Lazarek v. Ambit Energy Holdings, LLC
6:15-cv-06361
W.D.N.Y.Sep 29, 2017Background
- Plaintiffs Lazarek and Breton are former Ambit Energy customers who enrolled in Ambit’s budget-billing plan and received final bills that included unexpected "budget billing settlement" charges.
- Lazarek’s final bill showed he had paid $4,550.60 toward $5,295.03 of energy but was charged $1,078.35 as a "budget billing settlement" (allegedly $334.02 more than owed).
- Breton’s final bill included a $597.27 settlement charge that was unexpected; his usual balance was about $250 but his final bill was $1,518.14.
- Plaintiffs filed a putative class action alleging violations of New York and Maryland consumer-protection statutes and unjust enrichment, claiming Ambit failed to disclose and charged undisclosed/unsupported fees.
- Defendants moved to dismiss for (1) primary jurisdiction (regulatory agency should decide), (2) failure to satisfy Rule 8(a) notice pleading, and (3) failure to state claims under Rule 12(b)(6).
- The court denied the motion to dismiss in full, finding federal jurisdiction appropriate, pleading adequate under Rule 8(a), and the complaint plausibly alleged statutory and unjust-enrichment claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the doctrine of primary jurisdiction requires deferral to state Public Service Commissions | Ambit’s billing practices are consumer-deceptive issues suitable for court resolution | Disputes over utility/ESCO billing fall within PSCs’ primary jurisdiction and expertise | Court: Declined to defer; dispute involves alleged deceptive billing practices, not rates or technical regulatory questions, so no primary-jurisdiction bar |
| Whether the complaint meets Rule 8(a) notice-pleading requirements | Complaint sufficiently alleges which Ambit entities billed which plaintiff and that identical claims apply to multiple defendants | Group pleading as "Ambit" fails to give each defendant individualized notice | Court: Adequate notice; collective references permitted where plaintiffs allege each defendant’s role |
| Whether New York General Business Law § 349-d(3) claim is plausibly pleaded | Alleged that Ambit charged amounts exceeding what was owed and concealed/explained settlement charges | Publicly available ESCO rules disclosed reconciliation; Plaintiffs’ theory not materially misleading or causal | Court: Plausibly pleaded; plaintiffs allege Ambit charged unexplained amounts beyond reconciliations, satisfying the elements at pleading stage |
| Whether Maryland Consumer Protection Act and unjust enrichment claims are pleaded sufficiently | Alleged omission of material budget-billing balance information caused reliance and injury; unjust enrichment arises from overcharges | Claims lack factual specificity, reliance, causation, and applicable law for non-MD/NY class members; Rule 9(b) should apply to fraudlike allegations | Court: MD CPA claim plausibly pleaded (omission, materiality, reliance alleged); unjust enrichment survives dismissal (9(b) not applicable; choice-of-law/class issues premature) |
Key Cases Cited
- United States v. Western Pacific R.R., 352 U.S. 59 (1956) (primary jurisdiction doctrine explained)
- Nader v. Allegheny Airlines, Inc., 426 U.S. 290 (1976) (agency expertise may counsel primary-jurisdiction deferral)
- Goya Foods, Inc. v. Tropicana Prods., Inc., 846 F.2d 848 (2d Cir. 1988) (primary jurisdiction as administrative-exhaustion analogue)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standards for plausibility)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (legal conclusions not entitled to pleading-stage assumption of truth)