Two on-going lawsuits is enough, a California Superior Courtjudge said in dismissing Southern Union’s challenge in his court tothe merger plans of Southwest Gas with Oneok. Judge Ronald Pragerdismissed the case last Friday because SU is making the samearguments in the federal courts of Nevada and Arizona, the LasVegas-based Southwest said. The case was dismissed withoutprejudice, meaning SU can re-file upon resolution or termination ofthe federal actions.

“The judge found that Southern Union is proceeding withdiscovery of evidence in an existing lawsuit, and that SouthernUnion has presented no valid argument as to why it cannot obtainthe discovery it needs in a pending Nevada action as well,”Southwest said in a statement.

Despite a SU offer to merge at a higher price, Southwest choseOneok last spring (see Daily GPI, May5). Since that time, SU has tried time and again to delay themerger through the courts, accusing Southwest, Oneok and others ofwrongdoing. Last August, Austin, TX-based SU was successful indelaying the merger, as one of their lawsuits caused an investigationby the FBI and the Attorney General into the role Jim Irvin, acommissioner for the Arizona Corporation Commission, played insupporting the marriage between Southwest and Oneok (see Daily GPI, Aug. 23).

Throughout this battle, Southwest has maintained the same story.”Southern Union has pursued a strategy of filing high-profile butbaseless claims in nearly every available courthouse,” said ThomasSheets, vice president and general counsel of Southwest Gas, afteryesterday’s announcement. “The fact remains that Southern Union isnothing more than a spurned suitor. This decision is a sensiblestep in the direction of resolution of all of Southern Union’sgroundless claims on terms favorable to Southwest Gas shareholdersand customers.”

Neither Southwest nor Oneok would comment on the story. SU isprohibited to discuss the merger or any related topics due to acourt order.

The proposed merger has already been approved by Nevadaauthorities and has been endorsed by regulatory staffs in Arizonaand California. Approval by those three state regulatory agenciesis required before the merger can proceed. A Southwest spokespersonsaid they expect to have the agency approvals by the end of thisyear. She cautioned however that it could possibly carry over into2000, “if the hearings don’t go smoothly.”

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