This week PG&E appeared in bankruptcy court to answer questions under oath put to it by wildfire survivors and other creditors. PG&E and its lawyers resisted answering some questions and, in one instance, outright refused to do so even after being directed to answer by the United States Bankruptcy Trustee. (So much for PG&E’s commitment to “transparency” during the bankruptcy process.)
One of the first questions put to PG&E was why it filed bankruptcy. Usually a company does so because it is insolvent. PG&E admitted, however, that it is not insolvent any sense. Its assets exceed its liabilities by many billions of dollars. Further, it was and is able to pay its obligations as they come due. Then why bankruptcy, if not to keep for PG&E’s shareholders money that should rightfully go to PG&E’s victims?
According to PG&E, there was no single event that forced a bankruptcy. Rather, the best PG&E could offer up as an explanation was a January 10 meeting it had with the CPUC. During that meeting, PG&E asked about the process for getting the CPUC’s approval to pass costs of North Bay wildfire settlements on to ratepayers, rather than paying settlements out of corporate profits. According to PG&E, the CPUC said it would not approve PG&E passing on to ratepayers the costs of settlements until after PG&E actually paid them, PG&E, apparently, didn’t like that answer. If PG&E paid the wildfire victims what they were due, and the CPUC thereafter decided not to allow PG&E to pass the costs on to ratepayers, PG&E felt that it might put the company in a difficult financial position.
Of course, PG&E has neither paid nor agreed to pay any North Bay fire victim a single penny. When it filed bankruptcy, such payments were months if not years off. So, the meeting with the CPUC does not explain PG&E’s big rush to file bankruptcy. It left many observers to conclude PG&E’s real purpose in filing bankruptcy was to try and use the bankruptcy process to stick it to victims.
We also asked PG&E about the Butte Wildfire it caused in 2015. PG&E had agreed to pay settlements to certain of the victims of that fire, with payments coming due in the days leading up to the bankruptcy filing. PG&E ultimately stiffed those victims, citing the need to “conserve cash.” But we now know that PG&E is not and was not insolvent. It could have easily made those payments. In fact, while it was stiffing victims with its left hand, PG&E’s right hand had no problem coming up with $2.5 million to pay disgraced CEO Geisha Williams a severance bonus. We asked PG&E why and how it decided not to pay victims what they were due but to instead pay a bonus to the CEO at the helm when PG&E burned out so many of its customers. PG&E had no answer, promising to “get back to us” on that.
Because PG&E has not yet filed with the court all the financial information it is supposed to file, the questioning could not be completed and will resume on April 29.