At the height of California's energy crisis, the price of natural gas jumped 700 percent as it crossed the state line on an El Paso Corporation pipeline.
For several months a judge has been investigating the state of California's charges that El Paso used secret deals to cut out competitors and drive up prices, reports CBS News Correspondent Vince Gonzales.
"We can definitely document hundreds of millions of dollars that California is due in refunds because the price of natural gas was artificially high because of El Paso's illegal activity," says Lorretta Lynch of the California Public Utilities Commission.
But in a surprise move Monday, El Paso decided no more explanations were needed and declined to call any witnesses. The case is now in the judge's hands.
"I think we have dead-bang evidence from California that what they did was illegal," says Lynch. "They're presenting no defense to that. We have tape-recorded conversations about what they did."
El Paso told federal regulators they did not cut any secret deals, but after looking at e-mails and transcripts of phone conversations, Judge Wagner said: "If ever there was a deal being made it was being made there ... It's all buddy-buddy stuff."
The company denies any wrongdoing. In June, El Paso CEO William Wise testified that the deal that gave his compancontrol of the flow of natural gas into Southern California was just "a good business proposition."
But when El Paso gave up control of the flow of gas, prices plunged. Now the state hopes the judge will order some of El Paso's record profits to flow back to California.
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