A federal judge has signed off on a more than $16.05 million class action settlement involving claims that Connecticut-based North American Power & Gas LLC overcharged customers.
The settlement signed off on Friday by U.S. District Judge Victor Bolden comes five weeks after another judge signed off on an $18.5 million class action settlement involving Viridian Energy. The plaintiffs in both class actions were represented by attorneys from West Hartford-based Izard Kindall & Raabe.
In both cases, it’s alleged the companies misled customers about its variable rate plans. The companies did not admit liability in either case.
The core of the case against NAPG involved allegations the company, a third-party retail electricity supplier with customers in 12 states, agreed to sell power to its customers at a rate that should have varied based on wholesale market conditions. Plaintiff attorneys claim the rates did not vary much, and that the company overcharged customers in certain months. The company, in court papers, claimed there was a contract that was followed.
“We had an expert that agreed with us and they had an expert that agreed with them,” said Robert Izard, a partner with Izard Kindall.
Izard told the Connecticut Law Tribune Tuesday that the company has about 500,000 accounts, which account for about 400,000 people. He said that, as of July 23, 20,862 people had filed valid claims with the claim administrator. The deadline to file claims has passed, Izard said.
The money each claimant will receive, lzard said, will vary depending on how long that person was a customer and how much power they used between Feb. 20, 2012, and June 5, 2017, the dates the class action covers.
The minimum check will be for $2, while some customers will get checks for more than $1,000, Izard said. Each customer, Izard said, will get about .351 cents per kilowatt-hour. That, he said, entails multiplying the amount of kilowatt-hours purchased during the class period by .351 cents.
It’s the hope, in both class actions settlements, Izard said, that customers will receive settlement funds by the end of the calendar year. “The claims administrator has a process to go through,” he said.
The NAPG class action originally had eight plaintiffs from six states, including Paul Edwards and Gerry Wendrovsky from Connecticut.
In court papers, NAPG disputed the plaintiffs’ assertions.
“All of plaintiffs’ claims necessarily fail because they are predicated on the court imposing an obligation on NAPG that is not contained in the contract,” it argued.
The company continued: “Nothing in the language of the service agreement states that NAPG’s variable rate will necessarily rise and fall in any proportion, direct or otherwise, to a wholesale price of electricity.”
U.S. District Judge Stefan Underhill signed off on the Viridian Energy agreement on June 27.
In that case, 17,171 claims were processed and the average refund is $70, Izard said. With Viridian, the class period was from July 1, 2008, through Dec. 31, 2016. Class members alleged Viridian enticed them to shift their electric service, with promises of meaningful savings that never materialized.
In court papers, Viridian said the class action lawsuit “amounts to nothing more than [plaintiffs'] unhappiness with Viridian’s variable rates for electricity.”
“Plaintiffs disregard the clear and express terms of their contract with Viridian, which grants Viridian the discretion to decrease or increase its variable rate each month based on any number of broad wholesale market conditions, and warn customers of the risk that their rates may be higher or lower than the [utility's] rate in any given month,” the company argued.
NAPG was represented by Greil Roberts and Peter Siachos of Gordon Rees Scully Mansukhani. Roberts declined to comment Tuesday and Siachos did not respond to a request for comment. NAPG does not have a media relations department. A customer representative for the company said a request for comment would be delivered to upper management. As of press time, no one from the company had responded to a request for comment.
Viridian was represented by Maura Grinalds of Skadden, Arps, Slate, Meagher & Flom and by Dan Blynn of Venable. Grinalds did not respond to a request for comment and Blynn declined to comment. In addition, no one from Viridian responded to a request for comment.
Assisting Izard were Craig Raabe and Seth Klein, both with Izard Kindall.