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Duke Energy is facing lawsuits over payments
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Published: August 17, 2008
CINCINNATI - Ford Motor Co., Procter & Gamble Co. and General Electric Co. are among companies with operations in southern Ohio that were paid millions by Duke Energy Corp. in what lawyers say were kickbacks to the companies for dropping opposition to a rate increase, court documents show.
Also among the 22 companies are General Motors Corp., BP North America, Marathon Petroleum Co., AK Steel Holding Corp. and several hospitals, according to documents obtained by The Cincinnati Enquirer.
The utility was known as Cinergy Corp. in 2004 when it requested the increase in rates. Duke, which has its headquarters in Charlotte, bought Cinergy in 2006.
Judge Robert Ruehlman of Hamilton County Common Pleas Court released the list of companies after the newspaper challenged Duke's assertion that the records should remain sealed from the public because the 2004 and 2005 contracts with the companies contain confidential trade secrets.
Other court documents show that Duke paid out about $22 million total to the companies a year since 2005. During that same time, Duke's residential customers saw a 30 percent increase in their electric rates, the newspaper reported.
Randy Freking, one of the lawyers suing Duke, said that such payments violate an Ohio law that bans utilities from giving rebates to one group of customers at the expense of another. Duke faces two lawsuits on the matter, including one in Hamilton County that is scheduled to go to trial Monday in which former employee John Deeds claims he was fired when he raised concerns about the payments. The other suit, pending in federal court, alleges antitrust violations.
Duke said that the payments are legitimate business agreements to guarantee that the companies won't switch to a Duke competitor, and that they do not affect others' rates.
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