PG & E to File Bankruptcy Amid Lawsuit over California Fires
In 2018, fires ravaged just under 2 million acres of land. Recent evidence suggests that a local utility company’s equipment may be responsible for the catastrophic event. PG&E may be on the hook for expenses totaling at around $30 billion. Top brass has decided they cannot afford that so they plan to file for bankruptcy under chapter 11.
PG & E
PG&E is the holdings company for California’s largest utility company, Pacific Gas and Electric. They currently employ about 20,000 people. They incorporated in 1995. The fires of 2018 are not the company’s first brush with disaster. In 2017, the company was held responsible for a fire outbreak due to insufficient brush trimming around power lines. This catastrophe resulted in the death of 44 people.
The 2018 Fires
In the summer of 2018, over 8,000 fires ravaged central and southern California. During the course of these fires, over 80 people were killed. Just under 2 million acres of land were affected. The estimated damage caused by the fires is around $30 billion. In California, liabilities laws allow the utility companies to be blamed for disasters even if they followed all safety regulations as long as their equipment is at fault.
Reluctance to Bail Out PG&E
In the “too big to fail” age, essential companies such as utilities providers are often bailed out when faced with adversity. Utilities play an extremely important role in modern society. California state legislators have already expressed their reluctance to offer a hand to PG&E. They are quoted as saying there will be no “golden parachute”. This may be partially due to the fact that the 2018 fires were not the first strike against the company (2017 fires).
The Inevitable Chapter 11 Bankruptcy
Since PG&E was implicated in the fires, their stock price has dropped over 65%. When asked about their ability to cover the damages caused by the fires, the company said they have about $1.5 billion in cash on hand. Legislators stopped just short of demanding that the utility company file for bankruptcy under chapter 11 to allow for restructuring of debt. While restructuring, those in need of the funds the most will be prioritized.
Bankruptcy is an important tool for people who find themselves in over their head. If you are behind on mortgage, medical, or any other type of payments, there may be a way out. If you are interested in reclaiming your life, contact Elias Dsouza at Dsouza and Strachan Lawgroup. Elias has been helping people reclaim their life for over 15 years.