Summary
Xcel Energy Inc. (XEL) has filed an 8-K report on March 7, 2003, disclosing a significant lawsuit filed against it. On February 26, 2003, Fortistar Capital, Inc. and Fortistar Methane, LLC initiated legal action in the Federal District Court for the Northern District of New York. The lawsuit names Xcel Energy and five former employees of its subsidiaries, NRG Energy, Inc. and NEO Corporation, as defendants. Fortistar alleges violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) and claims of fraud. Specifically, the plaintiffs assert that the defendants engaged in a pattern of entering into agreements with the intent not to comply and made false statements to cover up these alleged fraudulent promises. The allegations against Xcel Energy primarily concern activities related to the Pike Energy power facility contract in Mississippi and statements about an "equity infusion" into NRG. Xcel Energy maintains that these allegations are baseless and the lawsuit lacks merit.
Key Highlights
- 1Xcel Energy Inc. is facing a lawsuit filed by Fortistar Capital, Inc. and Fortistar Methane, LLC.
- 2The lawsuit was filed on February 26, 2003, in the Federal District Court for the Northern District of New York.
- 3Xcel Energy and five former employees of its subsidiaries (NRG Energy and NEO Corporation) are named as defendants.
- 4Allegations include violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) and fraud.
- 5The core of the complaint involves claims of entering into agreements with no intention to comply and subsequent false statements to conceal fraud.
- 6Xcel Energy's involvement is primarily linked to the Pike Energy power facility contract and an alleged "equity infusion" into NRG.
- 7Xcel Energy strongly denies the allegations, believing the lawsuit to be unfounded and without merit.