LOS ANGELES (CNS) — A judge has given conditional approval to a proposed settlement that calls for the Los Angeles Department of Water and Power to pay out tens of millions of dollars in refunds to customers who were billed inaccurate amounts during a problem-filled overhaul of the utility’s customer billing system.
Superior Court Judge Elihu Berle said he supports the deal “in principal,” but wants changes to be made in the agreement to make the refund claims process less complicated for DWP ratepayers, according to attorney Gillian Wade, who represents a plaintiff critical of the deal.
Berle also would not commit to $13 million in attorneys’ fees that, under the current proposed agreement, would be given to the lead attorney seven days after the deal’s final approval, according to Wade.
On Monday, Dec. 21, Berle said he would decide after actual refund amounts — rather than estimated figures — have been calculated, the attorney said.
Another hearing was set for Feb. 5 to consider preliminary approval of the deal, Wade said.
LADWP officials said in a statement they are “pleased with Judge Berle’s decision today to approve in principle the class action settlement,” which stems from the “failed implementation” of the billing system. City and DWP officials say they are continuing to seek damages from Pricewaterhouse Coopers, which implemented the system in 2013.
Berle described the settlement as “unique,” “reasonable, adequate and in the best interest of the settlement class,” according to DWP officials.
Department officials added that “it makes good on a commitment we made to our customers to review every account and make whole any customer who was overcharged, regardless of how small the error.”
“With this agreement, every customer who was affected will be repaid 100 cents on the dollar,” the statement said
“It also includes benchmarks and key performance indicators that we fully intend to meet and report on to an independent monitor appointed by the court on a quarterly basis for 18 months.”
Those who were overcharged and still customers would get a credit, while those who are no longer customers will receive a refund, under the proposed settlement.
The refund or credit amounts will be reviewed by a third party, and customers can dispute them by submitting a claim to an “independent special master,” DWP officials said.
This special master will make a recommendation to the court, and if there is still disagreement, the customer can dispute the amounts directly with the judge that oversaw the settlement.
Customers should receive information about their rights 90 days from Dec. 21, DWP officials said.
Mayor Eric Garcetti said the ruling is “a big step towards closing the chapter on overbilling at the LADWP.”
“The settlement provides a transparent process to ensure that all overcharged customers are refunded or credited for every dollar they were wrongly charged,” he said.
“As we continue to strengthen the performance of our public utility and improve customer service, this settlement implements reforms that will prevent this from happening again.”
Berle had delayed granting preliminary approval in two previous hearings, after attorneys for some of the plaintiffs raised objections to the way another attorney had drawn up the terms with the DWP.
Consumer advocates also said they were concerned about the deal because its terms give DWP officials too much power in deciding how much they would refund or back-bill customers.
Utility officials say the deal, if accepted by the court, would result in $44 million total in overcharges to be credited back to customers and would give back “100 cents on the dollar to every customer affected by our billing system problems.”
They added that the settlement also gives customers a “thorough and fair neutral process for resolving claims, including the opportunity to have their claims heard directly by the court.”
The most recent version of the settlement, which was filed in court last month, includes all 12 revisions requested by Berle, according to DWP officials.
Those changes include putting in signature lines for class plaintiff representatives, using six languages on the claims forms, setting up an online claims submission system, and giving clearer information about the kinds of claims ratepayers could make.
Consumer advocates critical of the deal said before Monday’s hearing that despite the recent revisions, the settlement terms still would give DWP too much power to dictate the refund amount.
Consumer Watchdog President Jamie Court last month called the revised settlement “remarkably flawed,” and the claims process it would set up “confusing.”
Court also lashed back at the DWP’s statements, saying that the attorney who crafted the settlement will get his $13 million in fees as soon as the settlement deal goes through, while customers may need to wait until 2017 or later to get their checks.