Power Utility Suing Army Corps of Engineers Over Katrina Damages

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NEW ORLEANS -- Entergy Corp., two of its Louisiana power utilities and their insurance company are suing the U.S. Army Corps of Engineers over floods that hit southeastern Louisiana after Hurricane Katrina.

The federal court suit alleges that the Corps' negligence cost the companies millions of dollars in uncompensated damages to the Entergy New Orleans and Entergy Louisiana systems -- and resulted in major rate increases for their customers.

The suit does not ask for a specific dollar amount. But Entergy's insurer, Hartford Steam Boiler Inspection and Insurance Co., says it has paid out $69.5 million. The insurer also is a plaintiff and is seeking what it paid back from the federal government.