8-KOther Events

CENTERPOINT ENERGY INC 8-K Report, Corporate Update (Apr 3, 2006)

Filed April 3, 2006For Securities:CNP

Summary

CenterPoint Energy, Inc. (CNP) announced a significant development regarding a class action lawsuit against its subsidiary, CenterPoint Energy Resources Corp. (CERC). On March 28, 2006, the federal district court in Minnesota granted preliminary approval to a $13.5 million settlement aimed at resolving claims that CERC's Minnesota Gas division allegedly violated the Minnesota Cold Weather Rule. This settlement, if finally approved by the court and the Minnesota Public Utilities Commission, would put an end to all current and potential claims from residential natural gas customers involved in the class action, as well as related claims by the Minnesota Attorney General concerning the division's past conduct.

Key Highlights

  • 1Preliminary approval granted for a $13.5 million settlement by CERC.
  • 2Settlement resolves claims related to violations of the Minnesota Cold Weather Rule by CERC's Minnesota Gas division.
  • 3The settlement class includes residential natural gas customers.
  • 4The Minnesota Attorney General's claims regarding the Cold Weather Rule are also addressed.
  • 5CERC had already established a litigation reserve in Q4 2005 for anticipated settlement costs.
  • 6Final court and regulatory approval (Minnesota Public Utilities Commission) are still required.

Frequently Asked Questions

The main event is the preliminary approval by a federal district court in Minnesota for a $13.5 million settlement by CenterPoint Energy Resources Corp. (CERC), a subsidiary of CenterPoint Energy, Inc., to resolve claims of violating the Minnesota Cold Weather Rule.

The settlement involves CERC, its Minnesota Gas division, residential natural gas customers who are part of a class action lawsuit, and the Minnesota Attorney General. The settlement aims to resolve claims brought by all three parties.

The settlement requires final approval from the federal district court in Minnesota and also needs to be approved by the Minnesota Public Utilities Commission. Until both approvals are obtained, the settlement is not fully resolved.

Yes, CERC established a litigation reserve during the fourth quarter of 2005 to cover its anticipated settlement costs related to this matter.