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IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION EQUISTAR CHEMICALS, LP, Plaintiff, VS. RELIANT ENERGY POWER GENERATION, INC. AND RELIANT ENERGY INC. Defendants. NOTICE OF REMOVAL Defendants Reliant Energy Power Generation, Inc. ("REPG") and Reliant Energy, Inc. ("Reliant") (collectively "Defendants") file this Notice of Removal: STATE PROCEEDING 1. On September 12, 2007, an action was commenced in the 165th District Court of § § § § § § § § §
CAUSE NO.
Harris County, Texas, styled Equistar Chemicals, LP v. Reliant Energy Power Generation, Inc. & Reliant Energy, Inc., and assigned Cause No. 2007-CV-55494 ("State Proceeding"). 2. Defendants received a copy of Plaintiff's Original Petition in the State Proceeding on
September 12, 2007, and were served with summons on September 18, 2007. Therefore, this Notice of Removal is timely filed as required by 28 U.S.C. § 1446(b). BANKRUPTCY JURISDICTION 3. and (b). 4. Plaintiff's claims call for a determination of rights and obligations with regard to This Court has original jurisdiction over this action pursuant to 28 U.S.C. § 1334(a)
agreements to which Reliant Energy Channelview LP ("REC") is a party. Specifically, plaintiff
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seeks declaratory judgments that will affect directly REC's rights and obligations under agreements it has entered into with plaintiff. 5. On August 20, 2007, REC filed for bankruptcy protection in the United States
Bankruptcy Court for the District of Delaware under Chapter 11 of the United States Code. 6. As a result, all property of REC became part of the bankruptcy estate and any claims
or causes of action outside of Bankruptcy Court against REC are stayed. 7. REC owns and operates a cogeneration facility in Channelview, Texas. and sells
steam and power to plaintiff, which owns and operates a chemical plant adjacent to the cogeneration facility. 8. REC and plaintiff are the only parties to most of the crucial agreements that govern
the cogeneration facility, such as the Second Amended and Restated Cash Flow Participation Agreement ("Cash Flow Agreement") and the Second Amended and Restated Steam Supply Agreement ("Steam Supply Agreement"). The Cash Flow Agreement provides for "royalty" payments to plaintiff under certain circumstances, and the Steam Supply agreement requires REC to obtain plaintiff's consent to certain transactions. Neither of the defendants to the State Proceeding are parties to either the Cash Flow or Steam Supply Agreements. 9. Through the State Proceeding, plaintiff seeks a declaration to protect its "right and
ability to obtain royalty payments to which [it] is entitled." Original Petition ¶ 18. Furthermore, plaintiff asks the Court to protect its consent rights with regard to any sale of REC's facilities. Original Petition ¶ 17. Each of these allegations will require adjudication of contractual duties arising from agreements to which plaintiff and REC are the sole parties: (1) plaintiff's alleged right to royalties arises solely under the Cash Flow Agreement; and (2) the protection of plaintiff's alleged consent rights will affect contractual rights between Equistar and REC under, among other
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agreements, the Steam Supply Agreement. 10. Plaintiff cannot avoid the process mandated by federal law by pursuing an action
against REPG and Reliant -- as parent companies of a bankrupt entity -- to adjudicate claims arising from and directly affecting agreements between plaintiff and REC. 11. Accordingly, plaintiff's claims arise under, or arise in or are related to, Chapter 11 of
the United States Code and are removable pursuant to 28 U.S.C. § 1452(a). Any right to relief the plaintiff might have must be pursued as claims in the Bankruptcy Court under 28 U.S.C. § 501. NOTICE 12. Pursuant to 28 U.S.C. § 1446, a "Notice of Removal to Federal Court" will be filed
with the 165th District Court of Harris County, Texas, promptly after the filing of this Notice of Removal. Notice is also being delivered to plaintiff through its counsel of record. 13. As required by Local Rule 81, copies of all executed process in the case, pleadings
asserting causes of action, orders signed by the state judge, the docket sheet, an index of matters being filed, and a list of counsel of record are attached hereto. CONSENT OF ALL DEFENDANTS TO REMOVAL 14. Defendants Reliant Energy Power Generation, Inc. and Reliant Energy, Inc. both
consent to this removal, as indicated by the signature below of counsel for both parties. Defendants join together and, in conformance with the requirements set forth in 28 U.S.C. § 1446, remove this action from the 165th District Court to this Court. Defendants request that this Court assume full jurisdiction of this cause as if it had been originally filed here, that further proceedings in the State Proceeding be stayed, and for such other relief to which they may be entitled.
Respectfully submitted, 3
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AKIN GUMP STRAUSS HAUER & FELD LLP
By:
/S/ Michael M. Wilson State Bar No. 21704800 J. Josh Clayton State Bar No. 24050426 1111 Louisiana Street, 44th Floor Houston, Texas 77002 Telephone: (713) 220-5800 Facsimile: (713) 236-0822 ATTORNEYS FOR DEFENDANTS RELIANT ENERGY POWER GENERATION, INC. AND RELIANT ENERGY, INC.
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CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing document was served in accordance with the Federal Rules of Civil Procedure on the following counsel of record on the 12th day of October 2007. Thomas M. Farrell NICKENS KEETON LAWLESS FARRELL & FLACK, LLP 600 Travis, Suite #7500 Houston, Texas 77002
/S/ Michael M. Wilson
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IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION EQUISTAR CHEMICALS, LP, Plaintiff, VS. RELIANT ENERGY POWER GENERATION, INC. AND RELIANT ENERGY INC. Defendants. § § § § § § § § §
CAUSE NO.
INDEX OF DOCUMENTS FOR NOTICE OF REMOVAL
EXHIBIT A. Index of documents for Notice of Removal B. All executed process in the case C. Plaintiff's Original Petition; D. Defendants' Answer, Plea in Abatement; and Notice of Removal from State Court; E. List of Counsel of Record
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IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION EQUISTAR CHEMICALS, LP, Plaintiff, vs. RELIANT ENERGY POWER GENERATION, INC. AND RELIANT ENERGY, INC. Defendant § § § § § § § § § § §
CAUSE NO.
Counsel of Record
Equistar Chemicals, LP Thomas M. Farrell State Bar No. 06839250 Nickens Keeton Lawless Farrell & Flack, LLP 600 Travis, Ste 7500 Houston, Texas 77002 713.571.9191
Reliant Energy Power Generation, Inc. and Reliant Energy, Inc.
Michael M. Wilson State Bar No. 21704800 Akin Gump Strauss Hauer & Feld, LLP 1111 Louisiana Street, 44th Floor Houston, Texas 77002 713.220.2875