The U.S. Attorney’s Office in Houston has requested that a Houston judge reconsider separate rulings made in August that dismissed false reporting charges against two former natural gas traders.

The motions for reconsideration, which had been expected, concern separate criminal cases against former Dynegy Inc. trader Michelle Valencia and former El Paso Merchant Energy trader Todd Geiger. In August, District Judge Nancy Atlas dismissed one count of false reporting against Geiger and three against Valencia (see NGI, Sept. 1). Atlas let stand one count of wire fraud against Geiger and four counts of wire fraud against Valencia. Both have pleaded not guilty.

Atlas ruled that the Commodity Exchange Act, under which Geiger and Valencia were charged, was overbroad and incorrectly applied. In both Geiger’s and Valencia’s rulings, Atlas said that the Commodity Exchange Act, as written, does not require a person to know that information he or she provided was false or misleading.

Atlas, who used the same language in both rulings, wrote that “the court concludes that Congress’ failure to require a defendant be aware that the information she provided was false or misleading renders the statute over broad on its face.” The 55-page ruling noted that a literal interpretation of the law “could subject citizens to strict liability for inadvertently providing false or misleading information.”

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