PG&E appeals order on applicability of doctrine tied to fire liability

By Caroline Salls

Pittsburgh, Dec. 18 – PG&E Corp. appealed a U.S. Bankruptcy Court for the Northern District of California ruling that the California Constitution’s doctrine on inverse condemnation, which the company said improperly keeps it from spreading wildfire-related obligations to ratepayers, applies in PG&E’s case, according to a notice filed Tuesday.

According to the Nov. 27 decision, while PG&E takes issue with a longstanding principle of strict no-fault liability applied to private utilities, it focused its primary challenge on a 2017 change in policy that it claims undermines the company’s ability to spread liabilities from causes such as the wildfires to customers.

“[The PG&E debtors] stress repeatedly that the underlying policy of inverse condemnation as reflected in numerous cases is the distribution of losses throughout the community,” the ruling said.

However, the court ruled that the doctrine does apply, and said it “also predicts that the California Supreme Court would reject the debtors’ pleas and reach the same conclusion.”

“As recently as this past July, the California legislature refused debtors’ request to restrict inverse condemnation,” the decision said. “There is simply no reason to suggest that this court can expect the California Supreme Court to step up and do it.”

The court said PG&E has not provided enough evidence to justify deviation from intermediate appellate court cases that covered the issue.”

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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