Will PG&E’s Bankruptcy Impact Victims of the Dixie Fire?

As many people know, PG&E was forced to file Chapter 11 bankruptcy in 2019 as a result of several wildfires in Northern California in 2017 and 2018. These fires destroyed more than 20,000 businesses and homes throughout Northern California and caused more than 80 deaths. After a reorganization plan was approved by the court in 2019, wildfire victims were awarded more than $13 billion in cash and stock, which is currently being distributed by a court-appointed trustee.

At this point, it does not appear that victims of the Dixie Fire will be impacted by PG&E’s 2019 bankruptcy. The reason for this is that a bankruptcy claim only impacts debts that accrued prior to the date the bankruptcy was filed. Debts and liabilities that arise after a bankruptcy filing are not impacted by the bankruptcy. These are often referred to as “post-petition” debts.

Learn more directly from Stuart Talley about PG&E and their 2019 Bankruptcy in the video below

But many have asked whether the new liabilities caused by post-petition fires (including the Dixie Fire) could force PG&E into another bankruptcy. At this point, the answer seems to be that this is unlikely. First, public reports indicate that after PG&E emerged from bankruptcy, it purchased an insurance policy that provides approximately $1.4 billion in coverage. Second, in 2019, the State of California passed legislation to create a $20 billion fund that can be used to help utilities pay victims of wildfires started by their equipment. In all likelihood, PG&E will be able to tap into this fund to cover the cost of compensating victims of the Dixie Fire.

At Kershaw Talley Barlow, we are currently pursuing claims on behalf of individuals who have suffered losses due to the Dixie Fire. We have extensive experience representing wildfire victims in cases against PG&E and have recovered millions of dollars for individuals, businesses, and landowners harmed by PG&E’s negligence. If you have been impacted by the Dixie Fire, please call us at (916) 520-6639 or click here for a free case evaluation.