Last week, starting on February 15 and continuing for several days, an unprecedented winter storm stuck Texas and other central and southern states).  The winter storm and some potentially questionable decisions left millions of people without electricity for several days, searching for the basics. The effects of the blackout caused severe damage and led people to ask some critical questions. One of them is “Can the people of Texas join forces for a Class-Action lawsuit?”

We are based in Austin, Texas, and we went through this terrible experience firsthand. While we managed to maintain our operations at full capacity thanks to our staff not being tied to a single location, we still sustained damages and had to spend days without electricity. Granted, the winter storm was a once in a hundred years-type event. However, while it was undoubtedly an act of god, many questions still arose, mainly concerning the level of preparation in Texas, the contingency plans in place, and some decisions that proved to be poor. We’re primarily referring to ERCOT’s (the electricity grid management/operators) plan to pull the plug in various districts and bring it back on in rotations. This whole scenario backfired due to the severe weather conditions, and millions of inhabitants were left without electricity for days.

Given all this information, and with prior knowledge coming from similar disastrous situations, we were left wondering how all the affected people could fight for their rights. Similar to what we’ve seen in other cases, experts predict that many insurance companies will deny claims for this disaster, stating that it was an act of god. Can this be the next BP oil spill lawsuit?

Let’s break it down and understand why this could become a possible class-action.

  • There’s no doubt that it all started from natural sources, and this was a natural disaster at work. However, the first point of exploration and investigation is whether or not human error was involved. According to experts, the power grid was not prepared for extreme conditions and the subsequent surge in demand. Oddly, Texas is the number one energy-producing state. However, it still didn’t manage to deal with and survive disaster in February effectively, perhaps due, in part, to the fact that the government made decisions not to upgrade equipment to withstand shallow temperatures.
  • The second key point here is the independent operation policy in Texas. It predominantly operates independently from other power grids in the US, which meant the absence of any potential assistance.
  • Another question that arises is if this winter storm could have been predicted. Numerous experts state that this could’ve been the case as forecasts showed it weeks ahead, creating time for preparations. According to Jay Apt, co-director of Carnegie Mellon Electricity Industry Center, “When I read that this was a black-swan event, I just have to wonder whether the folks who are saying that have been in this business long enough that they forgot everything, or just came into it.”
  • And then we have one of the most significant decisions that proved to be disastrous. Rolling blackout is typical when power grids are on edge, using them as a last resort. Power companies or grid operators tend to use them when they see major trouble coming their way. The concept is to avoid leaving large areas without electricity for extended periods. But it all went wrong in this case. The extremely low temperatures didn’t allow this plan to be executed, and when ERCOT tried to bring the electricity back on, everything was already frozen. Could they look for alternatives? This is all theory, but the ugly truth is that an unrealistic plan created chaos, caused severe damages, and cost Texan lives.

What kind of damages and losses could be eligible for a class-action lawsuit?

  • Burst and broken pipes.
  • Collapsed roofs and ceilings.
  • Water damage and flooding.
  • Damaged home devices, furniture, and other belongings.

Several of these issues can require prolonged periods before complete restoration, and while insurance companies might deny claims, a class-action suit could be viable.

  • Injuries and deaths. 

That is undoubtedly the most disheartening reality we face. The winter storm and the blackout caused countless injuries and deaths, with the total number still unconfirmed. The most common causes were hypothermia, poisoning from trying to get warm using unsafe methods, house fires, slip and falls caused by ice, car crashes, and inability to get medical treatment.

Fact: The family of an 11-year old boy that died from hypothermia filled a class-action claiming $100M, accusing power company of negligence.

If your law firm wants to help those in need and get involved in a potential lawsuit, now is the time to do it. It’s still early, and some aspects are unclear, but if you possess the means to stand by those who were harmed, you should step in right away. Additionally, by joining early, you maximize your chances to get the most out of your time and investment, aiming for maximized ROI. You can listen to our last podcast episode, where we discuss what happened and what could be the next steps.

Last but not least, another class-action lawsuit is surfacing. This week, a woman from Texas brought to the forefront a potential case against the power retailer Griddy. The woman and other customers saw their bills skyrocket by over 300x. While the company supposedly encouraged their clients to change operators or providers to avoid large bills, the fact is this wasn’t really an option amid the winter storm and extreme conditions. Griddy is putting the blame on PUCT, stating that they used their authority to enforce a price of $9/kWh instead of 0.3/kWh. The company promises to join forces with its clients to go against those who enforced those ridiculous prices, the generators. Let’s see how this will evolve.

What are the key takeaways?

  • The most critical takeaway from this situation is that we have to be ready for not just the worst-case scenario but 100 times worse than the worst we can think.
  • Texans have suffered heavily from the winter storm and, in many cases, might need your law firm’s help to file their claims and fight against insurance companies. Be it damages, injuries, or death, countless people are affected and could soon be looking for an attorney who’s ready to fight for their rights.
  • Similar to Mass Torts Marketing, this might be a scenario favoring those who catch the wave early.