Pg& e Filed Bankruptcy We Continue To Fight
On January 29, 2019, PG& E filed Chapter 11 bankruptcy, which calls for reorganization of a company when its debts exceed its assets. PG& Es bankruptcy filing did not end the lawsuits filed on behalf fire victims. It only made us fight harder.
The PG& E bankruptcy continues to move forward. If the bankruptcy judge confirms PG& Es Plan for Reorganization, PG& E will exit bankruptcy by, as required by the Governor and legislature. The Plan then calls for the Fire Victims Fund to be set up and funded in the amount of $13.5 billion, half stock, half cash.
Once the fund is established, Our team will then make claims against the Trust on behalf of our Fire Victim clients, maximizing their claims for damages that were not covered by our clients insurance. Payments from the Trust will be based on a process still being developed, but that will include a requirement for information and documents that support the Fire Victims claim, whether that be for real property damage, personal property damage, business loss, medical expenses, emotional distress or wrongful death, or other losses.
In the meantime and to prepare those claim submissions, we continue to hold individual client meetings and gather documents and information regarding clients losses.
Pg& e Exits Bankruptcy Pays $5 Billion Into Wildfire Fund
Pacific Gas & Electric has emerged from a contentious bankruptcy saga that began after its equipment ignited wildfires in California that killed more than 100 people
SAN FRANCISCO — Pacific Gas & Electric has emerged from a contentious bankruptcy saga that began after its long-neglected electrical grid ignited wildfires in California that killed more than 100 people.
The nation’s largest utility announced Wednesday it emerged from Chapter 11 bankruptcy and paid $5.4 billion in initial funds and 22.19% of its stock into a trust for victims of wildfires caused by its outdated equipment.
This is an important milestone, but our work is far from over, Bill Smith, PG& E interim chief executive officer, said in a statement. Our emergence from Chapter 11 marks just the beginning of PG& Es next era as a fundamentally improved company and the safe, reliable utility that our customers, communities and California deserve.
A federal judge last month approved a $58 billion plan for the company to emerged from bankruptcy by June 30, the deadline that the company had to meet to qualify for coverage from a $21 billion wildfire insurance fund created by California last year.
U.S. Bankruptcy Judge Dennis Montali’s decision cleared the way for PG& E to pay $25.5 billion for losses from devastating fires in 2017 and 2018.
What Are The Allegations In The Camp Fire Lawsuit
The Camp Fire lawsuit is based, in part, on the following allegations against PG& E: On Tuesday November 6th, PG& E alerted customers that it may schedule a Public Safety Power Shutoff for November 8th across various Northern California counties, including Butte County.
PG& E may fear that juries would award substantial amounts against them, but there is less risk with a judge, reports Insurance Journal. Many people affected by the fires have the right to file claims, and may not know it. Failure to file your claim could leave more money for PG& E and its investors.
As of yet, we are not aware of any payouts by PG& E to victims of the 2018 Camp Fire that ravaged Butte County. PG& E has said, however, that it is setting aside $10 billion to pay for harm related to the Camp Fire. The judge overseeing PG& Es bankruptcy has approved a $105 million housing fund
Don’t Miss: Will Bankruptcy Stop A Judgement
What Pg& e’s Bankruptcy Means For Victims Of Pg& e’s California Wildfires
It is a bad day for fire victims, they are being victimized twice, the first time when PG& E burnt their homes down and now because instead of investing in their recovery, they are investing in themselves. I think they are doing this now because they have spent millions to determine what is the best scenario for the share holders and they have found the best way for holding on to the most money and keeping it out of the hands of victims is bankruptcy.
Mike Danko
Frequently Asked Questions About Pg& e’s Bankruptcy
Q: Is PG& E at risk of going out of business?
A: No.
Q: Is PG& E broke?
A: No. PG& E says that its book value is $62 billion. PG& E estimates its enterprise value could be even higher. Of course, that amount is not cash in the bank to pay claims to wildfire victims.
Q: Will PG& E get bailed out by the legislature?
A: Right now, its unclear that PG& E needs any bailout from anyone to pay its debts in full.
Q: If PG& E has money, then why is PG& E filing for bankruptcy?
A: The answer is not entirely clear. One of PG& Es largest shareholders claims that PG& E is solvent and able to pay wildfire victims in full without going through the bankruptcy process, and that the bankruptcy is an unnecessary waste of everyones time and money. Other analysts suggest that PG& E is trying to use the bankruptcy laws to reduce interest charges it must pay to certain of its lenders over the course of then next few years. Regardless, its safe to say that PG& E thinks reorganizing in bankruptcy will in the long run be best for PG& E shareholders.
Q: By filing bankruptcy, does PG& E admits that it owes fire victims?
A: PG& E does not admit liability for any of the fires. Victims must still prove their case against PG& E in a court of law.
Q: Do the lawsuits that victims have already filed against PG& E get stopped?
Q: Can PG& E avoid paying victims by filing bankruptcy?
A: No. PG& E can, however, require victims attorneys to jump through many more legal hoops than they would otherwise have to.
You May Like: How Many Bankruptcies Has Donald Trump Filed
Pg& e Filed For Bankruptcy Heres Why Its Stock Is Rising
- Order Reprints
- Print Article
Students participating in Pacific Gas and Electric’s PowerPathway Pole Climbing Capstone course climb utility poles at the PG& E pole climbing training.
California utility PG& E may have filed for Chapter 11 bankruptcy, but its stock is still rising on Tuesday.
PG& E stock was up 16% to $13.92 at 1:26 p.m. Thats pretty counterintuitive: In the hierarchy of investors that get paid when a company files for bankruptcy, shareholders rank last, behind bondholders, lawyers and in this case, wildfire victims. Shareholder BlueMountain Capital has been campaigning to stop the company from filing, arguing that bankruptcy court isnt necessary because the company is solvent….
Large Shareholder Claims Pg& e Bankruptcy Is Unnecessary
One of PG& Es shareholders, BlueMountain Capital Management, challenges PG& Es decision to file for bankruptcy in a letter written to PG& E. The shareholder challenges PG& Es decision to file for bankruptcy & deems it unnecessary.
As a PG& E shareholder, we write to challenge the Boards plan for a damaging, avoidable, and unnecessary bankruptcy. There is overwhelming evidence that PG& E is solvent. We simply cannot recall a situation where such a valuable company filed for bankruptcy with such blatant questions about the necessity of doing so.
BlueMountain Capital Management LLC
Also Check: What Is A Bankruptcy Petition Preparer
Why Are Campfire Lawsuits Tried In Bankruptcy Court
For example, the Insurance Journal reports that PG& E may benefit from having the Campfire lawsuits tried in bankruptcy court because then theyd be tried before a judge, not a jury. PG& E may fear that juries would award substantial amounts against them, but there is less risk with a judge, reports Insurance Journal.
Whos Going To Make Money From Pg& es Bankruptcy
Bankruptcy cases involving big corporations usually produce hundreds of millions of dollars in fees for lawyers, bankers and consultants. BlueMountain Capital Management, which owns PG& E stock and opposes the companys bankruptcy, says PG& Es last bankruptcy, filed in 2001, cost more than $400 million in fees. The current case could cost a lot more because lawyers hourly rates have gone up a lot since then.
The 2014 bankruptcy filing of Energy Future Holdings, a Texas utility, yielded professional fees of more than $600 million, according to data collected by Texas Lawbook.
Still, some legal experts say that processing many claims in one court can save money. Its going to produce some pretty big efficiencies, said Lynn M. LoPucki, a law professor at the University of California, Los Angeles.
PG& E has also asked the bankruptcy court to approve roughly $130 million of 2018 bonus payments to employees, who stand to get $5,000 to $90,000 each. The $130 million figure does not include the bonuses for 12 senior PG& E executives. The company has not yet asked the court to approve payments to those executives, although it noted that senior officers are typically eligible to receive bonuses in bankruptcy.
Recommended Reading: What Is Epiq Bankruptcy Solutions Llc
Meet Our Wildfire Lawyers
Northern California Fire Lawyersis a coalition of prominent Northern California law firms:Corey, Luzaich, de Ghetaldi & Riddle, Danko Meredith, andGibbs Law Group. Our firms consist of seasoned trial lawyers, leading national personal injury attorneys, and experienced complex litigators. Attorneys on our team have been appointed by California judges to serve in leadership positions in a number of large, coordinated fire and disaster cases. We bring a deep knowledge of the systems and fire-prevention policies of major utility companies and are well-positioned to leverage the hard work from our previous cases to benefit our clients.
What Was The Settlement Offer For The Pg & E Fire
There is no other settlement offer from PG& E on the table now and a better offer is not going to appear. Heres why: A review of PG& Es finances clearly indicates that the company simply cannot afford to pay out anything more than the negotiated $13.5 billion amount and still be a viable, operating utility.
You May Like: How Many Bankruptcies Has Donald Trump Filed
Pg& e: California Utility Firm Files For Bankruptcy After Deadly 2018 Wildfires
Company is facing hundreds of lawsuits from victims of recent fires and tens of billions of dollars in potential liabilities
Faced with potentially ruinous lawsuits over Californias recent wildfires, Pacific Gas & Electric Corp filed for bankruptcy protection Tuesday, in a move that could lead to higher bills for customers of the nations biggest utility and reduce the size of any payouts to fire victims.
The Chapter 11 filing allows PG& E to continue operating while it puts its books in order. But it was seen as a possible glimpse of the financial toll that could lie ahead because of global warming, which scientists say is leading to fiercer, more destructive blazes and longer fire seasons.
The bankruptcy could also jeopardize Californias ambitious program to switch entirely to renewable energy sources.
PG& E cited hundreds of lawsuits from victims of fires in 2017 and 2018 and tens of billions of dollars in potential liabilities when it announced earlier this month that it planned to file for bankruptcy.
The bankruptcy filing immediately puts the wildfire lawsuits on hold and consolidates them in bankruptcy court, where legal experts say victims will probably receive less money.
Theyre going to have to take some sort of haircut on their claims, said Jared Ellias, a bankruptcy attorney who teaches at the University of California, Hastings College of the Law. We dont know yet what that will be.
Resolute And Mourning Residents Of Fire
Legal experts said they still expected PG& E to move forward with bankruptcy in part because that would give the company space to formulate a plan to prevent its equipment from causing more catastrophic fires and reduce its future wildfire liability.
California may have to change an existing law that holds utilities entirely liable for damage caused by their equipment regardless of whether the company was negligent, said Kenneth Ayotte, who teaches corporate finance and bankruptcy law classes at the University of California, Berkeley School of Law.
PG& E would also be able to consolidate all wildfire lawsuits in bankruptcy court, where victims would have to tussle with creditors and would likely end up with less money.
Monday’s CPUC meeting may have provided a glimpse of the acrimony that would accompany any bankruptcy filing. Protesters repeatedly denounced and spoke over members of the commission and booed and shouted, “Shame,” as it voted to allow PG& E to immediately obtain credit and loans as part of any Chapter 11 filing. PG& E has said it has lined up $5.5 billion in credit and loans so it could continue operating during bankruptcy.
The commission faced criticism after it gave short notice of the meeting. State law generally requires multiple days of notice for public meetings, but the CPUC cited an exception for emergency situations that affect public health or safety.
You May Like: How Many Times Has Donald Trump Declared Bankruptcy
A Pg& e Bankruptcy Timeline: The Road To Chapter 11 And Beyond
Pacific Gas & Electric is in the midst of its second bankruptcy. While the first proceeding in 2001 stemmed from Californias energy crisis, the current stems from the utilitys role in recent wildfires and its resulting liabilities.
PG& E initially expected the proceeding to last two years. However, in order to qualify for the states new wildfire mitigation fund, the company is aiming to wrap up reorganization by June 30.
Besides direct coverage of the bankruptcy proceedings, Utility Dives timeline includes activity by state regulators and legislators the various pushes for company reorganization and wildfire impacts and preventative measures to reduce wildfire risk.
-
Willie Phillips Jr. called for balancing cost, reliability and sustainability to address issues such as climate change.
By Ethan Howland Oct. 20, 2021
-
The report doesnt completely write gas off, however, and acknowledges that a handful of units may be required to sit idle and be called upon when needed for short-term, emergency power.
By Kavya Balaraman Oct. 19, 2021
‘a Tactic’ Not A Necessity
Nettie Hoge, executive director of The Utility Reform Network in San Francisco, speculated that PG& E may be attempting to pressure the governor to come through with a more generous bailout package.
“This is not a necessity,” she said. “It’s just a tactic.”
Trading in PG& E’s stock was halted before yesterday’s announcement. When trading resumed in the final hour of the session, PG& E’s share price plunged almost 37 percent to close at $7.20.
Shares of Edison International, parent company of Southern California Edison Co., also tumbled on the news, shedding almost 35 percent to close at $8.25.
Nevertheless, Edison CEO John Bryson said he does not expect PG& E’s bankruptcy to affect his utility’s parallel bailout negotiations with Sacramento.
“We at Southern California Edison continue to believe that working out a comprehensive solution to our current crisis is a preferable course to take,” he said. “PG& E’s decision does not change our position.”
Edison tentatively has agreed to sell its power lines to the state for about $2.8 billion. Similar talks with PG& E have dragged on for months, with little if any progress.
Read Also: What Is Epiq Bankruptcy Solutions Llc
Is Pg& e Responsible For California Fires
The uncooperative power company, together with an overwhelmed regulator, a rapidly warming climate, and a growing population living in Californias tinder-dry forests, combined to set the stage for tragedy: PG& E equipment has been found responsible for numerous wildfires in recent years, including the 2018 Camp Fire
Why Did Pg& e File Bankruptcy In 2001
4/52001 bankruptcyPG& E
Furthermore, why did PG& E filed bankruptcy in 2001?
PG& E did it in 2001 in the wake of the California electricity crisis. The combination of drought and deregulated markets plunged California utilities into a horror of soaring wholesale energy costs. By April 2001, PG& E filed for Chapter 11 bankruptcy protection and reorganization, citing $9 billion in debt and growing.
Furthermore, when was the last time PG& E filed bankruptcy? The last time PG& E filed for bankruptcy, in 2001, fires had nothing to do with it. That bankruptcy was a result of California’s infamous energy crisis, in which a failed deregulation plan allowed Enron Corp.
Similarly one may ask, what happens if PG& E Files Bankruptcy?
Bankruptcy could affect wildfire victims seeking damages because the filing triggers a stay on lawsuits against PG& E. If wildfire victims aren’t happy with the reorganization, it could be that their claims are so large that they can veto the plan.
What date did PG& E file for bankruptcy?
Also Check: Donald Trump Number Of Bankruptcies
California Governor Pledges He Will Work To Ensure Bankruptcy Not Unfair To Wildfire Victims
California Governor Gavin Newsom pledges he will work on ensuring PG& Es bankruptcy will not lead to unfair treatment of the recent California wildfires. You can read Governor Newsoms statement here:
While PG& E announced its intent to file bankruptcy today, the company should continue to honor promises made to energy suppliers and to our community. Throughout the months ahead, I will be working with the Legislature and all stakeholders on a solution that ensures consumers have access to safe, affordable and reliable service, fire victims are treated fairly, and California can continue to make progress toward our climate goals.
Governor Gavin Newsom
Who Was Responsible For Paradise Fire
Pacific Gas and ElectricityAfter a very meticulous and thorough investigation, CAL FIRE has determined that the Camp Fire was caused by electrical transmission lines owned and operated by Pacific Gas and Electricity located in the Pulga area. The fire started in the early morning hours near the community of Pulga in Butte County.
Recommended Reading: How Many Times Has Donald Filed Bankruptcy
Our Pg& e And Wildfire Experience
No Other Firm Has More Experience Suing PG& E.Our first case against PG& E was nearly 30 years ago. We know PG& Es playbook and we use that unique knowledge to benefit our clients.
We have succeeded in trial against PG& E.Our lead trial lawyer, Mike Danko, is the only lawyer in Northern California to have taken a case of this type all the way through to trial and verdict against PG& E. Since then, PG& E has offered settlements to our clients in many cases during or just before the start of trial. PG& E knows we are ready, willing and able to take a case to trial, and that approach helps us achieve the best results for our clients.
Appointed by judges to lead legal battles against PG& E.We have been appointed by judges to leadership positions in large-scale cases against PG& E, including the 2017 North Bay Fires cases, the 2015 Butte Fire cases, and the 2010 San Bruno Explosion cases. Judges trust us to represent the best interests of fire & disaster victims.