Thursday, June 6, 2013

[californiadisasters] State Reassigns Lawyers Probing PG&E In San Bruno Blast



State reassigns lawyers probing PG&E

Jaxon Van Derbeken | San Francisco Chronicle
Updated 4:29 pm, Wednesday, June 5, 2013
The California Public Utilities Commission legal team investigating Pacific Gas and Electric Co.'s culpability for the San Bruno natural-gas explosion was abruptly reassigned this week, sending the agency into turmoil as it made its case for whether the company should be penalized more than $2 billion for violating safety rules.

The commission's four lead lawyers had worked on the case for more than two years, preparing thousands of pages of legal arguments and questioning hundreds of witnesses concerning PG&E's role in the September 2010 pipeline blast that killed eight people and destroyed 38 homes.

The commission's lead attorney, Frank Lindh, reassigned them Monday, the apparent culmination of a disagreement between the lawyers and the head of the state agency's safety arm over how much PG&E should have to pay in fines for San Bruno-related violations.

Last month, the safety division's leader, Jack Hagan, told the two administrative law judges handling the case that fining PG&E "makes no sense." Instead, he said, PG&E shareholders should have to make $2.25 billion worth of fixes to the company's natural-gas system.

In an unusual development, only Hagan signed the argument that the commission submitted to the judges - not the lawyers who had researched the case.

Hagan then ordered PG&E to spell out its past and planned spending on gas-system improvements. Coincidentally, it totaled close to $2.25 billion.

Last week, the legal team's head lawyer, Harvey Morris, filed a motion with the administrative law judges to throw out PG&E's figures as unsupported by any evidence. On Monday, the judges agreed and tossed the numbers.

That same day, Lindh took Morris and the others off the case. Lindh is a former lawyer for PG&E who originally assigned Morris - his assistant general counsel - to handle the San Bruno investigation because of Lindh's potential conflict of interest.

Lindh was out of the office Wednesday, according to his staff, and did not return calls seeking comment. Hagan's office referred calls to the utilities commission's public affairs office, which said some of the attorneys had asked to be reassigned.

Morris and other team lawyers declined to comment.

Their departure came at a critical stage, with the commission facing a Friday deadline to submit final arguments to the administrative law judges over how PG&E should be penalized.

Two new lawyers were given the task of reviewing the mammoth legal case. Hagan submitted a nine-page brief Wednesday, reiterating his earlier proposal and arguing that a fine, which would go into the state's general fund, "would not do anything to advance safety on (PG&E's) system."

The attorneys' reassignments prompted an outraged reaction from San Bruno Mayor Jim Ruane, who called for the state attorney general's office and the Legislature to investigate. City officials have no confidence that the utilities commission will make an effective case against PG&E, Ruane said.

He speculated that the commission lawyers had been reassigned because "they did not want to see nearly three years of their work turned into a conclusion that lets PG&E off the hook."

San Bruno has urged the administrative law judges to assess fines against PG&E. Its lawyers have argued that requiring the company to pay $2.25 billion in repairs rather than fines would allow it to reap $900 million in tax deductions.

State Sen. Jerry Hill, D-San Mateo, a frequent critic of the commission, said the agency "at every turn ... works to protect PG&E instead of protecting the public. This latest illegal interference with the safety division's prosecution of PG&E is yet another example of why we need new leadership" at the commission.

Source: http://www.sfgate.com/bayarea/article/State-reassigns-lawyers-probing-PG-amp-E-4580672.php



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