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28 Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, NY 10153-0119

Tig WEIL, GOTSHAL & MANGES LLP 

Stephen Karotkin (pro hac vice) 

(stephen.karotkin@weil.com) 

Ray C. Schrock, P.C. (pro hac vice) 

(ray.schrock@weil.com) 

Jessica Liou (pro hac vice) 

(jessica.liou@weil.com) 

Matthew Goren (pro hac vice) 

(matthew.goren@weil.com)| 

767 Fifth Avenue 

New York, NY 10153-0119 

Tel: 212 310 8000 

Fax: 212 310 8007 

Attorneys for Debtors 

and Debtors in Possession 

KELLER & BENVENUTTI LLP 

Tobias S. Keller (#151445) 

(tkeller@kellerbenvenutti.com) 

Peter J. Benvenutti (#60566) 

(pbenvenutti@kellerbenvenutti.com) 

Jane Kim (#298192) 

(jkim@kellerbenvenutti.com) 

650 California Street, Suite 1900 

San Francisco, CA 94108 

Tel: 415 496 6723 

Fax: 650 636 9251 

UNITED STATES BANKRUPTCY COURT 

NORTHERN DISTRICT OF CALIFORNIA 

SAN FRANCISCO DIVISION 

In re: 

PG&E CORPORATION, 

 - and - 

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).

 Case No. 19-30088 (DM) 

Chapter 11 

(Lead Case) (Jointly Administered) 

DECLARATION OF KENYON 

MARK LEE IN SUPPORT OF 

DEBTORS’ PRELIMINARY 

LIMITED OPPOSITION TO 

VLAZAKIS DEFENDANTS’ 

MOTION AS TO THE 

INAPPLICABILITY OF STAY, AND 

IN THE ALTERNATIVE FOR 

RELIEF FROM STAY 

Relates to Dkt. Nos. 4846, 4847 

Date: December 17, 2019 

Time: 10:00 a.m. 

Place: United States Bankruptcy Court 

 Courtroom 17, 16th Floor 

 San Francisco, CA 94102

Case: 19-30088 Doc# 5090 Filed: 12/12/19 Entered: 12/12/19 15:15:22 Page 1 of

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28 Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, NY 10153-0119

I, Kenyon Mark Lee, declare: 

1. I am an attorney admitted to the practice of law in the State of California. I am a 

partner in the law firm of Lee Law Offices, attorneys for Pacific Gas and Electric Company (the 

“Utility”). I make this Declaration in support of the Debtors’ Preliminary Limited Opposition to 

Vlazakis Defendants’ Motion as to the Inapplicability of Stay and in the Alternative for Relief from 

Stay (the “Opposition”).1

2. I have personal knowledge of the matters set forth herein except where specifically 

stated otherwise and could, and would, competently testify to these matters. 

3. On June 4, 2019, my office filed an action in the Superior Court for the County of 

Alameda (the “State Court”), PG&E v. Vlazakis et al., Case No. RG19021463 (the “State Court 

Action”), alleging causes of action for trespass, nuisance, declaratory judgment and an injunction. 

In the State Court Action, the Utility asks for a ruling that the Vlazakis Defendants are encroaching 

on the Utility’s property by having wrongfully and secretly supported their building by attaching it 

to the wall of a building on the Utility’s property, and seeks an injunction requiring abatement of 

the encroachment so that the Utility can complete construction of its Gas Regulation Station located 

in Oakland. 

4. On June 6, 2019 this office filed an application for a preliminary injunction barring 

the Vlazakis Defendants from interfering with the Utility’s removal of the encroachment by the 

Vlazakis Defendants and allowing it to proceed with the construction of its Gas Regulation Station. 

The judge assigned to the case recused himself prior to the hearing on the application and the matter 

was reassigned to Judge Whitman, who heard the application on August 13, 2019 and issued her 

decision denying the application on September 11, 2019. 

5. In recognition of the urgency of the matters raised by the Utility, Judge Whitman set 

an expedited case management schedule and scheduled a bench trial for May 12, 2020. 

6. While the Vlazakis Defendants raised arguments based on their alleged rights under 

a letter agreement entered into by PG&E and the Vlazakis Defendants in November 2017 (the 

1

 Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Opposition. 

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28 Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, NY 10153-0119

“Contract”) in their Opposition to the preliminary injunction application dated July 5, 2019 and on 

numerous occasions since then they made no effort to assert these claims in a cross-complaint at 

any time prior to October 29, 2019, when they filed an ex parte application for leave to file a crosscomplaint. 

7. On November 4, 2019 the Vlazakis Defendants appeared in the State Court on an ex 

parte application for leave to file a cross-complaint and an amended answer. The State Court denied 

the application and issued an order requiring the Vlazakis Defendants first to seek a ruling from the 

Bankruptcy Court “forthwith” regarding the applicability of the automatic stay to the proposed 

cross-claims and setting a briefing schedule for any motions for leave to file additional or amended 

pleadings. A copy of the State Court’s November 4, 2019 order is attached hereto as Exhibit A. 

8. I am informed and believe that at the November 4, 2019 hearing, counsel for the 

Vlazakis Defendants advised the court that he would seek relief in bankruptcy court within a week 

or ten days. Judge Whitman set the briefing schedule based on these representations. The Vlazakis 

Defendants did not file a motion seeking relief from the automatic stay in the time represented but 

waited until November 22, 2019. 

9. On December 2, 2019 the Vlazakis Defendants filed a motion for leave to file an 

Amended Answer; on December 10, 2019 they filed a motion for leave to file a Cross-Complaint, 

both without having first obtained relief from the automatic stay. 

The Vlazakis Defendants’ Title Claims 

10. The Vlazakis Defendants’ proposed Cross-Complaint alleges eight causes of action. 

The eighth cause of action seeks declaratory relief based on the preceding seven causes of action 

and asserts no independent substantive basis for relief. The fourth through seventh causes of action 

seek to establish the Vlazakis Defendants’ alleged right to use the Utility’s building/wall for support 

of their building by seeking to quiet title in the Vlazakis Defendants’ alleged property rights in the 

Utility’s building based on various easement theories. These claims, invoking theories of adverse 

possession, prescriptive easement, implied easement, and easement by necessity are typical real 

property title claims (collectively, the “Title Claims”). 

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11. The same Title Claims also are alleged – in the form of affirmative defenses – in the 

Vlazakis Defendants’ proposed Amended Answer. In their motion for leave to file an Amended 

Answer, the Vlazakis Defendants seek to add new affirmative defenses based on prescriptive 

easement, express easement, equitable easement, implied easement and easement by necessity (25th 

through 29th Affirmative defenses). A copy of the proposed Amended Answer is attached as 

Exhibit B.

2

 

12. The Title Claims and corresponding affirmative defenses involve only conduct and 

events that took place prior to the Utility’s discovery of the encroachment by the Vlazakis 

Defendants, which occurred in August 2016. The question to be resolved in this context is whether 

the Vlazakis Defendants had a right to use the PG&E building/wall to support their building as of 

that date or whether such use constituted trespass or nuisance. These claims and defenses do not 

implicate the Contract. 

The Vlazakis Defendants’ Contract Claims 

13. The first through third causes of action of the proposed Cross-Complaint are based on 

the Utility’s alleged breach of, and negligence in performing, the Contract. The Vlazakis 

Defendants seek damages for breach of contract and negligence in its performance, and specific 

performance of the contract (the “Contract Claims”). 

14. The Vlazakis Defendants’ Answer also contains a number of affirmative defenses that 

refer to the Utility’s alleged obligation to perform the Contract. For instance, the 4th Affirmative 

Defense alleges that defendants are “entitled to specific performance of Plaintiff’s agreement to go 

forward with structural upgrades of the common party wall since a binding contract supported by 

considerations was entered into by the parties to perform a specific undertaking enforceable by the 

Court.” The 11th Affirmative Defense alleges that the Utility breached the Contract and “PG&E’s 

covenants to perform” it by “reinforcing the existing masonry wall and to solidify and stabilize the 

subgrade below the wall.” 

2 A page is missing in the version of Exhibit B that was filed and served in the State Court Action.

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15. In essence, these “failure to perform” affirmative defenses are all based on the 

equitable principle of estoppel. This is confirmed by the 13th Affirmative Defense, which alleges 

that “PG&E is estopped by its conduct in failing to maintain and to protect the existing common 

party wall as previously represented to Defendants.” 

16. To the extent the Contract has any relevance to the Vlazakis Defendants’ defense to 

the Utility’s encroachment claims and request for an injunction it would be due only to the Vlazakis 

Defendants’ estoppel type arguments. The Vlazakis Defendants’ claims for breach of contract, 

negligence and resulting damages, all of which are based on conduct and events that post-date the 

Utilities’ discovery of the encroachment and the formation of the Contract, are entirely separate 

from any issues that are potentially relevant to an adjudication of the Utility’s claims. 

17. The evidence relevant to the Contract Claims would include complex design, 

engineering, permitting and cost matters related to the construction contemplated by the Contract, 

which would not be required if only the Title Claims were adjudicated. 

The Vlazakis Defendants’ Request for a Jury Trial 

18. The Vlazakis Defendants have requested a jury trial. 

19. Under California law, claims for breach of contract and negligence generally give rise 

to a right to a jury trial. 

20. The Utility’s complaint against the Vlazakis Defendants seeks the equitable remedy 

of an injunction. The Utility’s claims based on the encroachment, and the Vlazakis Defendants’ 

defenses to these claims based on real property title issues or estoppel, are essentially equitable and 

are not likely to give rise to a jury trial right. To the extent any of the Vlazakis Defendants’ 

affirmative defenses based on real property title issues, such as the prescriptive easement theory, 

might give rise to a jury trial, I believe there is a reasonable prospect that such issues can be 

eliminated by summary adjudication and will not change the nature of the bench trial or cause it to 

be postponed. 

Maintenance of the May 12, 2020 Trial Date 

21. I expect that the May 12, 2020 bench trial date can be maintained if the trial does not 

involve the proposed contract based cross-claims but is limited to the Utility’s claims and the 

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