An Ohio man filed a lawsuit in federal court Monday against FirstEnergy Corp. for its alleged role in a $60 million bribery and money laundering scheme to prop up two financially troubled nuclear power plants in the state.
Jacob Smith, of Lorain County, is seeking unspecified damages and other relief from FirstEnergy and subsidiary FirstEnergy Services. He was damaged as a homeowner who would pay the rate increase enacted in 2019 state legislation that established a $150 million annual bailout for the Davis-Besse and Perry facilities.
Smith’s attorney, Dennis Murray of Sandusky, is seeking to make this a class action suit, contending the Akron-based power company’s actions affected “tens of thousands, if not hundreds of thousands of persons,” according to the complaint filed in U.S. District Court in Columbus. Cleveland.com also reported Smith holds 108 shares of FirstEnergy stock.
The two power plants were at the time owned by FirstEnergy Corp. subsidiary FirstEnergy Solutions, which went through Chapter 11 bankruptcy and is now the stand-alone company Energy Harbor.
Smith’s complaint largely relies on the federal criminal affidavit unsealed on July 21 against Ohio House Speaker Larry Householder (R), three lobbyists, and another political operator to funnel and launder money from “Company A” and affiliates over three years. While Company A is not identified in the 81-page document, federal law enforcement officials have effectively acknowledged it is FirstEnergy Corp.
The end result of the scheme was House Bill 6, passed by the Ohio Legislature last July, which established rate hikes ranging from $0.85 per month for a home up to $2,400 per month for a business. All Ohio ratepayers must pay the rate hike, regardless of if they are FirstEnergy Corp. customers.
The $60 million allegedly went to bribes to Householder and the other four; to fund the election of roughly 20 freshmen state representatives in 2018, who would vote for Householder to become speaker in 2019; to support the bailout legislation[ and to finance opposition to a proposed ballot initiative to repeal the rate hikes. That ballot initiative died amongst court battle in late 2019.
“Plaintiff is entitled to recover compensatory and treble damages in an amount to be determined at trial, and to a prospective order directing Defendants to disgorge their ill-gotten gains in order to deter them from engaging in similar conduct in the future,” the lawsuit says.
FirstEnergy Corp. has denied wrongdoing, and has said it is cooperating with the ongoing federal investigation.
