Reg Martin, former receiver for SOBE

YOUNGSTOWN — A Mahoning County Common Pleas Court judge has approved a $35,246 final payment to Reg Martin, ousted receiver for SOBE Thermal Energy Systems LLC, for less than three months of work in which the utility company repeatedly failed to provide basic services.

Judge Anthony D’Apolito also authorized a $20,324 final payment for three months of work to Kenneth R. Goldberg, removed as Martin’s legal counsel.

In a judgment entry, D’Apolito wrote: “The court has reviewed the outgoing receiver’s motion and any responses thereto and finds that the requested fees and costs incurred by the outgoing receiver and counsel for the outgoing receiver as detailed in the motion and attached exhibits have been reasonable and necessary to the administration of the receivership. As such, the payment of the fees and costs is proper, and the motion is hereby approved.”

D’Apolito ordered the payments be made within 45 days of the order, which was Wednesday, by John C. Collins of Akron, SOBE’s current receiver, from the utility company’s revenue “or from other sources as agreed by the parties.”

Donofrio on Feb. 17 granted a motion by the Public Utilities Commission of Ohio to remove Martin as SOBE’s receiver. The PUCO request came Feb. 11.

Donofrio also granted requests from the PUCO on Feb. 17 to appoint Collins to replace Martin and for Michael J. Moran, a Cuyahoga Falls attorney, to serve as SOBE’s legal counsel, replacing Goldberg.

Goldberg submitted the motion for final fees and costs March 4.

With the final payments approved, Martin received $80,050, and Goldberg got $42,224 for five months of work for SOBE that included obtaining three boilers – all of which failed at various times, including all at once, to provide proper steam heat and hot water for much of downtown Youngstown.

Martin was paid $200 an hour and Goldberg $375 an hour. Collins is receiving $300 an hour and Moran is getting $350 an hour.

Martin’s final bill request of $35,246 was for the period between Dec. 1 and Feb. 26 as he was permitted to stay on the payroll during the transition.

Martin listed 163.5 hours of work at the $200-an-hour wage as well as 24 hours of “office work” for his company at $45 an hour. He also received 70 cents a mile for one trip to Youngstown from his Columbus-area home during the three-month period, one trip to Youngstown that he failed to include on a previous request for payment and a drive to Virginia to look at a boiler.

Martin’s itemized billing included expenses for searching for the boilers, setting up a bank account, discussing a $750,000 payment he received as receiver from Enbridge Gas Ohio’s settlement of the 2024 Realty Tower gas explosion investigation by the PUCO that paid for the rented boilers, email and text message exchanges and reading news articles.

Martin also billed for receiving numerous calls and emails from SOBE customers – the utility is supposed to service 28 downtown buildings – about the company’s repeated issues that resulted in no heat for days, including when temperatures dropped below zero degrees.

Martin’s bill including seeking payment for “customer complaints out of hand” on Feb. 3. Two days later, he charged for suggesting “an independent expert, if needed, to counter misinformation from customer.” On the same day, he wrote on his bill: “Due to continued level of unfounded derogatory comments from the public, I question (my) continuance in case despite that it all stems from boiler problem over the last three months.”

On Feb. 13, he billed for reading articles in The Vindicator about his removal as receiver as well as for texting and calling Goldberg asking that changes be made to indicate it was a resignation and not a termination.

The motion from an Ohio assistant attorney general representing the PUCO states Martin was being “removed and replaced,” and that he “agreed to resign.”

Goldberg’s final bill of $20,324 is for 54.2 hours of work from Nov. 25 to Feb. 23.

Goldberg billed for work on the Enbridge agreement, talked with PUCO officials, Martin — including to discuss complaints from customers — as well as for preparing court documents, working out Martin’s resignation and $262.50 to review three Vindicator articles about what was happening with SOBE.

Martin was appointed as SOBE receiver and Goldberg as his legal counsel by Donofrio on Sept. 26 at the PUCO’s request as the company was insolvent and unable to provide heat to its customers. A rented 800-horsepower boiler was removed Sept. 30 from SOBE because the company defaulted on paying for the equipment that provided heat and hot water to its customers.

SOBE owed $383,214 in back payments to the steam plant’s owner, Wabash Power Equipment Co. of Wheeling, Illinois. The repossession would have made the company unable to provide utilities to its customers.

But the equipment rented by Martin proved to be unreliable.

SOBE’s boilers repeatedly failed to provide proper heat and hot water for its customers, forcing a number of them to shut down.

In a Jan. 29 court filing, Goldberg blamed the problems on SOBE’s customers. The customers strongly denied that.

Several buildings were without heat for five days, starting Feb. 7, after the failure of two SOBE boilers, including an 800-horsepower one that arrived Feb. 1.

That came days after SOBE could not provide heat from Jan. 27 to Feb. 2, and Feb. 3 in some buildings, during days when the temperature was well below zero. Even after steam heat started flowing, some businesses couldn’t get it because of broken pipes.

Without the repossessed boiler, Martin was able to rent a 650-horsepower steam plant that was hooked up about 10 days after the other was taken away.

Because of the $750,000 Martin received from Enbridge, he was able to rent a 200-horsepower boiler.

Martin also used the Enbridge settlement money to rent an 800-horsepower boiler, which arrived Jan. 30. But that and the 650-horsepower boiler failed Feb. 7 with heat not restored to buildings until Feb. 12.