PG&E's massive bankruptcy: Beginning to sort out who gets what

- After Tuesday's first, short hearing on PG&E's massive and complex bankruptcy, Thursday the proceedings started in earnest with two courtrooms, mostly full of creditors' lawyers filling the main courtroom and an overflow courtroom hooked up by a TV system. 

Oddly, the very same U.S. Bankruptcy Judge who presided over PG&E's bankruptcy almost two decades ago during the California energy crisis is, once again, in charge of a hugely complex and expensive process that other power generators may soon face if wildfires plague them. 

Bankruptcy Judge Dennis Montali dealt with two courtrooms, his own and one for the overflow of interested parties—mostly lawyers. Most represent creditors who PG&E owes money to and/or had contracts with PG&E. Some represent the many people who lost homes and families who lost loved ones in the fires, claimants at the bottom of the list to be recompensed. 

"And so what we did today, is we asked the court to prioritize the needs of those wildfire victims, especially those ones who need immediate assistance because they have no insurance and no homes," said homeowners' attorney Amanda Riddle. She says though the bankruptcy proceeding puts all lawsuits, claims and settlements on hold, PG&E is not broke.

"They've got about $20 billion more in assists than liabilities and so what we're looking for is a stream lined process for the most impacted victims," Riddle said.

The first thorny issue: Determining which creditors are so important to the utility's continued operation that they must be paid what's owed to them now and going forward. 

For its part, PG&E's lawyers say it faces an overwhelming and growing number of claims. PG&E says despite Cal Fire's finding that PG&E equipment did not start the deadly Tubbs fire that wiped out Santa Rosa's Coffey Park, it still faces hundreds of cases where trial lawyers may well prove otherwise.

But, homeowners' attorney Dario De Ghetaldi says this all stems from the victims' losses, not PG&E, " These are real people and their stories are real. And, if you meet them and you hear their stories, you'll cry." 

Two bits of news: PG&E says it wants to create a huge trust fund to assure that as many, if not all claimants, are paid in an orderly fashion, much in the same way class action lawsuits. And, some lower level employees may be given bonuses they are entitled to, but high level executives are unlikely to get them.
 
 

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