Countersuit against Socorro Electric hits a snag

........................................................................................................................................................................................

There’s been a snag in Socorro Electric Cooperative’s member-owners’ countersuit against the co-op, but the judge presiding over the case says it won’t take much to unravel.

A status hearing scheduled for March 21 in district court in Los Lunas was vacated two days before that date due to what the judge described as “technicalities” with new filings from attorneys representing the members. A telephonic hearing was held instead the week before to discuss an amended countersuit that replaces the named parties in the countersuit.

Though the scheduled hearing was delayed, District Judge Albert J. Mitchell Jr. said in a phone interview on Monday that straightening out the details will ultimately help the case move along.

“It was a major step forward as far as moving the litigation forward,” he said. “Litigation of this type, probably half the time, this is necessary. You start and everybody looks closer and gets the opportunity to get focused in and see where they are going.”

The countersuit was initially filed two months after Socorro Electric filed a lawsuit against all of its approximately 10,000 member-owners in June 2010 in an effort to block new bylaws that called for it to operate with greater transparency. It named 10 current members of the board of trustees, four former trustees and the co-op’s former general manager as defendants, charging them with breach of fiduciary duty, fraud and wasteful spending. District 5 trustee Charlie Wagner of Magdalena, a leader in the movement to reform the co-op, was named as representative of the class in the countersuit, which requests class action certification.

The amended motion, filed March 12, names Socorro Electric as the defendant and replaces Wagner with members Carol Auffrey of Quemado and Herbert Myers of Socorro as representatives of the class.

Mitchell said one issue was that the attorneys representing the members, the Ikard Wynne law firm of Austin, Texas, jumped the gun by filing the amended version before he gave them permission.

“Electronic filing is a wonderful thing,” Mitchell said, “but sometimes you get to that bridge and there are bumps on that bridge, and we’re finding that we’re hitting bumps in a couple of cases.”

Judge Mitchell said he would allow the attorneys to revise their amended motion.

“We’ll see if the motion to amend meets the technicalities, and, if it does, then we can take up the motion for lack of jurisdiction,” he said.

Socorro Electric’s attorneys, the Kennedy & Han law firm of Albuquerque, filed its motion to dismiss the case for lack of subject matter jurisdiction in late January. The motion states that the countersuit violates the requirements established by the New Mexico Rural Electric Cooperative Act by failing to present factual pleadings contained in the claim.

“Several fundamental accusations are brought on the basis of ‘information and belief,’ with no factual support or information,” the motion reads. “These deficiencies in the cross claim are in direct violation of the explicit pleading provisions of RECA.”

If the countersuit is not dismissed, the next step would be addressing the class action aspect of the case, the judge said.

“We have to get class approved or disapproved and a representative in place before moving forward,” he said.

Mitchell gave no timetable as to when the next hearing would be set. Once the revised amended complaint is filed, the co-op would be given time to respond.

The judge did say he wanted to keep the case from hitting any more bumps in the road.

“I don’t want to start falling further behind,” he said.

 


-- Email the author at tslast@dchieftain.com.