Electric and natural gas supplier IDT Energy is the latest company to settle a class action lawsuit for allegedly overcharging customers during the harsh winter of 2014. Any current or former customers of IDT Energy, Genie Retail Energy, Genie Energy International Corporation, or Genie Energy LTD who purchased utilities between July 1, 2008 and October 16, 2017 are eligible to claim a part of the class action settlement.
The unusually harsh winter of 2014 plagued the northeastern states with frigid temperatures and a polar vortex. Customers struggling to keep their homes warm were shocked to see their rates unexpectedly skyrocket. Despite previous promises of cost savings, utility companies such as IDT Energy, which provides services in New York, New Jersey, Pennsylvania, Maryland, Illinois, Ohio and the District of Columbia (DC), suddenly began charging customers as much as four times the expected price. Outraged customers felt the rates did not match up with the cost estimates and promises made by the company, and quickly contacted the attorney general’s office, Office of Consumer Advocate and the Public Utility Commission for assistance.
Louis McLaughlin, Anthony Ferrare, and Deborah Aks, the lead plaintiffs in the class action lawsuit, accused the defendants of overcharging their customers for gas and electric utilities and breach of contract. They also sued the companies for allegedly violating various customer fraud laws and for failing to uphold their duty of good faith and fair dealing. IDT Energy has maintained that they committed no wrongdoing.
After a year of legal proceedings, the courts sided with the plaintiffs, stating that IDT Energy made deceptive savings claims to customers and failed to provide accurate pricing information. In addition to the $4.2 million IDT Energy already voluntarily paid to customers, the court ruled the defendants owed $2.4 million more in refunds to customers for their deceptive practices. The $4.2 million dollar settlement is almost as large as the $4.3 MILLION SETTLEMENT IN THE JPMORGAN CHASE BANK FDCPA CASE.
Qualified class members with proof of purchase can obtain cash or a credit on their bill by submitting a claim form via mail, fax, or online before April 5, 2018. Refund payments will vary depending on the length of the customer’s affiliation with IDT Energy, with the possibility of claiming up to 15 months for cash payments and 20 months for account credits. Rewards will also depend on various factors, such as whether the individual was a “high usage” or “low usage” customer, whether the customer purchased gas or electric services, and whether the claimant requests cash or account credit settlement.
Payments will begin after the final hearing on April 9, 2018. The case is McLaughlin v. IDT Energy Inc., et al., Case No. 1:14-cv-04107-ENV-RML, in the U.S. District Court for the Eastern District of New York. Attornies representing the plaintiffs include Steven L. Wittels, J. Burkett McInturff, Tiasha Palikovic, and Wittels Law PC of New York; Jonathan Shub, Kohn Swift & Graf PC, Troy, M. Frederick, Marcus & Mack PC of Pennsylvania; and D. Greg Blankinship, Finklestein Blankinship Frei-Pearson & Garber LLP, Matthew D. Schelkopf, McCune Wright Arevalo LLP, Matthew R. Mendelsohn, Mazie Slater Katz & Freeman LLC of New Jersey.
