Duke Energy Reaches $81M Antitrust Settlement Over Rebates

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In a settlement reached Wednesday, Duke Energy Corp. has agreed to pay nearly $81 million to rectify a class action lawsuit filed against the company. The class action lawsuit alleged that Duke gave illegal rebates to corporate customers, thereby allowing a competitive advantage and violating antitrust laws.

The Duke Energy class action lawsuit was originally filed in January 2008 and asserted that Duke issued rebates to large businesses in order to garner their support for a rate stabilization plan that Duke was attempting to solidify through the Public Utilities Commission of Ohio. The rebates in question amounted to tens of millions of dollars.

The proposed settlement deal grants $25 million to residential customers of Duke Energy Ohio and another $25 million to non-residential customers. The Class is comprised of Duke Energy Ohio customers from January 2005 to December 2008.

Another $8 million will be allocated for funding energy programs for the benefit of Duke Energy Ohio customers. Legal fees and other expenses make up the remaining $23 million of the total settlement.

The motion seeking preliminary approval of the Duke Energy settlement states, “Settlement negotiations in this case took place over the course of six mediation sessions, and initial agreement was ultimately reached through the mediation efforts of this court. After the initial agreement was reached, counsel for both parties spent significant time exchanging, reviewing and analyzing additional data for the settlement.”

If U.S. District Judge Edmund A. Sargus approves the Duke Energy settlement, it would bring closure to a long-standing antitrust class action lawsuit originated by plaintiff Anthony Williams, a residential customer, BGR Inc., a non-residential customer, and others represented by the class action lawsuit.

Originally filed in a lower court, the Sixth Circuit reviewed the class action lawsuit in June 2012, then brought it back into the courts saying that a lower court wrongly ruled that it lacked authority to decide the case. Duke then appealed the ruling to the Supreme Court, but it was denied a hearing in January 2013.

The Class became certified in March 2014 and the residential business Classes were approved as well. Multiple mediation sessions took place, some unsuccessful, before the settlement was finally reached.

Duke said in a statement that they agreed to a settlement to avoid the costs and uncertain outcomes involved with further litigation.

If the motion to approve the Duke Energy class action settlement is preliminarily granted, a Settlement Fairness Hearing will take place. At that time, the Court will hear all evidence and argument in order to make a final evaluation after considering all the information presented. Any Class Members who object to the terms of the settlement can also be heard at this time. The court will then make a final determination to approve or dismiss the settlement.

If the Settlement Fairness Hearing is scheduled, it will take place within 180 days of the Court’s preliminary approval of the class action settlement.

The plaintiffs are represented by Paul M. De Marco, W.B. Markovits, Louise M. Roselle, Christopher D. Stock, Terrence R. Coates and Eric J. Kmetz of Markovits Stock & DeMarco LLC, and Randolph H. Freking, Kelly Mulloy Myers and George M. Reul Jr. of Freking & Betz LLC.

The Duke Energy Antitrust Class Action Lawsuit is Anthony Williams, et al. v. Duke Energy Corp., et al., Case No.1:08-cv-00046, in the U.S. District Court for the Southern District of Ohio.

UPDATE: Claim filing instructions for the Duke Energy class action settlement are now available! Click here or visit www.DukeClassAction.com for details.

UPDATE 2: The Final Hearing on this case has been switched from Apr. 18, 2016 to Apr. 19, 2016.