Trial to focus on Entergy fees to city of Port Arthur

David Yates Oct. 29, 2007, 7:45am

The city of Port Arthur will battle Entergy in court this week in hopes of recovering unpaid franchise fees.

The city sued Entergy back in 2006 claiming the power company failed to live up to a franchise agreement executed in 1964 by misrepresenting the amount of money it was collecting from Port Arthur businesses and residents.

Jury selection began Monday, Oct. 29, for the trial of City of Port Arthur vs. Entergy Gulf States Inc. et al in Judge Donald Floyd's 172nd District court.

Under the franchise agreement, Entergy and its predecessor Gulf States Utilities, has been permitted to operate its electrical and power business "in, under, upon, across and along public roads, highways, streets, avenues and alleys owned" by the city, the original petition states.

The franchise was approved in 1964 by Ordinance No. 2964 for a term of 50 years and obligates Entergy to pay the city of Port Arthur 4 percent of its gross receipts from sales within the city's corporate limits.

"The city of Port Arthur has fulfilled its obligations under the agreement and (Entergy) has made use of the privileges conferred by the (franchise) agreement," the suit said.

"Over the years, (Entergy) has purported to comply with the terms of the agreement with plaintiff by providing payments of fees based on defendant's 'gross receipts' calculations. However, Defendant has understated actual 'gross receipts' calculations. However, Defendant has understated actual 'gross receipts' and underpaid plaintiff's franchise rentals."

The three count suit alleges Entergy committed breach of contract, negligent misrepresentation and fraud.

The city is represented by the Parker Law Firm.

Case No. E159-725-A

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