A longtime Alabama attorney plans to assist a Georgia utility with its pending lawsuit for breach of contract and bad faith against Georgia Power, a subsidiary of Atlanta-based Southern Company.
Donald Watkins, a leading voice in online news reporting about Southern Company's long-running racketeering scandal, states that he intends to provide Oglethorpe Power Corporation with documents to help expand its lawsuit to include Southern Company as a second defendant, along with adding claims for fraud and racketeering against both defendants. Watkins also plans to assist Oglethorpe with information it needs to request triple times its actual losses, while seeking punitive damages against both Southern Company and Georgia Power. Under the headline "Oglethorpe Power Corporation is a Victim of the Southern Company’s Fraud Scheme," Watkins writes:
In the interest of justice, I have decided to provide Oglethorpe with access to the Southern Company documents it needs to amend its pending lawsuit to: (a) add the Southern Company as a second defendant, (b) add fraud and racketeering claims against both defendants, (c) and add a request for triple times Oglethorpe's actual losses, plus punitive damages against Georgia Power and the Southern Company.
Eversheds Sutherland, LLP, which represents Oglethorpe in its lawsuit against Georgia Power, has been my principal corporate law firm in Europe and Africa since 2012. I will make sure that Oglethorpe gets everything it needs to win its "David versus Goliath" battle against Georgia Power and the Southern Company.
The lawsuit stems from Oglethorpe's allegations that Georgia Power has failed to abide by a written contract that calls for it to pay its share of expenses related to cost overruns at the Plant Vogtle project near Waynesboro, GA. Watkins explains the nature of the dispute:
On June 21, 2022, Oglethorpe Power Company filed a lawsuit against Georgia Power Company in the Superior Court of Fulton County, Georgia. Georgia Power is a wholly owned affiliate of the Atlanta-based Southern Company.
This "Preliminary Statement" in the complaint tells us everything we need to know about Georgia Power and the Southern Company:
“This case arises from Georgia Power’s refusal to honor the deal it struck with Oglethorpe and accept responsibility for Georgia Power’s share of massive cost overruns in the construction of nuclear power-generating Units 3 and 4 at the Alvin W. Vogtle Electric Generating Plant (“Vogtle Units 3 and 4”). For years, Oglethorpe has paid for its share of billions of dollars in cost overruns for Vogtle Units 3 and 4, with Georgia Power’s assurance and agreement that if cost overruns reached a certain point, Georgia Power, who is responsible for construction of the project, would step in and take responsibility. Now that the cost overruns have reached that point and beyond, Oglethorpe has called on Georgia Power to stand by its commitment. Instead of honoring that commitment, however, Georgia Power denies it and seeks to shift still more cost overruns onto Oglethorpe. This complaint is brought to hold Georgia Power accountable for its promises.”
Oglethorpe, which owns 30% of Vogtle Units 3 and 4, discovered for itself that Georgia Power is a cheater that reneges on written contracts. At the time Oglethorpe filed its lawsuit last June, the company did not know that Georgia Power's parent company, the Southern Company, was running a massive accounting-fraud scheme and racketeering enterprise that victimized Oglethorpe and many other innocent people and entities.
Today, the Vogtle construction project is $21 billion over the original cost estimate of $14 billion. The two reactors under construction are nearly six years behind schedule. Contractor delays, shoddy workmanship, rework projects, the inability to complete tasks on time, and the bankruptcy of reactor designer Westinghouse Electric Co. have more than doubled the project’s costs.
Oglethorpe is a very different type of energy operation, compared to Georgia Power and its sprawling parent firm. The cost overruns have forced Oglethorpe into a shaky position, and the lawsuit is designed to correct that. In short, Oglethorpe is tired of being victimized by its much larger partner in the Vogtle project. Writes Watkins:
The Southern Company's mismanagement of Vogtle Units 3 and 4 has been a nightmare of epic proportions for Oglethorpe.
Georgia Power is a for-profit corporation that has repeatedly exercised its ability to push its Vogtle-project cost overruns to the shareholders of the Southern Company and the customers of its affiliates.
Oglethorpe, by contrast, has no shareholders. Instead, Oglethorpe is a not-for profit Georgia electric-membership cooperative that provides power to 38 members that are also not-for-profit electric-membership cooperatives. These cooperatives, in turn, provide electricity to more than four million rural homes and businesses in 151 of 159 of Georgia’s counties. The people bearing the burden of Oglethorpe’s share of Georgia Power’s cost overruns for Vogtle Units 3 and 4 are the rural Georgians served by Oglethorpe and its member cooperatives.
Southern Company and its affiliates (including Alabama Power) seem to have developed a specialty in recent years of creating and abusing victims. It is time for that to end, Watkins states:
The passage of time has revealed that the Southern Company is nothing more that a slick and polished Wall Street corporate "thug." The company is faking profitability until it can place Units 3 and 4 into commercial service.
What could that mean for the public, given the documented cost overruns and shoddy workmanship on the project, which involves nuclear power? Could another "Three Mile Island" meltdown be in the making?
