5th Circ. Won't Force Miss. Electric Coop. To Pay Out $112.5M
Litigation Partner Chris Schwing was quoted in a Law360 article about the Fifth Circuit's decision to reject claims made by a group of Mississippi utility ratepayers who argued that the Southern Pine Electric Cooperative failed to distribute $112.5 million in excess revenues to its members. The court decided that the cooperative's board had discretion over payouts. Ms. Schwing represented Southern Pine in the case. The state law does require Southern Pine to pay out excess revenues, but gives the cooperative's board the discretion to decide what constitutes excess revenue.
"It is important that the board make those decisions about what the appropriate amount of equity is that a cooperative has," she said, adding that a utility can have major expenses and contingencies like hurricanes that have to be considered.