Wildfire Victims Seek Ban on PG&E Lobbying During Bankruptcy

Volunteer rescue workers search for human remains in the rubble of homes burned in the Camp Fire in Paradise, Calif., Thursday, Nov. 15, 2018. Dozens of people died and perhaps several hundred are unaccounted for in the nation’s deadliest wildfire in a century. (AP Photo/Terry Chea)

SAN FRANCISCO (CN) – Wildfire victims on Friday asked a bankruptcy judge to block utility giant Pacific Gas and Electric from spending millions on lobbying until it fully compensates those who lost homes, possessions and loved ones in a series of destructive fires sparked by its equipment.

“It is an insult to its victims for PG&E to cry poverty while pouring millions of dollars into campaign chest funds and lobbyists’ coffers in an effort to reap special benefits, including limiting liability for the death and destruction it has caused,” lawyers for a group of more than 3,500 fire victims wrote in a bankruptcy court filing Friday.

Representing victims of 18 wildfires, lawyers from the San Diego-based Singleton Law Firm and Sullivan Hill Rez & Engel said it would be inappropriate for PG&E to spend “lavish amounts of money” influencing state lawmakers and regulators as it evades its legal obligations to fire victims.

PG&E spent more than $11.8 million lobbying lawmakers and the California Public Utilities Commission during the 2017-2018 legislative session, according to state records.

Aside from seeking a blanket prohibition on lobbying, the lawyers also want U.S. Bankruptcy Judge Dennis Montali to make PG&E pay the $9.5 million in signed settlements to 52 victims of the 2015 Butte County Fire as a condition of its request for $4 billion in new loans.

“PG&E could have paid the settlement funds before filing bankruptcy, but it chose not to,” the fire victims stated in their brief, arguing the company instead chose to pay millions in severance to outgoing executives who oversaw PG&E at the time the fires were started. The company paid its former CEO Geisha Williams $2.5 million in severance when she resigned in January.

Also on Friday, a committee of tort claimants, or of those who have sued PG&E for damages, asked Montali to impose another condition on PG&E’s request for new loans. The claimants want PG&E to fund a program to provide food, shelter and basic necessities for victims of the 2018 Camp Fire. PG&E acknowledged last week that its equipment likely sparked the deadly blaze in Butte County, which killed at least 85 people and destroyed thousands of homes.

PG&E said in a statement Friday that it intends to launch such a program to provide aid for those affected by the Camp Fire.

“We feel strongly that it’s the right thing to do and are glad they support this important initiative,” PG&E spokeswoman Lynsey Paulo said in an emailed statement. “We intend to promptly file with the Bankruptcy Court our motion seeking authority to create such a fund and will urge its approval.”

The tort claimants also want PG&E to pay another $15 to $20 million in signed settlements with Butte County fire victims.

Beyond their demands for fire reparations, the tort claimants also want Montali to maintain control over the creditors’ claims to PG&E’s assets. The group argues that allowing creditors to whom PG&E already owes money to lend billions more to the company would give them “an unfair advantage in negotiations over other claimants holding claims of the same priority.”

Montali is expected to hear arguments on PG&E’s motion for $4 billion in new debtor loans on March 13.

PG&E, which got approval to borrow $1.5 billion in January, says it will use the loan money to pay a $1 million settlement to the Butte County government for the 2015 fire. The company also seeks permission to fund a $350 million employee bonus program with the new funding.

PG&E did not respond to a request for comment regarding the money it spends on lobbying.

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