L.A. County, 11 Other Parties Settle Claims Against Sempra

Los Angeles County and 11 other plaintiffs in a massive class-action lawsuit against Sempra Energy have agreed to settle for an undisclosed amount.

The trial against Southern California Gas Co., San Diego Gas & Electric Co. and their parent company, Sempra Energy, began last week and will continue despite the settlement with some of the plaintiffs. The utilities are accused of trying to manipulate the deregulated energy market, contributing to California’s 2000-01 power crisis.

Sempra executives said they were happy to reach agreement with some of the plaintiffs.

“Our companies are pleased to have reached a mutually agreeable settlement for a fraction of these particular plaintiffs’ claims,” Javade Chaudhri, executive vice president and general counsel of Sempra Energy, said in a statement issued late Saturday. “The allegations involved in this case are simply false, and, as part of this agreement, Sempra and our affiliate companies deny any wrongdoing.”

In addition to Los Angeles County, the plaintiffs included in the settlement are the cities of Burbank, Culver City, Glendale, Upland and Vernon; San Bernardino County; Edgington Oil Co.; the Imperial Irrigation District; World Oil Corp.; DeMenno-Kerdoon and Lunday-Thagard Co.

Among the remaining plaintiffs are Compton-based Continental Forge Co., which makes precision aluminum parts, and the cities of Los Angeles and Long Beach.

The lawsuit claims that 11 executives of the two Sempra utilities and El Paso Corp. hatched a conspiracy in 1996 at a Phoenix hotel to limit natural gas supply and stifle competition in California, fueling wild electricity price hikes that struck the state four years later.

Under state law, the nearly $8 billion in damages alleged by consumer plaintiffs would triple to about $23 billion if Sempra loses.