ATTACHMENT A 

Case: 19-30088 Doc# 3687-1 Filed: 08/25/19 Entered: 08/25/19 17:42:04 Page 1

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+1-212-474-1596

korsini@cravath.com 

August 22, 2019 

PG&E Chapter 11 Proceedings, No. 19-30088 N.D. Cal. 

Dear Counsel, 

I write in connection with the Court’s instructions at the August 14, 2019, 

hearing that the parties meet and confer regarding the structure of estimation proceedings. 

As the Court noted during the hearing, the structure of the estimation 

hearing is entirely within the Court’s discretion. As you will see below, we have 

proposed an approach that focuses on the fires that together likely account for over 90% 

of the asserted damages and that provide the stakeholders sufficient time to present 

evidence concerning liability and damages issues while also accounting for the 

abbreviated nature of estimation proceedings under Section 502(c). 

We look forward to discussing this proposal in advance of next Tuesday’s 

status conference. 

First, the Debtors continue to believe that the threshold legal issue of 

inverse condemnation should be addressed and resolved as a discrete legal question as 

soon as practicable. While we also continue to believe that this issue can be addressed in 

advance of the bar date, we are cognizant of the TCC’s objections to this approach and 

the Court’s recent observations on that issue. Accordingly, we have revised our original 

schedule and propose that the Debtors submit their pleadings on this issue by October 14, 

2019 (one week prior to the October 21 bar date), with all oppositions be filed by 

November 11, 2019 (three weeks after the bar date), and any replies be submitted by 

November 18, 2019, with a hearing scheduled shortly thereafter.

Second, as Mr. Pitre noted at the August 14 hearing, a small number of 

fires account for the overwhelming majority of alleged damages. (See Hr’g Tr. Aug. 14, 

2019 at 226:9-14 (“Break the twenty-two fires down, they break down to five fires that 

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make up ninety-two percent of all of the total damages.”).) As you know, in an effort to 

facilitate the estimation process, Debtors have agreed not to contest causation with 

respect to any of the 2017 or 2018 Wildfires except for the Tubbs fire. (Dkt. No. 3091 at 

4.) As a result, the issues that remain for estimation with regard to the non-Tubbs 

wildfires are: (1) the question of the Debtors’ legal liability (under inverse, negligence, 

etc.); and (2) the total estimated recoverable losses per fire. 

With the foregoing in mind, the Debtors propose that the estimation 

proceedings, following the initial phase addressing inverse condemnation, be divided 

between liability issues and damages. With respect to liability issues, the Debtors 

propose a series of successive evidentiary hearings on the following large wildfires: 

(1) Atlas; (2) Redwood; (3) Nuns; (4) Sulphur; (5) Cascade; and (6) Camp.1 Those 

evidentiary hearings would all proceed in succession, before the damages phase 

commences, at which time the losses associated with all of the fires could be addressed. 

Proceeding in that way will streamline the process. 

We believe that with respect to those six fires, it would be appropriate for 

the representatives of the wildfire claimants (through the TCC and the Ad Hoc 

Subrogation Group) to provide opening briefs, identifying in advance of the hearings the 

legal and factual issues relating to liability that they believe are in dispute. The Debtors 

will then respond, identifying any other issues and signaling their agreement or 

disagreement with the claimants’ submission. At the same time, the Debtors and the 

stakeholders can work together to stipulate to as many legal and factual issues as 

possible. In that way, the issues actually to be addressed at the evidentiary hearings on 

liability will be as narrowed and focused as possible. 

With respect to the liability-related evidentiary hearing for each of the six 

wildfires identified above, we believe that the wildfire claimants should present evidence 

first, with the witnesses subject to cross-examination by the Debtors and other 

participating parties, consistent with the order of proceedings in a regular trial. Once the 

claimants have presented their evidence, the Debtors will present their witnesses, subject 

to cross-examination by the wildfire claimants. The Debtors propose that each side be 

limited to no more than 5 witnesses (fact or expert) on liability issues per wildfire and 

that the Court employ a “chess clock” approach to time allocation for the duration of the 

liability phase of the estimation hearings. In total, the Debtors estimate that the parties 

can address the legal liability issues with respect to these six fires in no more than four 

weeks of hearings. Once those hearings are complete, the Debtors propose post-hearing 

 

1

 While Mr. Pitre focused on five fires during the August 14 hearing, we believe the size 

of these six fires along with the unique facts of Sulphur (involving an alleged pole 

failure) and Cascade (involving an alleged line slap) require addressing all six as part of 

the liability evidentiary hearings. 

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briefing and argument on liability issues.2

 We propose closing arguments on liability 

issues for all fires, after the post-hearing briefing has been completed. 

 Separately, given the number of wildfires at issue and the limited time 

available to resolve all estimation issues, we propose that any liability issues with respect 

to the wildfires not listed above (other than Tubbs) be addressed in the post-hearing 

briefing, and that all evidence concerning those fires be submitted in written form. 

 The Debtors expect the damages phase will involve exclusively expert 

testimony. To assist the Court and ensure maximum efficiency, the Debtors propose that 

each stakeholder that wishes to be heard on the estimation of total damages file a prehearing brief addressing, for all fires, the following: (1) categories of damages sought 

(e.g., property damage, physical injury, etc.); (2) identification of the parties/claimants 

seeking each category of damages; (3) legal theories/causes of action under which 

claimants are seeking recovery for each category of damages; (4) methodologies 

employed in calculating each category of damages; (5) identification of expert(s) upon 

whom claimants rely upon for the calculation of each category of damages; and (6) any 

related legal issues that further require this Court’s determination. The submission of 

evidence on behalf of the wildfire claimants should be coordinated through a single filing 

made by the TCC.3

 The Debtors will respond to these submissions, indicating its position 

on the damages sought and identifying the methodologies employed in calculating each 

category of damages, the expert(s) upon whom the Debtors rely upon for the calculation 

of each category of damages, and any related legal issues that further require this Court’s 

determination. 

 During the damages phase of the hearing—which we propose last no more 

than two weeks and also be subject to a chess clock—the Debtors submit that the order of 

the parties presenting witnesses should be determined by the total proposed damages 

estimate across all fires, based on the pre-hearing filings, with the party proposing the 

largest number going first and the remaining parties/Debtors proceeding in descending 

order. The Debtors propose that no rebuttal evidence be presented by any of the parties 

after the Debtors’ presentation. We also suggest post-hearing briefing and argument on 

the damages issues. 

 

2

 Once a verdict with respect to the Tubbs fire has been rendered in the state court 

proceeding, the Tubbs fire will need to be incorporated into the estimation process. The 

parties should meet and confer at a subsequent date to discuss how and when that process 

should occur once we have more visibility into the schedule and structure for the state 

court Tubbs trial. 

3

 In other words, it would be inefficient for the Court and the parties for multiple 

individual wildfire claimants to file overlapping briefs on liability issues. Instead, a 

single brief on behalf of the TCC should address all the issues presented by the individual 

claimants. 

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 Finally, we believe that the outcome of the estimation hearings will 

require the Court to estimate at least four different figures, consisting of the aggregate 

amounts required to fund a resolution of the following categories of claims: (1) personal 

injury tort claims; (2) all other individual claims; (3) the subrogation claims; and (4) the 

claims of any public entities who have not reached a settlement with the Debtors. 

This proposal is subject to any modifications in light of the 

recommendation for withdrawal of reference of the bankruptcy proceeding (in part) 

entered by Judge Montali last night (August 21, 2019). 

We are available to meet and confer by telephone with respect to these 

issues the remainder of the week. 

Regards, 

/s/ Kevin J. Orsini

Kevin J. Orsini 

Robert A. Julian, Esq. 

Cecily Dumas, Esq. 

 Baker Hostetler 

11601 Wilshire Boulevard, Suite 1400 

Los Angeles, CA 90025 

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Copy to (via email): 

Matthew A. Feldman, Esq. 

Benjamin P. McCallan, Esq. 

Wilkie Farr & Gallagher LLP 

787 Seventh Ave. 

Washington, DC 20006 

Andrew LeBlanc, Esq. 

Gregory A. Bray, Esq. 

Samir Vora, Esq. 

 Milbank LLP 

1850 K Street, NW, Suite 1100 

Washington, DC 20006 

2029 Century Park East, 33rd Floor 

Los Angeles, CA 90067 

Bruce S. Bennett, Esq. 

Joshua M. Mester, Esq. 

James O. Johnston, Esq. 

Jones Day 

555 South Flower Street, Fiftieth Floor 

Los Angeles, CA 90071 

Michael S. Stamer, Esq. 

Ira S. Dizengoff, Esq. 

David H. Botter, Esq. 

Abid Qureshi, Esq. 

Ashley Vinson Crawford, Esq. 

Akin Gump Strauss Hauer & Feld LLP 

One Bryant Park 

New York, NY 10036 

580 California Street, Suite 1500 

San Francisco, CA 94104 

Stephen Karotkin, Esq. 

Jessica Liou, Esq. 

Weil, Gotshal & Manges LLP 

767 Fifth Ave. 

New York, NY 10153 

 

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Paul J. Pascuzzi, Esq. 

Felderstein, Fitzgerald, Willoughby & Pascuzzi LLP 

500 Capitol Mall, Suite 2250 

Sacramento, CA 95819 

Michael A. Kelly, Esq. 

Walkup, Melodia, Kelly & Schoenberger 

650 California Street, 26th Floor 

San Francisco, CA 94108 

Frank Pitre, Esq. 

Cotchett, Pitre & McCarthy, LLP 

840 Malcolm Road, Suite 200 

Burlingame, CA 94010 

Steven M. Campora, Esq. 

Dreyer Babich Buccola Wood Campora, LLP 

20 Bicentennial Cir. 

Sacramento, CA 95826 

Alan W. Kornberg, Esq. 

Paul, Weiss, Rifkind, Wharton & Garrison LLP 

1285 Avenue of the Americas 

New York, NY 10019 

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