Shames Forms Own Group; Malcolm of UCAN Questions His Statements

Michael Shames, cofounder and former head of watchdog Utility Consumers' Action Network (UCAN), today (June 26) made a filing with the California Public Utilities Commission (CPUC) claiming that he is taking over UCAN's role in San Diego Gas & Electric's (SDGE) filing for a fat general rate increase. Shames has formed a new organization, San Diego Consumers' Action Network (SDCAN). In the filing, Shames states, "SDCAN seeks to act as the successor to UCAN," and "this request is made following an agreement between SDCAN and UCAN."

But, says Kim Malcolm, who has replaced Shames as head of UCAN, "These are Michael's words and not mine." There is no written agreement and no contract, she stresses. "His agency is not the successor to UCAN in the case." She told Shames that "he can use testimony UCAN originally submitted. That would be good for San Diego." However, UCAN will continue to work on the case on its own. Shames may proceed with his purported new group, obviously.

An all-important matter is intervenor fees, which the CPUC pays to those who contribute substantially to a rate case. Shames may collect such fees for work that he does on his own, "but he doesn't get for himself what he did for UCAN," says Malcolm. "That's UCAN property. And he knows that."

Today, the UCAN whistleblowers who filed suit against the group, and earlier complained of financial irregularities that Shames allegedly committed, dropped their suit as their case was settled privately, according to Malcolm. Those employees are Charles Langley and David Peffer. Langley would not comment on any matter. However, there has been no settlement with Privacy Rights Clearinghouse, which wants to form its own organization and feels it is entitled to funds, and Peter Navarro, who made a movie about China's trade abuses. A mysterious deal was set up whereby steelmaker Nucor would give UCAN $1 million, and UCAN would pass that sum to Navarro. But at the time of the aborted settlement, $400,000 had not been passed to Navarro, who tried unsuccessfully many times for political office in San Diego and is now a professor at the University of California Irvine.

After Malcolm took over, she pulled UCAN out of a broad settlement that had been drawn up by the parties. She wants an audit of unrestricted funds. UCAN remains out of that settlement, now in limbo.

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That audit may be crucial. I hope the US Attorney is still investigating UCAN money flows. This must NOT be dropped. Best, Don Bauder

END OF DICTATORSHIP? Mike Aguirre, attorney for the UCAN whistleblowers who yesterday settled their lawsuit, says Shames's actions yesterday reflect a "dictatorship" that has dissolved while the modus operandi remains. Because the board was looking the other way, Shames had carte blanche to do whatever he wanted, including with UCAN financial assets, says Aguirre. Shames is now out, but his behavior remains "You have to have mutuality to have an agreement," says Aguirre. Shames "made a misrepresentation" to the CPUC by claiming that he was taking over UCAN's handling of the big SDGE rate case. "He is attempting to take property rights that belong to UCAN. This should be reported to the U.S. Attorney." It is important to learn the roles of the board and those who helped perpetuate the situation -- lawyers, Kendall Squires, Paul Dostart, and Bob Ames, says Aguirre. Best, Don Bauder

The roles of Squires, Ames, and Dostart, in particular, must be examined. There are other board members whose non-actions and coverup activities must come under scrutiny, too. Best, Don Bauder

"Shameful" just does not quit. He's loose with the truth when it suits him, yet claims that the story is not yet told. But will he attempt to tell the story? Uhh, no. It is really outrageous that all this scandal unfolds for all of us while there is no indication that any investigation is underway. Sounds just about the same as the scandals with the So Bay school districts.

One certainly hopes that the US Attorney's investigation is still ongoing. If it has been dropped, there should be an investigation of that. Best, Don Bauder

SDGE PROTESTS SHAMES FILING; UCAN OFFICIALLY FILES ITS DENIALS OF SHAMES'S CLAIMS. On Friday, San Diego Gas & Electric (SDGE) officially filed its objections to Michael Shames's attempt to form a new group that would handle answers to SDGE's general rate case. SDGE's filing with the California Public Utilities Commission (CPUC) says that Shames's belated attempt to form San Diego Consumers' Action Network (SDCAN) is "highly disruptive" and "creates confusion" for SDGE. Today (July 2) Kim Malcolm, who replaced Shames as head of Utility Consumers' Action Network (UCAN) filed her response to Shames's filing with the CPUC. Essentially, Malcolm says in the filing what she said in the interview with me above. "UCAN has never stated an intent to 'discontinue its involvement in this proceeding,'" as Shames had claimed, Malcolm says in her filing. "SDCAN is not a successor to UCAN...SDCAN is not entitled to any costs UCAN incurred for Mr. Shames's work in this proceeding or any other prior to June 21, 2012."

SHAMES ANSWERS SDGE, UCAN. On Monday, Michael Shames, former head of Utility Consumers' Action Network (UCAN), who now is launching his own San Diego Consumers' Action Network (SDCAN), filed a paper with the California Public Utilities Commission (CPUC) disputing earlier filings by UCAN and San Diego Gas & Electric (SDGE). SDGE has told the CPUC it objects to Shames entering the general rate case with SDCAN. Shames in his filing says SDGE "took the few hours to submit a written protest to a motion in the long-shot hopes that [it would] be able to exclude testimony that will seriously compromise [its]...position in this proceeding." Generally, Shames says that UCAN's complaints about SDCAN are "not germane."

SHAMES GRANTED PARTY STATUS. The administrative law judge in the SDGE general rate case today (July 3) granted Michael Shames's San Diego Consumers' Action Network party status in the case.

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