Feinstein, Padilla Applaud SEC Decision to Provide Full PG&E Settlement Funds to Victims of Recent Wildfires
Aug 23 2021
Washington—Senators Dianne Feinstein and Alex Padilla (both D-Calif.) today announced the Securities and Exchange Commission has granted a request that will allow thousands of recent wildfire victims to keep payments from a settlement reached with PG&E rather than forcing the victims’ trust to return some of those payments to PG&E.
“This is excellent news for the 80,000 Californians who suffered from wildfires found to be caused by PG&E,” Senators Feinstein and Padilla said in a joint statement.
“Those who suffered from these wildfires deserve full compensation from the victims’ trust fund. This assistance is vital for tens of thousands of families, and we’re grateful the SEC worked with the victims trust to find a solution.”
In 2019, PG&E was found responsible for three wildfires that occurred in 2015, 2017 and 2018. PG&E and the 80,000 people affected by those fires reached a settlement that created a trust fund that included cash and 477 million shares of PG&E stock, at the time valued at approximately $5.2 billion.
Earlier this year, the possibility was raised that settlement stock payments may fall under a provision of law that governs insider trading, essentially meaning that any increased value of the stock shares would have to be returned to PG&E instead of going to the victims.
Following consultations with the victims and PG&E, Senators Feinstein and Padilla in May requested that the Securities and Exchange Commission grant an exemption to the law – known as Section 16(b) of the Securities Exchange Act of 1934 – in order to ensure the full value of the shares went to the victims, not PG&E.
Additional information on the issue is available in the May 27 letter the senators sent to the SEC, found here.