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The Netting Agreement between Reliant and Enron is ambiguous as to its language regarding whether the Enron parties are jointly liable. Click here for the full text of this decision FACTS:Under a Master Netting, Setoff and Security Agreement, Reliant Energy Services Inc. and Reliant Energy Services Canada Ltd. sought $78,468,996 from Enron Canada Corp. Reliant filed a breach of contract claim in federal court against Enron Canada seeking a declaratory judgment that the terms of the Netting Agreement made Enron Canada jointly liable for $78,468,996 and an injunction requiring Enron Canada to pay this amount into the registry of the court. Enron Canada moved to dismiss the claim asserting lack of personal jurisdiction and, in the alternative, that Reliant violated a 11 U.S.C. �362(a) bankruptcy stay. The district court found that personal jurisdiction was not lacking, but agreed that the bankruptcy stay extended to the Enron Corp. also extended to its subsidiary, Enron Canada, under the “unusual circumstances” exception articulated in A.H. Robins Co. v. Piccinin, 788 F.2d 994 (4th Cir. 1986). The district court also found that the terms of the Netting Agreement imposed no liability on Enron Canada for the debts of other Enron entities and denied Reliant’s request for a preliminary injunction. HOLDIGN:Vacated and remanded. The district court did not make a finding as to the intentions of the parties as it apparently felt the contract was unambiguous in favor of Enron Canada and granted summary judgment in Enron’s favor. The court disagrees and finds that the Netting Agreement is ambiguous and therefore remands this case to the district court to make a factual determination as to the intentions of the parties and, in particular, to determine the parties’ intended meaning of the term “Group.” OPINION:DeMoss, J.; DeMoss, Stewart and Fallon, JJ. DISSENT:Stewart, J. “Because I find that by its terms, purpose, and context, the Netting Agreement does not impose liability on Enron Canada to pay Reliant’s proposed final settlement amount, I would affirm the district court’s order dismissing Reliant’s claims. Moreover, the Panel’s remand of this case back to the district court for a hearing on the parties’ intent is not the most judicially efficient method for resolution. According to Reliant, the parties agree that the contract is unambiguous, but that its interpretation is a question of law for the Court to determine. The parties already have asserted their conflicting interpretations to the district court and to this Court: Difficult though it may be, it is up to this Court to decide the respective obligations of the parties on this record. I am unpersuaded that the parties will present any greater insight about the language in dispute during a reprise on remand than they did before. The most that the majority achieves is that it sends an intractable dispute back to the district court where the parties may decide to settle this case rather than traverse the appellate court again following another ruling by the district court. I would affirm the district court on this issue. Accordingly, I respectfully dissent.”

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