Attorneys for Cobb EMC argued Wednesday that the Marietta-based electric cooperative should be be allowed to rehire its controversial ex-CEO, despite objections by suing customers that the move violates a 2008 lawsuit settlement.
Both sides were in a Cobb County court Wednesday before Superior Court Judge J. Stephen Schuster, who did not say when he’ll rule.
Dwight Brown, the indicted-and-then-unindicted longtime leader of the co-op, retired Feb. 28 under provisions of the 2008 settlement, which followed a suit stemming from Cobb EMC’s management practices. Dwight Davis, Cobb EMC’s attorney, argued that settlement required Brown to retire and to not “seek an extension of his employment,” but did not prevent the board from bringing him back.
“The determination of whether it is a good idea whether to hire Dwight Brown or not is up to the board,” Davis said after the hearing.
Attorney Pitts Carr, representing the original suing customers, argued that language in the settlement agreement made it clear Brown would be succeeded by a new leader.
Pitts said he “can’t imagine” the public’s best interest is served by bringing Brown back to lead the co-op. He said ratepayers should be concerned if that happens.
Controversy surrounding Brown’s tenure involved Cobb EMC’s creation of a for-profit side business, Cobb Energy. In 2007 a group of customers sued the co-op’s board, management and Cobb Energy, following an Atlanta Journal-Constitution story on the arrangement.
The lawsuit alleged that Brown and other co-op leaders had unjustly enriched themselves by setting up Cobb Energy and siphoning co-op assets to it.
In January a Cobb grand jury indicted Brown on 31 counts of racketeering and theft in January, but the indictment was thrown out in March on a technicality. The district attorney is appealing the ruling, and Brown now works as an independent consultant for the co-op. He was not in court Wednesday.
Co-op leaders interviewed eight candidates -- four external and four internal -- for Brown’s position, but none was deemed as qualified, co-op attorney Steven Fox said, testifying as a witness. He said he explained to the board that no one was excluded from being selected.
“Nobody knows our co-op and the electric industry better than he does, and his expertise will help us continue . . . supplying reliable and affordable power to our members,” board chairman Larry Chadwick said in a statement in February, before Brown’s indictment was thrown out.
Davis maintained that Carr and his clients could not reach a settlement agreement that restricted Brown from being rehired to his leadership position. “Don’t give them now what they could not get in litigation,” he said to Schuster.
The settlement agreement also required elections allowing customers to vote on the board, but they’ve been stalled in a separate legal dispute. Schuster gave attorneys 30 days after a ruling in that case to develop a process for the elections, which would be the first since 2007.
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