In February 2014 the town of Eden, North Carolina was faced with a severe environmental disaster after a spillover of a coal ash dump at a Duke Energy power plant located closely.
The spillover resulted in lawsuits connected primarily to the breaching of environmental laws. Safety regulations of power plants and coal ash dumps and the grave endangerment of citizens’ lives quickly added to the list and with good reason.
At that point, the spill translated in 70 miles of the Dan River being covered in toxic sludge, a clear violation of the Clean Water Act. More recently, North Carolina’s Department of Environment and Natural resources announced that more than 90 percent of the water wells tested near the Duke Energy power plant and coal ash pits fail to comply with state standards.
Consequently, communities in this area have been informed that water coming from these wells is not safe and should not be consumed.
Duke Energy seems to be under fire as the North Carolina law suit is on the roll for nine violations of the Clean Water Act, related lawsuits are issuing and the shareholders are also in course of a lawsuit.
The shareholder case against Duke Energy is being treated in the Delaware Chancery Court. Vice Chancellor John Noble announced that until the North Carolina case draws to a conclusion, he is still considering the company’s request to put the lawsuit on hold for another six months.
The shareholder plaintiffs of the energetic company declared that the reason for which they are suing the company is that the Duke Energy officials were aware of breaching fiduciary duties. Allegedly, they knew that the company was violating federal environmental laws which exposed it to losses in the form of penalties, fines and cleanup costs at those locations where the coal ash spill affected the population, as well as the environment.
To this extent, Duke Energy agreed in February to a settlement amounting to a total of 102 million dollars in the North Carolina federal criminal case. The sum covers 68 million dollars accountable for fines and restitution and 34 million dollars accountable for community services and mitigation, paid by shareholders.
Against this background it is understandable that the shareholders are looking for restitution from the officials of the company. However, it is clear that the breach of environmental laws and the public outcry driven by affected communities is driving Duke Energy down on the market as well as in customer confidence.
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