LOS ANGELES (CN) – In a massive collection of property damage lawsuits stemming from the second largest wildfire in modern California history, a Los Angeles County judge said Thursday that Southern California Edison can’t escape a state law holding utilities financially liable when their equipment is determined to be the cause of a blaze.
Some 200,000 residents fled their homes as the Thomas Fire spread across multiple counties in December 2017 and into early 2018. The wildfire burned more than 280,000 acres and destroyed approximately 1,300 structures.
Edison now faces hundreds of lawsuits from property owners who claim faulty electrical equipment sparked the fire that burned through Santa Barbara, Los Angeles and Ventura counties.
Attorneys representing the property owners asked the Judicial Council of California for a Judicial Council Coordinated Proceeding, which places all pretrial motions before one judge – Presiding LA County Superior Court Judge Daniel Buckley.
In a demurrer filed in August, Edison challenged only one of plaintiff’s causes of action: the state’s strict inverse condemnation law.
That law leaves utilities liable for damage caused by faulty equipment, even when the companies were shown to have followed all the necessary safety precautions. Edison faces massive payouts if it’s found liable for property damage from the Thomas Fire.
Edison says because it is a privately owned corporation, it cannot legally spread the costs of damages among its ratepayers since the state’s Public Utilities Commission does not consider losses from inverse condemnation suits a valid reason to hike rates.
Edison’s attorney John Hueston with Hueston Hennigan said, “It’s not whether SCE [Southern California Edison] is barred from obtaining a rate increase – it’s whether SCE can spread those losses as a matter of right. That’s the critical point.”
The utility says liabilities should be socialized – spread throughout the community.
Edison cited two appellate cases, Barham v. Southern California Edison Co. and Pacific Bell Telephone Company v. Southern California Edison Company, both related to liability claims from property damage.
The utility said appellate courts have not decided whether private companies have access to public funds to compensate for a public taking. In both Bell and Barham, Edison said the courts assumed the utility company could spread its losses.
But Buckley said he does not have discretion to consider what another court might have ruled.
“I heard your arguments, you may well be right, but in the simple position that’s not my role,” said Buckley, overruling the demurrer.
California Fire Lawyers are also coordinating at least 2,000 cases in a Judicial Council Coordinated Proceeding in San Francisco Superior Court over the 2017 wildfires that tore through the North Bay and the multiple lawsuits filed against Pacific Gas & Electric.
Last month, Gov. Jerry Brown signed a law to help utility companies offset their liabilities by passing on some of the damages to ratepayers. The law takes effect in 2019, however, and is not retroactive.
State Sen. Bill Dodd, D-Napa, told The Associated Press that ratepayers can expect about $5 extra on their bills for every $1 billion Pacific Gas & Electric has to finance to pay damages.
Subscribe to Closing Arguments
Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.
