Con Ed’s Kangaroo Court: How a Private Company and Our Public Courts Put Consumers in the Hot Seat
Illustrations by Raul Aria
The Brooklyn civil courthouse on Livingston Street is dead quiet at 2 p.m. on a Friday afternoon in mid-March. The cops near the entrance usher people wanly through the metal detectors, but you can tell their hearts aren't in it. The jury room on the third floor has cleared out, empty but for the hum of the vending machine.
Room 306, just down the hall, is bustling by comparison. Five people sit glumly on wooden benches, in what looks like a typical courtroom. Peter Cole is there, wearing neat dreadlocks, thumbing at his phone.
Cole, who lives in Midwood, was there to respond to a lawsuit, he said. He'd lost his job as an administrator at a technology company not too long ago. Money got tight and something had to give, he says. It was a matter of priorities — rent, food, or electricity. He chose rent and food.
After missing a number of payments, and racking up significant debt, Cole began to receive a series of increasingly stern letters from Con Edison, but he simply couldn't pay. And that's how he ended up here, in a nearly deserted courthouse. Now the company was trying to seize his electrical meter, the last step in the process of shutting off his power completely. It's a fairly common procedure, but one that requires a judge's approval.
"They sent me a summons to show up this day and answer to it," he later told the Voice. "So I showed up." He smiled and shrugged. He wasn't in bad spirits, considering. He was hoping the judge would work something out.
Unfortunately, as Cole would learn momentarily, he had gotten the wrong impression about a few things. That summons, for example, folded on his lap, wasn't actually a summons. And the courtroom he was sitting in was not a courtroom. Not really; at least, not today.
Not that you could tell that just by looking. There's certainly nothing un-court-like about Room 306 itself: There's an elevated bench at the far wall, where the judge would sit, two small tables for the attorneys, and a space for spectators. Standard stuff. The only unusual thing about the scene was that on this March day, all those seats were empty.
As Cole would soon discover, he was not going to see a judge in Room 306. Rather, he'd be facing a pair of Con Ed representatives, employees of a private company, in a small adjoining room. Their goal? To get customers like Cole to strike a deal.
In fact, Cole was not participating in a hearing at all. It was a private negotiation, carried out by a private company and held in a public courthouse. Call it the court of Con Edison.
"I walk in there and I see everything set up like a court. I say, 'OK, I'm gonna see a judge,' " Cole laughs later. "But that didn't happen."
Sheryl Parker, whose Con Ed nightmare lasted years, at her home in Canarsie
It's easy to understand why Cole would be confused. Who expects to be ambushed by a private company in a public courthouse? And besides, the notice he received looked exactly like a civil complaint sheet; he was listed as a "defendant" in the case, and Con Ed was listed as the "plaintiff." The formatting was the same as on a court document. It even included an index number, for filing purposes.
"You will be required to be present at the hearing," the notice read. "You have the right to be represented by an attorney" and "the right to a hearing before a judge." The notice failed to mention, however, that neither of those things would be available when he arrived.
But this was no fluke. The two Con Ed employees in Room 306 that day were not rogue interlopers, squatting in a public courthouse. Con Ed Court is a fixture of the place, and similar proceedings are held every week all over the city, with the full knowledge and consent of the Office of Court Administration (OCA), the agency that oversees the court system. Two hundred and eighty-four such meetings were held in February alone, according to a Con Ed spokesperson. A spokesperson for the court said they've been happening for decades.
Advocates for low-income utility customers say the setup is a perversion of the legal system, designed to dupe customers. By sending out what amounts to mock court papers — accurate down to their utilitarian font — and luring customers into an actual courtroom, the company, they insist, is using the imprimatur of the legal system to pressure consumers into giving up their rights. All with the blessing of the courts.
Robert McGee, a spokesman for Con Ed, said that none of the company's "voluntary" meetings were designed to deceive customers and that customers always have a right to see a judge if they wish. (While he initially offered to arrange a phone interview with Con Ed attorneys to discuss this story, McGee later agreed only to answer inquiries via email.)
In response to detailed questions, McGee insisted those letters that look so remarkably like court papers were perfectly clear. "This notice advises the customer of their rights to go to court and either participate in a voluntary conference with us, or if they do not wish to do so, to see the judge," McGee wrote. McGee also said the documents the company sends out are "prepared according to the directives of the court." Lucian Chalfen, the OCA spokesperson, agreed. While noting that the documents are sent out by Con Ed, he insisted that the notices are, in fact, legal documents. They just refer to a hearing that is in fact a "voluntary conference."
The notice does indicate, on the second page, buried in dense legalese, that recipients have the option of a voluntary conference with Con Ed representatives. There are also three paper signs in the room — one taped to the door and two more inside — informing customers that they're involved in a voluntary proceeding and that the Con Ed reps do not represent the court.
Chalfen says the court is fully aware of Con Ed's tribunals. "Basically, the purpose of it is to resolve the issue before it goes into the court system.... Like anybody," Chalfen says of Con Ed, "they'd rather be paid than see some kind of court action."
As a sign on the door of Room 306 says, Con Ed "is being permitted to use this room as a courtesy." Courteous indeed.
The interior of Room 306 at the Brooklyn courthouse on Livingston Street
Alfred Fuente first heard about the strange world of Con Ed's private tribunals when he worked for the New York Legal Assistance Group (NYLAG), a nonprofit that provides free assistance to low-income customers for civil matters. (In contrast to criminal procedures, parties in civil suits are not guaranteed legal assistance, so nonprofits like NYLAG help fill that gap.)
Fuente, who is now in private practice, says that when he first became aware of what was going on in Room 306, he couldn't believe it. "Con Ed is kind of cloaking itself in the powers of the court," he says. "It's an abuse of power. And a failure, really, on the part of the courts."
A couple years ago, Fuente started trying to gather information about exactly what was happening in Room 306 — and, more specifically, how it could possibly be happening. Others at NYLAG have been doing the same, and now they're trying to get the word out.
Everyone is entitled to their day in court, Fuente points out. Not just because a raft of regulations guarantee access to utility services and set up a rigorous due process before a shutoff can occur, but also because customers may have a legitimate dispute with Con Ed. And when customers get hoodwinked into showing up to a negotiation, especially a sham court proceeding with an official gloss, they're at an inherent disadvantage. "If you're just going to have a 'friendly, voluntary conference,' " he asks, "then why does that even have to take place at the courthouse?"
What if a customer wants to dispute a bill? What if the company has made a mistake but won't budge voluntarily? "You're railroading [customers] into handing over money that they may not even owe," Fuente says.
Kevin Thomas, a staff attorney with NYLAG, has witnessed the process in the Bronx, where meetings take place in what he describes as a "closet" adjacent to a courtroom. "It's a kangaroo court," Thomas agrees. "The defendants that come up there believe they [the Con Ed representatives] are part of the court."
"Look," Fuente says, "it's a racket. There's no other way to say it."
Both the OCA and Con Ed acknowledge that the purpose of these conferences is to keep cases from going before a judge, and according to the company, the vast majority of them end with a repayment agreement. There's one upside to that: New York's courts are bursting at the seams, and if everybody leaves happy, that means there's one less case on the docket.
But it seems likely that in a system so heavily weighted in Con Ed's favor, the fact that almost everyone agrees to a deal might reflect an uneven balance of power. They might be agreeing to a deal that waives some of the protections they're entitled to under law. Cole, for example, didn't dispute that he owed the company, and his conference ended with a plan to repay the money in installments. East New York resident Keisha Witherspoon, another Room 306 attendee who spoke with the Voice about her experience, also struck a deal.
Both Cole and Witherspoon thought their arrangements were fair, though both might have had better outcomes if their cases had been overseen by a neutral party. Witherspoon, for example, likely could have paid less under the law. The Home Energy Fair Practices Act (HEFPA) caps monthly repayment installments at 10 percent of the amount owed, or 50 percent of the average monthly bill, whichever is higher. Witherspoon agreed to pay $400 per month against a debt of $1,100 — nearly four times more than the law might have required.
And that, of course, is the point. Ensuring that customers are informed of their rights is the reason judges are supposed to oversee cases like these in the first place.
"By and large, most New Yorkers, particularly in the low- and fixed-income community, don't know that they have rights conferred by law with regard to their relation to the utility," says Richard Berkley, director of the New York Public Utility Law Project, an advocacy group for low-income ratepayers. And he's right: Who among us can rattle off the specifics of HEFPA? "When it looks like the government is calling you in, and you go into a courtroom, in a court building, there's a tendency to believe that the company is operating under the color of law."
Garth Walcott has been involved in a dispute with Con Ed since 2008.
Even the language Con Ed uses seems designed to invoke jurisprudential authority. Cole's meeting ended when a Con Ed representative told him the case would be "adjourned" for a month, he said, after which they'd meet again. Fuente has heard that term, too. "What is there to adjourn?" he scoffs. "It's not a hearing!" When we were done with our interview, he suggested, would we "adjourn" that too?
That "adjourn" doesn't seem to be a slip of the tongue, either. McGee, the Con Ed spokesman, also used the term "adjournments." Fuente says the goal is obvious: to sow confusion.
Sheryl Parker is an example of someone who, with Fuente's help, did finally see a judge. But it was only after a saga with Con Ed that paints a pretty scary picture.
When Hurricane Sandy swept through Parker's working-class condo complex in Canarsie, waist-deep water covered the place, which is tucked into a corner of shoreline near where Fresh Creek meets Jamaica Bay; cars were inundated, there was mud everywhere, trees were toppled. The complex, with more than two hundred units, spent twelve days with no power. The units, heated by electricity only, became nearly uninhabitable.
"People were using candles," Parker remembers. Some residents simply left. "You just felt kind of forgotten," adds a neighbor, Katherine Soverall.
When the water receded, it turned out that all the electrical meters had been fried, leaving Con Ed no way to gauge how much energy Parker was using. Con Ed began estimating Parker's usage, as the company often does when meters can't be accessed by Con Ed employees. That wasn't the problem. The problem was that to Parker, the estimates seemed wildly off the mark, recalculated seemingly at random. According to court papers filed later, "over a one-month period in April 2014, Parker's electric bill fluctuated from $1,965.49 to $0 to $1,104.98 to $2,960.68."
When Fuente tried to clear the bill problems up — first by negotiating with Con Ed — he kept getting varying estimates on the amount owed. According to court documents he filed in the case, calls made to the company went unreturned, and no one at Con Ed seemed to be able to produce any coherent records.
"It went from something that could be quickly resolved to 'This is unbelievable,' " Fuente says. It was only after he filed a detailed brief challenging Con Ed's practices, arguing that they were violating his client's constitutional right to due process, that the company backed off.
If Fuente hadn't been with her, Parker says, she thinks she probably would have agreed to a payment plan like most people do. And Fuente suspects that the only reason Con Ed called off the dogs was to avoid a ruling that might have exposed its kangaroo court strategy. Without an attorney on their side, what chance do most customers have?
And there's another huge problem with all this, Fuente points out. Even if you assume that people can eventually get in front of a judge when they really need to, given enough time and persistence, why would you, as a party to a lawsuit, believe you have an equal chance to be heard when the courtroom has been literally occupied by your adversary? With Con Ed getting the run of the place, setting up a storefront in the halls of justice themselves, "the court immediately loses any sense of impartiality," Fuente says. "Rather than being a forum for two competing parties, it's siding immediately with one party."
After five or six meetings with Con Ed representatives over the past few years — at this point he's lost count — Garth Walcott was fed up by the time he arrived at the Bronx courthouse two Thursdays back. So he walked into the meeting room and told them as much.
"I sat there and I said, 'I have no intention of meeting with you,' " Walcott says. This time would be different. This time, he insisted on seeing a judge.
Walcott is not new to this game. Since 2008, he's been fighting Con Ed over how the company calculates his electrical rates. Con Ed says he should be charged a commercial rate, because Walcott, a middle-class employee at a local community college, rents out the top floor of his home in Williamsbridge.
The apartment at issue, however, the one where he lives with his wife and young son, is his own residence. So he doesn't think a commercial rate should apply.
Walcott may or may not be right about that. But while he's tried, unsuccessfully, to mediate his dispute with the company, he's never had an impartial arbiter deal with his case directly until the day he spoke to the Voice. Every time he's met with Con Ed reps in the past, he says, he's established some kind of payment plan out of sight of a judge. He's wanted a hearing before, but he always took the path of least resistance.
"I kind of made partial payments just so it didn't get out of control, with the hope that it can be resolved," Walcott says.
For Walcott, it's not about the money. He can pay the past-due fees — a little over $4,000. He just doesn't believe he should have to pay a higher commercial rate for the rest of his life. In other words, he thinks Con Ed is wrong, and they think he's wrong — exactly the kind of impasse the courts are designed to resolve.
Walcott got his day in court. He got in front of the judge. But he doesn't exactly feel touched by the hand of justice.
According to Walcott, who describes all of this with the bemused grin of someone who can't quite believe what he's saying, Judge Paul Alpert seemed to signal from the start that he was leaning Con Ed's way. "The judge said, basically, 'I hope you have the money set aside,' " Walcott remembers. That was before the proceeding even began, he adds. "And I said, 'There's a possibility I might not owe anything, because I've been overcharged for years.' "
The judge didn't seem interested, Walcott says, and ruled against him within minutes. The matter concluded with Alpert signing an order authorizing the City Marshal to "break open, enter, and search" Walcott's home, at Con Ed's request, for the purposes of seizing his meters. It can be executed at any time.
After what he's seen, after all those meetings, after coming face to face with a Con Ed quite comfortably ensconced in the court system itself, Walcott finds it hard to believe the judge was impartial. The attorney representing Con Ed — at least Walcott thinks he was an attorney — was the same person who normally sits in the side room a few feet away, holding "conferences" and then "adjourning" them.
"His office is right next to the judge's chamber," Walcott says. "I don't get that. I really don't get that." Of course the judge is going to be more sympathetic to someone with whom he effectively shares a workspace, he says. "As humans, we are biased — that's just human nature. You're working next door to the person. I don't find that very fair."
While he was in court on Thursday, Walcott was approached by Thomas, the attorney with NYLAG, who offered some assistance. He hopes he'll be able to challenge the order.
But as of right now, Walcott says, "they're going to seize my meter." So he's waiting for a knock on the door.
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