Customers Can’t Sue PG&E for Losses During Power Shutoffs, Court Finds

A PG&E contractor works on utility poles along Highway 128 near Geyserville, Calif., on Oct. 31, 2019. (Philip Pacheco/AFP via Getty Images)

Pacific Gas and Electric customers in California can’t sue the utility company for financial losses that occur during public safety power shutoffs, the California Supreme Court ruled Nov. 20.

The utility, which delivers electricity to nearly 16 million Californians, sometimes shuts off power delivery during extreme weather conditions, such as high winds and low humidity, to prevent wildfires.

In June 2022, the California Supreme Court voted to review a class-action lawsuit in bankruptcy court by California citizen Anthony Gantner in 2019 against PG&E and its parent company PG&E Corporation.

In the legal claim, Mr. Gantner said the company’s shutoffs in the fall of 2019 left him and other California residents and business owners without power for many days. They sought $2.5 billion to compensate for making their homes uninhabitable, loss of refrigerated food, loss of cell phone service, expenses for alternative means of lighting and power, dangerous dark conditions, lack of running water, and loss of productivity and business.

The lawsuit claimed the shutoffs were the result of the company’s decades of negligent maintenance of its power lines.

In its opinion, the state’s Supreme Court justices sided with PG&E, saying the utility can’t be sued for negligence over the shutoffs because it interfered with the California Public Utilities Commission’s (PUC) ability to supervise, regulate, and review the utility’s public safety shutoff program.

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Specifically, the justices agreed that although the state’s public utilities regulations allow private citizens to sue utilities, the same laws also prohibit lawsuits that obstruct the official duties of the PUC, a public agency that regulates privately owned utilities in the state.

“We hold that allowing suit here would interfere with the PUC’s comprehensive regulatory and supervisor authority over [public safety power shutoffs],” Associate Justice Goodwin Liu wrote in the opinion.

By seeking billions of dollars in alleged damages, Mr. Gantner’s suit would “‘hinder’ or ‘frustrate’” the PUC’s carefully designed implementation of regulations, Justice Liu said in the opinion.

Chief Justice Patricia Guerrero, and all five associate justices concurred with the opinion.

In 2020, the Northern District of California Bankruptcy Court in San Francisco dismissed Mr. Gantner’s claim, agreeing with PG&E that the shutdowns fell within the PUC’s regulatory powers.

On appeal, the U.S. District Court in San Francisco affirmed the lower court’s dismissal of the lawsuit. Mr. Gantner appealed to the Ninth Circuit Court of Appeals, which asked the California Supreme Court to consider whether the company’s policies shield it from liability and if the PUC regulations preempt the plaintiff’s claim of negligence.

During the October and November 2019 power shutoffs, the state found PG&E violated the state’s public utilities code and PUC guidelines for power shutoffs, because the company’s online outage maps were inaccurate and its website was unavailable and did not work. As a result, 50,000 customers were not notified ahead of time before the power was shut off.

The PUC fined the utility over $106 million for the violations.

The company now publishes shutoff forecasts on a designated online page.

Mr. Gartner’s attorneys did not immediately respond to a request for comment.