Texas Supreme Court Sidesteps Grid Manager Immunity -- For Now
(Bloomberg) -- The Texas Supreme Court, in a closely divided decision, ruled Friday that the state’s power-grid manager has legal immunity that may shield it from billions of dollars in blackout-related claims.
The all-Republican high court split 5 to 4, with the majority deciding that a legal technicality prevented it from weighing in on the Electric Reliability Council of Texas’s claim to governmental immunity in a case that predated the February disaster. As a result, a lower court ruling granting government immunity to Ercot stands for now.
Four justices – including the chief justice - pushed back strongly, with dissenting opinions that said the public uproar over Ercot’s role in power outages that impacted millions of people last month demanded a clear decision from the high court on the immunity issue.
“The parties want to know. The public wants to know. The Court refuses to answer,” Chief Justice Nathan Hecht wrote. He said the court will face the same question again a year or two from now, as the same case circles back and fresh challenges related to the February calamity also rise through the court system.
The Texas high court decision largely ignores recent filings by some of the state’s largest counties begging for Ercot to be left exposed to blackout-related claims.
“Let those who have suffered bring and prove their case,” said Harris County Attorney Christian Menefee. “Simply being regulated and serving a public purpose is not enough to confer immunity – many private businesses do just that.”
Ercot is a private entity that receives no taxpayer funds and is managed by “an industry-centric board of directors,” Menefee said, and as such doesn’t deserve the same shield from private lawsuits that state-funded agencies get.
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