Former regulator’s acts in Duke case not criminal, court rules

Indiana’s former top utility regulator, who was fired nearly four years ago for his role in the Duke Energy Corp. ethics scandal, has won the latest round of a legal fight to get criminal charges against him dropped.

The Indiana Court of Appeals ruled unanimously Tuesday that the charges against David Lott Hardy were based on administrative, not criminal, behavior. Therefore, Hardy could not be prosecuted for a crime, the court said.

The appeals court upheld a trial judge’s decision to dismiss four felony counts of official misconduct against Hardy.

Hardy, who was chairman of the Indiana Utility Regulatory Commission, was accused of failing to disclose secret meetings with Duke Energy executives concerning cost overruns at the company’s $3.3 billion Edwardsport power plant.

He also was accused of helping the agency’s top lawyer break ethics rules in seeking a job with Duke while helping oversee the Edwardsport case.

Hardy was chairman of the IURC for five years, until he was fired by Gov. Mitch Daniels in October 2010 as the scandal came to light.

Hardy was indicted in December 2011 after reporting by The Indianapolis Star, which used open-records laws to show that Hardy had met privately several times with Duke executives to discuss problems at Edwardsport, a violation of Indiana law.

Marion Superior Court Judge William Nelson dismissed the charges last year, ruling that the actions no longer amounted to a crime. Although he scolded Hardy in the courtroom for a “definite betrayal of trust,” Nelson said the General Assembly made changes to the law in 2011 that invalidated the charges. The changes, recommended by the Indiana inspector general’s office, took effect more than a year after Hardy’s actions.

Indiana Attorney General Greg Zoeller appealed the dismissal, saying the law was not meant to be retroactive.

But the appeals court said the issue of retroactivity was not the main one to be decided. It simply ruled that the allegations against Hardy were administrative and ethical violations, not criminal violations, and therefore he could not be held to answer for a crime.

Zoeller is reviewing the ruling and has not decided whether to appeal to the Indiana Supreme Court, spokesman Bryan Corbin said.

Call Star reporter John Russell at (317) 444-6283. Follow him on Twitter: @johnrussell99.