Get the facts about PG&E’s Proposed Settlement and what it means for California fire Survivors
Settlement Overview
PG&E has proposed a $13.5 billion settlement with wildfire victims across the state. The proposed settlement will help families, communities, and business impacted by these wildfires continue to recover and rebuild. As part of the settlement process, anyone with a claim against PG&E will have a chance to vote on this proposal.
Watch our recent Telephone Town Hall with fire survivors:
Here are some quick facts showing why approving this settlement is essential to give wildfire victims the resources they deserve.
Rejecting this settlement now won’t lead to a better deal later
There is no other settlement offer from PG&E on the table now and a better offer is not going to appear. Here’s why:
A review of PG&E’s finances clearly indicates that the company simply cannot afford to pay out anything more than the negotiated $13.5 billion amount and still be a viable, operating utility.
Attorneys for wildfire victims have extracted just about every last penny that is available to pay victims. Any other view is not supported by the financial facts.
Rejecting This Settlement Now Will Mean No Payments to Victims for Years
Rejecting the PG&E restructuring plan now will eliminate the company’s ability to exit bankruptcy by June 30, 2020, which means PG&E can’t participate in the state-backed $21 billion wildfire liability fund.
This fund was set up to help utilities like PG&E offset the costs of future fires it might cause. Without access to this fund, it is unlikely that there will be another settlement offer anywhere near $13.5 billion. This also means PG&E could decide to go into Chapter 7 bankruptcy process to liquidate all of its assets – delaying a payment, if any, for years.
No Wildfire Victim or Survivor Will Be Forced to Take PG&E Stock As Part of a Settlement
Opponents to the settlement are putting out false information on this point. PG&E has agreed to pay wildfire claimants a total of $13.5 billion. One half of this will be paid in cash, while the other half will be paid out in the form of stock of the new PG&E when it exits bankruptcy.
The cash and stock will be placed into a trust account around August 2020. These funds will be managed by some of the smartest and largest money management institutions to ensure that these assets are protected while we are working through the claims process and while the funds are being distributed.
Once the stock is placed in the trust, it can be sold at proper intervals in order to have the cash to make settlement payments to claimants. NO CLAIMANT WILL BE FORCED TO TAKE STOCK IN THE NEW PG&E.
Insurance Companies Settled With PG&E and Won’t Come After Wildfire Victims Settlements
Under the legal doctrine known as SUBROGATION, insurance companies have always been entitled to get paid the full amount of what they paid out to wildfire victims IF a third party was found responsible for starting the fires.
In this case, PG&E started the fires and so insurance companies are allowed to collect any money their insured gets from PG&E.
Instead of going to each fire victim seeking to recover their money, the insurance companies decided to settle all of these claims with PG&E directly.
They made this deal in September of 2019 for a total of $11 billion. That figure represents about 55% of the $20 billion the insurance companies are expected to pay out to all wildfire insurance claims which is a deep discount.
“It’s our chance to rebuild our homes a lot faster and help our community do the same.”
“We’re here just trying to build our lives back up again and the no vote would delay it.”
“By voting no we increase the risk of obtaining a much lesser settlement, if any at all.”
“There’s no way we’ll be able to survive if we have to wait”
“It’s been two and a half years, we just want to move on”
“I don’t think we’re going to get a better deal than this.”
“If this doesn’t happen, it could be another three or four years – if ever.”
“It was a no-brainer for us to vote yes.”
Bloomberg: PG&E Is Set to Exit Bankruptcy, Ending Saga Sparked by Fires
Only 19 months after the Camp Fire erupted in the tinderbox mountains of Northern California, PG&E Corp., the power utility behind the deadliest conflagration in the state’s history, is poised to emerge from bankruptcy with its safety still in question. As the...
AP: PG&E clears another bankruptcy hurdle with debt refinancing
U.S. Bankruptcy Judge Dennis Montali signed off on the deal to refinance billions of dollars in debt to pay off PG&E bondholders. The bondholders had threatened to cause problems for the nation's largest utility. But as part of the truce, they agreed to abandon an...
Associated Press: PG&E’s Bankruptcy Plan Strides Toward Approval in California
From the Associated Press: BERKELEY, Calif. (AP) — California regulators are being advised to approve Pacific Gas & Electric's plan to emerge from bankruptcy with new controls designed to prevent a recurrence of the utility's past bad behavior that has resulted in...
Chico ER: Paradise resident favors PG&E’s settlement offer
"Yesterday I voted YES to accept the offer from PG&E. "In my opinion it is a fair offer. In my opinion it is the best offer. "There are no winners in these situations. Everybody loses something. Some of my friends lost their lives. Too many unfortunate events of...
Law 360: PG&E Touts Erin Brockovich’s Support Of Reorganization Plan
Law360 (April 9, 2020, 5:04 PM EDT) -- Pacific Gas & Electric is drumming up support for its reorganization plan, trumpeting Thursday an endorsement from consumer advocate Erin Brockovich, who led a legal battle against the utility over contaminated California...
Yahoo Finance: Numerous Voices Express Continued Support for PG&E’s Settlement with Wildfire Victims and its Plan of Reorganization
In December 2019, PG&E reached the settlement that provides for approximately $13.5 billion to be transferred to a trust to pay the victims from wildfires in 2015, 2017, and 2018 pursuant to the terms of PG&E's Plan. That settlement was supported by the...
Bloomberg News Discusses Strength of PG&E Settlement
Bloomberg – PG&E Plan Has Broad Support From Fire Victims, Lawyers Say
Read more from Bloomberg News: Lawyers for more than half the wildfire victims who negotiated a $13.5 billion settlement with PG&E Corp. say their clients plan to vote overwhelmingly in favor of the bankrupt utility’s reorganization plan. The attorneys represent...
Press Democrat – Close to Home: Five reasons why wildfire victims should accept PG&E’s offer
Read more from Roy Miller in The Press Democrat: Over the next six weeks, wildfire victims will vote on whether to accept the $13.5 billion settlement negotiated by their lawyers and PG&E. I lost my home and all my family’s possessions in these fires, and I am...
Will clients be forced to take stock in PG&E?
Could there be a better settlement option?
Will every survivor receive the same amount?
What are the financial risks of fighting for a better settlement
What are the expected expenses individual clients will pay?
Who are the Funds involved?
ADVERTISEMENT: Roy Miller of the Hansen & Miller Law Office, Mikal Watts of Watts Guerra LLP, and Joseph Earley of the Law Office of Joseph Earley are the attorneys responsible for this advertisement.
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