-benefits methodology at issue;
3. Ridgeline's construction cost breakdowns for its 187-mile, 24-inch-diameter pipeline s
3. Ridgeline's construction cost breakdowns for its 187-mile, 24-inch-diameter pipeline system, which had an original construction cost of approximately $587.2 million, including allocated overheads, contingencies, and allowance for funds used during construction ("AFUDC");
4. Rate base components and cost-of-service workpapers for both the Ridgeline and ATPC sy
4. Rate base components and cost-of-service workpapers for both the Ridgeline and ATPC systems, including depreciation schedules, accumulated deferred income tax data, and working capital allowances;
5. Capital structure information, financing terms, and debt arrangements, including the s
5. Capital structure information, financing terms, and debt arrangements, including the specific terms of credit facilities, revolving credit agreements, note purchase agreements, and other financing instruments, as well as equity return data and comparable proxy group information;
6. Shipper contract information, throughput volumes, and capacity utilization data, inclu Standard
⚑ Commercial term
6. Shipper contract information, throughput volumes, and capacity utilization data, including the terms of individual transportation service agreements, negotiated rate contracts, firm and interruptible capacity commitments, and historical and projected throughput data (Ridgeline's current throughput is approximately 680 million cubic feet per day ("MMcf/d"), reflecting approximately 56.67% utilization of its certifi
7. Internal financial projections, revenue forecasts, and valuation data, including long-
7. Internal financial projections, revenue forecasts, and valuation data, including long-range financial plans, volume growth projections, and discounted cash flow analyses prepared by or on behalf of either party in connection with the interconnection project or the parties' overall business operations; and
8. Proprietary engineering drawings and metering station schematics for the Wetzel County
8. Proprietary engineering drawings and metering station schematics for the Wetzel County Interconnect, including process flow diagrams, piping and instrumentation diagrams ("P&IDs"), and site layout plans. Much of this information is highly sensitive from both a commercial and competitive standpoint, particularly given the competitive relationship between Ridgeline and ATPC in the Appalachian Basin natural gas trans
III. Proposed Categories of Protected Information Medium
⚑ Confidentiality undertaking
III. Proposed Categories of Protected Information We propose that the protective order establish two tiers of confidentiality protection, reflecting the varying degrees of commercial sensitivity of the information likely to be exchanged. This two-tier framework is consistent with the approach commonly adopted in FERC proceedings involving the exchange of commercially sensitive information and provides an appropriate
IV. Proposed Terms of the Protective Order Medium
⚑ Liability cap to check against exposure
IV. Proposed Terms of the Protective Order Set forth below is a summary of the principal terms that we propose for inclusion in the protective order. The enclosed draft Protective Order (Exhibit A) sets forth these terms in full detail and in the form we propose for filing with ALJ Whitfield. We summarize the key provisions here for ease of discussion. A. Scope and Applicability The protective order would apply to al
1. Outside counsel of record for any party and their associates, paralegals, legal assist
1. Outside counsel of record for any party and their associates, paralegals, legal assistants, and administrative support staff who are directly engaged in work on the proceeding and who have a need to access the information in connection with their work on the matter;
2. Expert witnesses and consultants retained by any party for purposes of the proceeding, Medium
⚑ Liability cap to check against exposure
2. Expert witnesses and consultants retained by any party for purposes of the proceeding, including but not limited to Dr. Eleanor Vasquez (retained by MGPC as its rate expert), Dr. Raymond Braswell of Braswell Energy Consulting Group LLC (retained by Ridgeline as its tariff redesign consultant), and any experts or consultants that ATPC, CMGA, or other parties may retain for the proceeding, in each case subject to ex
3. FERC Trial Staff, acting in their official capacity in connection with the proceeding;
3. FERC Trial Staff, acting in their official capacity in connection with the proceeding;
4. The presiding Administrative Law Judge, ALJ Clara Whitfield, and Settlement Judge Howa
4. The presiding Administrative Law Judge, ALJ Clara Whitfield, and Settlement Judge Howard Margolis; and
5. Not more than two (2) designated in-house employees of each party who are not involved Medium
⚑ Liability cap to check against exposure
5. Not more than two (2) designated in-house employees of each party who are not involved in competitive decision-making on behalf of the party. Each party would be required to identify its designated in-house employees by name and title prior to receiving access to any Confidential Information, and to certify that the designated employees do not participate in, advise on, or have access to decisions regarding market
1. Outside counsel of record for any party and up to two (2) designated associates per fi
1. Outside counsel of record for any party and up to two (2) designated associates per firm who are directly engaged in substantive work on the proceeding;
2. Expert witnesses and consultants retained for purposes of the proceeding, subject to e Medium
⚑ Confidentiality undertaking
2. Expert witnesses and consultants retained for purposes of the proceeding, subject to execution of a Non-Disclosure Agreement in the form of Exhibit B that specifically acknowledges the heightened restrictions applicable to HCI-AEO information;
3. FERC Trial Staff, acting in their official capacity in connection with the proceeding;
3. FERC Trial Staff, acting in their official capacity in connection with the proceeding; and
4. The presiding Administrative Law Judge, ALJ Clara Whitfield. Medium
⚑ Confidentiality undertaking
4. The presiding Administrative Law Judge, ALJ Clara Whitfield. Critically, we propose that in-house employees, officers, and directors of any party be expressly excluded from access to HCI-AEO information. This exclusion would apply without limitation to the following individuals: • Ridgeline personnel: James K. Winfield (Chief Executive Officer), Angela Moretti (Chief Financial Officer), Thomas Greaves (Vice Presid
1. Written documents and data. The producing party shall mark each page or document conta Medium
⚑ Confidentiality undertaking
1. Written documents and data. The producing party shall mark each page or document containing protected information with the legend "CONFIDENTIAL" or "HIGHLY CONFIDENTIAL — ATTORNEYS' EYES ONLY," as applicable. Where a document contains both tiers of information, the document shall be marked with the higher designation, and the producing party shall, to the extent practicable, identify the specific portions of the d
2. Oral disclosures. When a party discloses protected information orally—whether in meeti Medium
⚑ Confidentiality undertaking
2. Oral disclosures. When a party discloses protected information orally—whether in meetings, telephone conferences, or depositions—the disclosing party shall identify the information as "Confidential" or "Highly Confidential — Attorneys' Eyes Only" at the time of the oral disclosure. Within five (5) business days of the oral disclosure, the disclosing party shall confirm the confidentiality designation in writing to
3. Deposition testimony. Any party or deponent may designate portions of deposition testi Medium
⚑ Confidentiality undertaking
3. Deposition testimony. Any party or deponent may designate portions of deposition testimony as containing Confidential Information or HCI-AEO. Such designations shall be made within fifteen (15) business days of receipt of the final deposition transcript. Pending the expiration of the designation period, the entire transcript shall be treated as HCI-AEO to ensure that no inadvertent disclosures occur before designa
1. Any party may challenge a confidentiality designation by providing written notice to t Medium
⚑ Confidentiality undertaking
1. Any party may challenge a confidentiality designation by providing written notice to the designating party's counsel of record. The written notice shall identify the specific information or document at issue and state the basis for the challenge (e.g., that the information is publicly available, that the designation is overly broad, or that the information does not warrant the level of protection designated).
2. Within ten (10) business days of receipt of the challenge notice, the designating part Medium
⚑ Confidentiality undertaking
2. Within ten (10) business days of receipt of the challenge notice, the designating party shall respond in writing, either (i) withdrawing or modifying the designation, or (ii) providing a written justification for the designation, including a description of the competitive harm that would result from disclosure at a lower level of protection or without any confidentiality protections.
3. If the parties are unable to resolve the dispute within the ten (10) business day peri
3. If the parties are unable to resolve the dispute within the ten (10) business day period, the challenging party may seek relief from ALJ Whitfield by motion, supported by a memorandum setting forth the basis for the challenge. The designating party shall have the burden of demonstrating, by a preponderance of the evidence, that the challenged designation is warranted.
4. Pending resolution of any challenge, the challenged information shall continue to be t Medium
⚑ Confidentiality undertaking
4. Pending resolution of any challenge, the challenged information shall continue to be treated in accordance with its existing designation. F. Use Limitations We propose that all protected information, whether designated as Confidential Information or HCI-AEO, be subject to the following use limitations:
1. Protected information shall be used solely for purposes of the FERC proceeding in Dock
1. Protected information shall be used solely for purposes of the FERC proceeding in Docket Nos. RP22-847-000 and RP22-847-001, including preparation of testimony, briefing, argument, settlement discussions, and any rehearing or judicial review proceedings arising therefrom.
2. No person who receives access to protected information shall use or disclose such info
2. No person who receives access to protected information shall use or disclose such information for any commercial, competitive, or business purpose unrelated to the proceeding.
3. No person who receives access to protected information shall disclose such information
3. No person who receives access to protected information shall disclose such information to any person who is not authorized to receive it under the terms of the protective order. We wish to emphasize that these use restrictions are particularly important in this proceeding given the direct competitive relationship between Ridgeline and ATPC in the Appalachian Basin natural gas transportation market. Both companies
1. Any party filing a document with FERC that contains or incorporates Confidential Infor Medium
⚑ Confidentiality undertaking
1. Any party filing a document with FERC that contains or incorporates Confidential Information or HCI-AEO shall file the document under seal in accordance with the procedures set forth in 18 C.F.R. § 388.112 and any applicable orders of ALJ Whitfield.
2. Simultaneously with any sealed filing, the filing party shall file a redacted public v
2. Simultaneously with any sealed filing, the filing party shall file a redacted public version of the document from which all protected information has been removed or obscured.
3. All sealed filings shall be accompanied by a cover letter or certification identifying Medium
⚑ Confidentiality undertaking
3. All sealed filings shall be accompanied by a cover letter or certification identifying the filing as containing information protected under the protective order and specifying the tier of protection applicable to the sealed material. We note that FERC's established policies on the privileged and confidential treatment of documents provide a well-developed framework for the handling of such filings, and we propose
I. Survival. We propose that the obligations of the protective order survive the terminat Medium
⚑ Confidentiality undertaking
I. Survival. We propose that the obligations of the protective order survive the termination of the proceeding, including any rehearing or judicial review, for a period of three (3) years following the date of final, non-appealable resolution of the proceeding. During this survival period, all persons who received access to protected information shall continue to be bound by the confidentiality, use, and non-disclosu
1. Immediate notification. In the event that any person becomes aware of any unauthorized
1. Immediate notification. In the event that any person becomes aware of any unauthorized disclosure or misuse of protected information, the person and the counsel for the party with whom the person is associated shall immediately notify the counsel for the designating party and ALJ Whitfield of the unauthorized disclosure. The notification shall describe the circumstances of the disclosure, identify the information
2. Injunctive relief and sanctions. Any party whose protected information has been the su Medium
⚑ Liability cap to check against exposure
2. Injunctive relief and sanctions. Any party whose protected information has been the subject of an unauthorized disclosure or misuse shall have the right to seek injunctive relief, sanctions, or any other remedies available under the Commission's Rules of Practice and Procedure, 18 C.F.R. Part 385, including but not limited to an order compelling the return or destruction of improperly disclosed information, an ord
3. Reservation of additional remedies. Nothing in the protective order shall be construed Medium
⚑ Confidentiality undertaking
3. Reservation of additional remedies. Nothing in the protective order shall be construed to limit or waive any party's right to pursue any additional remedies at law or in equity that may be available, including claims for damages arising from breach of the protective order's confidentiality obligations.
V. Non-Disclosure Agreements for Experts and Consultants Medium
⚑ Confidentiality undertaking
V. Non-Disclosure Agreements for Experts and Consultants As noted above, we propose that each expert witness, consultant, or other third party who is granted access to protected information under the protective order be required to execute an individual Non-Disclosure Agreement ("NDA") prior to receiving any such access. A form of NDA is attached to the enclosed draft Protective Order as Exhibit B. The proposed NDA w
VI. Proposed Timeline and Next Steps
VI. Proposed Timeline and Next Steps In light of the procedural schedule established by the Commission and the prehearing conference set for November 14, 2022, we propose the following timeline for finalizing the protective order:
1. We request that Kellner, Royce & Dillard LLP review the proposed protective order term
1. We request that Kellner, Royce & Dillard LLP review the proposed protective order terms set forth in this letter and the enclosed draft Protective Order (Exhibit A) and provide any comments, objections, or counterproposal within fifteen (15) business days of the date of this letter, i.e., by approximately October 17, 2022.
2. Following receipt of KRD's comments, we propose that the parties exchange any addition
2. Following receipt of KRD's comments, we propose that the parties exchange any additional rounds of comments or revisions as may be necessary, with the goal of reaching agreement on a joint proposed protective order no later than November 1, 2022.
3. We propose that the parties aim to file the joint proposed protective order with ALJ W
3. We propose that the parties aim to file the joint proposed protective order with ALJ Whitfield in advance of or at the prehearing conference on November 14, 2022, so that the order can be entered and discovery can commence without delay following the conference.
4. With KRD's concurrence, we are prepared to circulate the proposed terms to Whitmore &
4. With KRD's concurrence, we are prepared to circulate the proposed terms to Whitmore & Sable LLP (counsel for MGPC), Fordham Municipal Law Group PC (counsel for CMGA), and FERC Trial Staff (Jonathan Briggs, Lead Trial Attorney) for their review and potential joinder in the proposed protective order. We believe that early circulation will facilitate the prompt adoption of a unified protective order applicable to all
5. We further propose that Settlement Judge Howard Margolis be informed of the terms of t
5. We further propose that Settlement Judge Howard Margolis be informed of the terms of the protective order in connection with the settlement conference process, to the extent that protected information may be exchanged or discussed in the context of any settlement discussions. We are available to schedule a telephone conference at your convenience to discuss the proposed terms in further detail. Please do not hesit
VII. Enclosed Draft Protective Order and Form of NDA Medium
⚑ Confidentiality undertaking
VII. Enclosed Draft Protective Order and Form of NDA Enclosed with this letter please find the following documents: • Exhibit A: Draft Protective Order — a proposed form of protective order for filing with ALJ Whitfield, incorporating the terms described in this letter. The draft protective order is formatted for filing as a joint submission by the parties and includes signature lines for counsel of record for each p