In re: FirstEnergy Solutions Corp., et al.
No. 18-50757 (Bktcy. N.D. Ohio)

FES Bankruptcy Settlement
** IMPORTANT NOTICE TO CLASS MEMBERS **

The Fairness Hearing (the “Hearing”) in this matter will go forward before the Court as scheduled on May 21, 2020 at 10:00 Eastern Daylight Time, BUT WILL BE HELD TELEPHONICALLY.  Therefore, if you wish to attend the Hearing or wish to seek permission to participate in the Hearing, you must both (a) establish an account IN ADVANCE with Court Solutions LLC (“Court Solutions,” which is the service provider that arranges telephonic hearings for the Court) and (b) dial-in or log-in to the Hearing through Court Solutions at least 15 minutes before the scheduled start of the Call.

There is a fee of approximately $70 to use Court Solutions, and (if you do not already have an active account) you will be required to provide a valid credit card number when you register to use this service.  For additional information about how to register with Court Solutions, and how to use this service to participate in a court hearing, you should go to www.court-solutions.com, and may also call them at (917) 746-7476.  If you are asked for your “law firm name” and are not a lawyer, you should simply enter “pro se” (meaning that you are representing yourself or your company).

If you register and wish to attend/participate, on the day of the call (May 21, 2020), in addition to the log-in credentials that you will receive when yo register with the service, you will also be asked for the following information:

Name of Judge: 
enter “Koschik”
Case No.:
enter “18-50757”
Hearing Date & Time: 
enter “May 21, 2020” (or 5/21/2020) and “10 a.m.”
If you are required to enter a “case name”, please be advised that the original case name (“FirstEnergy Solutions”) has recently been changed, and Court Solutions may now have the case listed under either the name “Energy Harbor” or “Pleasants.”  Accordingly, please be sure to call in at least 15 minutes before the scheduled start of the call to ensure that you have sufficient time to log-in properly.  If you have established a Court Solutions account, you can use the above (917) 746-7476 number to call a Court Solutions representative for assistance in connecting to the Hearing. 

Please note that, as provided in ¶16 of the Court’s December 26, 2019 Preliminary Approval Order and further detailed in the Website Notice (both available on this website), absent good cause shown any person who wishes to object to any aspect of the proposed Settlement, Plan of Allocation, or Professional Fees and Expense Application was required to submit a written objection to the Court and to counsel for the Parties by May 1, 2020.  There can be no assurance that the Court will allow any objector who has not yet filed a written objection or request to appear will be allowed to speak at the Hearing.  If you wish to speak (or have your attorney speak at your own expense) at the hearing, but have not filed an objection or request to appear with the Court, you should contact Class Counsel as soon as possible at wfredericks@scott-scott.com, or leave a message for William Fredericks, Esq., at (212) 634-5613.  

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Settlement Class Members were mailed an Individual Notice letter on March 20, 2020, and are also being advised to view the more detailed “Website Notice” in the 'Documents' section of this website, because, based on information provided by FirstEnergy Solutions Corp. (“FES”,  now known as Energy Harbor LLC), their business is a member of a class of FES business customers that has been certified by the U.S. Bankruptcy Court for the Northern District of Ohio (the “Court”), and because a proposed settlement of the class’s claims is now pending before the Court. 

WHAT CLAIMS ARE AT ISSUE THAT INVOLVE MY BUSINESS?

The Class Representative in this matter, Schwebel Baking Company (“Schwebel”), alleges that FES breached FES’s contracts with its large and mid-size industrial and commercial customers (the “Settlement Class Members”) by “passing through” to those customers certain “Polar Vortex Surcharges” that FES had paid in connection with efforts to ensure a reliable supply of electricity during unusually cold weather conditions in early 2014.   FES (which filed for bankruptcy in 2018) has maintained throughout that it was entirely proper for it to “pass-through” the surcharges at issue, but it has agreed to a proposed class-wide Settlement to avoid the cost of further expensive litigation and to facilitate the implementation of its recently Court-approved Plan of Reorganization.

WHAT DOES THE SETTLEMENT PROVIDE?

Under the Settlement, in exchange for releasing all Polar Vortex Surcharge-related claims, the Settlement Class will receive an Allowed Claim of $12,000,000 in FES’s bankruptcy proceedings.  By contrast, Class Counsel estimate that had Schwebel and the Settlement Class prevailed on all aspects of their breach of contract claims, the Settlement Class would have been entitled to an Allowed Claim of roughly $22,000,000.  However, because the Settlement Fund will initially be funded with equity securities in the reorganized, post-bankruptcy FES which will then have to be sold and converted to cash (after which distribution checks will be sent to eligible Settlement Class Members), it is not possible to know with certainty what the ultimate cash value of the Settlement will be.  The estimated value of the Settlement Fund, based on information from FES’s last Disclosure Statement dated May 30, 2019 (which estimates how much value will be available to distribute to all of FES’s various creditors at the end of the bankruptcy proceedings) is $3.768 million, or 31.4 cents for each dollar of the Class’s $12 million Allowed Claim, before deductions for Settlement-related notice and administration costs and Class Counsel’s application for an award of professional fees and expenses.

WHAT ARE MY OPTIONS? 

To Participate in the Settlement and Be Eligible to Receive a Payment:
To reduce claims administration costs, you will not be required to file an individual claim, submit supporting documentation, or take any other actions for your Company to receive any payment it is entitled to under the Settlement.  Instead, under the proposed Plan of Allocation, each Settlement Class Member will receive a percentage share of the net Settlement fund based on their “Recognized Claim Amount,” which is equal to the total net amount of Polar Vortex Surcharges that it paid to FES.

Your Recognized Claim Amount will not be the same as the payment you will receive under the Settlement; instead, it will be used to determine your percentage pro rata share of the Net Settlement Fund.  Your payment will be determined by dividing (a) your Recognized Claim Amount by (b) the total of all Recognized Claim Amounts of all Settlement Class Members.  To avoid the significant administrative expense involved in paying relatively small claims, distributions will not be made to Settlement Class Members who would otherwise be entitled to receive a distribution of less than $50 (the “Minimum Payment Threshold”).

To Request a Review of your Recognized Claim Amount:
Based on billing records provided by FES, Heffler Claims Group (the “Claims Administrator”) has calculated your Recognized Claim Amount (i.e., the total amount of all Polar Vortex Surcharges that you paid) and reported it to you in your Individual Notice letter.  If you believe that your Recognized Claim Amount is not correct, and that it would be higher if calculated based on information from your records, you must submit a letter by May 11, 2020 (together with copies of supporting documentation) to the Claims Administrator that complies with the requirements of §8 of the Website Notice.

To Object to any Aspect of the Settlement, or to Request Exclusion from the Class:
If your business wishes to object to the proposed Settlement, Plan of Allocation or related Professional Services Fees and Expense Application, it may submit an objection to the Court, and it also has the right to enter an appearance through an attorney (at its own expense).  If your business does not want to be part of the proposed Settlement, the Court will exclude from the Class any member who timely and validly requests exclusion.  Any requests for exclusion must be received by April 21, 2020, and any objections must be received by May 1, 2020, and conform with the requirements set forth in the Website Notice.

THIS IS ONLY A SUMMARY AND SHOULD BE READ IN CONJUNCTION WITH THE WEBSITE NOTICE, WHICH IS AVAILABLE IN THE 'DOCUMENTS' SECTION OF THIS WEBSITE OR BY CALLING 1-833-930-2422.

The Website Notice contains important additional information concerning: (a) the nature of the underlying claims asserted on behalf of the Settlement Class; (b) the definition of the Settlement Class; (c) the defenses asserted by Debtor FES to the claims that were asserted against it; (d) the terms of the Settlement and the proposed Plan of Allocation; (e) estimated notice and administrative costs and Class Counsel’s application for an award of Professional Services Fees and Expenses; (f) each Settlement Class Member’s rights to appear by counsel, to request exclusion from the Settlement Class, to challenge the calculation of its Recognized Claim Amount, and to object to the Settlement, the Plan of Allocation or any Professional Services Fee and Expense Application; (g) the time and manner for exercising the foregoing rights; and (h) the binding effect of the proposed Settlement and proposed class-wide Judgment on Settlement Class Members.

PLEASE NOTE THAT IF YOU WISH TO BE ELIGIBLE TO PARTICIPATE IN THE SETTLEMENT (AND THE COURT APPROVES IT) YOU DO NOT NEED TO TAKE ANY ACTION (SUCH AS FILING A CLAIM FORM) TO RECEIVE WHATEVER PAYMENT YOUR BUSINESS IS ENTITLED TO UNDER THE PROPOSED SETTLEMENT AND PLAN OF ALLOCATION.

Please check this website for details and updates on the timing and format for the Fairness Hearing.  In light of the Coronavirus outbreak and related travel and other restrictions, it is possible that the Fairness Hearing may be held telephonically or by other means, and may also be rescheduled.

Please do not contact the Court with questions, as it will be unable to answer them.  Instead, please review the Website Notice in the 'Documents' section of this website.  You can also call the Claims Administrator, Heffler Claims Group, at 1-833-930-2422, or contact Co-Class Counsel, Scott+Scott Attorneys at Law LLP, at 1-212-223-6444.

This website is authorized by the Court, supervised by counsel and controlled by the Claims Administrator approved by the Court. This is the only authorized website for this case.

For more information please call 1-833-930-2422.

Documents

Please read for a full explanation of the settlement and your options and all applicable timelines.

Contact

Contact us with any inquiries, comments, and/or requests.

Important Dates

  • Individual Notice letters mailed to Settlement Class Members

    Friday, March 20, 2020
    Individual Notice letters were mailed to Settlement Class Members on Friday, March 20, 2020.
  • Exclusion Deadline

    Tuesday, April 21, 2020
    You must complete and mail your request for exclusion so that it is received by the Claims Administrator on or before Tuesday, April 21, 2020.  See §10 of the Website Notice for complete details.
  • Objection Deadline

    Friday, May 1, 2020
    You must mail your objection(s) and/or notice of intent to appear at the Fairness Hearing so that it/they are received or served no later than Friday, May 1, 2020.  See §14 of the Website Notice for complete details.
  • Request Review of Your "Recognized Claim Amount"

    Monday, May 11, 2020
    You must submit Your letter requesting review of Your Recognized Claim Amount to the Claims Administrator no later than Monday, May 11, 2020.  See §8 of the Website Notice for complete details.
  • Fairness Hearing Date

    Thursday, May 21, 2020
    The Fairness Hearing is scheduled for Thursday, May 21, 2020 at 10:00 a.m., ET.   See §16 of the Website Notice for complete details and check this website for updates.

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