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Putative Class Action Alleging Breach of Contract and Deceptive Pricing Practices in Energy Services

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CRA Vice President Dr. Debra Aron advised Bevan, Mosca & Giuditta, P.C., counsel to Agway Energy Services (Agway), and testified at deposition on economic issues related to class certification in litigation in federal court.  Relevant to the case, Agway is an Energy Services Company (ESCO) that provides retail electricity services to residential customers in New York and Pennsylvania.  Plaintiff alleged that Agway breached its contract with consumers and engaged in deceptive practices by charging introductory rates and then switching customers to a monthly variable price that was allegedly higher than the variable rates charged by the competing electric utilities and the competing ESCOs and that was “disconnected” from “true market-based” rates.

Dr. Aron analyzed the market and the relevant regulatory structure to determine if there was evidence that the prices charged were inconsistent with the contractual language and/or inconsistent with competitive market prices.  She collected and analyzed a data set of prices from dozens of competitors by geographic market and quarter, finding that in the significant majority of market quarters, Agway’s prices were below the median despite being the only one of the competitors to offer an acknowledged “value-added” service.

The court has not yet ruled on Plaintiff’s motion for class certification or Defendant’s motion for summary judgment.

Dr. Aron was supported by CRA team Dr. Olga Ukhaneva, Dr. Patricia Anghel, and Peter Hawkins.

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