Hearing in Grant PUD lawsuit scheduled for Tuesday

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SPOKANE — A hearing is scheduled Tuesday on a request from plaintiffs in a lawsuit against the Grant County PUD to delay the implementation of Class 17, the “evolving industries” class approved in August 2018. The plaintiffs, eight companies and one individual, filed suit in U.S. District Court in December. The lawsuit asked for a preliminary injunction to keep Class 17, and Class 17 rates, from being implemented before the case comes to trial.

Class 17 is scheduled to go into effect April 1.

The hearing on the temporary injunction is scheduled for 1:30 p.m. Tuesday at the federal courthouse in Spokane. The case is scheduled to go to trial March 23, 2020. Both sides have agreed to a bench trial, which means the case will be heard by a judge, not a jury. A hearing is scheduled for Nov. 20 to determine if the two sides have reached a settlement.

The plaintiffs, a group of cryptocurrency companies, are asking that Class 17 be eliminated, and seeking damages. The suit also names the five PUD commissioners at the time the rate schedule was adopted, Terry Brewer, Bob Bernd, Dale Walker, Tom Flint and Larry Schaapman, and up to 10 unnamed PUD administrators and employees as defendants.

The plaintiffs include Blocktree Properties LLC, Corsair Investments WA LLC, Cytline LLC, 509 Mine LLC, MIM Investors LLC, Miners United LLC, Telco 214 Wholesale Software, Inc. and Wehash Technology LLP. Along with the businesses is one individual, Mark Vargas.

The lawsuit contends that Class 17 is “blatantly discriminatory, lacks even basic due process protections, and will impose grossly excessive rates on plaintiffs.” It claims that the allocation of the plaintiffs to Class 17 shows they are being treated “differently from any other industry, even though many industries served by Grant (PUD) are ‘evolving industries’ under the (Class 17) criteria.” The plaintiffs also allege the PUD’s appeal system doesn’t meet standards for due process, and contend that Class 17 “places a huge burden on interstate commerce that is unjustified by any legitimate local interest.”

The PUD has filed a reply to the suit, saying that under state law the commissioners can’t be sued. “Plaintiffs, as customers of the Grant County PUD, have assumed the risk of a change in PUD rates and rate schedule classification,” according to the PUD’s reply. Utility district attorneys contended the cryptocurrency companies didn’t file any kind of damage claim before filing the federal suit.

Cheryl Schweizer can be reached via eail at education@columbiabasinherald.com.

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