Griddy gutted, $1 billion class-action filed
The future of Griddy Pro is looking dire, following two significant developments over the past two days:
- Griddy Pro’s parent company Griddy has been banned from the Texas power market; and
- a $1 billion class action lawsuit has been filed against the company.
Griddy Pro offered variable rate electricity through Griddy, so getting locked out of their only utilities market is a pretty big blow.
According to reports, the Electric Reliability Council of Texas ‘revoked Griddy’s rights to enter the state’s electricity market on Friday’.
Griddy confirmed the ban in a February 27th Facebook post:
Today, ERCOT took our members and have effectively shut down Griddy.
Reactions Griddy’s recent Facebook posts are surprisingly mixed. Nobody is happy about higher bills but a number of customers want Griddy to continue.
What factor Griddy Pro being an MLM opportunity and source of income plays into that I can’t say.
The stated reason for ERCOT banning Griddy is “payment breach”. I believe this means Griddy wasn’t paying its suppliers.
Which is probably because Griddy’s own customers aren’t paying their ridiculous bills.
The combination of “pay whatever the current rate is” and Winter Storm Uri has seen Griddy’s customer bills run into the thousands.
These bills have prompted a billion dollar class-action lawsuit, filed by Griddy customer Lisa Khoury.
Attorneys for Lisa Khoury said in the lawsuit that her bill spiked to $9,340 the week of the storm, compared to her average monthly bills that range from $200 to $250.
Griddy drafted payments from Khoury’s bank account several times, according to the lawsuit, pulling $1,200 before she blocked further charges from her bank. She still owes thousands.
The class-action was filed last Monday and unfortunately isn’t showing up on Pacer. I believe this means it’s a state-level lawsuit, which I won’t be able to track.
Taking a look at the bigger picture though, one of the core criticisms in BehindMLM’s Griddy Pro review was the potential for bills to spiral out of control.
Granted Winter Storm Uri has taken that risk to the extreme, the potential was still always there.
When a utilities provider’s answer to an anticipated hike in utilities rates is “leave us for another provider” (what Griddy did amidst Winter Storm Uri’s fury), I don’t think that’s a long-term business model.
From a marketing perspective, how are you going to pitch savings when Griddy customers can just as easily have accumulated savings wiped in a few days?
Update 23rd March 2021 – Griddy has declared bankruptcy after it was sued by the Texas government.
As a result of the legal action and bankruptcy, Griddy’s customers won’t have to pay their Winter Storm Uri bills.