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AKIN GUMP STRAUSS HAUER & FELD LLP 

Michael S. Stamer (pro hac vice) 

Ira S. Dizengoff (pro hac vice) 

David H. Botter (pro hac vice) 

Abid Qureshi (pro hac vice) 

One Bryant Park 

New York, New York 10036 

Telephone: (212) 872-1000 

Facsimile: (212) 872-1002 

Email: mstamer@akingump.com 

 idizengoff@akingump.com 

 dbotter@akingump.com 

 aqureshi@akingump.com 

AKIN GUMP STRAUSS HAUER & FELD LLP 

Ashley Vinson Crawford (SBN 257246) 

580 California Street 

Suite 1500 

San Francisco, CA 94104 

Telephone: (415) 765-9500 

Facsimile: (415) 765-9501 

Email: avcrawford@akingump.com 

 

Counsel to the Ad Hoc Committee of Senior Unsecured 

Noteholders of Pacific Gas and Electric Company 

UNITED STATES BANKRUPTCY COURT 

NORTHERN DISTRICT OF CALIFORNIA 

SAN FRANCISCO DIVISION 

In re: 

PG&E CORPORATION, 

-andPACIFIC GAS AND ELECTRIC 

COMPANY,

Bankruptcy Case 

No. 19-30088 (DM) 

Chapter 11 

(Lead Case) 

(Jointly Administered) 

MOTION OF THE AD HOC COMMITTEE 

OF SENIOR UNSECURED 

NOTEHOLDERS FOR 

RECONSIDERATION AND RELIEF FROM 

ORDERS PURSUANT TO FEDERAL 

RULES OF CIVIL PROCEDURE 59(e) AND 

60(b)

Hearing 

Date: January 21, 2020 

Time: 10:00 a.m. (Pacific Time) 

Place: Courtroom 17 

 450 Golden Gate Ave, 16th Floor 

 San Francisco, CA 94102 

Objection Deadline: January 14, 2020 

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)

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TABLE OF CONTENTS 

Page 

PRELIMINARY STATEMENT .......................................................................................................1

BACKGROUND .............................................................................................................................2

ARGUMENT ...................................................................................................................................8

A. Legal Standard. ........................................................................................................8

B. In Light of New Factual Developments, the Court Should 

Reconsider its Rulings on the Anticompetitive Provisions 

in the TCC RSA and Subro RSA. ............................................................................9

1. The Anticompetitive Provisions in the TCC RSA 

Should Be Removed. ...................................................................................9

2. The Anticompetitive Provisions in the Subro RSA 

Should be Removed. .................................................................................. 11

CONCLUSION ..............................................................................................................................12

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TABLE OF AUTHORITIES 

Cases Page(s) 

City of L.A., Harbor Div. v. Santa Monica Baykeeper, 

254 F.3d 882 (9th Cir. 2001) ............................................................................................. 8, 11 

In re Krow, 

No. BR 12-31601DM, 2016 WL 4167966 (Bankr. N.D. Cal. Aug. 4, 2016) .......................... 8 

McDowell v. Calderon, 

197 F.3d 1253 (9th Cir. 1999) ................................................................................................. 8 

Reynoso v. All Power Mfg. Co., 

No. SACV 16-1037 JVS (JCGx), 2018 WL 5906645 (C.D. Cal. Apr. 30, 2018) ............. 8, 11 

Sch. Dist. No. 1J, Multnomah Cty., Or. v. ACandS, Inc., 

5 F.3d 1255 (9th Cir. 1993) ..................................................................................................... 8 

Sierra Club v. City & Cnty. of Honolulu, 

No. CV 04-00463 DAE-BMK, 2008 WL 515963 (D. Haw. Feb. 26, 2008) ..................... 8, 11 

Statutes and Rules 

Fed. R. Bankr. P. 9023 ................................................................................................................... 8 

Fed. R. Bankr. P. 9024 ................................................................................................................... 8 

Fed. R. Civ. P. 59 ........................................................................................................................... 8 

Fed. R. Civ. P. 60 ........................................................................................................................... 8 

Other Authorities 

11 Charles Alan Wright et al., Federal Practice and Procedure § 2810.1 (2d ed. 1995) ........... 8 

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1. The Ad Hoc Committee of Senior Unsecured Noteholders of Pacific Gas and 

Electric Company (the “AHC”) by its undersigned counsel, Akin Gump Strauss Hauer & Feld 

LLP, hereby submits this motion (the “Motion”) pursuant to Federal Rules of Civil Procedure 59 

and 60, as incorporated by Federal Rules of Bankruptcy Procedure 9023 and 9024, for an order 

(i) vacating the orders granting the TCC RSA Motion [Dkt. No. 5174] and the Subro RSA 

Motion [Dkt. No. 5173] (as defined below) in their entirety or, in the alternative, (ii) vacating the 

orders and conditioning approval of the applicable restructuring support agreements on removal 

of the anticompetitive provisions contained therein. 

PRELIMINARY STATEMENT 

2. All major constituents in these chapter 11 cases agree that the full, prompt, and 

fair payment of wildfire victims’ claims is paramount. To promote that goal, this Court 

terminated exclusivity and allowed for a competing plan process. Such a process was, and still 

is, critical to facilitating the best possible outcome for wildfire victims. 

3. The competing plan process triggered by the termination of exclusivity has 

worked as intended, providing significant benefits to the wildfire victims. After this Court 

terminated exclusivity, the AHC and TCC put forth a competing plan that guaranteed the wildfire 

victims $13.5 billion. At the time, this settlement far exceeded the $8.4 billion sum to be paid to 

wildfire victims under the Debtor plan. Eventually, faced with the impending Tubbs trial and 

estimation hearings, which were highly likely to result in substantial wildfire claims, the Debtors 

and equity holders finally and begrudgingly matched the allowed claim amount set forth in the 

AHC plan and settled with the TCC and other wildfire victims for $13.5 billion. 

4. New developments, not before this Court at the time it approved the Subro RSA 

and TCA RSA, demonstrate that this competitive process is continuing to unfold. In particular, 

the AHC, on December 20, 2019, announced that under their proposed plan of reorganization, 

wildfire victims would be paid $13.5 billion in cash up front on the effective date of the plan. 

The AHC plan thus directly addresses a major shortcoming in the Debtors’ payment of such 

claims: wildfire victims will be forced to take stock in the very company that caused their 

devastating losses. The AHC plan also provides significantly greater certainty and value. Of the 

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$6.75 billion to be paid in cash under the Debtor plan, over $1 billion will be paid to wildfire 

victims over the course of the next two years, if and when the Debtors generate additional funds 

from NOLs. 

5. The orders granting the TCC RSA Motion and Subro RSA Motion, however, 

short-circuit this competitive process. Through anticompetitive provisions that prevent key 

constituencies from voting for, or even negotiating with, the AHC regarding a plan, those RSAs 

stifle competition rather than promote it. Of particular concern is the provision in the TCC RSA 

that forces the fiduciaries of wildfire victim claimants to refrain from encouraging, supporting, or 

even participating in the formulation of any plan other than the Debtor plan. This and other 

anticompetitive provisions contained in the RSAs undercut all benefits that typically accompany 

a competitive process—namely, consensus building and outcome optimization. There is simply 

no reason to bind wildfire victims to the Debtors’ current settlement offer when a preferable 

alternative already exists and there is good reason to continue to allow competition given the fact 

that the Debtor plan is unlikely to pass muster under AB 1054. 

6. Federal Rules of Civil Prodcedure 59 and 60 exist precisely to enable this Court to 

address the still-changing landscape of the treatment of wildfire victim claims. In the face of the 

AHC’s new offer, allowing the RSAs’ anticompetitive provisions to render the competitive 

process essentially meaningless not only undermines the Court’s prior order terminating 

exclusivity, but also ensures that wildfire victims’ concern about the Debtors’ treatment of their 

claims cannot and will not be addressed. 

7. Accordingly, the AHC requests that the Court grant the motion for 

reconsideration, vacate the orders approving the TCC RSA and Subro RSA, or, in the alternative, 

vacate the orders and condition subsequent approval on removal of the anticompetitive 

provisions. 

BACKGROUND 

8. On September 24, 2019, the Debtors filed a motion (the “Subro RSA Motion”) to 

approve an RSA (the “Subro RSA”) with entities representing approximately 85% of insurance 

subrogation claims (the “Consenting Creditors”). (See Subrogation Settlement and RSA Motion

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[Dkt. No. 3992].) Among other things, the Subro RSA provides for $11 billion in cash to be paid 

to settle all subrogation claims on the effective date of the plan. (Subro RSA, Section 4.) The 

Subro RSA also includes several anticompetitive provisions that bind the subrogation 

claimholders to support the Debtors’ proposed plan of reorganization (the “Debtor Plan”) and the 

Debtor Plan alone. Specifically, the Subro RSA requires each Consenting Creditor to support 

and cooperate with the Debtors to obtain confirmation of the Plan, and to timely vote or cause to 

be voted all of its subrogation claims to accept the Plan. (Subro RSA, Section 2(a)(ii).) Further, 

the Subro RSA requires each Consenting Creditor to vote against any other proposed plan, 

regardless of whether such plan offers subrogation claimholders the same or better treatment than 

the Debtor Plan. (Subro RSA, Section 2(a)(iii).) 

9. On October 9, 2019, the Court terminated exclusivity solely as to the then-joint 

proposed plan of the Official Committee of Tort Claimants (the “TCC”) and the AHC. (See 

Order Granting Joint Motion of the TCC and AHC to Terminate the Debtors’ Exclusive Period 

Pursuant to Section 1121(d)(1) of the Bankruptcy Code [Dkt. No. 4167].) In granting the TCC 

and AHC’s motion to terminate exclusivity, the Court noted that if both plans are confirmable 

“the voters will make their choice or leave the court with the task of picking one of them.” (Id.) 

10. On October 16, 2019, several groups, including the UCC and the AHC, filed 

objections to the Subro RSA Motion. (See Objection of the Official Committee of Unsecured 

Creditors to the Debtors’ Subrogation Settlement and RSA Motion [Dkt. No. 4236] (the “UCC 

Objection”); Objection of the Ad Hoc Committee of Senior Unsecured Noteholders to Debtors’ 

Subrogation Settlement and RSA Motion [Dkt. No. 4241] (the “AHC Objection”).) Citing the 

recently terminated exclusivity, both the UCC and AHC objected to the provisions of the Subro 

RSA that forced Consenting Creditors to vote against any competing plan. (UCC Objection ¶ 9; 

AHC Objection ¶ 5.) Governor Gavin Newsom also filed an objection to the Subro RSA 

challenging the anticompetitive provisions. (See Objection of Governor Gavin Newsom to the 

Debtors’ Subrogation Settlement and RSA Motion [Dkt. No. 4640], ¶ 11.) As Governor Newsom, 

the AHC, and UCC argued, requiring the Consenting Creditors to vote against the AHC Plan, 

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even if the AHC Plan provided the same or better terms as the Debtor Plan, is contrary to a 

competing plan process. 

11. On October 17, 2019, the TCC and AHC filed their competing plan of 

reorganization (the “AHC Plan”) [Dkt. No. 4257]. Like the deal memorialized in the Subro 

RSA, the deal in the AHC Plan provided subrogation claimholders with $11 billion of value. The 

AHC Plan also provided for $13.5 billion to be paid to the victims of PG&E-caused wildfires in 

a mix of cash and stock. 

12. Over the course of the next several weeks, the Subro RSA was repeatedly 

amended. Among other changes, the anticompetitive terms were amended to permit the 

subrogation claimants to vote against the Debtor Plan, if (and only if) the Debtors determine that 

they are insolvent and the Debtors file an insolvent plan that does not pay subrogation claimants 

$11 billion in cash. (See Proposed Second Amended and Restated Restructuring Support 

Agreement [Dkt. No. 4921].) Aside from this revision, the fundamental anticompetitive 

provisions remained in the Subro RSA. 

13. On December 4, 2019, the Court heard argument on the Subro RSA and took the 

matter under advisement. 

14. On December 6, 2019, the Debtors entered into a settlement and RSA with certain 

attorneys representing wildfire victims (the “Consenting Fire Claimant Professionals”) and the 

TCC (the “TCC RSA” and together with the Subro RSA, the “RSAs”).

1

 Per the settlement 

agreement, the Debtors took advantage of the hard-fought settlement negotiations between the 

AHC and TCC and matched their $13.5 billion allowed claim amount. The $13.5 billion is to be 

paid in consideration consisting of half common stock and half cash. Of the $6.75 billion cash 

component, $5.4 billion is to be paid on the effective date, with the remaining $1.35 billion to be 

funded from anticipated tax benefits and paid in January of 2021 and 2022. If the Debtors do not 

 

1

 The precise terms of the TCC RSA were laid out in the motion for approval filed on December 9, 2019. (See Tort 

Claimants RSA Motion [Dkt. No. 5038] (the “TCC RSA Motion”).) 

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generate sufficient tax benefits to meet these payment obligations, the fire victim trust will 

receive a letter of credit. 

15. Like the Subro RSA, the TCC RSA includes a series of anticompetitive provisions 

that prevent the signatories to the RSA from supporting any plan other than the Debtor Plan. 

Specifically: 

 The Consenting Fire Claimant Professionals must use all reasonable efforts to 

advise their existing and future clients to support and vote to accept the Debtor 

Plan; 

 The TCC must create a letter (the contents of which are to be approved by the 

Debtors and the equity plan proponents), to be distributed with the solicitation 

materials to the Debtor Plan, advising all holders of wildfire claims to vote to 

accept the Debtor Plan; 

 Each party to the TCC RSA must oppose efforts and procedures to seek 

confirmation, consummation or implementation of the AHC Plan; and 

 Each party to the TCC RSA must not solicit approval or acceptance of, encourage, 

propose, file, support, participate in the formulation of or vote for any 

restructuring other than the Debtors Plan, including the AHC Plan or any other 

plan of reorganization proposed by the Ad Hoc Committee. 

(See TCC RSA, Section 2.) 

16. As with the Subro RSA Motion, the AHC, UCC, and others objected to the 

anticompetitive provisions. The AHC and UCC argued that the terms of the RSA undermine the 

competing plan process by requiring the TCC and Consenting Fire Claimant Professionals to 

recommend that wildfire victims vote for the Debtor Plan, even if the AHC Plan provides more 

to wildfire victims. (See Objection of the Official Committee of Unsecured Creditors to Debtors’ 

TCC RSA Motion [Dkt. No. 5132]; Objection of the Ad Hoc Committee of Senior Unsecured 

Noteholders to Debtors’ TCC RSA Motion [Dkt. No. 5131].) 

17. Governor Newsom echoed the arguments of the AHC and UCC in a statement to 

the Court regarding the TCC RSA Motion. Governor Newsom noted that the TCC RSA 

“contains provisions limiting competition and precluding the TCC and Consenting Fire Claimant 

Professionals from supporting any other competing plan of reorganization—even one that 

provides identical treatment of the fire victims’ claims.” (See Statement of Governor Gavin 

Newsom Regarding the TCC RSA Motion [Dkt. No. 5138].) Accordingly, Governor Newsom 

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requested that the Court require amendments to the RSA allowing the TCC and Consenting Fire 

Claimant Professionals to support any alternative restructuring. (Id.) 

18. On December 17, 2019, the Court heard argument on the TCC RSA Motion. At 

the hearing, representatives of the TCC and wildfire victims expressed displeasure that they were 

receiving stock and deferred cash payments as consideration for the settlement. Notably, counsel 

for the TCC stated: 

“We would have loved to get cash in an amount adequate to address 

tort claims, as of the effective date. . . . . And with respect to those 

parties who made those observations, we agree completely. We would 

prefer not to have stock.” 

(Hr’g Tr. at 222:10-225:13, December 17, 2019 (No. 19-30088).) The court also heard from 

counsel to individual wildfire victims who objected to the fact that his clients were being forced 

to accept a settlement that would pay stock in the very company that caused his clients so much 

suffering. (Id. at 137:10-138:9.) Despite the TCC and wildfire victims’ stated preference for 

cash over stock, as of the December 17 hearing on the TCC RSA Motion, both the Debtor Plan 

and AHC Plan provided for a mix of cash and stock to the wildfire victims. 

19. At the conclusion of the hearing, the Court orally granted the Subro RSA Motion 

and TCC RSA Motion. (Id. at 292:23-302:22.) Notably, the Court emphasized that the goal of 

the chapter 11 cases was to provide recoveries for the tens of thousands of wildfire victims who 

are involuntary creditors in these cases. (See id. at 299:11-24.) 

20. Also on December 17, 2019, U.S. District Court Judge James Donato held a status 

conference in the estimation proceedings. During the hearing, the Debtors informed Judge 

Donato that they reached a $13.5 billion settlement with the TCC and representatives of other 

wildfire claimants. In response, Judge Donato concluded that there was nothing left to do with 

regards to estimation: “the settlement gets approved, you’re done. Settlement is not 

approved, you have effectively estimated the loss at 13.5 billion. So what else is there to do?” 

(Hr’g Tr. at 6:18-23, December 17, 2019 (No. 19-5257).) When counsel for the Debtors 

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attempted to push back on this assessment, noting that if the settlement is not approved the 

Debtors may return to argue the value of the claims, Judge Donato countered: 

“[W]e started this estimation process by looking at other settlements and inferring from 

those other settlements what the value would be here. Now we have the gold standard. 

You have actually settled. So I don’t have to even infer. You’ve put – you’ve put the ink 

on the paper and you have said it’s 13.5 billion. I just can’t imagine that you would 

ever be allowed to revisit that. Maybe we don’t have to get into it, but, you know, 

whether -- settlement or not, you have both estimated the value to be 13.5 billion. So 

that figure is here.” 

(Id. at 9:2-11.) 

21. The Court issued formal orders granting the motions and approving the RSAs on 

December 19, 2019. [See Dkt. Nos. 5173, 5174.] 

22. One day later, on December 20, 2019, the AHC presented a letter and revised term 

sheet for an amended plan of reorganization to Governor Newsom (the “New AHC Plan”). (See

Ad Hoc Committee, Letter to Governor Gavin Newsom, Dec. 20, 2019 (the “AHC Letter”), 

attached hereto as Exhibit A.) Most significantly, and in contrast to the Debtor Plan, the New 

AHC Plan committed to pay victims “their full claim of $13.5 billion in cash up front on the 

effective date of the plan.” (Id.) 

23. The AHC Letter also set forth corporate governance, capital structure, safety, and 

other changes to bring the AHC Plan in alignment with Governor Newsom’s requirements for an 

AB 1054-compliant plan. (Id.) Among other things, the AHC committed to changes to the 

public safety power shutoff (“PSPS”) procedures, better treatment for PG&E’s employees, rate 

growth caps, an overhaul of the board of directors, and an escalating enforcement process 

culminating in the State of California having the option to purchase the reorganized PG&E. 

24. Also on December 20, 2019, Judge Donato entered an order staying the district 

court estimation proceedings and vacating all hearing dates. [See Estimation Dkt. No. 276.] 

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25. On December 26, 2019, California Superior Court Judge Andrew Cheng entered 

an order vacating all future dates in the Tubbs litigation and setting a hearing to show cause on 

dismissal of the litigation for March 2, 2020. [See California North Bay Fire Cases JCCP 4995.] 

ARGUMENT 

A. Legal Standard. 

26. Beyond “inherent procedural power to reconsider, rescind, or modify an 

interlocutory order for cause seen by it to be sufficient,” City of L.A., Harbor Div. v. Santa 

Monica Baykeeper, 254 F.3d 882, 885 (9th Cir. 2001) (emphasis omitted), the Federal Rules of 

Civil and Bankruptcy Procedure provide specific mechanisms for revisiting issued orders. Under 

Federal Rule of Civil Procedure 59(e), as incorporated by Federal Rule of Bankruptcy Procedure 

9023, a motion for reconsideration may be granted if the court “(1) is presented with newly 

discovered evidence, (2) committed clear error or the initial decision was manifestly unjust, or 

(3) if there is an intervening change in controlling law[,]” though “[t]here may also be other, 

highly unusual, circumstances warranting reconsideration.” See Sch. Dist. No. 1J, Multnomah 

Cty., Or. v. ACandS, Inc., 5 F.3d 1255, 1263 (9th Cir. 1993). The court has “considerable 

discretion” when hearing such a motion. See McDowell v. Calderon, 197 F.3d 1253, 1254 n.1 

(9th Cir. 1999) (citing 11 Charles Alan Wright et al., Federal Practice and Procedure § 2810.1 (2d 

ed. 1995)). Courts have also granted motions for reconsideration in light of new factual 

developments—the basis for the current motion. See Reynoso v. All Power Mfg. Co., No. SACV 

16-1037 JVS (JCGx), 2018 WL 5906645, at *2 (C.D. Cal. Apr. 30, 2018); see also Sierra Club v. 

City & Cnty. of Honolulu, No. CV 04-00463 DAE-BMK, 2008 WL 515963, at *4 (D. Haw. Feb. 

26, 2008); In re Krow, No. BR 12-31601DM, 2016 WL 4167966, at *1 (Bankr. N.D. Cal. Aug. 4, 

2016). 

27. Under Federal Rule of Civil Procedure 60(b), as incorporated by Federal Rule of 

Bankruptcy Procedure 9024, a court may grant relief from an order or proceeding when “any 

other reason . . . justifies relief.” 

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B. In Light of New Factual Developments, the Court Should Reconsider its Rulings 

on the Anticompetitive Provisions in the TCC RSA and Subro RSA. 

28. As the AHC’s newly disclosed plan readily demonstrates, the anticompetitive 

provisions of the RSAs cannot coexist with a competitive plan process. Instead, the 

anticompetitive provisions hinder a resolution of these chapter 11 cases that provides the best 

recovery for wildfire victims, other constituents, and the State of California. The Court’s 

decisions to approve the anticompetitive provisions of the Subro RSA and TCC RSA therefore 

warrants reconsideration under both Rule 59(e) and 60(b). 

29. The AHC disclosed the New AHC Plan to Governor Newsom on December 20, 

2019, following the entry of the orders approving the Subro RSA and TCC RSA. As noted 

above, the New AHC Plan will provide wildfire victims with $13.5 billion in cash on the 

effective date, and it contains further commitments designed to satisfy the requirements of AB 

1054, addressing deficiencies in the Debtors’ corporate governance and enhancing safety and 

accountability, among other things. The AHC believes that the New AHC Plan is demonstrably 

superior to the Debtor Plan in its treatment of wildfire victims. And, although the Governor and 

CPUC ultimately will have to decide, the AHC further believes that the New AHC Plan is better 

for all constituents, including the State of California. 

1. The Anticompetitive Provisions in the TCC RSA Should Be Removed. 

30. The anticompetitive provisions in the TCC RSA prohibit the TCC from 

supporting a superior plan and effectively prevent the New AHC Plan from receiving the 

required votes. In keeping with the overarching goal in these chapter 11 cases to provide 

wildfire victims with full and fair compensation, the New AHC Plan now provides wildfire 

victims with $13.5 billion in cash on the effective date. This consideration is objectively better 

than the mix of stock, upfront cash payments, and deferred cash payments under the Debtor Plan. 

Counsel for the TCC recognized this point, noting that “we would have loved to get cash in an 

amount adequate to address tort claims, as of the effective date. . . . We would prefer not to have 

stock.” (Hr’g Tr. at 222:10-225:13, December 17, 2019 (No. 19-30088).) 

31. Yet, the TCC RSA requires the TCC and Consenting Fire Claimant Professionals 

to go to extreme lengths not only to advocate against the New AHC Plan that they would prefer, 

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but to affirmatively defeat it. Under the TCC RSA, the Consenting Fire Claimant Professionals 

must advise their clients to “support” and vote for the inferior Debtor Plan. (TCC RSA, Section 

2(g).) Separately, the TCC must create a letter (the contents of which are to be approved by the 

Debtors and certain equity interests), to be distributed with solicitation materials advising all 

holders of wildfire claims to vote to accept the inferior Debtor Plan. (TCC RSA, Section 2(k).) 

All parties to the TCC RSA must not “solicit approval or acceptance of, encourage, propose, file, 

support, participate in the formulation of or vote for any restructuring . . . other than the [Debtor] 

Plan, including, without limitation” the New AHC Plan “or any other plan of reorganization 

proposed by the Ad Hoc Committee.” (TCC RSA, Section 2(o).) Finally, all parties to the TCC 

RSA must oppose “efforts and procedures to . . . seek confirmation, consummation or 

implementation” of the New AHC Plan. (TCC RSA, Section 2(n).) Those provisions make no 

sense given that the crux of AHC participation in the plan process has been to foster competition 

and provide a better choice to wildfire victims and others. 

32. In response, the TCC, Debtors, and equity plan proponents likely will point to the 

“fiduciary out” contained in the TCC RSA. (TCC RSA, Section 19.) But the fiduciary out does 

not resolve the issues identified in this Motion. First, the fiduciary out only applies to the TCC, 

so the Consenting Fire Claimant Professionals, who are also fiduciaries, are still contractually 

bound to advise their clients to vote for the inferior Debtor Plan. (Id.) Second, reliance on the 

fiduciary out rests on the faulty premise that the TCC RSA should have been approved. But the 

TCC RSA should not have been approved, and the TCC should never have been made to bear the 

burden of potentially blowing up the settlement or making a determination that its obligations 

under TCC RSA are inconsistent with its fiduciary duties. Instead, the Court should have 

recognized that the anticompetitive provisions are contrary to a competing plan process and 

required the Debtors to remove those provisions. Finally, even if the TCC determines that the 

New AHC Plan does not trigger the fiduciary out, additional amendments could be made to 

further improve the plan for the wildfire victims, the State of California, and other stakeholders. 

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This was precisely the point of having a competitive plan process, and wildfire victims should 

not be foreclosed from voting for more favorable plans that may be proposed later on.2

33. Where, as here, a court “has jurisdiction over the case, then it possesses the 

inherent procedural power to reconsider, rescind, or modify an interlocutory order for cause seen 

by it to be sufficient.” City of L.A., 254 F.3d at 885 (emphasis omitted). Moreover, case law is 

clear that, under the Federal Rules of Civil and Bankruptcy Procedure, this Court is able to take 

into account the changed circumstances of the New AHC Plan and the developments in the 

Tubbs and estimation proceedings and alter its order approving the TCC RSA in order to further 

the competitive process for the benefit of wildfire victims and all other constituencies. See

Reynoso, 2018 WL 5906645, at *2 (accepting argument that “motion for reconsideration is 

warranted because new material facts emerged after RBC filed its motion for decertification that 

the Court did not consider”); Sierra Club, 2008 WL 515963, at *4 (“For the reasons set forth 

below, the Court holds that its 2005 Order dismissing Plaintiffs’ First and Second Claims based 

on res judicata should be reconsidered in light of current circumstances.”). The new 

developments in this case provide ample justification for this Court to provide the requested 

relief. 

2. The Anticompetitive Provisions in the Subro RSA Should be Removed. 

34. Although the New AHC Plan does not at this time provide more favorable 

treatment to holders of subrogation claims, the anticompetitive provisions in the Subro RSA 

nevertheless should be removed for the same reasons. The AHC plan continues to evolve and 

future developments may occur that make the AHC plan more favorable to subrogation 

claimholders than the Debtor Plan. Yet, under the terms of the Subro RSA, the subrogation 

claimants must vote against any plan that is not the Debtor Plan. (Subro RSA, Section 2(iii).) 

 

2

 It is likely that the Debtors will also argue that if the anticompetitive provisions are stricken, the Debtors will back 

out of their settlement with the wildfire victims and proceed with estimation. This is an empty threat. In Judge 

Donato’s own words, “settlement or not, [the Debtors and TCC] have both estimated the value to be 13.5 billion.” 

(Hr’g Tr. at 9:10-11, December 17, 2019 (No. 19-5257).) Further, all future hearing dates in both the district court 

estimation proceedings and state court Tubbs litigation have been vacated, and Judge Donato has made clear that his 

calendar cannot accommodate estimation until after June 30. As such, any attempt by the Debtors to blow up the 

settlement and re-open estimation will be futile. 

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CONCLUSION 

35. For the foregoing reasons, the Court should grant the AHC’s Motion and vacate 

the orders approving the RSAs, or, in the alternative, vacate the orders and condition subsequent 

approval of the RSAs on the removal of the anticompetitive provisions contained therein. 

Dated: December 31, 2019 AKIN GUMP STRAUSS HAUER & FELD LLP 

By: /s/ Ashley Vinson Crawford_______

Ashley Vinson Crawford (SBN 257246) 

Michael S. Stamer (pro hac vice) 

Ira S. Dizengoff (pro hac vice) 

David H. Botter (pro hac vice) 

Abid Qureshi (pro hac vice) 

Counsel to the Ad Hoc Committee of Senior Unsecured 

Noteholders of Pacific Gas and Electric Company 

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