Sophisticated In-House Counsel For Your Business

Sophisticated In-House Counsel For Your Business

Fees at the center of Texas company’s class-action lawsuit

| Jun 14, 2021 | Contracts |

Businesses in Houston and throughout Texas rely on their contracts to ensure they and their customers are treated fairly. This is especially true when there are unpredictable events that cause challenges. In contracts, there are usually details as to what will be charged for services. If there are allegations that rates were changed and fees were assessed when they should not have been, then it could be the basis for business litigation. Companies concerned about these issues should have a firm grounding in the law as they try to settle the matter and decide if a lawsuit is needed.

Plastics company sues electricity supplier alleging wrongdoing with fees

During the historic winter storm in Texas, people were stretched thin with their utilities. This also impacted companies that had contracts with outside suppliers. A class-action lawsuit has been filed by a plastics company located in Texas. It says that an Iowa-based electricity supplier made changes to how it charges despite there being a fixed-rate plan for its commercial customers. The fees were based on line-item costs that it provided while the storm was taking place in February.

The energy company services approximately 15,000 customers in Texas and 60,000 overall. The plastics company is a fixed-rate customer. Its financial statement after the storm, however, said that there were line-item charges that the plastics company asserts were unauthorized. It cost almost $54,000 which is around triple the normal bill per month. The energy company provided heat to the plastics company’s facility to keep pipes from freezing. The plant was not in operation at the time. The plastics company is expecting other companies who were overcharged to join its lawsuit. The violations include breach of contract and deceptive trade practices.

Business litigation over contract issues requires professional advice

Companies need cost certainty, especially during times of trouble. If a business it is involved with tries to circumvent or outright violate the terms of a contract, commercial litigation to deal with contract disputes might be needed. On the other side of this case, the energy company might have a legitimate response as to why its costs were assessed in this way. For every company regardless of its perspective, it is important to have professional guidance. This can help with settling the dispute out of court or achieving a successful resolution through litigation.