Tubbs fire victims urge bankruptcy judge to allow civil trial against PG&E

A federal bankruptcy judge in San Francisco overseeing the reorganization of PG&E said the public’s confidence in how compensation is allotted to wildfire victims could be a key factor in his decision whether to allow a civil trial to determine the company’s liabilities for the 2017 Tubbs fire that devastated Santa Rosa.

During a pivotal day of arguments Wednesday, U.S. Bankruptcy Judge Dennis Montali heard lawyers for wildfire victims press for the opportunity to prove before a jury that the ?investor-owned utility is responsible for the fire, despite Cal Fire’s conclusion that private property owners’ power equipment sparked the fire.

A civil trial would be an unusual interruption to the streamlined process used for resolving claims in bankruptcy court, a sign of the unprecedented nature of the utility’s case. PG&E, the state’s largest utility, filed for Chapter 11 bankruptcy in January under pressure from its estimate of $30 billion in liabilities for wildfires sparked by its power equipment in 2017 and 2018, halting lawsuits against the company by wildfire victims.

But Montali repeatedly returned to the concept of public trust during nearly three hours of arguments Wednesday. He said he would issue a written opinion by Friday or Monday.

“Does it appear fair? Does it appear fair if there isn’t a jury?” Montali said.

The judge’s ruling could resolve a key question looming over the bankruptcy proceedings about the method for determining how Tubbs fire victims should be compensated compared to victims of other fires in which PG&E was found at fault and to have acted negligently. The fire, the state’s most deadly and destructive blaze in 2017, stands apart as one of the few major wildfires that year Cal Fire investigators said wasn’t ignited by PG&E power equipment.

An attorney for PG&E called a civil trial on Tubbs fire liability “a bridge to nowhere” because a jury verdict may not come in time for the bankruptcy case, which the company hopes to resolve by the middle of next year. Gov. Gavin Newsom and the California Legislature have imposed a June 30, 2020 deadline for PG&E to resolve claims and exit bankruptcy in order for the utility to participate in a $10.5 billion wildfire insurance fund.

The fund would help the state’s utilities pay for victims’ claims from future fires not caused by their power equipment or negligence.

Kevin Orsini, an attorney for PG&E, urged the judge to settle the matter of compensation for Tubbs fire victims in bankruptcy court because it would provide the most expeditious resolution. He stressed that the state’s 16-month investigation determined the inferno nearly two years ago was not ignited by PG&E.

“The light shines brightly,” in bankruptcy court, Orsini said.

The Tubbs fire ignited Oct. 8, 2017, near Calistoga in northern Napa County and burned across about ?12 miles into Santa Rosa, destroying 5,130 homes and killing 22 people.

Victims of the blaze are asking for a fast-track civil trial involving a small pool of plaintiffs who are elderly and feeble that may be entitled to speedier due process because of their conditions.

PG&E raised concerns with the judge that such a trial would not include a representative group of fire victims and potentially set up an unfair case for the company.

But one of the attorneys representing wildfire victims, Mike Kelly, said the Tubbs victims’ claims were too significant to be resolved in closed-door negotiations, adding that the fire represented 26% of all wildfire losses statewide amid the staggering number of major fires that torched communities in 2017 and 2018.

“Those people have the right to have the light of day shined on the facts and shined on PG&E’s behavior,” Kelly said.

Santa Rosa resident Greg Wilson, whose Mark West Springs-area home was destroyed by the Tubbs fire while he and his wife escaped death by seeking refuge in their pool, is among plaintiffs in lawsuits against PG&E hoping the bankruptcy judge will allow the chance for the civil case to move forward.

Wilson, an engineer living in Sebastopol while his family rebuilds their home, attended the hearing in San Francisco, because he believes the outcome is important to his family.

“To have true due process, I want to feel like everyone has left everything on the table,” Wilson said. “The proper way was to take this to trial.”

You can reach Staff Writer Julie Johnson at 707-521-5220 or julie.johnson@pressdemocrat.com. On Twitter @jjpressdem.