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BAKER 

&

HOSTETLER LLP

ATTORNEYS AT LAW

SAN FRANCISCO

Robert A. Julian (SBN 88469)

Cecily A. Dumas (SBN 111449)

BAKER & HOSTETLER LLP

1160 Battery Street, Suite 100

San Francisco, CA 94111

Telephone: 628.208.6434

Facsimile: 310.820.8859

Email: rjulian@bakerlaw.com

Email: cdumas@bakerlaw.com

Eric E. Sagerman (SBN 155496)

Lauren T. Attard (SBN 320898)

BAKER & HOSTETLER LLP

11601 Wilshire Blvd., Suite 1400

Los Angeles, CA 90025-0509

Telephone: 310.820.8800

Facsimile: 310.820.8859

Email: esagerman@bakerlaw.com

Email: lattard@bakerlaw.com

Counsel to the Official Committee of Tort Claimants

UNITED STATES BANKRUPTCY COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

In re:

PG&E CORPORATION

-andPACIFIC 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)

Bankruptcy Case 

No. 19-30088 (DM)

Chapter 11

(Lead Case)

(Jointly Administered)

PLAN SCHEDULE STATEMENT OF 

THE OFFICIAL COMMITTEE OF 

TORT CLAIMANTS

Date: October 23, 2019

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

Place: United States Bankruptcy Court

Courtroom 17, 16th Floor

San Francisco, CA 94102

Case: 19-30088 Doc# 4333 Filed: 10/21/19 Entered: 10/21/19 11:38:26 Page 1 of

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ATTORNEYS AT LAW

SAN FRANCISCO

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The Official Committee of Tort Claimants (“TCC”) in the chapter 11 cases (“Cases”) of 

PG&E Corporation (“Holdco”) and Pacific Gas and Electric Company (the “Utility,” and 

collectively with Holdco, the “Debtors” or “PG&E”), hereby requests that the Court permit the 

TCC/Ad Hoc Bondholder (“AHB”) joint plan of reorganization to proceed to confirmation before 

the Debtors’ plan, and in support of its request respectfully represents the following:

1. The TCC started its responsibilities in these Cases with a mind open to working 

collaboratively with the Debtors. This was despite the warnings of wildfire claims 

lawyers that based on their experience they believed that the Debtors would not act 

fairly toward wildfire victims, even in their post-petition role as fiduciaries to 

victims.

2. Unfortunately, as the TCC and other parties in these Cases now realize, the Debtors 

have not and will not serve their fiduciary roles, but instead are single-mindedly 

facilitating the parochial interests of the investors to preserve the value of equity 

holdings. The Debtors have shown they cannot be trusted by this Court to steward 

the Cases as honest brokers.

3. Had the Debtors been acting as fiduciaries, they would have proposed a plan that 

provides that a resolution trust for wildfire claims will be funded with cash in the 

amount estimated by the Court or agreed to by the parties. That is the mandate of 

AB 1054.

4. Instead, the Debtors continue to insist on capping payment of the class designated 

in the plan as “Other Wildfire Claims” (consisting of victim and certain State and 

federal wildfire-related tort claims) at $8.4 billion (although with $6.9 billion 

committed financing) even though the outcome of the estimation will likely be far 

higher.

Case: 19-30088 Doc# 4333 Filed: 10/21/19 Entered: 10/21/19 11:38:26 Page 2 of

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ATTORNEYS AT LAW

SAN FRANCISCO

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5. It is clear that the Debtors base their cap on the amount of financing they can raise 

without diluting equity value. This approach is backwards. The Debtors will not 

increase the amount as a result of mediation or settlement discussions because their 

goal is to preserve equity value. Debtors have chosen a litigation role to protect 

investors instead of a fiduciary role to protect victims.

6. In attempting to justify their public assertion of a low value of claims, the Debtors 

rely on the fig leaf of the advice of their litigation counsel and paid experts. With 

due respect to their skills, the Debtors’ advisors consistently misconstrue applicable 

law.

7. Here is one example: Debtors’ counsel sanctimoniously intones that under 

applicable California law, homeowners in Paradise, California, and other affected 

communities are limited in their recoveries to the lesser of diminution of value of 

their properties or replacement cost. Say a home destroyed in the Camp Fire had a 

value before the fire of $300,000, and now the uninhabitable lot is worth $25,000. 

PG&E values this victim’s claim at the diminution value of $275,000 less any 

insurance received. In contrast, if this homeowner wants to rebuild, they are subject 

to years of delay because all municipal services of water, electricity, garbage 

collection, wireless networks, etc., have all been destroyed because 80% of the 

community was burned. The homeowner also faces surge pricing (which is not 

covered by insurance) for builders and other contractors because of the magnitude 

of the destruction of an entire community. The cost associated with delay and surge 

pricing is much higher than $275,000 and may ultimately result in a loss of use and 

replacement cost claim two to three times that amount. Recovery of the full amount 

it takes to restore the victim to what he had before the fire is reasonable and fair, in 

contrast to PG&E’s lowball payment which results in undercompensated victims, 

economic waste of hundreds of uninhabitable lots and a windfall to PG&E. 

Case: 19-30088 Doc# 4333 Filed: 10/21/19 Entered: 10/21/19 11:38:26 Page 3 of

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ATTORNEYS AT LAW

SAN FRANCISCO

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8. Debtors’ litigation counsel referred to a hypothetical $1,000,000 damages claim by 

Camp Fire victims in open court a hearing last summer, implying that the amount is 

excessive and presumably driven by greed. But, why should a Camp Fire victim 

be limited to a $275,000 diminution award when PG&E deprived them of the 

choice to immediately rebuild their home by burning down their entire town? 

Those who moved were forced to. California law does not support PG&E’s low 

number and PG&E knows it. 

9. These legal and factual issues among others will be addressed by the district court 

in the estimation proceedings if the Debtors’ plan goes forward. For this Court’s 

edification, though, the disposition in favor of victims of the damages issue 

described above alone is worth over a billion dollars. Even more egregious is 

PG&E’s miniscule valuation of people’s emotional distress from fleeing walls of 

flames and facing death. PG&E treats this element of damage as though the victims’ 

experience was no more traumatic than being in a fender bender. PG&E’s litigation 

position on trauma is truly disgraceful.

10. Instead of squarely facing the legal and moral deficiencies of their litigation 

positions (arguing that inverse condemnation doesn’t apply to an IOU is another 

loser), the Debtors hawk their lowball estimate to the press, California Public 

Utilities Commission, Legislature and Governor of the State of California without 

shame in order to sell their plan and salvage equity value. That, and disparage the 

AHB hedge funds, as though the hedge funds whose interests they are protecting are 

any different. And, finally, accuse victims and their lawyers of being greedy, and 

rely on the hope that victims will not find their way to file claims (the “participation 

rate” bugaboo). The Court should not allow such behavior by fiduciaries.

Case: 19-30088 Doc# 4333 Filed: 10/21/19 Entered: 10/21/19 11:38:26 Page 4 of

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HOSTETLER LLP

ATTORNEYS AT LAW

SAN FRANCISCO

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11. The TCC contends that the Debtors’ refusal to propose a plan that pays victims in 

whatever amount the estimation shows is owed is a breach of fiduciary duty and 

disqualifies the Debtors’ plan from consideration on a schedule having primacy or 

equality with the TCC/AHB plan. The most valid path forward is a fast track of the 

TCC/AHB plan.

12. The TCC doesn’t assert that there is a perfect solution for victims, ratepayers and 

the State of California to PG&E’s mismanagement of its electrical system. The TCC 

has only been able to conclude that the hopes for fairness it brought to the 

bankruptcy process in February 2019 will never be realized with these Debtors in 

control.

Dated: October 21, 2019 Respectfully submitted,

BAKER & HOSTETLER LLP

By: /s/ Cecily A. Dumas

Cecily A. Dumas

Counsel to the Official Committee of Tort 

Claimants 

Case: 19-30088 Doc# 4333 Filed: 10/21/19 Entered: 10/21/19 11:38:26 Page 5 of

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