Cleveland attorney Jack Landskroner won a $44 million class action lawsuit settlement in August 2015 on behalf of customers of the Los Angeles Department of Water and Power who were overbilled.
Landskroner, a consumer rights attorney who investigated similar billing problems in Cleveland, called the deal a “home run” for customers in Los Angeles.
“This settlement with the utility in Los Angeles will guarantee 100 percent recovery for any customer who was overbilled by the department,” Landskroner said. “This type of deal is a home run for ratepayers, including families and small businesses that were hurt by the failed computer system.”
According to the lawsuit, which was filed in April 2015, customers were overbilled in part because of a faulty billing system rolled out in September 2013.
Landskroner was familiar with the problems in Los Angeles because his office received billing horror stories from people in Cleveland back in 2009. That was shortly after PricewaterhouseCoopers installed a new $20 million customer care and billing system.
While Landskroner was investigating the problems, the city of Cleveland corrected the billing system and helped the customers who had complained to the attorney.
Landskroner subsequently learned that Los Angeles faced similar huge billing errors connected with the same botched system installed by PricewaterhouseCoopers. The city of Los Angeles filed a lawsuit against PricewaterhouseCoopers in March 2015, claiming hundreds of millions of dollars in damages related to the problematic billing system. The Department of Water and Power said it billed $44 million in excess charges after the system was implemented. Officials said some of that money was credited or refunded, which reduced the sum owed to customers to $36 million.
Viewing the lawsuit as an admission by the city of Los Angeles that customers were harmed, Landskroner filed suit on behalf of one of several customers who were overbilled.
As a result of Landskroner’s efforts, the city of Los Angeles agreed to a reform plan. Every customer who was overbilled will receive credit or a refund. The city also will hire a consultant to monitor compliance and agreed to improve customer service and limit its ability to collect on bills not sent in a timely manner.
According to a Los Angeles Times article, the proposed settlement negotiated with Landskroner could resolve all of the claims against the Water and Power agency, which has faced four different Superior Court lawsuits from L.A. residents.
According to Landskroner, the DWP will have to audit 1.6 million customer accounts and spend $20 million to overhaul the billing system, among other reforms.
If the agency fails to pursue the reforms, Landskroner can bring the case back to the judge to ensure compliance.
A decision on preliminary approval of the settlement is expected to be made in September.