PG&E Says It’s Open to Extending Fire Victim Claims Deadline

By Joel Rosenblatt | October 29, 2019

PG&E Corp. told a judge it’s willing to extend the deadline for victims of wildfires caused by the utility’s equipment to file claims in its bankruptcy.

U.S. District Judge James Donato criticized the company at a hearing last week, saying it’s “just not right” that less than half of the eligible northern California residents had filed claims by the Oct. 21 deadline. He said Monday that it’s “good news” that PG&E is willing to continue accepting claims until Dec. 20 and even beyond. He added that he expects a victim participation rate of 90% or higher.

Donato is tasked with finding PG&E’s potential liability from fire-related losses and estimating damages for the bankruptcy proceeding. At Monday’s hearing the judge asked lawyers for both sides how the bankruptcy may be affected by the Kincade Fire, which has burned 66,000 acres in Sonoma County north of San Francisco since it started Oct. 23 and continues to rage.

While other judges have raised the specter of how future fires might weigh on or derail PG&E’s bankruptcy, Donato is the first to demand information from lawyers about Kincade. Attorneys from both sides agreed to respond quickly, without specifying a date.

Any claims arising from Kincade can most likely be brought directly against PG&E without going through the bankruptcy, Mike Danko, a lawyer representing fire victims, said in an email.

“There is a small chance that the bankruptcy judge will decide that Kincade claims must go through the bankruptcy because, while they arose after PG&E filed” for bankruptcy, they are still the result of PG&E conduct “core” to the proceeding, Danko said.

Shares of PG&E and its debt have plummeted on investors’ concern the company’s equipment may have caused the Kincade fire. The mandatory blackouts and fires scattered across Northern California this month follow a string of deadly blazes in 2017 and 2018 that saddled PG&E with an estimated $30 billion in liabilities, forcing it into bankruptcy.

Donato on Monday also voiced frustration that a questionnaire drafted by PG&E as part of the claims process is too complicated, calling it “unreadable and unfriendly” and ultimately “unworkable.” PG&E wants to use the questionnaire partly to gauge the level of victims’ emotional distress. By the end of the hearing Donato reluctantly agreed to consider the data if enough victims participate.

The case is In re. PG&E Corp., 19-cv-05257, U.S. District Court, Northern District of California (San Francisco).

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