Duke Energy 2012 Annual Report Download - page 49

PART I
29
ITEM 3. LEGAL PROCEEDINGS
For information regarding legal proceedings, including regulatory and environmental matters, see Note 4 to the Consolidated Financial Statements, “Regulatory
Matters” and Note 5 to the Consolidated Financial Statements, “Commitments and Contingencies — Litigation” and “Commitments and Contingencies —
Environmental.”
Brazilian Regulatory Citations. In September 2007, the State Environmental Agency of Parana (IAP) assessed seven fi nes against Duke Energy International
Geracao Paranapenema S.A. (DEIGP), totaling $15 million for failure to comply with reforestation measures allegedly required by state regulations in Brazil. On
January 14, 2010, DEIGP received a notice that one of the fi nes was subsequently increased, on grounds that DEIGP is an alleged repeat offender; however, in 2012
the decision to increase the amount of that fi ne was reversed. DEIGP fi led administrative appeals with respect to all the fi nes. Between 2009 and 2012, four of the
fi nes, in the total amount of $9 million, were judged to be valid in the administrative courts. DEIGP challenged those administrative rulings in the Brazilian state
courts, by fi ling judicial actions for annulment and also requested that its payment obligations be enjoined pending resolution on the merits. In one of the four cases,
the court granted DEIGP’s request for injunction, and subsequently ruled on the merits in favor of DEIGP. The plaintiff fi led an appeal. In two of the four cases, the
court granted DEIGP’s request for injunction, and a decision on the merit is pending. In the fourth case, DEIGP’s request for injunction was denied; however, DEIGP
was granted permission to deposit the total amount of the fi ne in the court registry and to suspend entry of the debt in the state tax liability roster.
Additionally, DEIGP was assessed three environmental fi nes by the Brazilian federal environmental enforcement agency, Brazil Institute of Environment and
Renewable Natural Resources (IBAMA), totaling approximately $1 million for improper maintenance of existing reforested areas. DEIGP believes that it has properly
maintained all reforested areas and has challenged these assessments.
ITEM 4. MINE SAFETY DISCLOSURES
This is not applicable for any of the Duke Energy Registrants.