Large City Lawsuits

SoCal Edison & PG&E are Lobbying the Legislature to Avoid Wildfire Liability

SoCal Edison & PG&E are Lobbying the Legislature to Avoid Wildfire Liability

SCE and PG&E are lobbying for legislative changes in Sacramento, to lessen their liability for the 2017 wildfires and future ones. In particular, these investor-owned utilities (with market caps of over $20 billion) are spending substantial amounts fighting California’s current application of inverse condemnation to their culpability for wildfires. Currently, under inverse condemnation, utilities such as SCE have strict liability for fire damages (and debris-flow damage) caused by their facilities, even when homeowners can’t demonstrate the utilities were negligent. Inverse condemnation has been applied to utilities in California for almost twenty years (since SCE was found liable under the theory for a 1993 fire, in Barham v. So Cal. Edison Co (2012) 208 Cal.App.4th 1400), so the precedent these utilities are trying to upend is well-established.

Recently, SCE and PG&E have convinced the legislature to consider two last-minute bills before this year’s session ends in August. Bill 1033 would create a procedure, whereby utilities would present safety plans for their territories to the California Public Utilities Commission, and if the CPUC approved them, the utility would automatically be deemed to have acted prudently. Under the law (as it stands), in the event of a wildfire, if it’s ruled a utility did not act prudently, the utility is precluded from passing on fire costs to ratepayers, and the utilities’ shareholders must bear the expense. In the 2007 San Diego Wildfires, SDG&E settled over 2,000 cases, and paid out over $2 billion, while never admitting liability. The utility petitioned the CPUC to pass on $379 million in unreimbursed costs to its ratepayers, citing that their cases were settled under inverse condemnation. The CPUC denied SDG&E’s request, finding the utility had not acted prudently in its safety procedures.  (http://www.sandiegouniontribune.com/business/energy-green/sd-fi-sdge-wil...). While the utilities have argued for a complete exemption for investor-owned utilities from inverse condemnation, the current version of Bill 1033 would allow them to pass on unreimbursed costs to their customers. (In addition, we believe the utilities will use these plans in the future to argue that they weren’t negligent in causing wildfires.)

The second bill, AB33 (originally written for electric vehicles) was recently amended to allow PG&E to settle wildfire lawsuits with state-authorized bonds, which would be repaid by PG&E’s customers. (See https://lostcoastoutpost.com/2018/jul/10/revised-bill-would-place-cost-w...). This late session bill is disturbing: the utilities are seeking an automatic way to pay for their wildfire damages, rather than accepting responsibility themselves. If this bill passes, we believe SCE will attempt to have its ratepayers shoulder the costs of the Thomas Fire and Montecito Mudslides. We believe the utilities’ shareholders—who have been reaping handsome dividends from these quasi-monopolies—should accept losses as well as profits, and pay to rebuild communities that their companies destroyed.

To counter the utilities’ lobbyists, and ensure our communities will not be left with the bill for SCE’s negligence, we have joined with: several law firms from the Thomas Fire Court-appointed leadership team, members of the 2017 North Bay Fires leadership teams, and an organization called “Up From the Ashes.” (http://www.holdpgeaccountable.com/take-action-now.html). Collectively, our team is lobbying the legislature to resist PG&E and SCE’s demands for a free pass on their liabilities. Several of our attorneys will be attending a rally on the steps of the State Capitol, on August 8th, 2018, at 10:00 am. We also have encouraged our clients to write their representatives and tell them vote against SCE and PG&E’s attempt to evade liability for the 2017 Fires and future wildfires.

If you would like to learn more about PG&E and SCE’s lobbying efforts, the below articles have some useful information:
https://www.davisenterprise.com/local-news/state-government/a-political-...
http://www.latimes.com/opinion/editorials/la-ed-wildfire-liability-20180...

Spreter & Petiprin, APC has teamed up with three other law firms: Robertson & Associates, LLP (Ventura); Foley, Bezek, Behle, Curtis, LLP (Santa Barbara); Law Offices of Joe Liebman (Santa Barbara) to prosecute the Thomas Fire and Montecito Mudslide cases. Our firms have over 30 years of experience in mass-tort, landslide and erosion, wildfire, real estate, and construction litigation. Our team now represents over 425 plaintiffs in the Thomas Fire and Montecito Mudslide Litigation. We filed one of the first cases against SoCal Edison over the Thomas Fire, and the first Montecito Mudslide lawsuit and wrongful death case.