1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

30

UNITED STATES DEPARTMENT OF JUSTICE

CIVIL DIVISION

JOSEPH H. HUNT

Assistant Attorney General

RUTH A. HARVEY

Director

KIRK MANHARDT

Deputy Director

MATTHEW J. TROY (GABN 717258)

Senior Trial Counsel

P.O. Box 875

Ben Franklin Station

Washington, DC 20044-0875

Telephone: (202) 514-9038

E-mail: matthew.troy@usdoj.gov

DAVID L. ANDERSON (CABN 149604)

United States Attorney

Attorneys for the United States of America

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).

)

)

)

)

)

)

)

)

)

) 

)

) 

) 

) 

)

)

)

)

)

)

Bankruptcy Case

No. 19-30088 (DM)

Chapter 11

(Lead Case)

 (Jointly Administered)

 Date: December 17, 2019

 Time: 10:00 a.m.

 Place: United States Bankruptcy Court

 450 Golden Gate Avenue

 Courtroom 17

 San Francisco, CA 94102

 Judge: Hon. Dennis Montali

 RE: Docket No. 5038 and 5076

 

STATEMENT OF THE UNITED STATES OF AMERICA IN RESPONSE TO

DEBTORS’ MOTION PURSUANT TO 11 U.S.C. §§ 363(b) AND 105(a) AND FED. R. 

BANKR. P. 6004 AND 9019 FOR ENTRY OF AN ORDER (I) AUTHORIZING THE 

DEBTORS AND TCC TO ENTER INTO RESTRUCTURING SUPPORT 

AGREEMENT WITH THE TCC, CONSENTING FIRE CLAIMANT 

PROFESSIONALS, AND SHAREHOLDER PROPONENTS, AND (II) GRANTING

RELATED RELIEF

Case: 19-30088 Doc# 5117 Filed: 12/16/19 Entered: 12/16/19 06:33:16 Page 1 of

4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

30

The United States of America, on behalf of various federal agencies, hereby responds to the 

Debtors’ Motion Pursuant to 11 U.S.C. §§ 363(b) and 105(a) and Fed. R. Bankr. P. 6004 and 9019 for 

Entry of an Order (I) Authorizing the Debtors and TCC to Enter into Restructuring Support 

Agreement with the TCC, Consenting Fire Claimant Professionals, and Shareholder Proponents, and 

(II) Granting Related Relief (Dkt. No. 5038) (the “RSA Motion”), in which they seek approval of a 

restructuring support agreement (the “RSA”) between them and, among others, the Official Committee 

of Tort Claimants (“TCC”). 

The United States does not object to the relief requested in the RSA Motion but files this 

statement to (1) address one assertion made in the Motion and (2) reserve its rights with respect to the 

Estimation Approval Motion described in the RSA Motion as well as the establishment, 

administration, and governance of the Fire Victim Trust.1

Resolution of All Prepetition Fire Claims

Various United States agencies have filed wildfire related claims aggregating approximately 

$4.3 billion in these cases. The Amended Plan described in the RSA and Term Sheet propose to 

channel the United States’ wildfire related claims to the Fire Victim Trust for resolution and 

satisfaction. The RSA Motion asserts that the RSA and Term Sheet “fully resolve the chapter 11 

plan’s treatment of all prepetition fire claims” including “the claims asserted by the DOJ, FEMA, and 

certain California State agencies (including Cal OES and CAL FIRE).” RSA Motion at 9, n.3.2 But as 

the Debtors’ 8-K SEC filing announcing the RSA correctly noted, the United States is not a party to 

the RSA. And it was not involved in any way in the negotiations leading to it and has not otherwise 

settled its wildfire related claims. In other words, there is a significant creditor in these cases asserting 

 

1 Terms not otherwise defined herein shall have the meaning ascribed to them in the Motion and 

accompanying exhibits.

2 To be clear, the Department of Justice has not asserted wildfire related claims in these cases. 

Other agencies of the United States, such as FEMA, the Small Business Administration, the Department 

of the Interior, and the Department of Agriculture, have done so.

Case: 19-30088 Doc# 5117 Filed: 12/16/19 Entered: 12/16/19 06:33:16 Page 2 of

4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

30

wildfire related claims that does not view the RSA and Term Sheet as having fully resolved the plan’s 

treatment of its claims. In essence, the only thing the RSA and Term Sheet resolved was how much 

consideration had to be in the Fire Victim Trust to satisfy wildfire related claims. The treatment of 

those claims through that trust is, however, still subject to the rigors of 11 U.S.C. § 1129 and a 

confirmation hearing. Accordingly, there remains much to be resolved, or decided by the Court, with 

respect to the Amended Plan’s treatment of the United States’ wildfire related claims, and the United 

States reserves all right with respect thereto.

Reservation of Rights

The RSA describes an Estimation Approval Motion, which will seek approval of a settlement 

of the Estimation Matters “provid[ing] for the aggregate estimation and aggregate allocation of the 

Fire Victim Claims in the amount of the Aggregate Fire Victims Consideration for all purposes in 

these Chapter 11 cases.” RSA Motion, Ex. A, paras. 1(h) and (i).3 The RSA Motion does not explain 

what “aggregate allocation” of Fire Victim Claims means but it seems certain to impact the treatment 

of those claims, including the United States’ wildfire related claims, in relation to the Fire Victim 

Trust. The RSA further describes Definitive Documents defined broadly as any documents necessary 

to implement the RSA, the Amended Plan, or the Disclosure Statement. Id. para. 1(f). These 

documents presumably would include the Fire Victim Trust Agreement and the Fire Victim Claim 

Resolution Procedures, RSA Motion, Ex. B [Term Sheet], at 6-8, both of which relate to the 

establishment, administration, and governance of the Fire Victim Trust -- an issue of paramount 

importance to the United States’ given the amount of its wildfire related claims. Accordingly, the 

United States reserves all rights with respect to the Estimation Approval Motion, the Disclosure 

Statement, the Amended Plan, the Definitive Documents, and the establishment, administration, and 

 

3 Estimation Matters is defined as the Debtors’ section 502(c) motion filed in this Court (Dkt. 

No. 3091) as well as the estimation proceeding before Judge Donato in the District Court, Case No. 19-

cv-05257-JD. RSA Motion, Ex A. para. 1(j).

Case: 19-30088 Doc# 5117 Filed: 12/16/19 Entered: 12/16/19 06:33:16 Page 3 of

4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

30

governance of the Fire Victim Trust.

Date: December 16, 2019 Respectfully submitted,

JOSEPH H. HUNT

Assistant Attorney General

DAVID L. ANDERSON (CABN 149604)

United States Attorney

/s/ Matthew J. Troy

RUTH A. HARVEY

Director

KIRK MANHARDT

Deputy Director

MATTHEW J. TROY

Senior Trial Counsel

Attorneys for the United States

CERTIFICATE OF SERVICE

I hereby certify that on December 16, 2019, I electronically filed the foregoing Statement with the Clerk 

of the Court by using the CM/ECF system, which will send a notice of electronic filing to all CM/ECF 

participants.

/s/ Matthew J. Troy

Matthew J. Troy

Senior Trial Counsel 

Attorney for United States

Case: 19-30088 Doc# 5117 Filed: 12/16/19 Entered: 12/16/19 06:33:16 Page 4 of

4