Four Firms Settle State Gas Suit

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In a case left over from the California energy crisis, four companies have agreed to pay ratepayers a combined $67.4 million over allegations of manipulating natural gas prices, the Sacramento Bee reports.


The settlement stems from a class-action lawsuit over allegations that the four companies boosted gas prices by reporting false data to trade publications and engaging in “wash trades.”


In wash trades, the same volume of natural gas is bought and sold simultaneously at identical prices. The idea is that the flurry of activity will create the appearance of greater demand, putting upward pressure on prices.


The proceeds will be combined with an earlier settlement of $92.1 million, for a total payout of $159.5 million. The dollars will be refunded to California consumers in the form of rate relief, credits or rebates, probably sometime later this year, plaintiffs’ attorney Barry Himmelstein said Wednesday. The payout will have to be approved first by the Public Utilities Commission.


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