PG&E Found Guilty

California’s largest utility obstructed investigation; punishment lenient

Leaks, hazy visuals, and misleads? Sounds like a typical publicized trial. Except in this case, none of those are puns.

Pacific Gas & Electric, California’s largest public utility, bore the weight of related missteps on Tuesday when a federal jury convicted the company of obstructing investigators and of five counts of pipeline-safety violations, including failing to gather information to evaluate potential gas line threats and deliberately not classifying a gas line as high risk. It could face fines of up to $3 million.

A lethal San Bruno pipeline explosion in 2010 was the catalyst in the prosecution, but the surrounding timeline revealed a haze of illegal and dangerous practices, including an attempted cover-up where employees were encouraged to evade regulations (exposed earlier this year when one of those employees “blew the whistle”) and patterns of unreported pipeline leaks that preceded other explosions.

Despite the guilty verdict, criticism of the prosecution is ripe at the moment due to the potential for much harsher penalties, which could have totaled as much as $562 million had prosecutors further pursued any of the pipeline safety counts (convictions came down for 5 of 11 total counts). It is unclear whether this is related to the fact that California regulators fined the company $1.6 billion last year for the blast.

“The motive was profits over safety,” Assistant U.S. Attorney Jeffrey Schenk said during his closing argument. That motive left eight dead in the 2010 explosion, which also destroyed 38 homes. No PG&E employees were charged, and no one is facing prison time.

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