PG&E’s former corporate officers and directors have reached a $117 million settlement with a trust for wildfire victims over alleged mismanagement leading up to the 2017 North Bay wildfires and the 2018 Camp Fire, according to trust officials.
The settlement will be paid for out of the $200 million insurance policy PG&E carried for its former corporate officials, not from any operating funds.
“It is our hope that in holding PG&E’s past officers and directors accountable in connection with the damage inflicted on thousands of fire victims in California, the current board and new leadership of PG&E charts a different course where safety and the protection of customers is the central operating principle of the company,” Cathy Yanni, trustee for fire victims, said in a statement.
“We are pleased to see early signs of a new focus on safety with PG&E’s recent announcements about plans to harden infrastructure and lay power lines underground, both measures that would significantly reduce fire hazards.”
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Wildfire attorneys sued the 20 named former leaders of the company after the 2020 bankruptcy and took depositions from former PG&E executives earlier this year in advance of the pending trial. The settlement was reached in principle in May and finalized in July.
Wildfire trust victims attorney Frank Pitre said the $117 million sum was among the largest reached against former corporate boards and officials in the U.S.
But he said the bulk of the settlement must be used to compensate federal agencies involved in fire response, as per provisions of the PG&E bankruptcy settlement.
The hope is that compensating the obligations to federal agencies will clear the way to allow victims to recover from other proceeds of litigation, including pending suits against PG&E vegetation management contractors and its outside consultants.
“This was a compromise,” Pitre said, “to account for the fact because there was a dispute over policy limits, the costs of defense and competing claims.”
PG&E, in a statement, said the agreement “is another step forward in PG&E’s ongoing effort to resolve issues outstanding from before its bankruptcy and to move forward focused on our commitments to deliver safe, clean and reliable energy to our customers, and to continue the important work of reducing risk across our energy system.’’
