Enforcement Authority Under The Commodities Exchange Act Undercut by U.S. v. Radley

On September 17, 2009, the U.S. District Court for the Southern District of Texas dismissed a twenty-six count indictment brought by the Commodity Futures Trading Commission ("CFTC") and U.S. Department of Justice ("DOJ") against four former BP employees for allegedly attempting to manipulate the Texas Eastern Transmission Corporation ("TET") propane market in 2004. The opinion may materially impact the government's ability to bring future actions under prevailing federal commodities laws.

The indictment alleges that in the first quarter of 2004 BP traders and others attempted to corner the TET propane market by acquiring a dominant long position in forward TET propane contracts and withholding a portion of the commodity from sale in order to artificially inflate the price. According to the indictment, over several days in early February, BP traders bought large quantities of TET propane for late February delivery, and, with direct approval of BP management, then set