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DLA Piper, Sen. Mitchell Tainted by PG&E San Bruno Case: Recusal is the Only Path to Integrity for Law Firm, California Public Utilities Commission

George Mitchell: Reputation at Stake

Editorial

This week’s unilateral announcement by the California Public Utilities Commission to select DLA Piper—a global law firm that has represented the company headed by the current CPUC President Michael Peevy and worked to defend utility companies in major litigation—has sent shock waves throughout California’s legal community, elected leaders, the public and the media.

The fact that none of the parties at the negotiating table–with the exception of the ‘defendant’ in the case, Pacific Gas & Electric Co.–knew of or agreed to mediation nor was a party to the selection of the mediator, has raised ethical and legal questions that stun even the most passive observers in this monumental national public safety case.

The most fundamental basis of mediation is the agreement by all parties that it is necessary, closely followed by the mutual agreement of an unbiased and neutral mediator.  That very principal has been broken in every conceivable fashion by the California Public Utilities Commission and admitted as such to the Associated Press when CPUC Commissioner Mike Florio said in an interview he felt the move to inform PG&E first about the selection of DLA Piper had not been well thought out: “I think we handled this rather poorly. Announcing it before people were brought into it was not a good idea,” Florio said.

In our opinion, it’s beyond not being a ‘good idea,’ it breaks the very foundation of mediation and ruins the integrity of the CPUC process and DLA Piper’s participation.

If DLA Piper and Senator George Mitchell hope to retain any integrity and their reputations in the legal community, they must immediately resign this assignment now they have become aware of the unethical and potentially illegal manner in which they were selected.  We urge them to resign even before the CPUC leadership has the opportunity to rescind their appointment. It is not only the honorable thing to do, but it is the only thing that will preserve their reputation and demonstrate that they are not simply stooges for the utility industry and CPUC President Michael Peevy.

We commend San Francisco City Attorney Dennis Herrera for standing up and demonstrating his leadership in joining the challenge to demand the CPUC decision to unilaterally appoint DLA Piper and Sen. George Mitchell as mediators when they have conflicts not only with their representation of utility companies, but directly with the interests of San Francisco itself.

As always, San Bruno must win praise for being a leader in its attempt to protect public safety and its citizens in opposing this dubious appointment.  And The Utility Reform Network and the California Division of Ratepayers Advocates should be justly proud that they stood up and truly represented the ratepayers in calling attention to this disgraceful appointment of the clearly conflicted DLA Piper and Sen. Mitchell.

We hope for the sake of Sen. George Mitchell and DLA Piper that they resign now that they know their appointment was tainted, their position conflicted, and their very reputation is at stake.

Their integrity is in their hands and their decision.

 

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San Francisco City Attorney Blasts CPUC, PG&E Over DLA Piper Law Firm Selection in San Bruno Blast: Will DLA Piper Recuse Itself?

DLA Piper Law Firm Conflict in CPUC PG&E Case

More Bad News for DLA Piper: Conflict is raised by SF City Attorney. DLA Piper is adverse to S.F. in litigation, claims several utilities among its clients. CPUC Has Refused Comment on Conflict, Call for DLA to Recuse Firm

San Francisco City Attorney Dennis Herrera today expressed serious concerns about the California Public Utilities Commission’s unilateral appointment of former U.S. Senator George Mitchell and DLA Piper to mediate a settlement of enforcement actions against Pacific Gas and Electric Company over the deadly September 2010 explosion of its natural gas pipeline in San Bruno, Calif.

Mitchell currently serves as chairman emeritus of DLA Piper LLC, an international law firm that represents multiple parties currently involved in separate litigation against the City and County of San Francisco. The firm’s utility sector clients include Southern California Edison and Exxon Mobil.

“I have the highest regard for U.S. Sen. George Mitchell, and I greatly admire him for a distinguished public service career that includes major diplomatic achievements in Northern Ireland and the Middle East,” said Herrera. “But the legitimacy of an enforcement action involving one of the deadliest gas pipeline catastrophes in California history must be beyond reproach. What’s at stake in these proceedings is the safety of millions of Californians, and they deserve a process untainted by the appearance of utility industry bias. I don’t doubt Sen. Mitchell’s integrity or good intentions.”

Herrera continued “But the fact is, he leads a law firm that is both adverse to San Francisco in litigation, and that represents major gas utilities involved in cases before the CPUC. Moreover, the commission’s decision to unilaterally appoint a mediator raises larger questions about why the CPUC elected to appoint an outside mediator in the first place. It’s possible that mediation could prove helpful. But it is far more important that CPUC live up to its obligations as an industry regulator that protects the public interest.”

Herrera has been sharply critical of the CPUC following revelations from an independent review panel’s 2011 investigation into the San Bruno tragedy, which concluded that the commission’s “culture serves as an impediment to effective regulation,” and which went on to fault state regulators who “did not have the resources to monitor PG&E’s performance in pipeline integrity management adequately or the organizational focus that would have elevated concerns about PG&E’s performance in a meaningful way.” In July 2011, Herrera initiated steps to sue the CPUC along with federal regulators for failing to reasonably enforce federal gas pipeline safety standards as required by the U.S. Pipeline Safety Act. Herrera later elected to omit CPUC as a defendant after the commission showed signs of progress.

DLA Piper LLC contacted Herrera’s office last Friday, before the CPUC announced its appointment of Mitchell to serve as mediator, to inform city lawyers about litigation and other matters in which DLA Piper is currently adverse to the City and County of San Francisco. Those cases include litigation involving hotel chains and airlines.

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San Bruno, Ratepayer Advocates Challenge California Public Utilities Commission, PG&E: Demand CPUC Rescind Appointment of Sen. George Mitchell in Blockbuster PG&E Announcement

A blistering attack by the City of San Bruno, ratepayer advocates and Assemblyman Jerry Hill called into question the California Public Utility’s appointment of Sen. George Mitchell and his law firm DLA Piper as mediators in the PG&E explosion and fire settlement.

Mayor Jim Ruane of San Bruno, Thomas J. Long, Legal Director of consumer advocacy group The Utility Reform Network (TURN), and Karen Paull, Acting Legal Counsel, The Division of Ratepayer Advocates (DRA) all stood in front of the CPUC this morning and lambasted the “unholy and cozy alliance” between regulator CPUC and the regulated Pacific Gas & Electric Co.

The City of San Bruno and consumer advocates signed a letter demanding the CPUC rescind the appointment of Sen. Mitchell immediately because the CPUC  went behind their backs in appointing the mediator to oversee the talks and presented evidence that CPUC and PG&E had ex-parte contact in making the decision. The groups objected to the choice of mediator and said they should have been consulted before regulator CPUC appointed the mediator.

The California Public Utilities Commission had announced Monday that it had appointed former U.S. Senator George Mitchell to serve as mediator in the talks.

San Bruno City Manager Connie Jackson and attorneys with San Francisco and the consumer groups said the CPUC had notified PG&E before it appointed Mr. Mitchell, but didn’t notify San Bruno, San Francisco, or ratepayer advocates and officials.

“The unilateral announcement by the CPUC Monday that it had selected a mediator without consulting any of the parties at the negotiating table is consistent with the cozy and unholy relationship between the CPUC and PG&E.  This action is symbolic of the broken, dysfunctional and dishonest relationship between PG&E and the CPUC, the agency that is supposed to be the watchdog and protector of the public’s interest,” said Mayor Ruane of San Bruno.

“San Bruno is rightly concerned that the DLA Piper law firm has previously represented utilities–and that the firm was selected unilaterally by the CPUC and PG&E without the participation of any other party, which goes against the fundamental principles of mediation,” said Mayor Ruane at the press conference today.

“It also is of deep concern to us that DLA Piper has a lengthy list of corporate clients, including Southern California Edison, which the current chairman of the CPUC, Michael Peevey, once headed, according to news media reports about the appointment.

“In order for any mediation to succeed, the mediator will have to assure all the parties to our satisfaction that they have no conflicts, that they can be an unbiased mediator, and that the process will be open, transparent and fair,” Mayor Ruane said.

He continued: “We find that there is too much of a coincidence that one week before the announcement of DLA Piper as mediator, we were told that “a mediator with gravitas” is necessary to settle the negotiations, and now, with the unilateral start of mediation, that PG&E shareholders are paying for the mediation. This leads us, we rightly believe, to the conclusion that the CPUC and PG&E have had improper ex-parte contact as part of this process.

“We state unequivocally for the record that no fine or settlement with PG&E will ever be legitimate or credible without the participation of the City of San Bruno.

“We call into question the integrity of the entire CPUC process that has occurred over the past two years since our community was ripped apart by the negligent and systematic safety failures of PG&E and the inability of the CPUC to independently protect and represent the interests of the residents of San Bruno and the people of California.

“The healing process has physical manifestations in the reconstruction of our Crestmoor neighborhood. However, the scars and horrors of the explosion and fire remain. The City committed to its citizens that it would be an active and relentless participant in all of the investigations that followed.

“We remain at the table to represent the interests of the citizens of San Bruno, the memory of those whose lives were taken by PG&E’s negligence, their families and friends, and equally important, every other city, town and community in the State of California so we can help others prevent what happened to us,” Mayor Ruane concluded.

Mayor Ruane and the consumer advocate attorneys said Sen. Mitchell’s previous work for Southern California Edison, a utility where CPUC Chairman Michael Peevey was formerly an executive, made them question whether he would be impartial.

PG&E and CPUC investigators said Friday that they had started fresh talks to settle the investigators’ allegations that the utility violated numerous state and federal safety rules prior to the fatal 2010 pipeline explosion in San Bruno.

The CPUC had been holding public hearings following three investigations investigators completed after a section of the utility’s gas pipeline in San Bruno ruptured on Sept. 9, 2010, igniting a giant fireball that killed eight people and injured 58. The fire destroyed 38 homes and damaged 70 others. The neighborhood where the blast occurred hasn’t been fully rebuilt, although some houses have been rebuilt.

Both federal and state investigators blamed PG&E for the blast and found that defects in the utility’s aging pipeline and inadequate pipeline safety management contributed to the pipe’s rupture.

A CPUC judge suspended those hearings last week, after state investigators, who are employed by the CPUC, asked to stop the hearings to allow time for a fresh round of talks with PG&E.

Members of the CPUC have said they plan to order fines and possibly other penalties against PG&E over the San Bruno disaster.

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Communications Workers of America in California Question CWA Union Leadership Over Failure to Sign Contract with AT&T

 

There is growing dissent among California Communications Workers of America against their union leaders’ intransigence and failure to approve a new contract with AT&T.

While every single CWA District and Local in the United States, with the exception of Connecticut and California, has signed a new contract deal with pay increases and generous health care benefits, California AT&T workers are starting to strike back at their own union and demand settlement.

Just this week, more than 20,000 AT&T workers in California, Nevada and Connecticut started two-day strikes Tuesday to protest what the union called harassment by the company. But a number of union members opposed the two day strike and question their union leadership’s action, which cost them two days of pay.

The phone company is negotiating new contracts with the Communications Workers of America. The company is restricting standard bargaining-support activities such as wearing union stickers and buttons, said Libby Sayre, president of the CWA district covering California and Nevada.

The contracts expired in April, and negotiations have been going on since February.

Dallas-based AT&T Inc. is the country’s largest employer of unionized workers. About 140,000 of its 256,000 employees are union members.

California AT&T workers are quietly saying they don’t care about the ‘sticker issue’ raised by CWA District 9 President Libby Sayre and are pushing back at union leadership and demanding an immediate conclusion to contract negotiations with AT&T.

“We are at odds with our own union leadership, not with AT&T,” one worker, requesting anonymity, said.  “The deal that was accepted by AT&T workers in other states is a good one and we want it here, too.”

The growing dissent by CWA workers against their leadership was visible in northern California this week as a number of members protested the two day strike and instead held signs protesting against CWA’s leadership, holding signs that read: “Our Union Has Us Striking Over a Stupid Sticker!” and “We Just Lost 2 Days Pay: Thanks CWA.”

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