SAN DIEGO & AKRON, Ohio--(BUSINESS WIRE)--Shareholder rights law firm Robbins LLP announces that a purchaser of FirstEnergy Corp. (NYSE: FE) filed a class action complaint against the Company for alleged violations of the Securities Exchange Act of 1934 between February 21, 2017 and July 21, 2020. FirstEnergy generates, transmits, and distributes electricity in the United States.
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FirstEnergy Corp. (FE) Accused of Engaging in an Illicit Bribery Scheme
According to the complaint, at the end of fiscal 2016, FirstEnergy reported a weak energy market, poor forecast demand, and hundreds of millions of dollars in losses. To alleviate investor concern, FirstEnergy stated in its annual report for 2016 that it intended to pursue "legislative or regulatory solutions" to remedy its dismal financial prospects. However, FirstEnergy failed to disclose that these solutions included an illicit campaign that funneled tens of millions of dollars to state lawmakers, including Ohio House Speaker Larry Householder, issuing misleading messages on media platforms, and illegally thwarting a citizen's ballot initiative to secure the votes for passage of Ohio House Bill 6 ("HB6"), which provided a $1.3 billion ratepayer-funded bailout to keep FirstEnergy's nuclear facilities in operation. On July 21, 2020, federal agents announced the arrest of Householder and four other individuals, including a prominent FirstEnergy lobbyist in connection with a $60 million racketeering and bribery scheme. The criminal complaint described FirstEnergy's extensive bribery scheme and corruptive tactics to ensure the passage of HB6 as "the largest bribery, money-laundering scheme" in Ohio history. On this news, the price of FirstEnergy stock plummeted, trading as low as $22.85 per share on July 22, 2020, representing a 45% decline from its closing price of $41.26 per share on July 20, 2020.
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