The battle to reach a PG&E bankruptcy plan reached another milestone this March when the company agreed to plead guilty to 84 counts of involuntary manslaughter and one count of unlawfully starting a fire, according to NBC News.

The company has been deemed responsible for the most destructive fire in California’s history. Now the victims of that fire are wondering where the $4 million in fines from these charges will come from in the bankruptcy plan.

PG&E has published a press release claiming that “the satisfaction of the $4 million in fines and expenses associated with the plea agreement … will not reduce the amount of funds available to satisfy wildfire victim claims.” The release states that the $4 million in fees will be paid with the “income earned on the distribution to be made to the subrogation claimants” under the PG&E bankruptcy plan. The release also includes a subsection clarifying that “forward-looking statements” can’t be guaranteed. The same language is included in releases covering their commitments to safety and re-emergence from bankruptcy.

PG&E Bankruptcy Plan Is Approved

PG&E filed for Chapter 11 in January 2019, according to CNN. The company reported $7 billion in claims from the Camp Fire at the time. Governor of California Gavin Newsom has previously rejected a PG&E bankruptcy plan and its revised version a month later, according to PBS News Hour. 

According to statements from the company, the PG&E bankruptcy plan will include reorganizing the infrastructure of the business to focus more on local communities and customers through a regionalized structure. It involves hiring new board members and a commitment to California’s climate goals. Enhancing regulatory oversight, agreeing to state observance, and an agreement to sell the company if it doesn’t re-emerge from bankruptcy before June 30 are also a part of the PG&E bankruptcy plan.

On the monetary side, CNN reports that the company must establish a fund of $13.5 billion that will be used to compensate victims. It is this fund that experts worry will be drained by PG&E debts, fees, and financial commitments. The PG&E bankruptcy plan has been approved by Newsom, but the actual implementation of that plan is yet to be seen.

The Victims Fund of PG&E Bankruptcy Plan

The Camp Fire is the deadliest and most destructive wildfire in California’s history so far, but it wasn’t the first fire the company has been accused of starting, and the PG&E bankruptcy plan will likely include provisions for other fires as well. According to the company’s bankruptcy press release, roughly $25.5 billion will be paid to victims of a series of wildfires in the years 2017 and 2018. 

The Camp Fire itself caused at least 84 deaths and the destruction of 14,000 homes, 500 businesses, and roughly 4,300 other buildings, CNN reports.

It was found that PG&E reported “an outage” near where the wildfire began just 15 minutes before it started. According to CNN, a downed power pole “riddled with bullet holes” and other PG&E equipment were found within the burn area. After the blaze, the utility began facing significant pressure from debt holders and victims bringing them to file for Chapter 11 protection. The negotiation of the PG&E bankruptcy plan has been underway since soon after.

This article is not legal advice. It is presented
for informational purposes only.