Jan 23, 2020

PG&E moves closer to bankruptcy exit after deal with creditors

Firefighting operations near PG&E powerlines try to control the Kincade Fire in California last October. Photo: Philip Pacheco/AFP via Getty Images

PG&E announced a deal with creditors Wednesday that the bankrupt power giant called a major step toward emerging from Chapter 11 bankruptcy, but the company is still at odds with California Gov. Gavin Newsom.

Why it matters: The company's missteps and massive liabilities from wildfires have put a spotlight on how the industry must grapple with conditions likely to be worsened by climate change.

What they're saying: "This agreement helps achieve our goals of fairly compensating wildfire victims, protecting customers' bills and emerging from Chapter 11 as the utility of the future that our customers and communities expect and deserve," CEO Bill Johnson said in a statement.

The big picture, via the Wall Street Journal:

"A series of settlements with victims of the wildfires that drove PG&E into bankruptcy last year capped PG&E’s damages exposure at $25.5 billion. Now bondholders have been appeased with a new deal that could mean revisions to its exit financing."

But, but, but: "Newsom is urging a federal judge to reject Pacific Gas and Electric's blueprint for getting out of bankruptcy and renewing his threat to lead a bid to turn the beleaguered utility into a government-run operation," AP reports.

  • They note that Newsom "has tremendous leverage because the company's plan hinges on its ability to draw upon a special insurance fund California created last summer to help insulate utilities from potential wildfire losses in the future."

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Why the Boy Scouts of America filed for bankruptcy

Victims' rights Attorney Jeff Anderson speaks to media during a press conference on April 23, 2019. Photo: Eduardo Munoz Alvarez/AFP via Getty Images

The Boy Scouts of America filed for bankruptcy protection this week with the sole purpose of relieving the legal pressure it faces from sexual abuse victims.

Why it matters: Bankruptcy means that a judge will put a ceiling on how much BSA will pay to victims. The proceedings could limit the degree to which local councils' billions of dollars' worth of assets can be awarded to victims.

Boy Scouts of America files for bankruptcy

Photo: Al Schaben/Los Angeles Times via Getty Images

The Boy Scouts of America filed for bankruptcy protection in Delaware early on Tuesday.

Why it matters: The Chapter 11 filing comes as the 110-year-old youth organization faces mounting legal costs from multiple sexual abuse lawsuits and declining membership.

Go deeperArrowUpdated Feb 18, 2020 - Economy & Business

Pennsylvania diocese files for bankruptcy amid sexual abuse lawsuits

Photo: Jeff Swensen/Getty Images

The Diocese of Harrisburg became the first in Pennsylvania to seek bankruptcy protection on Wednesday, the Washington Post reports.

Why it matters: Pennsylvania influenced a series of investigations into Catholic dioceses across the country when state Attorney General Josh Shapiro released a grand jury inquiry into six dioceses, including Harrisburg, in mid-2018.