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TIMOTHY S. LAFFREDI (WI SBN 1055133) 

Assistant United States Trustee

CAMERON M. GULDEN (MN SBN 310931)

Trial Attorney

United States Department of Justice

Office of the U.S. Trustee 

450 Golden Gate Avenue, Suite 05-0153

San Francisco, CA 94102

Telephone: (415) 705-3333

Facsimile: (415) 705-3379

Email: cameron.m.gulden@usdoj.gov

Attorneys for Andrew R. Vara, Acting United States Trustee for Region 31

UNITED STATES BANKRUPTCY COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

In re:

PG&E CORPORATION,

- and -

Bankruptcy Case

No. 19-30088 (DM)

Chapter 11

(Lead Case)

(Jointly Administered)

Date: April 24, 2019

Time: 9:30 a.m. (Pacific Time)

Place: Hon. Dennis Montali

450 Golden Gate Avenue

16th Floor, Courtroom 17

San Francisco, CA 94102

PACIFIC GAS AND ELECTRIC 

COMPANY,

Debtors.

 Affects PG&E Corporation

 Affects Pacific Gas and Electric Company

 Affects both Debtors

* All papers shall be filed in the lead case, 

No. 19-30088 (DM)

UNITED STATES TRUSTEE’S OBJECTION TO

APPLICATION OF THE OFFICIAL COMMITTEE

OF UNSECURED CREDITORS FOR AUTHORITY TO RETAIN AND 

EMPLOY CENTERVIEW PARTNERS LLC AS INVESTMENT BANKER

Andrew R. Vara, Acting United States Trustee for Region 3 (the “United States 

Trustee”), by and through his undersigned counsel, hereby files this objection (“Objection”) to 

 

1

Andrew R. Vara, Acting United States Trustee for Region 3, is acting in this appointment for Tracy Hope 

Davis, United States Trustee for Region 17, who has recused herself.

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the Motion of the Official Committee of Unsecured Creditors for Authority to Retain and 

Employ Centerview Partners LLC as Investment Banker (ECF No. 1213, “Motion”).2

This Objection is supported by the following memorandum of points and authorities and 

any argument the Court may permit.

PRELIMINARY STATEMENT

Rigorous compliance with professional retention rules is critical to the integrity and 

transparency required of the bankruptcy system. Bankruptcy Rule 2014 requires that 

professionals file a verified statement listing “all of the person’s connections” to the debtor, 

creditors, and any other parties in interest. Here, the disclosures made by Centerview are not 

transparent and are incomplete. Referencing only unspecified client “confidentiality 

obligations,” Centerview’s declaration discloses vague connections to certain “Potential Partiesin-Interest and/or their affiliates.” Centerview does not adequately explain the purported 

separateness of its investment affiliates, and it must either do so or disclose the affiliates’ 

connections to interested parties. 

It is not adequate for Centerview to simply assert that certain of its connections are 

confidential. On the contrary, “[p]ursuant to the disclosure rules of §§ 327 and 329 and Rules 

2014 and 2016, the [party seeking employment] has the duty to disclose all relevant information 

 

2 The United States Trustee requests that the Court take judicial notice of the pleadings and

documents filed in these cases pursuant to Federal Rule of Bankruptcy Procedure 9017 and Federal

Rule of Evidence 201.

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to the court, and may not exercise any discretion to withhold information.” In re Thomas, 476 

B.R. 579, 586 (N.D. Cal. 2012).

Bankruptcy Rule 2014 requires that disclosures be sufficiently explicit for a court and 

other parties to determine whether a professional is disinterested or holds or represents an 

adverse interest. Given the lack of information provided by Centerview and its decision to 

withhold certain information, it is impossible for the Court and other parties in interest to make 

such a determination. An indeterminate statement of connections with a creditor does not satisfy 

Rule 2014. Rather, “the burden is on the person to be employed to come forward and make 

full, candid and complete disclosure in applications for employment.” In re Lotus Properties LP, 

200 B.R. 388, 391 (Bankr. C.D. Cal. 1996). Accordingly, the Court should deny the 

Application.

I. BACKGROUND

1. On January 29, 2019, the Debtors commenced the above-captioned cases by 

filing voluntary petitions for relief under Chapter 11 of the Bankruptcy Code. ECF No. 1.

2. On February 12, 2019, the U.S. Trustee appointed an Official Committee of 

Unsecured Creditors (“the Committee”). ECF No. 409.

3. The Committee filed the Motion on April 3, 2019. ECF No. 1213.

4. The declaration of Samuel M. Greene, a partner at Centerview, accompanies 

the Motion. Id. at 61. Schedule 2 of Mr. Greene’s declaration include a list titled 

“Connections to Potential Parties in Interest.” Id. at 45.

5. Following is a list of 62 entities to which it has such connections, Centerview 

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adds the following note: 

Centerview currently is engaged to advise and/or was formerly engaged in the 

last three years to advise several Potential Parties-in-Interest and/or their 

affiliates that, due to confidentiality obligations owed to such entities, 

Centerview is unable to disclose. These Potential Parties-in-Interest are in the 

following categories: “Bank Accounts,” “Contract Counterparties”, “Litigation

Counterparties/ Litigation Pending Lawsuits”, “Top Unsecured Creditors”, 

“Unsecured Notes”, “Utility Providers” and “Vendors”. Centerview’s work for 

each of these entities is or was on matters that are wholly unrelated to the 

Debtors or these cases.

6. Aside from listing the names of the 62 parties on Schedule 2, Centerview 

provides no further information regarding the nature of the various representations.

II. MEMORANDUM OF POINTS AND AUTHORITIES

A. Statutory Framework

Section 327 provides that the trustee or debtor in possession may employ, with court 

approval, professionals who are disinterested and who do not hold or represent interests adverse 

to the estate. 11 U.S.C. § 327. Bankruptcy Rule 2014 imposes a complementary duty of 

disclosure so that courts and parties can determine whether a professional to be employed 

satisfies section 327’s ethical requirements. Rule 2014 requires the applicant to include, among 

other things, “all of the person’s connections with the debtor, creditors, or any other party in 

interest . . . .” 

“While the term “connections” is not defined in Rule 2014(a), it has long been held to be 

read broadly. In addition, strict compliance with the disclosure requirements, independent of a

finding of any actual conflict, is required in order to give effect to the disinterestedness 

requirements of the Bankruptcy Code and maintain the integrity of the system.” In re Condor 

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Sys., Inc., 302 B.R. 55, 70 (Bankr. N.D. Cal. 2003) (internal cite omitted). Thus, Rule 2014 is 

likewise broader than section 327, and “[a]ll facts that may be pertinent to a court’s 

determination of whether an attorney is disinterested or holds an adverse interest to the 

estate must be disclosed.” In re Hathaway Ranch P'ship, 116 B.R. 208, 219 (Bankr. C.D. Cal. 

1990) (emphasis in original). 

These statutory provisions, which prohibit conflicting interests in bankruptcy, “serve the 

important policy of ensuring that all professionals appointed pursuant to section 327(a) tender 

undivided loyalty and provide untainted advice and assistance.” Rome v. Braunstein, 19 F.3d 54, 

58 (1st Cir. 1994). Therefore, “[t]he disclosure rules impose upon [professionals] an 

independent responsibility. Thus, failure to comply with the disclosure rules is a sanctionable 

violation, even if proper disclosure would have shown that the [professional] had not actually 

violated any Bankruptcy Code provision or any Bankruptcy Rule.” In re Park Helena Corp., 63 

F.3d at 880 (citing In re Film Ventures Int’l, Inc., 75 B.R. 250, 252 (B.A.P. 9th Cir. 1987)).

“The disclosure requirements of Rule 2014 do not give the professional the right to 

withhold information because it is not apparent to the professional that a conflict exists. In re 

Condor Sys., Inc., 302 B.R. at 70. On the contrary, the Ninth Circuit Court of Appeals has held 

that “[t]he duty of professionals is to disclose all connections with the debtor, debtor-inpossession, insiders, creditors, and parties in interest . . . . They cannot pick and choose which 

connections are irrelevant or trivial . . . . No matter how old the connection, no matter how trivial 

it appears, the professional seeking employment must disclose it.” In re Park-Helena Corp., 63 

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F.3d at 882 (internal cite omitted). Finally, “the disclosure requirement is a continuing one, even 

after an application for employment is approved.” In re Condor Sys., Inc., 302 B.R. at 70.

B. The Role of the United States Trustee

Under 28 U.S.C. § 586, the United States Trustee is charged with the administrative 

oversight of cases commenced pursuant to chapter 11 of title 11 of the United States Code. This 

duty is part of the U.S. Trustee’s overarching responsibility to enforce the bankruptcy laws as 

written by Congress and interpreted by the courts. 11 U.S.C. § 307 (stating that “[t]he United 

States Trustee “may raise and may appear and be heard on any issue in any case or proceeding 

under this title but may not file a plan pursuant to section 1121(c) of this title”; Stanley v. 

McCormick (In re Donovan Corp.), 215 F.3d 929, 930 (9th Cir. 2000).

III. ARGUMENT

A. Centerview May Not Circumvent Bankruptcy Rule 2014 on the Grounds of 

Client Confidentiality.

In addition to its connections to the 62 parties listed in Schedule 2, Centerview reports

that it has additional “confidential connections” but attempts to assure the Court and interested 

parties — without providing any specific information — that these undisclosed connections do 

not rise to the level of a connection that would disqualify Centerview from being retained. 

Although Centerview may have private contractual confidentiality agreements,3 these 

 

3 A limited exception to public disclosure may be invoked to protect “an entity with respect to a trade 

secret or confidential research, development or commercial information.” 11 U.S.C. § 107(b)(1); 

accord Fed. R. Bankr. P. 9018. The moving party bears the burden of showing that a request to place 

documents under seal falls within the parameters of Bankruptcy Code § 107(b) and Bankruptcy Rule 

9018 by demonstrating “. . . that the interest in secrecy outweighs the presumption in favor of access.” 

In re Continental Airlines, 50 B.R. 334,at 340 (D. Del. 1993).

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agreements do not and cannot supersede the ethics and disclosure requirements of the 

Bankruptcy Code and Rules. See In re Project Orange, 431 B.R. 363 (Bankr. S.D.N.Y. 2010) 

(conflict waivers obtained from a creditor by a law firm do not, by contractually permitting the 

firm to represent the debtor on some matters adverse to creditors, trump the statutory 

requirements governing the estate’s employment of professionals); see also Granite Partners, 

219 B.R. 22, 34 (Bankr. S.D.N.Y. 1998) (observing that while clients may, in some instances, 

waive conflicts, “the mandatory provisions of section 327(a) do not allow for waiver.”). 

Moreover, client confidentiality is a common concern with other professionals, including law 

firms which are also bound by the duties of professional responsibility and confidentiality, yet 

other professional firms routinely satisfy their disclosure requirements. 

The United States Trustee (and other parties in interest) has no information that the 

undisclosed Centerview connections are not a conflict under section 327(a) — and that is 

precisely the point. Without voluntary adequate disclosures, parties do not have a roadmap to 

assess any firm’s connections. The requirements of Bankruptcy Rule 2014 “transcend those of § 

327, as they mandate disclosure of all connections with the named parties, rather than being 

limited to those which deal with disinterestedness.” In re Filene’s Basement, Inc., 239 B.R. 845, 

849 (Bankr. D. Mass. 1999). Once disclosures are properly made, only then can the Court and 

the parties objectively satisfy themselves whether there are no conflicts or disabling connections.

B. Centerview’s Affiliate Disclosures Do Not Satisfy Bankruptcy Rule 2014

Centerview advises that it is a global investment banking and advisory firm with “legal 

and separate affiliates and related parties (the “Corporate Group Entities”) that engage in a 

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variety of investment activities.” ECF No. 1213 DKT No. 135, Ex B at ¶24. Mr. Greene’s 

declaration asserts that “[t]he Centerview employees providing services in connection with these 

chapter 11 cases have no control over the investment or business decisions made for the 

Corporate Group Entities . . . [and that] “[l]ikewise, the investment professionals responsible for 

the Corporate Group Entities’ day-to-day portfolio have no access to any confidential 

information relating to Centerview’s work for the Debtors.” Id. However, even if true, without 

more information the Court and interested parties have absolutely no information upon which to 

form a belief as to the connections between Centerview, its investment affiliates and parties, and 

these Debtors. For example, Centerview fails to provide the name of its investment arms, the 

corporate structure of the related parties, and the nature of investments that are made. Likewise, 

Centerview has not pointed to any documented policies that actually restrict the flow of 

information. Without even this most basic of information, it is impossible to reach a reasoned 

determination regarding whether there is any cause for concern about Centerview’s investment 

affiliates. If Centerview cannot carry its burden in establishing separateness of operations, then 

it must fully disclose all connections of the Corporate Group Entities.

C. Centerview Fails to Explain Material Connections That it Did Identify

Centerview’s disclosures are also deficient because Centerview fails to explain its 

identified connections. Although Schedule 2 of the Declaration indicates that there is some 

connection between Centerview and 62 different parties, no information is provided as to what 

the connection may be and/or why Centerview believes that such connection does not render 

Centerview disinterested. Furthermore, even if such connections ultimately prove unrelated to 

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the Debtors, Centerview’s disclosures are insufficient to satisfy Rule 2014. Centerview has 

provided no information regarding the identity, nature, or scope of many of the connections. 

Stated another way, the Declaration gives the appearance of compliance without actually 

complying with Rule 2014. Centerview fails to provide any information regarding why it listed 

the 62 parties on Schedule 2 and what those connections may be to each party.

WHEREFORE, the United States Trustee respectfully requests that the Court (i) deny 

the Application and (ii) grant such other relief as the Court deems appropriate and just.

Dated: April 15, 2019 Andrew R. Vara

Acting United States Trustee, Region 3

By: /s/ Cameron M. Gulden

 CAMERON M. GULDEN

Trial Attorney

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