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Wildfire Victims May Become Low Priority in PG&E Bankruptcy Case - ABI

A group of Butte County wildfire victims have filed a class action complaint against PG&E as part of the embattled utility’s bankruptcy case, but a 50-year-old court ruling could place wildfire victims near the bottom of the stack of priorities in PG&E’s insolvency proceeding, according to a market researcher and a Bay Area bankruptcy expert, the East Bay Times reported. A 1968 U.S. Supreme Court ruling in connection with a fire that burned down an industrial building, if applied to the PG&E bankruptcy case, potentially would place the claims of the victims of the infernos of recent years at a lower priority than victims of any PG&E-caused wildfires that began after the company’s bankruptcy filing this year. “Any wildfire victims whose claims arise — meaning, their property catches on fire — from the date of PG&E’s bankruptcy onward will have first priority in the bankruptcy case,” said Jared Ellias, a bankruptcy expert and law professor with the UC Hastings College of the Law. Prof. Ellias assessed whether that 1968 Supreme Court decision could come into play in the PG&E bankruptcy case which is being supervised by U.S. Bankruptcy Court Judge Dennis Montali. That would produce an inferior status for the claims of victims of fires that occurred in 2017, such as the infernos that scorched the North Bay Wine Country and nearby regions; and the 2018 wildfire that roared through Butte County and essentially destroyed the town of Paradise, he said.

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