IBJNews

Browning ordered to testify over Duke Energy CEO's ouster

Back to TopCommentsE-mailPrintBookmark and Share

Indianapolis real estate developer and Duke Energy Corp. director Michael Browning has been ordered to appear Friday before the North Carolina Utilities Commission, which is investigating the unexpected ouster of the utility’s new CEO just hours after the company merged with Progress Energy Inc.

Browning and other directors also are targets of a civil probe being conducted by North Carolina Attorney General Roy Cooper.

North Carolina regulators had approved the $32 billion merger, completed July 2, predicated on Progress CEO Bill Johnson replacing Duke CEO James Rogers as head of the merged utilities. Duke, which provides electricity to 69 of Indiana's 92 counties, is based in Charlotte; Progress in Raleigh.

Regulators and former Progress directors were furious when Duke’s new board asked for Johnson’s resignation this month and offered him a severance package worth $10.3 million.

Rogers was reinstalled as CEO of Duke.

Appearing last week for a grilling before the North Carolina Utilities Commission, Rogers testified he met June 23 with Browning and top Duke director Ann Gray. 

Browning has been director of Duke and its predecessor utilities in Indiana and Ohio under Rogers’ leadership since 1990. The chairman of Browning Investments Inc. is a member of the Central Indiana Business Hall of Fame.

Rogers said the two directors conveyed the Duke board’s growing lack of confidence in Johnson and asked if Rogers would be prepared to stay on as CEO.

“I wasn’t part of their deliberations on this,” Rogers said of the board. “I was just informed. And if they felt strong enough to inform me of that, I was practical enough to realize I couldn’t … there was no way I could change their mind,” Rogers told the commission last week.

Rogers said Duke’s board wasn’t comfortable with Johnson’s leadership style and questioned decisions he made regarding Progress’ nuclear plants in the southeast.

Both Browning and Gray are to be questioned by the utility commission on Friday. 

Browning did not respond to phone and e-mail messages seeking comment.

Last week, North Carolina’s attorney general launched a civil inquiry into the merger and the ouster of Johnson. Borwning is among those from whom he’s seeking documents and phone and travel records.

The former lead director of Progress, John Mullin, called the ouster of Johnson “an incredible act of bad faith” and said that he doubted that any Progress director would have voted for the merger knowing Rogers would remain as CEO.

“In my opinion this is the most blatant example of corporate deceit that I have witnessed during a long career on Wall Street and as a director of 10 publicly traded companies,” Mullin told the Wall Street Journal on July 5.

Duke’s stock price dropped nearly $5 per share after the Johnson ouster. Standard & Poor’s put Duke’s ratings on credit watch.

Duke Energy, the largest electric utility serving Indiana, already is entangled in scandal over spending on its Edwardsport coal-gasification plant, which is nearly $1 billion more than original estimates.

Rogers and his former top Indiana executives are accused of improperly influencing Indiana regulators, leading to Indiana Gov. Mitch Daniels' decision to fire former Indiana Utility Regulatory Commission Chairman David Hardy.

Moreover, a former IURC judge, with Hardy’s assistance, wrangled for a job with Duke even while hearing cases before the commission. He later got the job but was fired along with Duke’s top Indiana executive.

The IURC this week is conducting hearings on a proposed settlement between Duke, industrial customers and the Indiana Office of Utility Consumer Counselor that would cap ratepayers’ share of Edwardsport at $2.6 billion.

The estimated cost of the plant, which won’t begin commercial service until the first quarter of next year, has risen to more than $3.3 billion.

 

.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. By Mr. Lee's own admission, he basically ran pro-bono ads on the billboard. Paying advertisers didn't want ads on a controversial, ugly billboard that turned off customers. At least one of Mr. Lee's free advertisers dropped out early because they found that Mr. Lee's advertising was having negative impact. So Mr. Lee is disingenous to say the city now owes him for lost revenue. Mr. Lee quickly realized his monstrosity had a dim future and is trying to get the city to bail him out. And that's why the billboard came down so quickly.

  2. Merchants Square is back. The small strip center to the south of 116th is 100% leased, McAlister’s is doing well in the outlot building. The former O’Charleys is leased but is going through permitting with the State and the town of Carmel. Mac Grill is closing all of their Indy locations (not just Merchants) and this will allow for a new restaurant concept to backfill both of their locations. As for the north side of 116th a new dinner movie theater and brewery is under construction to fill most of the vacancy left by Hobby Lobby and Old Navy.

  3. Yes it does have an ethics commission which enforce the law which prohibits 12 specific items. google it

  4. Thanks for reading and replying. If you want to see the differentiation for research, speaking and consulting, check out the spreadsheet I linked to at the bottom of the post; it is broken out exactly that way. I can only include so much detail in a blog post before it becomes something other than a blog post.

  5. 1. There is no allegation of corruption, Marty, to imply otherwise if false. 2. Is the "State Rule" a law? I suspect not. 3. Is Mr. Woodruff obligated via an employment agreement (contractual obligation) to not work with the engineering firm? 4. In many states a right to earn a living will trump non-competes and other contractual obligations, does Mr. Woodruff's personal right to earn a living trump any contractual obligations that might or might not be out there. 5. Lawyers in state government routinely go work for law firms they were formally working with in their regulatory actions. You can see a steady stream to firms like B&D from state government. It would be interesting for IBJ to do a review of current lawyers and find out how their past decisions affected the law firms clients. Since there is a buffer between regulated company and the regulator working for a law firm technically is not in violation of ethics but you have to wonder if decisions were made in favor of certain firms and quid pro quo jobs resulted. Start with the DOI in this review. Very interesting.

ADVERTISEMENT