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Judge denies NextEra's appeal for $60M claim in failed Oncor deal

A federal judge Sept. 30 reaffirmed a 2018 decision to knock down NextEra Energy Inc.'s request for $60 million related to its failed attempt to purchase a stake in Oncor Electric Delivery Co. LLC.

In an opinion with the U.S. District Court for Delaware, Judge Richard Andrews said NextEra cannot recover administrative expenses from its effort to acquire Energy Future Holdings Corp.'s 80% stake in the Texas utility after the Public Utility Commission of Texas ultimately rejected the Florida-headquartered company's attempted acquisition of Oncor.

"The Bankruptcy Court held that NextEra's claim for administrative expenses ... fails because NextEra's expenses are not considered administrative expenses under that provision of the Bankruptcy Code. I agree," Andrews wrote. Because NextEra failed to close the transaction, the utility cannot claim that the fees are administrative expenses or that they were necessary to preserve the estates' value.

While NextEra said its failed acquisition gave Sempra Energy a "structural framework and regulatory approval roadmap" to buy Oncor in March 2018, Andrews said NextEra's decision to persist in pursuing a "dead-end path" to save its deal decreased Energy Future Holdings' value, outweighing any benefit Sempra may have gotten from NextEra's efforts.

"Rather than 'preserving' the estates, NextEra diminished them," the judge added.