PG&E Settles Most Chromium Contamination Suits

By Published On: February 10, 2006

After more than a decade of litigation, Pacific Gas & Electric tentatively settled with most, but not all, of the 1,200 plaintiffs who alleged they were exposed to cancer-causing chromium 6 released from utility facilities. PG&E agreed to pay $295 million to 1,100 plaintiffs who entered the settlement, the utility announced late Friday, February 3. “Clearly this situation should have never happened, and we are sorry that it did,” PG&E stated. The settlement agreement prohibits the attorneys representing the settling plaintiffs from discussing the case. ?The terms require confidentiality,” Gary Praglin, partner at Engstrom, Lipscomb & Lack, told Circuit. PG&E Corp., the utility’s parent company, does not expect the remaining claims to “have a material adverse effect on it or the utility, PG&E Corp. told the Securities and Exchange Commission February 6 in an 8K filing. The parent company will reveal the financial impact of the settlement February 17. It stated that it does not expect the settlement payments to affect its projected 7.5 percent earnings per share between 2006 and 2010. The settlement will become final only after 90 percent of the plaintiffs agree, by September 15, 2006, to release the utility from any chromium-related liability. The remaining plaintiffs, who allege they have suffered chromium-related illnesses, filed suit in 2000 and 2001 in Los Angeles Superior Court. Their claims were not part of the consolidated suits that were filed in 1995 by the settling 1,100 plaintiffs. The latter case was heading toward trial in the Los Angeles court this month (Circuit, Oct. 14, 2005). The ten-year delay came about, in part, because all the suits were put on hold while the utility was mired in bankruptcy proceedings. The cases that remain pending in court are in the early stages. Discovery has not yet begun, according to Jon Tremayne, PG&E spokesperson. The 1,100 settling plaintiffs sought $500 million in compensation and punitive damages for blood cancers, kidney, lung, and stomach ailments, and other serious illnesses they claim were caused by chromium 6 leaked from facilities in Kettleman, Topock, and Hinkley. The allegations linked to the Hinkley plant were the subject of the movie Erin Brockovich. Bill Walker, the Environmental Working Group’s West Coast vice-president, said, “PG&E?s apology rings hollow when you consider all they did to block the victims? efforts to get justice?even paying a consultant to publish a fraudulent study denying chromium 6 causes cancer. Real justice would mean jail time for the PG&E executives and their consultants.” Last month, a PG&E consultant from ChemRisk, who was part of the defense team in the Brockovich suit, was reported to have distorted data from a 1997 Chinese study linking chromium 6 exposure to stomach cancer, according to the Environmental Working Group. Praglin, one of the attorneys for the group of plaintiffs, stated at that time that the study was a consideration in the large suit (Circuit, Jan. 6, 2006). Tremayne said that PG&E agrees that it and its consultant’s role in the controversial review of the Chinese study should have been “acknowledged and transparent.” He added, however, that PG&E and the plaintiffs continue to have “opposing views of the facts and health science” that are at the heart of the case. “Although the settlement does not resolve these differences, we believe it best to move forward,” the utility stated.

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