Peachtree Files Suit Against AGL
The first of the marketers to bow out of natural gas deregulation in
Georgia is going on the offensive almost a year after the company filed
for bankruptcy. Peachtree Natural Gas which is still in bankruptcy court,
filed a $50 million suit against AGL Resources, Atlanta Gas Light and billing
provider Utilipro in the State Court of Fulton County.
The marketer claims the defendants "have intentionally, maliciously,
and without privilege interfered with existing and prospective contractual
and business relations between Peachtree Natural Gas and its potential
and existing customers."
"It's something we handle in the normal course of our business.
We were not surprised by the suit and we will defend ourselves vigorously
in court on this," said AGL's spokesperson Nick Gold. "We feel
the suit is without merit."
In the filing, Peachtree claims that Utilipro did not carry out its
agreement to provide accurate billing as well as other services. Peachtree
said its customer's bills were often mis-calculated, sent to the wrong
address, or were never sent in the first place, while Utilipro, which is
80% AGL-owned, provided accurate billing and other collection-related services
for customers of AGL Resources' affiliate Georgia Natural Gas.
Peachtree alleges that "AGL, by itself, and in conjunction with
its corporate affiliates, including Atlanta Gas Light and Georgia Natural
Gas, directed and procured many of Utilipro's failures and violations of
its agreements with Peachtree Natural Gas.....to increase Georgia Natural
Gas' market share among natural gas customers in Georgia and, ultimately,
benefit AGL at Peachtree Natural Gas' expense."
Peachtree filed for bankruptcy in October citing "unexpected capital
needs and billing problems." At that time, Deborah Latham, Peachtree's
CEO, pointed toward the Georgia Public Service Commission's (GPSC) requirement
for suppliers to purchase liquefied natural gas supplies from AGL and delays
in billing by Utilipro as the causes for the debt (see NGI, Nov.
As a result, the Georgia bankruptcy court in November named Shell Energy
Services the winning bidder for Peachtree Natural Gas' 170,000 customers.
Shell's $19.3 million offering beat out the only other company involved
in the bidding, Georgia Natural Gas (see NGI, Nov.
Earlier this year, Utilipro, which serves electric and gas suppliers
in California, Georgia, New Jersey, Nevada, and Pennsylvania, said it was
forced to cut staff members and reorganize the company due to deregulation
taking hold too slowly. Utilicorp's CEO Brian Gillespie acknowledged the
problems with Peachtree, but said the situation in Georgia was not a contributing
factor to the reorganization. He said at the time, "Certainly, Peachtree
was a good company, but it had other issues besides our billing that caused
their problems" (see NGI, April 10).
Gold said his company must respond to the suit within 30 days, but added,
"this is just the beginning of this whole process which, as suits
play out, could take years."