The 2007 Malibu fire investigationy
This column comes under the general rubric of “be careful what you wish for.”
Recently we received an email from Southern California Edison (Edison) demanding a correction for something we had written about the California Public Utilities Commission (CPUC) investigation into the 2007 Malibu Fire. We had said that the CPUC had ruled that Southern California Edison and several communications companies were responsible for the October 2007 fire. Edison said we were wrong and we owe them a correction because as of yet the CPUC had made no ruling.
So to try and figure out what happened I talked to my people and then began to dig into the Internet to see what others had written and what CPUC documents were available online.
It turns out that the Consumer Protection and Safety Division (CPSD) of the CPUC had conducted an investigation of the fire and their conclusions were that Edison and several communications companies were responsible for the fire because of overloaded telephone poles. Additionally, they seemed to think Edison was a major culprit and suggested an overall fine to all of the culprits in the nature of $99 million, not exactly chump change by any analysis. They also added they thought that Edison had not exactly been on the square with the investigators, that the investigators believed that Edison destroyed evidence and misled investigators about the cause of the fire that destroyed 14 structures and 36 vehicles, including some Malibu landmarks like the Malibu Presbyterian Church and the hilltop castle of Malibu’s Princess Lilly Lawrence. Edison, of course, denied this emphatically.
It was reported by the Los Angeles Times that Edison felt the fine was excessive and not supported by the evidence and they were “particularly disappointed” with the allegations that they misled the commission during the investigation.
Before being in the newspaper business I spent 20-plus years of my life as a litigator, fighting insurance companies, automobile companies, governmental entities, which gives you a sense of both my experience and my bias. I’ve read hundreds of reports by numerous investigators. You learn to watch for those things that go “bing” when you see them, read them or hear them. One of the things you do know is that bureaucrats, even bureaucrats who are investigating a fire, are by nature typically very conservative people, careful in what they say, well aware of the fact that they need to document everything, and that litigation will almost always follow. This is even more so when they are involved in a matter that is “adjudicatory,” as this was. They are generally very reluctant to point fingers or make accusations unless very carefully couched in all sorts of qualifying language. So reading some of the investigation’s blunt conclusions about the cause of the fire, and then reading between the lines, it would appear to me that the investigators were either royally ticked off by what they thought Edison had done or Edison had done something pretty egregious in their minds.
Understandably, that would make Edison and others very nervous because, if later on some civil jury were to agree that conduct was in fact egregious, that might mean punitive damages that could get very expensive.
But the next part is going to be the hearings before the Public Utilities Commission. It’s not yet clear to me how much they are factually bound by the Consumer Product Safety Division investigation but what became clear as I read the paperwork was that the investigation was not just some staff report as some have intimated, but was in fact very much a legal proceeding, with all sorts of ground rules for the investigation and some very specific guidelines and some very specific questions to be answered. In other words, Edison is already in a bit of a hole and now they have to try and dig themselves out.
This investigation, ultimately a hearing, probably an appeal or two and some of the civil lawsuits are going to take several years to play out.
Let me give you a sort of coming attractions about what to anticipate from the defense. It usually breaks this way: We didn’t do it or it wasn’t our fault, and besides, the investigation was biased or sloppily done; or everything has a failure point and in those winds any pole would have given way; or the rules and regulations of the state and the PUC made it impossible to do anything else; or we’re required to carry all that stuff, which overloads the poles; or we’re only partially at fault and the other companies are equally at fault. (Generally this is the last resort. They usually try to present a common front and not shoot at each other.)
It’s much too early to guess how this will end. The ultimate decision by the CPUC will come after a hearing supposedly just based on the evidence, but any regulatory decision is made in a political process. Stay tuned because this impacts us all, especially as we go into fire season again.
P.S. As for Edison, they got their correction but they also got my attention and from now on I’ll be watching all this a lot more carefully, particularly in Sacramento.