By MATT GOURAS Associated Press Writer
HELENA - A Senate panel agreed Wednesday that NorthWestern Energy needs protection from a $3 billion lawsuit filed by shareholders of the company it purchased.
The Senate Finance and Claims Committee approved Senate Bill 458 by a 12-7 margin. It now goes to the full Senate for a vote.
Critics said the Legislature was bending to corporate interests, endorsing legislation that would have no other use than to let NorthWestern off the hook.
''This clearly was written by NorthWestern for NorthWestern,'' said Sen. Emily Stonington, D-Bozeman.
The legislation, requested by the utility that serves 295,000 electrical customers, would prevent NorthWestern from being ordered to pay damages in the case filed in 2001 by stockholders of the former Montana Power Co.
NorthWestern bought the remains of Montana Power - its electrical and natural gas transmission systems - a year ago, completing MPC's two-year transition from the utility business to a telecommunications company.
The former Montana Power stockholders claim they were illegally denied the right to vote on the sale of several company holdings that eventually led to loss of their multimillion-dollar investments in the utility as the stock price plummeted.
Stock once worth more than $60 as Montana Power has been trading, as Touch America, at less than $1 since last summer.
Supporters of the measure said the directors of Montana Power are to blame for the woes of Touch America shareholders.
NorthWestern has argued that it bought Montana Power's properties and liabilities, but didn't buy its decision-making power.
Supporters on the Senate panel said they didn't trust a judge to make a decision on the case.
''I have a great deal more ... confidence in 150 legislators up here than I do in one judge to make the right decision,'' said Sen. Greg Barkus, R-Kalispell.
Supporters have also said the measure is needed to protect the financially struggling NorthWestern from bankruptcy, which could mean rate increases for utility customers.
After the panel's hearing, a lobbyist for the shareholders suing NorthWestern said the Legislature had once again been duped by ''the siren song of the utility.''
''This is a sad day for the Legislature,'' said Susan Good. ''I don't know when they will ever learn.''
She said Montana Power argued for deregulation in the late 1990s, only to spin off into NorthWestern. Now when the decisions have gone bad, she said, the firm is looking to ''crawl back into the womb of deregulation.''