What's Next for PG&E?

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PG&E  (PCG) - Get Report agreed to plead guilty on 84 counts of involuntary manslaughter and one felony count of unlawfully causing a fire on Monday, March 23. 

The company was blamed for the campfire in Northern California, which was the deadliest fire in California history.

Rebecca Rose Woodland, litigator, joined TheStreet to break down what's next for the company.

Video Transcript:

Katherine:
On Monday, March 23rd PG&E agreed to plead guilty on 84 counts of involuntary manslaughter and one felony count of unlawfully causing a fire. The company was blamed for the campfire in Northern California, which was the deadliest fire in California history. Joining me to explain what this means is Rebecca Rose Woodland litigator and legal analyst. The company agreeing to this plea isn't the end of the story, what kind of litigation does PG&E still face?

Rebecca Rose Woodland:
So the plea deal is tremendous in the fact that this was one of the greatest corporate admissions in U.S. history. We had 84 counts of involuntary manslaughter and one count of unlawfully creating a fire that PG&E pled guilty to. What we're looking at now is how then will they fix the rest of the problems? They set up a wildfire fund, which would be the civil damages that people have claimed into as a result of loss of fire, loss of life for loved ones, loss of businesses. So many different things that resulted from that fire and they're looking to now try to administer that money, payout that money. We're also seeing that this is a pattern with PG&E as they had already been on probation for admitting to a felony from a disaster that was caused by an eruption of a gas pipeline years prior. So we're seeing that PG&E having filed bankruptcy in January of 2019 has to do a lot now to restructure.

Katherine:
You mentioned the bankruptcy filing. How could the company agreeing to plead guilty to these counts impact that?

Rebecca Rose Woodland:
That's a great question Katherine. Actually two days ago, Governor Newsome of California has come to an arrangement of sorts with PG&E now moving forward to try to have them re-emerge from bankruptcy 30th of June, I'm sorry, of this year as what they provide to the state is essential electric and gas. So the governor has put many restrictions on the re-emergence of PG&E, including replacing board members, having different oversights in place, so that if they move forward as he hopes they do, from what we can see from this restructuring and this agreement, that they move forward in a positive way towards not having these issues reappear. The governor wants further oversight.

Rebecca Rose Woodland:
Otherwise, I think what the possibility could be would be that the governor and the state buyback and create a state-owned utility rather than PG&E continue to remain private. So we'll wait and see how this unrolls and unravels as the days flow out between now and the 30th of June. Also with the coronavirus epidemic on top of and pressuring this utility to really be all that it can in this time and operate at the fullest capacity so that the state remains in a very stable situation with gas and electric while they're going through this terrible epidemic and pandemic.

Katherine:
As always, I appreciate your insight, Rebecca. Thank you for joining us today and for more on the markets, please head on over to thestreet.com.

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