Pacific Gas & Electric Co. v. Public Utilities Commission
237 Cal. App. 4th 812
| Cal. Ct. App. | 2015Background
- Following the 2010 San Bruno gas pipeline explosion, the PUC imposed reforms on PG&E, including improved recordkeeping and safety practices.
- PG&E later discovered MAOP and related record discrepancies and filed an Errata in July 2013 attempting to adjust MAOP data.
- The PUC staff treated the Errata as potentially misleading and issued an Order to Show Cause under Rule 1.1.
- An OSC hearing in September 2013 examined whether PG&E acted with intent to mislead; PG&E contended there was no such intent.
- The Commission issued Decision 13-12-053 (Dec. 19, 2013) imposing $14,350,000 in civil penalties for Rule 1.1 violations and for delay in correcting the record.
- The California Court of Appeal affirmed the Commission’s decision, denying PG&E’s rehearing and upholding penalties.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Rule 1.1 requires intent to mislead | PG&E: Rule 1.1 requires an intent to mislead | PUC: Rule 1.1 does not require intent | No strict intent element required; penalties upheld |
| Whether continuing violations require ongoing misconduct | PG&E: no continuing misconduct | PUC: continuing violations exist per §2108 | Continuing violations permitted; daily penalties affirmed |
| Whether PG&E received constitutionally adequate notice | PG&E: notice was lacking or unclear | PUC: notice sufficient under due process | Notice adequate; due process satisfied |
| Whether the fines violated excessive-fines clauses | PG&E: fines are grossly disproportionate | PUC: penalties tied to public safety and deterrence | Not clearly unconstitutional; penalties within constitutional bounds under independent review |
Key Cases Cited
- United States v. Bajakajian, 524 U.S. 321 (U.S. 1998) (excessive fines proportionality guidepost)
- City and County of San Francisco v. Public Utilities Com., 39 Cal.3d 523 (Cal. 1985) (strong presumption in favor of PUC decisions; deference to agency results)
- Greyhound Lines, Inc. v. Public Utilities Com., 68 Cal.2d 406 (Cal. 1968) (deference to agency interpretation of statutes/regulations)
- Richards v. CH2M Hill, Inc., 26 Cal.4th 798 (Cal. 2001) (continuing violation concept in other contexts; tolling mechanics)