PG&E: Judge orders mediation of ‘whatever issues can be identified’

By Caroline Salls

Pittsburgh, Oct. 30 – The judge handling PG&E Corp. and Pacific Gas and Electric Co.’s Chapter 11 bankruptcy case ordered mediation in “a good faith effort to mediate whatever issues can be identified,” according to an order filed with the U.S. Bankruptcy Court for the Northern District of California.

Judge Dennis Montali noted in his order that mediation worked in Pacific Gas and Electric’s 2003 bankruptcy proceedings.

“Now, more than 16 years later in the utility’s second case (this time with parent company), the need for mediation is far more obvious and the stakes unbelievably higher,” the order said.

“Certain parties are polarized; the emotions are running higher and higher, the staggering costs (economic and otherwise) are multiplying daily and very recent events that need not be repeated here but are obvious to everyone in Northern California might make a successful reorganization even more of a challenge.”

In addition, Montali said “the clock is ticking” on deadlines set in recently enacted wildfire legislation, a Tubbs Fire trial is scheduled to begin in January and a district court estimation hearing will be held in February.

The judge said the goal of the mediation is to confirm a Chapter 11 plan in order to set in place the next stage of the complex process of compensating wildfire victims for their losses, other creditors are entitled to receive what they are owed under the law and equity owners are “entitled to consideration of their rights under whatever alignment or realignment may follow as part of a Chapter 11 plan.”

Retired bankruptcy judge Randall J. Newsome was appointed as mediator.

The electric and natural-gas utility is based in San Francisco. The company filed bankruptcy on Jan. 29, 2019 under Chapter 11 case number 19-30088.

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