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An attorney for the Roman Catholic Diocese of Pittsburgh raised the prospect of bankruptcy in a court hearing on Friday over whether the church can use a trust fund for needy children, worth more than $8 million, toward compensating victims of sexual abuse by priests, the Pittsburgh Post-Gazette reported. Attorney Robert Ridge said during a hearing in Allegheny County Orphans Court that the diocese is looking at every available funding source to go toward a compensation fund for victims. He told Orphans Court Administrative Judge Lawrence O’Toole that the diocese was asking for a determination now on whether the trust fund could be used because, if the diocese does need to file in bankruptcy court, the same question will come up there. The hearing came in response to a challenge by Attorney General Josh Shapiro’s office over a petition by the diocesan-affiliated Catholic Institute of Pittsburgh to use the fund. The diocese has said that, under the spirit of the fund’s purpose, it could be used to compensate adults who suffered sexual abuse as children by priests. And Mr. Ridge said the 1899 will of James L. Toner, whose bequest to the church got the fund started, never restricted the funds to just needy children. But Senior Deputy Attorney General Gene Herne said “there’s no ambiguity” to the purpose of the fund when it was last defined legally in 1978. “This is for the benefit of children,” he said. “They’ve run that way for 41 years with no opposition until they had bills to pay.

OxyContin maker Purdue Pharma paid its CEO $9 million and its board chairman nearly $4 million in the 12 months before the company's bankruptcy filing last month, according to recently filed financial documents, the Associated Press reported. Five other board members overseeing the private company were paid a combined $3.7 million over that span. Purdue, a privately held company that usually does not disclose detailed financial information, had to make the information public as part of its bankruptcy proceedings. In a statement Wednesday, Purdue said its employees have highly specialized skills that would be hard to replace. The court documents say pay for the company's executives included salary, incentives, retirement plan contributions and an auto allowance, among other things. They were filed on Tuesday in U.S. Bankruptcy Court in White Plains, N.Y. Purdue sought bankruptcy protection in September in its effort to settle nearly 2,700 lawsuits that seek to hold the company accountable for its role in the nation's opioid epidemic. The company's proposed settlement with state and local governments could be worth up to $12 billion over time.

A wildfire raging in California threatens to destroy more than homes and businesses — it could also undermine bankrupt PG&E Corp.’s plan to raise $14 billion to finance the crisis-stricken utility’s turnaround plan, Reuters reported. If the fire becomes large enough, investors could walk away from their commitment to finance the California power utility’s bankruptcy plan. That would put in doubt the company’s plan to provide up to $8.4 billion to victims of past fires blamed on the company’s equipment. In Sonoma County north of San Francisco, the Kincade Fire has burned more than 75,000 acres in PG&E’s service area since breaking out on Oct. 23, forcing evacuation orders for some 180,000 people. The fire has destroyed 124 structures and more than 90,000 are threatened amid strong winds and dry weather, according to CalFire, California’s fire-fighting agency. The number of structures destroyed is key to PG&E’s bankruptcy exit plan. Any fire this year caused by PG&E that destroys more than 500 homes or commercial structures would trigger a clause in the financing agreement that would allow investors to back out. The agreement has a similar termination clause for next year.

PG&E Corp. told a judge it’s willing to extend the deadline for victims of wildfires caused by the utility’s equipment to file claims in its bankruptcy, Bloomberg News reported. U.S. District Judge James Donato criticized the company at a hearing last week, saying that it’s “just not right” that less than half of the eligible northern California residents had filed claims by the Oct. 21 deadline. He said yesterday that it’s “good news” that PG&E is willing to continue accepting claims until Dec. 20 and even beyond. He added that he expects a victim participation rate of 90 percent or higher. Judge Donato is tasked with finding PG&E’s potential liability from fire-related losses and estimating damages for the bankruptcy proceeding. At yesterday’s hearing the judge asked lawyers for both sides how the bankruptcy may be affected by the Kincade Fire, which has burned 66,000 acres in Sonoma County north of San Francisco since it started Oct. 23 and continues to rage. While other judges have raised the specter of how future fires might weigh on or derail PG&E’s bankruptcy, Judge Donato is the first to demand information from lawyers about Kincade. Attorneys from both sides agreed to respond quickly, without specifying a date. Read more. 

In related news, PG&E Corp.’s bond and stock prices dropped sharply yesterday amid mounting concerns about the bankrupt electric utility’s potential liability related to the Kincade Fire burning in Northern California, the Wall Street Journal reported. The selloff, which began on Friday as the Kincade fire spread, hit bonds hardest Monday, reflecting concerns that bondholders might not recover the full value of their claims in the bankruptcy. PG&E filed a public report on Thursday stating that it became aware of a broken wire on one of its transmission lines in the area seven minutes before the Kincade fire began. PG&E’s $3 billion bond due 2034 fell to 91 cents on the dollar from around 106 on Friday, according to data from MarketAxess, representing a roughly $450 million of paper losses for holders of that security alone. The company has more than a dozen bonds outstanding and about $1.65 billion changed hands yesterday. Read more. (Subscription required.) 

California Governor Gavin Newsom (D) wants Warren Buffett’s Berkshire Hathaway to make a takeover bid for bankrupt utility giant PG&E Corp., Bloomberg News reported. If Berkshire is interested in buying the San Francisco-based power and natural gas company, now is the time to make an offer, Newsom said Saturday. “We would love to see that interest materialize, and in a more proactive, public effort,” he said in an interview. “That would be encouraging to see. They are one of the few that are in a position to make a significant run at this.” Newsom made the remarks following a media briefing in Napa County, just east of a wildfire that has burned more than 25,000 acres, destroyed at least 49 structures and triggered a historic evacuation of tens of thousands of people. PG&E disclosed earlier this week that one of its transmission lines went down minutes before the blaze broke out. The company’s equipment has already been tied to a series of deadly blazes that devastated California in 2017 and 2018, saddling it with an estimated $30 billion in liabilities and forcing it into bankruptcy. Berkshire has been raised as a possible suitor since PG&E’s collapse, but the most vocal group seeking to take control of the utility is a collection of creditors led by Pacific Investment Management Co. and activist investor Elliott Management Corp. Newsom said Saturday that he’d like to see more than just hedge funds vying for the company and has been talking to mayors of cities including San Francisco, San Jose and Oakland about possible bids. Read more. 

In related news, PG&E Corp. shares plunged 26 percent on Friday as possible liabilities from the Kincade Fire in northern California boost the risks that shareholders will be wiped out and could undermine efforts to bring the company out of bankruptcy, Bloomberg News reported. It’s still unknown if this week’s fire in Kincade was caused by PG&E equipment. But the prospect raises the risk of draining PG&E’s equity value. This would undermine the recovery plan favored by PG&E and its shareholders, and make it more likely that a rival plan from bondholders will win approval, Citi analyst Praful Mehta said. Backers of the PG&E plan could terminate their financial commitment of over $14 billion if a destructive wildfire is linked to PG&E and its service territory before 2020. With wildfires continuing to spread, participants wonder whether PG&E will be able to reach a bankruptcy settlement. Read more. 

A wind-driven wildfire that forced some 2,000 people to flee homes in Northern California’s wine country yesterday erupted near the base of a damaged high-voltage transmission tower owned by Pacific Gas and Electric Co, utility and fire officials said, Reuters reported. The company, a unit of bankrupt holding company PG&E Corp., acknowledged in an “electric safety incident” report to the California Public Utilities Commission that one of its power lines malfunctioned at about the time and location of the fire’s origin on Wednesday night. It said a PG&E technician inspecting the site on Thursday found the area taped off by state fire department personnel who brought to his attention “what appeared to be a broken jumper on the same tower." Neither PG&E nor the commission said whether the damaged tower or the malfunctioning transmission line attached to it were suspected of igniting the blaze, dubbed the Kincade fire, which has destroyed about a dozen homes and other structures. The cause is being investigated, said the California Department of Forestry and Fire Protection, or Cal Fire, which listed the same place and time of origin for the fire as the tower incident reported by PG&E. PG&E filed for bankruptcy protection last January, citing more than $30 billion in liability stemming from devastating wildfires in 2017 and 2018 found to have been sparked by its equipment.

More than half a million homes and businesses in California could lose power this week as utilities including Pacific Gas & Electric and Southern California Edison cut off electricity as a preventive measure against wildfires, Reuters reported. Over 308,000 customers in seven counties, including Los Angeles, San Bernardino and Ventura in southern California, are under the Public Safety Power Shutoffs (PSPS) consideration, Southern California Edison said. Meanwhile, PG&E has shut off power in 15 counties, affecting about 178,000 customers in those areas. The company said additional power shutoffs for parts of San Mateo County and Kern County were expected to begin at about 1 a.m. today, affecting more than 1,000 customers. San Diego Gas & Electric Co has also identified more than 41,000 customers under PSPS consideration, but has not implemented any power shutoffs today.

A bankruptcy judge has approved a $39.2 million agreement between victims-survivors of clergy sexual abuse and the Diocese of Duluth (Minn.), KDAL610.com reported. The decision on Monday gives final approval to a joint agreement reached earlier this year between the diocese and attorneys representing survivors and victims of clergy sexual abuse. It marks the end of a nearly four-year bankruptcy process for the Duluth Diocese and will settle claims against the diocese and against 30 parishes. The diocese, all its parishes, and several other Catholic entities in the region will together contribute approximately $10 million, with the rest of the settlement being funded by insurance. In addition to providing compensation for those hurt by abuse, the agreement also provides for non-economic considerations, such as the release of documents relating to historic cases of clergy sexual abuse.

People in more than 180,000 homes and businesses in California could find themselves in the dark as Pacific Gas & Electric again plans to shut off power in parts of 17 counties for up to two days, as a preventive measure against wildfires, Reuters reported. The company said it was tracking a “dry, offshore wind event” that might impact its service area on Wednesday and Thursday and needed to turn off the electricity as a safety measure. Hot, dry winds from California’s mountains, called the Santa Ana winds, are expected to pack a 40 mph punch, with gusts up to 60 mph, starting late today, the National Weather Service said. The company cut off electricity to more than 730,000 homes and workplaces in northern California earlier this month to try to reduce wildfire risks posed by extremely windy and dry weather. The bankrupt Californian power producer said it had crews, equipment, vehicles and aircraft on standby to conduct the shutoffs and subsequent inspections, repairs and power restoration.

Two Ohio counties and four drug companies yesterday settled a landmark lawsuit over responsibility for the opioid epidemic in a deal that could help push the parties toward a wide-ranging agreement on more than 2,400 similar claims filed across the country, the Washington Post reported. The $260 million settlement, reached just hours before opening arguments were scheduled to begin in the first federal lawsuit of the opioid era, will give Cuyahoga and Summit counties badly needed cash and anti-addiction medication. Those will be provided by mammoth opioid distributors McKesson Corp., AmerisourceBergen and Cardinal Health, and drug manufacturer Teva Pharmaceuticals, four of the defendants in the first case. But the agreement also may help guide the next round of negotiating as drug companies and governments that have sued them continue efforts to resolve the remaining legal actions all at once. The Ohio deal ratchets up the pressure on plaintiffs and drug companies to reach a global settlement or, some argue, to cut their own deals sooner. If the hundreds of lawsuits filed by cities, counties, Native American tribes and others continue to be settled individually, the first jurisdictions are likely to get larger payouts, attorneys said.