NEW YORK–(COMMERCIAL THREAD) –Getnick & Getnick srl, working with the New York Attorney General’s Office, secured a settlement in a groundbreaking whistleblower case against National Grid, a utility company that provides natural gas and electricity to homes and businesses in New York City , Rhode Island and Massachusetts, as well as electrical services in other areas of the Northeast. This resolution, which addresses National Grid’s alleged failure to properly manage New York State’s electricity distribution system on Long Island and the Rockaway Peninsula, marks the first time that the New York False Claims Act has been applied to an electricity distribution company. New York Attorney General Letitia James today announced the $ 6 million recovery from National Grid Electric Services LLC.
Getnick & Getnick LLP is representing the whistleblower in the matter. The whistleblower, whose identity remains protected, will receive 23.5% of the government’s clawback in today’s settlement. This is the highest percentage that has been paid in any non-Medicaid New York False Claims Act case in which the state has chosen to replace. Getnick & Getnick got the same percentage of reward for another whistleblower customer in a previous case.
According to the settlement agreement, from 2007 to 2013, National Grid’s contractual obligations to the State of New York included issuing invoices to customers, collecting payments from customers, and remitting those payments to the State in paying them to the Long Island Power Authority (“LIPA”). LIPA is the not-for-profit utility that owns the electricity transmission and distribution system on Long Island. It provides electricity to more than 1.1 million residential and commercial customers in Nassau and Suffolk counties, as well as on the Rockaway Peninsula of Queens.
The settlement agreement explains that National Grid failed to fulfill its obligations by authorizing excessive “advanced consumption” and falsely informed LIPA. Advanced consumption occurs when electricity flows to a location, but no one is charged or paid for it. While there are instances where limited advanced consumption occurs in the ordinary course of a utility’s operations, for example, when transitioning between successive tenants of a rental property, which the whistleblower alleged in this case was a multi-million dollar fraud where National Grid mismanaged the state’s electricity and then made false reports to LIPA to cover up its conduct. LIPA was aggrieved, as were all of National Grid’s customers who diligently paid their utility bills.
The Settlement Agreement describes and provides examples of false and misleading information that National Grid submitted to LIPA on a monthly basis beginning in April 2008 and continuing through August 2012. For example:
In 2012, following a report that “all accounts were closed” in February and should be closed in March, National Grid’s internal database showed at least 3,639 unresolved advanced consumption accounts in June. . (See, Settlement Agreement, 8.)
“National Grid employees knew. . . that the National Grid report presented an inaccurate picture to LIPA. For example, on June 7, 2012, a National Grid manager who was responsible for generating reports to LIPA on anticipated consumption admitted to other National Grid employees that although National Grid was “reporting on a monthly basis that we were completing »Some anticipated consumption accounts. , these accounts were “not complete from the point of view of LIPA, because [they are] keep moving on. ”(See, Settlement Agreement, 9.)
The same National Grid manager “has repeatedly conceded that National Grid’s reports to LIPA regarding anticipated consumption were” not true “” (See, Settlement Agreement, ¶ 9.)
Getnick & Getnick partners Margaret Finerty, Richard Dircks, and Neil getnick, together with Council Stuart Altschuler, worked closely with the Attorney General’s office in the prosecution and resolution of this case. Getnick & Getnick would like to acknowledge the many years devoted to this case by the Office of the Attorney General and its Office of Taxpayer Protection. This is another example of a successful public / private partnership under the New York False Claims Act.
Partner Marguerite Finerty, former New York Criminal Court judge and former deputy chief of the Manhattan District Attorney’s Office, said, “Public services occupy a unique position of trust in our society and have a direct impact on the lives of their people. clients. This case clearly shows that when that trust is violated in New York State, there will be significant consequences. ”
Partner Richard Dircks said, “We commend our whistleblower client for the courage to take this action, and for the determination, persistence and integrity required to bring it to fruition for the benefit of all New Yorkers.”
Management partner Neil getnick noted: “Today’s settlement illustrates the strength of the New York False Claims Act as a force multiplier, empowering whistleblowers to hold even the largest entities accountable for malpractice and rewarding them for their efforts.” .
Today’s press release from the New York Attorney General, which includes a link to the settlement agreement, can be accessed here: Attorney General James Secures $ 6 Million From National Grid To Help People On Long Island low income | New York State Attorney General (ny.gov)
Getnick & Getnick is a law firm specializing in the fight against fraud and the promotion of business integrity. The company works with whistleblowers, government agencies and businesses, guided by the principle that the fight against fraud is pro-business. The firm’s whistleblower cases have raised more than $ 1 billion for taxpayers, and its clients have received record accolades, including the biggest award ever for a single whistleblower.