By Helen Sedwick
If you are still sitting on the fence about whether to make a claim, please take a moment to read the following FAQs.
Q: PG&E filed bankruptcy — doesn’t that mean they are broke?
Not at all. PG&E is far from broke. It has assets in excess of $75 Billion and $1.5 Billion per year in net profit. It has the ability to borrow billions more.
PG&E did not escape liability by filing bankruptcy. After the fires, PG&E was facing thousands of lawsuits. Litigating thousands of claims individually would be unmanageable. Bankruptcy moved the cases to a different courtroom where claims can be managed in a more uniform and efficient manner.
Last time PG&E filed bankruptcy (2002), it ended up paying all claims in full. While PG&E might not pay claims in full this time around, experts expect wildfire victims will receive a high percentage of their claims.
Q: My home survived. Do I still have a claim?
Yes, you do. If you ran out the door in the middle of the night, drove through smoke and flames, were shut out of your home for weeks, only to return a burned-out wasteland, you have a claim for emotional distress. And chances are you had damage to trees, landscaping, and other property that was not covered fully by insurance. If you were a renter, you lost personal property and were almost certainly underinsured. You have a claim.
Q: Won’t PG&E employees and customers be hurt by all these fire claims?
PG&E employees and customers may be hurt more if too many fire survivors don’t file claims. A group of edge fund managers and mega-banks is pushing a bankruptcy plan that discounts claims from the Tubbs Fire by up to 88% and all other fires by 43%. Their plan would also burden PG&E with more debt. If the hedge funds and banks outvote other creditors, then fire survivors will suffer what is called a “cram-down” — the plan will be crammed down our throats. If history is any indication, the hedge funds will make huge profits at the expense of PG&E employees, customers, and wildfire survivors.
Q: Why bother? Won’t my insurance company take all my recovery anyway?
No it won’t. In this state, you will get paid first and in full before your insurance company gets a dime. And, you’ll recover more than uninsured property losses. You are entitled to recover for the emotional distress of evacuation, living in a disaster zone, and/or rebuilding. Add to that lost trees and landscaping. It may be that the final Bankruptcy Plan creates one pool of funds for individual fire victims and another for our insurance company. Even under that structure, you will be entitled to a recovery that’s separate from money due to your insurer.
Q: How long before we see any money?
Right now, it looks like mid-2020.
Q: What will it cost me to file a claim?
Nothing up front. Wildfire plaintiffs’ attorneys are working on a contingency fee basis. You pay nothing during the process, not even the costs of investigation, expert witnesses, court filings, and appearances, etc.
Contingency attorneys are paid by receiving a percentage of your recovery. That percentage is negotiable. Some attorneys are charging 33%, even 40%. Others 20% to 25%. Personally, I don’t see any justification for a contingency fee higher than 20% to 25% in this matter. High fees may be justified where the attorneys are taking on a large risk, which isn’t the case in the PG&E bankruptcy. Every one of their wildfire clients will get a payment from PG&E. And so will the attorneys. As I said, I don’t see any reason to pay more than 20 to 25%.
Q: How much work is involved in preparing a claim?
Not much. You will be asked to fill out a form called a Proof of Claim, which is fairly straight-forward. It must be filed by October 21, 2019. If you are represented by an attorney, your attorney will fill out the form with you.
Don’t worry if you don’t know the exact amount of your recovery. Many of us don’t have the final cost of our rebuilds or additional living expenses, and none of us know how to put a dollar amount on lost trees and emotional distress. All that will be worked out later. As part of the final bankruptcy plan, PG&E will deposit billions of dollars into a trust fund and will appoint a professional trustee company to calculate and make distributions. At that time, your final recovery numbers will be worked out.
Q: How do I decide which attorney to hire?
When I need a medical specialist, I ask my doctor friends for a referral. Same with attorneys. Ask your attorney contacts. Here’s what I looked for:
- A firm with experience in mass tort litigation, especially where a bankruptcy is involved.
- A reasonable fee.
- Someone who communicates well and responds to my emails.
- Someone who is committed from start to finish. For instance, was the firm on a steering committee prior to bankruptcy? Are they on one of the bankruptcy committees? Do they have ties to the community? Have they even been to your neighborhood? I don’t want to engage an attorney, and then find out my case has been handed off to a Texas or other out-of-town firm or to some over-worked associate who can’t keep my name straight.
- Investment. Will the attorney be engaging an arborist, business advisor, and other experts to help me prepare and support my claim?
- Chemistry. Do I like this person? Do I want him or her on my team? Personally, I prefer the more corporate types. I cringe at flashy, celebrity and aggressive PI attorneys.