PG&E Beats $2.5B Negligence Suit Over Blackouts At 9th Circ.

Manoj Prasad
Highlights
  • The California Supreme Court clarified that state law shields PG&E from liability during emergency blackouts, so a Ninth Circuit panel dismissed a $2.5 billion class action seeking to hold the utility liable for blackouts allegedly caused by electrical grid maintenance issues.
  • Section 1759 and section 2106 impose liability on a public utility if it β€œdoes, causes to be done, or permits any act, matter, or thing prohibited or declared unlawful, or which omits to do any act, matter, or thing required to be done, either by the Constitution, any law of this State, or any order or decision of the commission.”
  • It's a big win for PG&E, which has been sued many times in recent years, including a $117 million settlement with previous executives and directors accused of insufficient safety program monitoring.

A panel of judges from the Ninth Circuit upheld the dismissal of a $2.5 billion class action lawsuit that wanted to hold PG&E responsible for blackouts that were supposedly caused by maintenance problems with its electrical grid.

This came after the California Supreme Court made it clear that the utility is not legally responsible during emergency blackouts.

Sections 1759 and 2106 of the law say that a public utility is responsible if it “does, causes to be done, or permits any act, matter, or thing prohibited or declared unlawful, or which omits to do any act, matter, or thing required to be done, either by the Constitution, any law of this State, or any order or decision of the commission.” This case is about how these sections interact with each other.

The planned class action was filed in 2022. It said that millions of Californians were affected by blackouts because PG&E did not properly maintain its electrical grid.

According to the California Supreme Court’s clarification of state law, PG&E is not responsible for damages during emergency blackouts. The bankruptcy court threw out the case, and the Ninth Circuit panel upheld the dismissal.

A big win for PG&E, which has been hit with a lot of lawsuits and legal problems in the past few years, is the Ninth Circuit panel’s ruling. The power company went bankrupt in 2019 because its technology had caused wildfires that cost billions of dollars in damages.

The ruling also shows how complicated the laws are in California when it comes to utility liability. There has been a lot of discussion and lawsuit about how sections 1759 and 2106 work together. The California Supreme Court’s clarification of state law has helped make things clearer.

Overall, the Ninth Circuit’s ruling is a big win for PG&E. It also shows how hard it is for California’s utilities to balance the need for reliable energy with the risk of being sued for blackouts and other problems.

SOURCES: Law360
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