This evening there is a growing firestorm in the California Public Utilities Commission legal department as attorneys are openly questioning the ethical behavior of the CPUC’s General Counsel Frank Lindh in removing attorneys from the penalty phase against PG&E for its gross negligence in the San Bruno explosion and fire.
The top public safety division attorneys quit the case this past week after spending nearly three years of their careers attempting to bring Pacific Gas & Electric Co. to justice for the death and destruction caused by its failure to maintain its pipeline in the center of the City of San Bruno.
The safety division attorneys rebelled and had refused to put their names to a CPUC document because they told the CPUC General Counsel Frank Lindh of its illegality. Insiders say the overwhelming majority of attorneys in the CPUC are now lining up against Lindh and in support of their colleagues. They are privately raising issues of conflict of interest between CPUC President Michael Peevey, PG&E and Frank Lindh, who formerly was a PG&E employee prior to joining the CPUC.
A number of news stories by the San Francisco Chronicle’s Jaxon Van Derbeken, NBC 11 investigative reporters Tony Kovaleski and Liz Wagner, Mercury News Reporter Joshua Melvin and editorials in the Merc News and Sacramento Bee have shed light on CPUC conflicts and now the State agency appears to be spinning out of control.
Last night a special investigative report by NBC 11 reporters Kovaleski and Wagner showed CPUC President Peevey at a PG&E employee union event honoring him for his ‘leadership in safety’ which raises questions about conflict of interest as well as video footage that shows his possibly illegal ex-parte contact with CPUC safety division director Jack Hagen.
There is a growing revolt and more news and action is expected this week from attorneys inside the CPUC as well as parties in the case against PG&E, which includes its own Division of Ratepayer Advocates, consumer advocate TURN, the City and County of San Francisco’s City Attorney Dennis Herrera, and the City of San Bruno, which has called upon attorney General Kamala Harris—followed by the same call from Lindh—to investigate the CPUC immediately.
The conflict has broken out into an open dispute this week when Lindh found he was talking to an unfriendly forum—his own staff—when he gave the keynote speech Monday at a legal conference his agency is hosting, according to a report first published by The Recorder reporters Max Taves and Cheryl Miller yesterday and picked up today in the American Bar Association Journal and Law.Com.
Attendees from around the country watched as top in-house CPUC lawyer Frank Lindh was heckled during his speech about staff attorneys at a “hypothetical” utility regulator who lacked judgment and loyalty, the Recorder reports.
Specifically, his speech discussed what duty of loyalty is owed by a staff lawyer who strongly disagrees with a client’s legally permissible position on a rate-setting proposal.
“My solution in this circumstance would be to ask for a reassignment, but also to take steps to make sure I am not leaving my client in the lurch by withdrawing at the last minute,” said Lindh. “In the end, it all comes back to loyalty.
Under the canons of ethics, I simply cannot be disloyal to my client, even in the circumstance where I disagree strongly with my client’s wishes.”
His comments at the National Conference of Regulatory Attorneys conference in San Francisco were apparently relevant to the recent reported reassignment of an entire team of CPUC lawyers. They were responsible for handling litigation over Pacific Gas and Electric Co.’s culpability in a 2010 natural gas explosion and fire that killed eight people and destroyed 38 homes.
The four-lawyer team had taken a position that supported the city of San Bruno’s call for more than $2 billion in fines to be imposed on the gas company, and the city asked earlier this month for the state attorney general and lawmakers to look into the lawyers’ reassignment.
In a Friday interview, Lindh also said the AG should investigate—to set the record straight—and said he “begged the attorneys to stay on the case,” the Bay Area News Group reported in an article published by the San Mateo County Times.
They withdrew from the case,” Lindh said, “and they left me with the obligation to fill in behind them.”
However, in an email to Lindh leaked to the newspaper that was also sent Friday, assistant CPUC general counsel Harvey Morris said the team had not sought reassignment. He said they had refused to sign a brief they believed to be unethical, apparently over concerns that it made unlawful recommendations about the penalties that should be assessed against the gas company in the San Bruno case, according to the Bay Area News Group article and other media reports.
Because you did nothing to resolve our ethical concerns, one attorney asked to be taken off the case, and then you claimed that all of us asked to be reassigned,” Morris wrote.