RELEASE: Cobb EMC Members Request Rehearing in April FERC Request

Marietta, Ga. – Today Dan Davis and Mark Hackett, customers of Cobb Electric Membership Corporation (EMC), requested that the Federal Energy Regulatory Commission (FERC) rehear the denial of their Request for Investigation of Cobb EMC. On April 26th of this year, the two customers asked FERC to investigate evidence of wrongdoing by Cobb EMC and several of its affiliates based on violations of the Federal Power Act (FPA). On August 4, 2011, FERC denied the customers’ Request for Investigation.

Davis and Hackett are requesting that FERC review its ruling in part because of a factual error FERC made in reviewing the evidence. “The Federal Energy Regulatory Commission ruled that because Cobb EMC and Cobb Energy Management are cooperatives whose customers are also their shareholders, that there was no risk of affiliate abuse,” said Hackett. “In fact, Cobb Energy Management is not a cooperative, and between 1999 and 2008 was only minority- owned by Cobb EMC. We presented information from the Derivative Litigation settled in 2008 and the Indictment of Dwight Brown that indicates that millions of dollars were siphoned from Cobb EMC to the mostly privately held affiliate Cobb Energy Management. We believe FERC must review whether their mistaken belief that Cobb Energy Management was a cooperative compromises their ruling. Even now, the Georgia State Court is still trying to unravel the tangle of subsidiaries of Cobb Energy Management.”

“The fact that the captive customers of Cobb EMC were not the majority shareholders of Cobb Energy between 1999 and 2008 invalidates the basis for FERC to claim that there was no chance of affiliate abuse in this case,” said Dan Davis, the other Cobb EMC customer requesting the rehearing.

Davis and Hackett are represented by William R. Mapes, Esq., who specializes in legal actions before the FERC.

Mapes, who is based in Washington, DC and submitted the Request for Rehearing to the Commission on behalf of Davis and Hackett, said that in addition to the factual error about the cooperative status of Cobb Energy Management, there were several other questionable elements in the FERC ruling. “The Commission in part denied my clients’ Request because they contended that certain of the apparent violations were not proven in the Request. But the Federal Power Act does not place the burden of proof upon the requestors as the Commission claims. Instead, the Act provides that if there is any reasonable ground for investigating such complaint that it shall be the duty of the Commission to investigate. Along with other jurisdictional details we believe there are not just reasonable grounds—but compelling grounds- -for the FERC to review their ruling in light of these concerns.”

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