ComEd Customers Sue Electric Company, Madigan For $450 Million

ILLINOIS — A group of Commonwealth Edison customers on Monday filed suit against the electric company and Illinois House Speaker Michael Madigan in federal court for an alleged bribery scheme that attorneys say defrauded nearly 9 million Illinoisans.

Last month, federal prosecutors charged ComEd with one count of bribery, and ComEd agreed to pay $200 million in restitution and cooperate with investigators as part of a deferred prosecution agreement.

The agreement stipulates that ComEd cannot pass the fine along to customers, but does not recover any money for customers that may have been harmed by the alleged scheme. The agreement also does not protect ComEd from civil lawsuits.

"We filed our civil RICO case now to protect Illinois ratepayers from further damage by Michael Madigan — in both his capacity as Speaker and as Chair of the Democratic Party of Illinois — and also to get our clients back the damages they have suffered from ComEd's and Madigan's bribery scheme," said Stuart Chanen, one of the attorneys who filed the suit.

RELATED: ComEd Bribed Illinois House Speaker Mike Madigan, Prosecutors Say

Prosecutors say ComEd admitted to influencing and rewarding Madigan, beginning in 2011 and continuing through 2019, arranging jobs for political allies that included little or no work, appointing an individual to ComEd's board at Madigan's request, steering company contracts to a law firm associated with Madigan, and even granting internships to students from Madigan's ward in Chicago.

Meanwhile, Madigan passed legislation that favored ComEd and opposed legislation that would have hurt the company's bottom line, prosecutors said.

ComEd, which serves about 70 percent of Illinois households, made more than $150 million from the arrangement, prosecutors alleged. The class action suit argues that money largely came from the company's customers.

For example, according to the suit, Madigan shepherded a 2011 bill drafted largely by ComEd lobbyists through the legislature. The bill allowed ComEd to bypass the regulatory process and charge customers higher rates. As a result, electricity prices have risen by about 35 percent since 2011, the suit claims. Then Illinois Gov. Patrick Quinn vetoed the bill, calling it a "sweetheart deal for big utilities," but Madigan led a successful effort to override his veto, and the Energy Infrastructure Modernization Act became law in October of that year.

And, in 2017, the suit claims Madigan pushed an energy subsidy disguised as an environmental bill through the legislature.

"The purported purposes of (the Future Energy Jobs Act) were many," the suit says. "Sometimes the General Assembly asserted that the purpose was 'environmental' and at other times asserted its purpose was to 'save jobs' and 'preserve local tax revenue.' The primary purpose of FEJA, however, was to require Illinois consumers to provide massive subsidies to two nuclear power plants known as Quad Cities and Clinton."

As a result of the bill, ComEd began collecting a zero emission credit fee, leading to another 4 percent rate hike on customers, the suit claims.

Among those suing ComEd are Anne Potter, of Morton Grove, Got It Maid, a Highland Park home cleaning company, Robert Dillon, of Highland Park, Robin Hawkins, of Chicago, Denise Yarborough, of Vicksburg, Mississippi (formerly Chicago), and Raymond Simpson, of Chicago. All were ComEd customers, according to the suit, and are represented by Stuart Chanen and Ariel Olstein, of Lincolnwood's Chanan & Olstein law firm, Patrick Giordano of Evanston-based Giordano & Associates, and Paul Neilan of the Law Offices of Paul G. Neilan in Highland Park.

In addition to ComEd and Madigan, the suit names as defendants former ComEd executives Anne Pramaggiore, John Hooker and Fidel Marquez, City Club of Chicago President Jay Doherty, and former Chicago Alderman Michael R. Zalewski.

None of the defendants, including Madigan, have yet been charged with a crime.

The suit claims each customer may be owed up to $5,000 and asks for $450 million in damages, including the $150 million in "ill-gotten gains" the company has already agreed to pay to the government, but not including another $50 million assessed by prosecutors as part of a "culpability score" modifying the base fine.

The suit also asks the court to prevent Madigan from participating in legislative activities involving the company or electricity issues, to remove Madigan as chair of the state Democratic Party — which the suit claims he has run as a corrupt organization — and to enjoin ComEd from charging customers zero emission credit fees.

The suit relies heavily on the admissions ComEd agreed to in its agreement with prosecutors, attorney Patrick Giordano said in a news release. He encouraged the company to settle with customers now rather than face a jury trial.

But ComEd challenged that characterization in a statement to The Center Square, a state newswire service.

ComEd Vice President of Communications Paul Elsberg apologized for the company's conduct, but said, "The improper conduct described in the deferred prosecution agreement, however, does not mean that consumers were harmed by the legislation that was passed in Illinois."

Rather, Elsberg claimed the legislation prosecutors allege his company bribed the House Speaker to pass "resulted in substantial benefits for ComEd's customers, including improved reliability since 2012 and billions of dollars in savings."

Elsberg previously asked Patch to clarify that the company's deferred prosecution agreement does not say Madigan passed legislation "in exchange" for bribes. But, since the company has both admitted that it paid the bribes "for the purpose of influencing and rewarding" Madigan, and to benefiting from legislation Madigan passed, Patch has reached out to clarify the company's position.

As part of the company's agreement with prosecutors, ComEd agreed not to make any public statement contradicting its acceptance of responsibility, and it must consult with the government before issuing statements to ensure they are true and accurate.

Patch also sought comment from Madigan's office, but they have not gotten back to us.

RELATED: Pritzker: Madigan 'Must Resign' If Bribery Allegations Are True

All the attorneys taking ComEd to court have previously represented customers in battles with the electricity giant, according to the news release.

"Back then, our clients were the lone wolves crying foul," attorney Paul Neilan said in a statement. "We knew that EIMA was bad for the ratepayers and obliterated any true regulation of ComEd as a utility. We also knew that Speaker Madigan had crammed the legislation through the General Assembly — we just didn't know then that he did so as payback for numerous bribes ComEd had paid to his associates.

"But we know it now."

Read the complaint in full: