AKRON, Ohio — Editor's note: The above video features previous reporting on the FirstEnergy HB6 scandal.
Akron-based First Energy announced it has settled a series of shareholder lawsuits seeking corporate reforms in the wake of a bribery and corruption scandal.
In a statement released by FirstEnergy on Thursday, the company announced that six board members, all who have served at least five years, will not stand for election at the company’s May shareholder meeting. FirstEnergy's board of directors will now be responsible for overseeing the company's lobbying and political activities while a committee of board members will review the current executive team.
As part of the settlement agreement, FirstEnergy will also receive $180 million from the company's insurer. It will be paid after court approval, less any attorney's fees awarded to plaintiffs.
"We are grateful to the outgoing Board members for their dedication and years of service. They began the hard work of instituting changes that form the foundation on which we are continuing to bring the company forward. With a refreshed and rightsized Board, we will continue to build on these important efforts to enable a brighter future for the organization," said FirstEnergy Vice Chair and Executive Director John W. Somerhalder II in a statement.
The lawsuits were filed after federal officials in July 2020 accused FirstEnergy of secretly funding a $60 million bribery scheme to win legislative approval for a $1 billion bailout for two Ohio nuclear power plants. Former House Speaker Larry Householder was indicted on a federal conspiracy charge along with four associates. Householder has pleaded not guilty and is currently awaiting trial. He was expelled from the Ohio House in June of 2021.
Also in June of 2021, FirstEnergy signed a deferred prosecution agreement with the Justice Department and agreed to pay a $230 million penalty. A federal charge of conspiracy to commit honest services fraud will be dismissed against FirstEnergy in 2024 if the company abides by a long list of reforms listed in the agreement.
FirstEnergy still faces shareholder lawsuits alleging the company committed securities violations. Defendants include current CEO and President Steven Strah along with former CEO Chuck Jones, who was fired by the company in October 2020 for violating company policies and its code of conduct.
- FirstEnergy agrees to $306 million refund to Ohio customers
- Ohio AG Dave Yost freezes assets of former utility chairman Sam Randazzo for role in FirstEnergy bribery scandal: Mark Naymik Reports
- CEO, former Ohio House Speaker worked closely to pass tainted energy bill
- FirstEnergy charged, agrees to pay $230 million penalty in connection to HB 6 bribery scheme