MARSHALL, Texas – The Texas Public Utility Commission has cleared the way for litigation to proceed against Des Moines-based MidAmerican Energy Services with a series of orders affirming that the agency does not have jurisdiction to make common law determinations about the meaning of customer contracts or determine attorney’s fees, interests, and penalties.
The orders were issued in response to class action lawsuits filed against MidAmerican that allege the electricity supplier passed through unauthorized “Supplemental Ancillary Charges” during the February 2021 winter storm to commercial customers that held fixed-rate contracts.
The rulings signal that current class action litigation filed against MidAmerican in federal court in the Eastern District of Texas should move forward. In response, MidAmerican has withdrawn the company’s requests to dismiss the lawsuits.
The litigation class currently includes thousands of Texas businesses with overcharge claims estimated to be in the hundreds of millions of dollars.
The PUC’s orders state:
“As a creature of statute, the Commission’s powers and duties are limited to those that the Legislature expressly conferred on it through statute and the implied powers that are reasonably necessary to accomplish the Commission’s express responsibilities. The Commission does not have the authority to make common-law determinations regarding contracts.”
“Although the Commission has been expressly delegated authority to grant some remedies (such as ordering charges or refunds to resolve billing disputes), the Commission does not have authority to order some forms of relief available in courts of law, such as awarding attorney’s fees, court costs, or damages under contract law. Those types of relief must be sought before a court of competent jurisdiction.”
“The PUC’s orders are significant in that they dismiss a key portion of MidAmerican’s legal argument against the validity of these claims,” says Derek Potts of the Potts Law Firm in Houston. “The company has tried to bypass state regulations that protect residential and small business customers by taking advantage of and price-gouging thousands of larger commercial customers. The PUC rightfully has found that the consequences of those unlawful actions should be heard in a court of law, and we look forward to that opportunity.”
The litigation alleges violation of the Texas Deceptive Trade Practices Act, among other claims for breach of contract, negligence and misrepresentation.