Thank you for sharing!

Your article was successfully shared with the contacts you provided.
It may not have stopped pestilence, war, famine or death, but — if you believe California Attorney General Bill Lockyer — a settlement announced Monday between power users and energy company Reliant reaches biblical proportions nonetheless. “Reliant was one of the four horsemen of the Apocalypse,” said Lockyer, according to a statement from his office trumpeting the deal, worth about $450 million. It was reached between Reliant and a group of plaintiffs that includes the state, several California utilities and ratepayers in California, Washington and Oregon. If approved by state and federal regulators, the deal would resolve claims for refunds pending before the Federal Energy Regulatory Commission, along with an antitrust suit filed by Lockyer. The settlement is the fifth between California and out-of-state energy companies accused of inflating prices in 2000 and 2001, and is the second largest after the $750 million Mirant agreed to pay earlier this year. While this latest settlement means California ratepayers have recouped a total of about $3 billion, suits stemming from the energy crisis have had mixed receptions in the federal courts, raising concerns among plaintiffs lawyers that the seemingly slam-dunk cases would fizzle out. Most frustratingly for lawyers representing the state and private classes of ratepayers, the 9th U.S. Circuit Court of Appeals has said federal regulatory laws preclude customers from suing over rate gouging. But with ongoing litigation and claims in front of the FERC, Reliant apparently felt that getting rid of future uncertainty was worth nearly a half-billion dollars, said Barry Himmelstein, a partner at Lieff Cabraser Heimann & Bernstein and one of the lawyers representing the class. “It’s a very good deal in light of the adverse case law,” he said. While the attorney general’s office has not yet released detailed information about the settlement terms, it appears that the bulk of the money will go to California. According to the statement from Lockyer’s office — which pinned the total value at $460 million, as opposed to the $445 million announced by Reliant — $453 million will go to California parties. Of that, about $3 million will go to local municipalities and utilities, and about $20 million to private and state attorneys. In addition to the civil suits, Reliant and four of its officials are also facing federal criminal charges brought by a San Francisco grand jury last year accusing the company of intentionally manipulating California’s power market. A Reliant trader is facing separate federal criminal charges in Texas relating to manipulation of natural gas prices.

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.