Consumer advocates urged city leaders and attorneys Monday to remedy “fatal flaws” in a proposed settlement on overbilling issues at the Los Angeles Department of Water and Power, including provisions they contend would limit ratepayers’ ability to challenge refund amounts.
Thousands of DWP customers were issued faulty bills following a problem- filled overhaul of the utility’s billing system, with many of the payment amounts based on estimated, rather than actual, water and electricity use.
The city was hit with several lawsuits by customers contending they were overbilled, with settlement talks leading to a proposed deal for distributing credits and refunds to overcharged customers that was announced earlier this year by the city and one of the attorneys in the class-action case.
A Los Angeles Superior Court judge is expected to decide Tuesday whether to accept the proposed settlement, but attorneys for some members of the class-action lawsuit say it has “fatal flaws” and want city officials to pull back from agreeing to it without some fixes.
They say one of the major failings is that only DWP officials would be allowed to determine the refund amounts, which would be reviewed by an “independent” utility consultant who opponents of the settlement contend would side with the utility.
Meanwhile, customers would be asked to give up their right to sue prior learning how much they would be receiving or paying back, Consumer Watchdog officials said in a letter to Mayor Eric Garcetti and City Attorney Mike Feuer.
“Make no mistake, this settlement is not fair to ratepayers,” the letter signed by Consumer Watchdog President Jamie Court and consumer advocate Liza Tucker says. “It is an inside job between the LADWP and an attorney who doesn’t truly represent the interest of the community.”
The settlement plan “will shortchange, confuse and anger ratepayers,” Court and Tucker said.
DWP officials and the City Attorney’s Office did not immediately respond to the Consumer Watchdog group’s letter.
Attorney Jack Landskroner, who negotiated the settlement deal, defended the terms Monday, saying it would “not only return 100 percent of the overcharges LADWP billed to customers,” but that the amounts would be “verified by an independent court-appointed monitor.”
The monitor, Paul Bender, “is one the most experienced utility billing experts in the country,” with a “track record for standing up for ratepayers by challenging and stopping wrongful billing practices by large utilities,” Landskroner said.
He added that he sympathizes with the consumer advocacy group’s “distrust of LADWP based on past history,” but thinks the “well-intended grassroots group may have been manipulated and misinformed by trial lawyers who have a personal financial interest in obstructing the settlement.”
Consumer Watchdog officials previously accused Landskroner, who would be paid $13 million in legal fees under the settlement, of designing a deal that would be financially lucrative for him despite only having done “87 days of work.”
— City News Service