PacifiCorp Settles for $250M in 2020 Wildfire Lawsuit

PacifiCorp Settles for $250M in 2020 Wildfire Lawsuit

Introduction

PacifiCorp, a major utility provider, has agreed to substantial settlements totaling hundreds of millions of dollars over its alleged involvement in the catastrophic Oregon wildfires in 2020. The company, owned by Berkshire Hathaway, filed a report with the U.S. Securities and Exchange Commission revealing a $250 million settlement with 10 timber companies. This agreement was to resolve a lawsuit linked to the Archie Creek Complex Fire in Southern Oregon. Additionally, on December 5, PacifiCorp settled for $299 million in a separate lawsuit filed by Southern Oregon residents who lost homes and property in the same fire. These settlements have brought PacifiCorp’s total payouts this month to over half a billion dollars. The lawsuit from the timber companies accused PacifiCorp’s subsidiary, Pacific Power, of negligence. Despite warnings from the National Weather Service over the Labor Day weekend in 2020, the company's employees allegedly continued to operate electrical equipment and failed to cut power. Moreover, the lawsuit claimed the utility did not adequately manage vegetation near power lines, which could have ignited due to high winds during that period. In a statement, PacifiCorp acknowledged the tragedy of the wildfires and expressed its commitment to resolving the issue for the affected customers and communities. They emphasized the need for comprehensive solutions to prevent such catastrophic fires in the future. A Texas-based law firm represented both the timber companies and individual property owners in these settlements. The firm's attorney highlighted the significant recovery of damages for Oregon's timber industry, which lost extensive timberlands in the 2020 fires. The attorney also commended PacifiCorp and Pacific Power for opting for settlements over trials. Looking ahead, the attorney expressed a desire to collaborate with PacifiCorp, Oregon lawmakers, and utility regulators to establish a statewide risk pool for utilities. This proposed fund, akin to one created in California in 2019, would involve contributions from utility customers and utilities themselves before wildfires occur, providing faster compensation to victims and financial stability for utilities. PacifiCorp's legal challenges from the 2020 wildfires are not yet over. In spring, the company faced trials where it struggled to convince jurors that its equipment was not responsible for wildfires in Western Oregon, resulting in around $90 million in damages to 17 plaintiffs. Further payouts are expected as related class action cases proceed next year, although PacifiCorp plans to appeal these decisions. Additionally, Pacific Power is confronting several ongoing lawsuits. These include claims for its potential role in the 2020 Slater Fire near the Oregon-California border, allegations from Willamette Valley wine growers regarding smoke damage to their crops in 2020, and a recent lawsuit for its involvement in the 2022 McKinney Fire, which also occurred near the Oregon-California border, allegedly starting under a powerline.