Nieves v. Just Energy New York Corp.

DECISION AND ORDER I. Introduction   Plaintiff and her proposed class of New York electricity customers of Defendant challenge improper pricing practices for electricity rates that Defendant imposed upon them (Docket No. 1, Compl.). At issue here is the variable rate clause in Defendant’s contract, which states: “You will be charged at the Intro Price for the first 3 billing cycles from the Start Date. After the Intro Price period expires, you will be charged a Variable Rate per kWh. The Variable Rate will not change more than once each monthly billing cycle. Changes to the Variable Rate will be determined by Just Energy according to business and market conditions and will not increase more than 35 percent over the rate from the previous billing cycle.” (Docket No. 1, Compl. 24, Ex. A, Contract Terms & Conditions, Sec. 7.3 (emphasis added). Before this Court is Defendant’s Motion to Dismiss (Docket No. 8)¹ the Complaint. For the reasons stated herein, Defendant’s Motion to Dismiss is granted. II. Background This is a diversity² jurisdiction class action under New York contract law challenging terms of Defendant’s utility supply contract (see Docket No. 1, Compl., Ex. A, Terms and Conditions Sec. 21, Governing Law, New York State law governs). Defendant is an independent energy supply company (or “ESCO”). In 1996, New York State deregulated the market for retail electricity supply, allowing ESCO, other than local utility companies to supply electricity, while the utility delivered the electricity. (Docket No. 1, Compl.

11, 13.) ESCOs do not need to file their rates for supplying electricity with the New York State Public Service Commission (id. 12). A. Pleadings Plaintiff alleges that Defendant engaged in a bait and switch scheme wherein Defendant charged low introductory per kilowatt hour rates for customers to sign with Defendant, promising to charge variable rates for electricity then, months later, increases the per kilowatt hour variable rate by exorbitant amounts (id. 15). Plaintiff signed with Defendant in January 2011 and Defendant charged her the introductory rate (id.