%1

PG&E Corp. said that its chapter 11 reorganization plan has been confirmed by the U.S. Bankruptcy Court for the Northern District of California, bringing the power provider one step closer to emerging from bankruptcy and participating in a state-backed wildfire fund, Reuters reported. The court’s approval follows the confirmation of the plan by power regulator California Public Utilities Commission in May. The company said that it expects to emerge from bankruptcy in July and that it is on track to participate in a state-backed wildfire fund, which reduces liability for investor-owned utilities but requires them to spend billions of dollars upgrading equipment. The utility filed for chapter 11 protection in January last year, citing potential liabilities exceeding $30 billion from major wildfires sparked by its equipment in 2017 and 2018. Earlier last week, the company pleaded guilty to 84 counts of involuntary manslaughter stemming from a devastating 2018 wildfire in Northern California touched off by the utility company’s power lines.

The Roman Catholic Diocese of Syracuse (N.Y.) has filed for chapter 11 bankruptcy, just days after 38 people filed Child Victims Act lawsuits against the church, Syracuse.com reported. Since last year, the diocese has faced dozens of claims that its priests sexually abused children and that officials covered up the abuse for decades. On Wednesday, 38 more victims filed lawsuits, including a Central New York grandmother. The filings in court show the diocese has assets of more than $10 million but less than $50 million. Lawyers for the diocese from Syracuse firm Bond, Schoeneck & King estimated the diocese has between 100 and 200 creditors and up to $100 million in liabilities. The filings also revealed the diocese received a $1.3 million federal Paycheck Protection Program loan to help cover expenses during the coronavirus pandemic.

A California judge yesterday ordered Pacific Gas & Electric to pay a $3.5 million fine for causing the Camp Fire, the blaze that killed scores of people and destroyed the town of Paradise in 2018, the New York Times reported. Judge Michael R. Deems of Butte County (Calif.) Superior Court read the sentence, which matched a plea agreement between the company and a local prosecutor, after hearing statements from survivors of the 84 people killed in the fire, many of whom said PG&E was getting away with a slap on the wrist. The judge seemed to echo that sentiment. “If these crimes were attributed to an actual human person rather than a corporation, the anticipated sentence based on the applicable statutes to which the defendant has pleaded guilty would be 90 years to be served in state prison,” Judge Deems said. “Nevertheless, the court’s sentencing options are limited.” PG&E pleaded guilty on Tuesday to 84 counts of involuntary manslaughter and one count of illegally causing the fire. An estimated $30 billion in liability from that and other fires forced the company to seek bankruptcy protection in January 2019. State regulators have said that the utility repeatedly failed to maintain a transmission line that broke from a nearly 100-year-old tower, igniting the Camp Fire. The company’s failure was all the more glaring because the line cut through a forested and mountainous area, and some of the company’s towers had been knocked down by strong winds well before that blaze.

A U.S. subsidiary of Ireland’s Trane Technologies PLC has filed for bankruptcy as a way to deal with roughly 100,000 asbestos lawsuits, fearing the personal-injury litigation could otherwise continue for decades, WSJ Pro Bankruptcy reported. Aldrich Pump LLC, which has its North American headquarters in Davidson, N.C., said that the chapter 11 strategy centers around creating a trust that would pay “legitimate” asbestos claims, including from people with mesothelioma. Murray Boiler LLC, an affiliated company, also filed for bankruptcy. The businesses are owned by publicly traded Trane, an Irish industrial manufacturing company, according to papers filed in U.S. Bankruptcy Court in Charlotte, N.C. Neither Trane, which makes climate-control products, nor other subsidiaries are part of Wednesday’s bankruptcy filing. Aldrich said that it didn’t use asbestos in its manufacturing process but made industrial equipment that, in some instances, had asbestos-containing parts. Most of the lawsuits filed against the company involve its pumps and compressors that used metal piping through which liquids or gases flow. A gasket, a sealing product, was inserted between the pipes to avoid leaks. Decades ago, certain gasket materials that were the industry standard at the time contained asbestos, Aldrich said. About 20 years ago, after the miners and sellers of raw asbestos themselves began seeking protection from creditors in bankruptcy court, the number of mesothelioma cases against Aldrich and Murray doubled, the company said. Currently, Aldrich and Murray face roughly 100,000 asbestos-related lawsuits nationwide, according to court papers. The vast majority were filed at least a decade ago.

PG&E Corp. pleaded guilty to 84 counts of manslaughter for its role in sparking California’s deadliest wildfire, on the same day that a separate judge said that he would clear the way for the company to exit bankruptcy, the Wall Street Journal reported. The San Francisco-based utility became one of the few U.S. corporations to be convicted of homicide-related charges in a dramatic scene that unfolded yesterday in Superior Court in California’s Butte County, where the 2018 Camp Fire razed the town of Paradise. PG&E Chief Executive Bill Johnson entered the guilty pleas for each of the felony counts of involuntary manslaughter, looking at the images of the 84 victims on a screen as Judge Michael Deems recited the counts in alphabetical order. Johnson, who joined PG&E last year and is set to step down as its CEO this month, also pleaded guilty on its behalf to one count of unlawfully causing a fire. The company, which has agreed to pay the statutory maximum penalty of $3.48 million, is expected to be sentenced later this week. Meanwhile in a separate hearing in the U.S. Bankruptcy Court in San Francisco, Judge Dennis Montali said he intends to approve PG&E’s $59 billion reorganization plan, which involves issuing huge amounts of new debt and equity to help pay liability claims related to wildfires. Formal signing could take a few more days, as remaining issues are resolved and the documents are finalized, the judge said. The proceedings bring PG&E closer to closing a dark chapter in its history, after fires sparked by company equipment killed more than 100 people and burned more than 15,000 homes in Northern California in 2017 and 2018. The company, which provides gas and electric services to 16 million people, or nearly one in 20 Americans, filed for chapter 11 protection in January 2019, citing more than $30 billion in potential fire-related liability claims.

The Diocese of St. Cloud (Minn.) filed for bankruptcy in U.S. Bankruptcy Court Monday, just weeks after reaching a $22.5 million settlement with clergy abuse survivors, the Minneapolis Star Tribune reported. The chapter 11 filing provides a "framework for resolution" of the clergy abuse claims filed by 70 individuals against 42 priests dating to the 1950s, the diocese said. The diocese announced its intent to file for bankruptcy in 2018 to pay for the claims, and has been negotiating with attorneys for the survivors since. St. Cloud is the fifth diocese in Minnesota, and the 26th Catholic diocese or religious order in the nation, to file for bankruptcy. In all cases, it followed a wave of lawsuits charging priest sexual misconduct with minors. The New Ulm Diocese, Duluth Diocese and Archdiocese of St. Paul and Minneapolis have emerged from bankruptcy, said attorney Mike Finnegan. Winona Diocese has not reached a resolution, he said. The Crookston Diocese, with 15 abuse lawsuits, did not file for bankruptcy. The $22.5 million survivor fund will be administered by an independent trustee appointed by the bankruptcy court, with input from the committee representing survivors' interest, the diocese said. The funds "are made up of insurance and benefits coverage settlements, cash and property contributions from the diocese, and contributions from parishes," the diocese said.

The Buffalo (N.Y.) Diocese’s lists of assets and liabilities filed with the U.S. Bankruptcy Court identifies multiple investment funds and bank accounts holding in excess of $28 million, dozens of properties and a fleet of vehicles. What the schedule doesn’t mention is insurance coverage, which has played a huge role in the resolutions of other chapter 11 reorganizations by dioceses and archdioceses facing child sex abuse lawsuits, the Buffalo News reported. Eight insurance companies, for example, agreed in 2018 to pay $137 million toward a $210 million fund to settle abuse claims in the Archdiocese of St. Paul & Minneapolis. Of the nearly $800 million in bankruptcy settlements reached by 15 Catholic dioceses, archdioceses and religious orders since 2004, more than half of the funds have come from insurers, according to research by Pennsylvania State University law professor Marie T. Reilly. Buffalo Diocese lawyers are now counting on the yet-to-be quantified insurance coverage as they try to resolve the claims of more than 250 people who allege they were abused as children by priests or other employees. “Insurance is without question in this case our largest and most important asset,” Buffalo Diocese bankruptcy attorney Stephen Donato said during a hearing last week with Chief Judge Carl L. Bucki of the U.S. Bankruptcy Court in the Western District of New York.

PG&E Corp. has won approval from a bankruptcy judge for an order allowing it to go to market to sell $20 billion worth of new debt and equity as it awaits approval of its plan to exit chapter 11, WSJ Pro Bankruptcy reported. Judge Dennis Montali said at a hearing yesterday in the U.S. Bankruptcy Court in San Francisco that he will sign the order authorizing the start of the financing effort, setting the stage for PG&E to take advantage of favorable conditions in the debt markets. A decision on confirmation of the company’s chapter 11 exit proposal could be days away, he said. California’s largest utility needs the cash to absorb $25.5 billion worth of wildfire damage claims it has agreed to pay, cleaning up the aftermath of disastrous fire seasons in 2017 and 2018. PG&E expects to go to the public debt markets for $10.7 billion of bond financing, including $5.9 billion of investment grade bonds issued by the utility, and $4.75 billion of high-yield bonds at the corporate level.