By Dave Anderson
The Energy and Policy Institute

The judge in Energy Harbor’s bankruptcy case has hit the brakes on approving millions of dollars in fees and expenses for the utility’s outside law firms and consultants after learning of the federal racketeering case against former Ohio House Speaker Larry Householder.

Judge Alan Koschik said he’d been prepared to approve remaining interim fees and expenses for nineteen firms at the July 21 court hearing, according to a transcript reviewed by the Energy and Policy Institute.

The judge had also been prepared to grant allowances for the total final fees and expenses incurred by the firms over the course of the multi-year bankruptcy case, much of which have already been paid for, including nearly $68 million for the utility’s bankruptcy counsel and lobbying firm Akin Gump Strauss Hauer & Feld, and $2.4 million for the public relations firm Sitrick & Company.

Energy Harbor is the new name for the company formerly known as FirstEnergy Solutions (FES), which had been a subsidiary of FirstEnergy Corp. until it emerged from bankruptcy at the end of February. Both Akin Gump and Sitrick & Company were involved in last year’s successful campaign by FES to pass House Bill 6. The new law benefits Energy Harbor by providing long sought subsidies to the Davis-Besse and Perry nuclear plants, and what environmentalists call a “stealth bailout” of the coal-fired Sammis power plant, as well as rolling back Ohio’s renewable energy and energy efficiency standards for electric utilities.

Instead of approving the fees and expenses, Koschick read aloud excerpts from a article by Jeremy Pelzer, with the headline “House Speaker Larry Householder arrested in $60 million bribery case related to HB6 nuclear bailout,” that was handed to him shortly before the hearing began.

“The investigation centers on House Bill 6, the one billion dollar plus rate payer bailout of two Ohio nuclear power plants owned by FirstEnergy Solutions, now Energy Harbor, that Householder helped push through last year, with the help of millions in dark money, according to the Toledo Blade,” he read.

“Former Ohio Republican Party Chair turned consultant, Matt Borges, prominent lobbyist, Neil Clark, FirstEnergy Solutions lobbyist Juan Cespedes and Householder aid Jeff Longstreth, all are currently in custody, according to a source,” he continued.

All five men have since been indicted on racketeering charges, along with a secretive group called Generation Now that spent millions of dollars in support of HB 6 last year. The racketeering case also implicates a broader political network that includes FirstEnergy Corp., Energy Harbor, AEP, Murray Energy, the CEO of Boich Companies, and a host of political consultants and murky entities, though none have currently been named by federal investigators or charged with crimes outside the five indicted and Generation Now.

Koschick announced at the hearing “that this may not be the right day to finally approve fees and expenses relating to what was the FirstEnergy Solutions case, now Energy Harbor.”

The judge set a new hearing on the matter for Aug. 18.

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