Former Cobb EMC chief re-indicted on theft, racketeering

By Kristi E. Swartz and Janel Davis

The Atlanta Journal-Constitution

Former Cobb EMC chief executive Dwight Brown was again indicted by a Cobb County grand jury Thursday afternoon, this time with four new counts of intimidating witnesses, going along with 31 previous counts of racketeering and theft originally filed back in January.

Brown is alleged to have influenced and threatened witnesses, all of them Cobb EMC customers who sued the co-op in the 2007 for creating a for-profit business and siphoning co-op assets to it. After that case was settled, Brown and the EMC board filed a lawsuit against the customers and one of their attorneys seeking damages and attorneys’ fees.

“It certainly confirms our belief that when the EMC filed suit against my client, it was for the sole purpose of intimidation and precluding them from performing their role as representatives of the EMC,” said Pitts Carr, attorney for the suing customers.

The other 31 counts included in Thursday’s charges mirror those from the January indictment that accused Brown of stealing millions from the customer-owned cooperative and its customers, and of making false statements to customers in order to conceal the thefts.

This marks yet another shift in a legal saga for Brown, who had led the Marietta-based electric cooperative since 1993. Brown's first indictment capped a two-year criminal investigation of EMC that provides power to about 200,000 customers.

That indictment was later thrown out on a technicality. Brown resigned in February as part of a settlement agreement between the co-op and customers. Since February, Brown has worked as a consultant for the co-op, a move that has further angered some employees and customers.

Chip Nelson, the co-op's chief operating officer since 2004, has been the company’s interim CEO.

Brown’s lawyer, former Gov. Roy Barnes, was still reviewing the indictment and had no comment.

Brown's re-indictment comes one day after rumors began to surface that longtime Georgia utility regulator Stan Wise was being courted to lead Cobb EMC, as originally reported in the Marietta Daily Journal. Wise, a Marietta resident and long-time friend of Brown's, would not confirm Thursday whether he was a candidate for the position. EMC spokesman Sam Kelly said he was unaware of whether Wise was a candidate.

Wise did not return phone calls but issued a statement late Thursday morning.

“The next CEO, whomever that may be, needs to start the healing process and move this EMC forward with some reforms," he said. "The co-op needs a plan for open and legitimate board elections and better communication and interaction with member-owners."

Calls to the 10 members of the Cobb EMC board, responsible for choosing Brown’s replacement, were not immediately returned. Kelly was also unaware of any planned board meetings to discuss Wise as a candidate.

Wise, a former Cobb County commissioner and insurance salesman, was first elected to the PSC in 1994. His current term ends in 2012. Commissioners serve six years and earn $116,452 annually.

Consumer advocates have said Wise has close ties with the natural gas, electric and telephone companies that the agency regulates. His campaign contributions include donations from executives, board members or entities related to Cobb EMC and Cobb Energy, as well as from AT&T, AGL Resources and SCANA Energy.

Wise has also been criticized for voting to allow Georgia Power to charge customers for the construction costs of the Plant Vogtle expansion in east Georgia.

The Georgia Public Service Commission has limited oversight over the electric cooperative and there is no prohibition against former utility regulators taking a job with one of the PSC-regulated companies after leaving the agency, a PSC spokesman said.

Joel Mendelson, coordinator of an activist group of co-op members, Take Back Cobb EMC, which has lobbied for leadership changes at the co-op, criticized the idea of Wise’s candidacy.

“... It goes to further prove that the current board is not looking out for EMC members, but looking out for Brown,” Mendelson said. “They [are considering] a person who has been a friend of Brown's for more than two decades and we are disappointed.”

All 10 Cobb EMC board members are scheduled to appear in court Aug. 12 for a compliance hearing on the settlement agreement. The EMC hopes to have a plan in place for an initial meeting and new board member elections by July 13, Kelly said. The co-op has not had board elections since the legal problems began.