When Michael Pircio blew the whistle on FirstEnergy Corp., the electric utility allegedly involved with former Ohio House Speaker Larry Householder’s $60 million racketeering scheme, the company filed a lawsuit to make an example out of him, Pircio said Monday in a court filing.
When FirstEnergy found out that, days after his termination, Pircio downloaded nearly 60 files from company servers, it filed a $15 million lawsuit in federal Ohio court to send a signal to anyone else who might consider such behavior, according to a motion to dismiss filed by Pircio on Monday.
Clearsulting, a FirstEnergy contractor, hired Pircio in February to audit FirstEnergy’s processes in compliance with the federal Sarbanes-Oxley Act. He was terminated on July 30, the same day Householder was criminally indicted.
“Both Clearsulting and FirstEnergy are reticent to admit that Pircio had the statutory right under the Defend Trade Secrets Act to do what he did,” his legal team said in the motion. “Instead, they are going on the offense to ‘out’ and punish this particular whistleblower and send a message to potential other whistleblowers that if they report on them, these two powerhouse companies and their fleet of lawyers are coming after them.”
The Defend Trade Secrets Act was passed by the Obama administration in 2016 and gives immunity to whistleblowers who disclose trade secrets made in confidence to an attorney or federal, state, or local governmental official “solely for the purpose of reporting or investigating a suspected violation of law,” according to the American Bar Association.
According to the filing, Pircio only provided the documents to his whistleblower-representing attorney, H. Vincent McKnight, and the Securities and Exchange Commission (SEC), which is currently investigating the utility, according to filings made by FirstEnergy alongside its initial complaint.
FirstEnergy declined to comment on the new filings.
SEC investigations are typically kept under wraps, said McKnight in a call when the case was filed, calling the case “unusual and groundbreaking.”
Pircio said if the court decides to move forward with the complaint “it will completely obliterate the state and federal whistleblower protection and immunity statutes” because “employers will then always allege that employees who blow the whistle on them ‘took’ ‘proprietary and confidential information’ and committed a criminal act.”
Pircio argues that his actions were in compliance with company-sanctioned whistleblower policy, a right enshrined in his contract with Clearsulting.
Pircio ran for the Ohio House of Representatives in 2018 on a Republican ticket, but wasn’t one of the candidates receiving money from Householder’s scheme, according to indictments against Householder.
Larry Householder was indicted for allegedly conspiring with FirstEnergy and its affiliates to bail out two struggling power plants owned by a FirstEnergy subsidiary, Energy Solutions. The company emerged from bankruptcy this year as Energy Harbor.
According to the criminal indictment, FirstEnergy and its affiliates funnelled millions of dollars to support the campaigns of around 20 candidates who supported Householder’s bid for Speaker of the House. Once elected, Householder pushed House Bill 6 through the state legislature. It passed with voter support, allowing the two plants to receive millions of dollars in ratepayer-subsidized bailout money.
Despite the criminal indictment and losing his Speaker role, Householder is running for office unopposed in the upcoming election, and no action has been passed to repeal House Bill 6. Ratepayers will begin paying the utility increase of $0.85 starting in January.
