LOS ANGELES, Oct. 12, 2017 /PRNewswire/ -- A settlement has been reached with the City of Los Angeles (the "City"), the Los Angeles Department of Water and Power ("LADWP"), and the LADWP Board of Water and Power Commissioners (together, "Defendants") in a class action lawsuit claiming LADWP has embedded in its power (electric) rates an 8% surcharge in order to fund transfers to the City's Reserve Fund. The Plaintiffs claim that the 8% surcharge is a tax that has not been approved by the electorate and, thus, violates California Constitution article XIII-C, section 2, subdivision (b) and/or (d), and Government Code sections 53722 and/or 53723. Defendants deny the allegations, and the Court has not decided who is right. Instead, the parties agreed to a settlement to avoid the expense and risk of continued litigation.
You are included in the settlement if, between January 29, 2012 and September 14, 2017, you held a retail customer account with LADWP in which there was a charge for electricity.
The City has agreed to create a Settlement Fund, which is currently estimated to be Fifty-Two Million Dollars ($52,000,000). After administrative expenses, attorney's fees and expenses of up to 29% of the Settlement Fund, service awards in the amount of $5,000 to each of the four Class Representatives, and a $650,000 payment to non-profit charitable organization(s) are paid from the Settlement Fund, the balance will be distributed as a per kilowatt-hour credit to the electric rates of LADWP retail electricity customers. The City and LADWP have also agreed to deduct 8% from the amounts otherwise charged to LADWP retail electricity customers pursuant to its 2016 Electric Rate Ordinance and will no longer transfer any funds LADWP collects through the 2016 Electric Rate Ordinance to the City. Please see the Detailed Notice and / or the Settlement Agreement available at www.LACityTransferSettlement.com.
If you do nothing, you are staying in the Settlement, your rights will be affected, and, if you are a LADWP retail electricity customer during the first billing period after the Settlement is finally approved by the Court, you will receive the benefits described above. If you do not want to be legally bound by the Settlement, you must exclude yourself from it by December 27, 2017. If you do not exclude yourself, you may object. Objections are due December 27, 2017. More information, including the Settlement Agreement, a Detailed Notice, and instructions on how to exclude yourself and object, is available at www.LACityTransferSettlement.com.
The Los Angeles Superior Court will hold a hearing in this case, Eck v. The City of Los Angeles, No. BC577028, on February 14, 2018. At this hearing, the Court will decide whether to approve: the Settlement; Class Counsel's request for attorneys' fees and expenses; and service awards to the Class Representatives. You or your lawyer may appear at the hearing at your own expense.
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SOURCE Zimmerman Reed LLP, Ahdoot & Wolfson PC, and Krause Kalfayan Benink & Slavens LLP