Consumer Watchdog Group Is Accused Of Serving As ‘ComEd’s Lapdog’

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Manuel Martinez / WBEZ
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Manuel Martinez / WBEZ

Consumer Watchdog Group Is Accused Of Serving As ‘ComEd’s Lapdog’

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Lawyers suing scandal-scarred Commonwealth Edison on behalf of the power company’s customers are accusing a consumer-advocacy group of serving as “ComEd’s lapdog,” court records show.

But the Citizens Utility Board says that is not fair — and CUB has now taken legal action itself to try to win back money for the roughly 4 million homes and businesses served by ComEd across northern Illinois.

State officials created CUB 37 years ago to act as an independent watchdog for customers of the power company and other state-regulated utilities.

Lawyers in a class-action suit in Cook County Circuit Court allege CUB instead is trying to shield ComEd, which has admitted to bribing Illinois politicians as it won electricity-rate increases and other lucrative legislation in Springfield during the past decade.

CUB officials hired outside lawyers — including former Democratic Illinois Gov. Pat Quinn — to explore whether they could try to win restitution for customers.

And the group quietly filed a lawsuit of its own against ComEd in federal court on Oct. 22, alleging the power company engaged in “racketeering activities” and enriched itself “at the expense of Illinois utility customers.”

Then on Nov. 2, Quinn and CUB’s other lawyers sought to intervene in the Cook County case, asking the judge to “stay proceedings” in the legal battle.

CUB’s lawyers argued that the Cook County case should be suspended while four other similar cases are pending in federal court. They also wrote that “utility consumers already have a built-in mechanism to represent them — CUB.”

The lawyers for the plaintiffs in the Cook County case responded Thursday by accusing CUB of having “rampant conflicts of interest.” They cited a September WBEZ story that detailed the financial connections between CUB and ComEd.

Although CUB is not supposed to receive any funding from ComEd, WBEZ’s investigation revealed the consumer organization actually did get a lot of money from two ComEd-funded foundations over the past 20 years.

“Millions of dollars funneled into CUB from ComEd has neutered CUB, turning it from a statutorily-mandated utility watchdog into ComEd’s lapdog, failing to so much as growl in response to defendants’ rampant bribery scheme,” lawyers Stephan Blandin and Adam Levitt argued in the newest filing in their case.

The lawyers argued that CUB has tried to insert itself into the case “for the sole purpose of shutting it down.”

CUB’s executive director, David Kolata, told WBEZ on Friday that the allegations made in the class-action lawsuit are “specious” and that the group “will strongly contest them.”

Under a deal with federal prosecutors, ComEd has admitted it engaged in a bribery scheme that lasted eight years and involved offering monetary payments and no-work jobs and contracts to associates of powerful Illinois House Speaker and state Democratic Party Chairman Michael Madigan of Chicago. Madigan has not been charged and has denied wrongdoing.

During the scheme, ComEd won approval of two highly valuable pieces of Springfield legislation, which led to steep rate increases — and much higher profits for the electric company’s shareholders. CUB supported the second of those measures, in 2016.

In the new filing in the case in Cook County, the plaintiffs — a group of electricity customers — allege there is an “incestuous relationship between ComEd, its legislative puppets and CUB.”

“CUB is not in a position to provide genuine, unconflicted advocacy for Illinois consumers,” the plaintiffs’ lawyers, Blandin and Levitt, wrote.

Besides being “severely compromised” by the funding it has received through the ComEd-backed foundations, they argued, CUB also had “enabled” the corruption scheme in Springfield.

And by trying to intervene in the Cook County case, CUB’s actions were “wildly inappropriate,” the lawyers said.

Neither the lawyers in that case nor the attorneys for CUB have offered any estimate of the financial harm they believe the scandal has done to ComEd’s consumers.

ComEd agreed to pay a $200 million fine to the government, and court records in the criminal case show the benefits of the bribery scheme to ComEd exceeded $150 million. But the true cost to the public may have been much higher than those figures, according to a WBEZ analysis of state records.

Since the corruption began, revenues from ComEd’s state-approved rates for delivering electricity jumped from about $2 billion a year to nearly $2.7 billion in 2019, the records show.

At the same time, the “net operating income” for ComEd rose even faster, from about $500 million a year when the bribery scheme began to $739 million last year.

ComEd’s chief executive, Joe Dominguez, has apologized for the scandal but says the legislation the company won in Springfield has provided benefits for customers and should not be repealed.

The power company’s former top in-house lobbyist, Fidel Marquez Jr., pleaded guilty in the Springfield corruption scheme in September and is cooperating with the ongoing investigation.

Dan Mihalopoulos is an investigative reporter of WBEZ’s Government & Politics Team. Dave McKinney covers Illinois politics and government.