Texas power supplier cites breach of contract by insurer in lawsuit

An electric company claims Hartford Underwriters left it in the cold over lawsuits following Winter Storm Uri.

White Powder Snow during winter storm Uri over a foot of fresh snow in Round Rock north of Austin , Texas , USA. (Credit: Roschetzky Photography/Shutterstock.com)

When an extreme weather event hit much of the country in February 2021, it unleashed record-breaking temperatures, high winds and ice across much of Texas, causing major power outages as the demand for heat increased across the state.

In the ongoing multidistrict litigation brought on by Winter Storm Uri, a Texas electric power company is attempting to prove breach of contract by Hartford Underwriters Insurance Co. for refusing to represent it in wrongful death lawsuits.

Reed Smith, the law firm for Golden Spread Electric Cooperative, expects to show the court that the insurer failed to act according to the terms of the policy, according to a complaint filed in the U.S. District Court for the Southern District of Texas, Galveston Division.

Golden Spread Electric, a nonprofit corporation in Amarillo, provides electric power to 16-member cooperatives.

Alleged negligence

On April 26, 2021, the family of Terrill Turner, deceased, sued Golden Spread Electric and other electricity providers in the 164th District Court of Harris County.

The lawsuit, styled Turner v. NRG Texas Power, alleges the plaintiffs, Brazoria County residents, suffered loss of life, sustained injuries and property damage during the February 2021 storm, because the defendants negligently failed to prepare for a “worst-case-scenario” storm by sufficiently weatherizing facilities.

On Jan. 21, 2022, the family of Anne Louise Martin, deceased, amended a lawsuit originally brought against the Electric Reliability Council of Texas and CenterPoint Energy to include Golden Spread Electric.

The Martin action, Martin v. Electric Reliability Council of Texas, similarly blamed the electric company for its negligence in preparing for a storm such as Uri.

On July 7, the Winter Storm Uri Multidistrict Litigation Panel, which was created two months before, designated the 281st District Court of Harris County as the MDL Pretrial Court for cases alleging wrongful conduct by the Electric Reliability Council of Texas and power generator defendants that caused property damage and bodily injury.

The Martin and Turner lawsuits were transferred to In re Winter Storm Uri Litigation.

‘Hartford wrongfully denied all coverage’

The plaintiff adds in its complaint that it has been named in a number of additional lawsuits being consolidated into the MDL, and anticipates still more lawsuits that will assert similar allegations.

Golden Spread Electric alleges it timely reported the Turner action, but on June 17, “Hartford wrongfully denied all coverage obligations.”

The lawsuit, Golden Spread Electric Cooperative v. Hartford Underwriters Insurance, states that, “As a result of Hartford’s wrongful denial of its contractual obligation to defend Golden Spread Electric in the Turner Action, Golden Spread Electric has incurred, and will continue to incur, substantial defense costs defending itself in the Turner Action,” the complaint states.

Golden Spread Electric seeks a declaration and order from the court, finding Hartford obligated to defend the company in all suits that have been, or in the future will be, consolidated in the Winter Storm Uri MDL.

As of Feb. 23, Hartford had not responded to the complaint.

However, on Feb. 22, U.S. Magistrate Judge Andrew M. Edison ordered that a videoconference be held on June 1 for the disclosure of interested parties, and to discuss joint discovery and a case management plan.

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