SAN FRANCISCO, Sept. 3, 2014 /PRNewswire-USNewswire/ -- In conjunction with yesterday's record $1.4 billion fine by the California Public Utilities Commission, Schubert Jonckheer & Kolbe LLP is actively investigating serious misconduct by PG&E Corporation's (NYSE: PCG) top executives.
The Schubert firm is investigating shareholder-derivative claims that PG&E's officers and directors intentionally or recklessly breached their fiduciary duties both prior to and following the September 9, 2010 San Bruno pipeline explosion. Yesterday's CPUC action resulted in the largest fine ever levied by a regulatory agency. That fine will be paid entirely by the company, even though PG&E's current and former officers and directors may have engaged in reckless or intentional conduct.
The Schubert firm is also investigating reports that PG&E's officers and directors breached their fiduciary duties by obstructing the National Transportation Safety Board's investigation of PG&E following the September 9, 2010 explosion.
On April 1, 2014, a federal grand jury for the Northern District of California returned an indictment of PG&E related to its conduct leading up to the pipeline explosion. The indictment charged PG&E with twelve federal felony violations of safety laws, including failing to properly identify and evaluate all potential threats to the pipeline; failing to maintain repair records for the pipeline; and failing to prioritize and assess a pipeline that faced an unstable manufacturing threat. The criminal indictment could potentially result in fines of more than six million.
On July 29, 2014, the U.S. Attorney's office announced that a federal grand jury for the Northern District of California had returned a superseding indictment charging PG&E with obstruction of the investigation of the NTSB, as well as additional violations of the Natural Gas Pipeline Safety Act of 1968 ("PSA"). According to the superseding indictment, during the course of the NTSB's investigation, PG&E produced a version of a policy outlining the way in which PG&E addressed manufacturing threats on its pipelines. PG&E later withdrew that policy claiming it was produced in error and was an unapproved draft. In fact, PG&E was operating under the so-called unapproved draft from 2009 through April 5, 2011. PG&E did not prioritize as high-risk and properly assess many of its oldest natural gas pipelines, which ran through urban and residential areas.
The superseding indictment also charges PG&E with twenty-seven counts of knowingly and willfully violating the PSA. These charges stem from PG&E's recordkeeping and pipeline "integrity management" practices. PG&E allegedly failed to address recordkeeping deficiencies concerning its larger natural gas pipelines, knowing that their records were inaccurate or incomplete. PG&E also allegedly failed to identify threats to its larger natural gas pipelines and did not take appropriate actions to investigate the seriousness of threats to pipelines when they were identified. Finally, PG&E allegedly failed to adequately reprioritize and assess threatened pipelines after the pipelines were overpressurized as required by the PSA and its regulations.
PG&E is charged with one count of obstruction of an agency proceeding in violation of 18 U.S.C. § 1505 and twenty-seven separate counts of violations of the PSA. The maximum statutory penalty for each count is a $500,000 fine, a fine based on the twice the gross gain PG&E made as a result of the violations, or twice the losses suffered by the victims. The superseding indictment alleges that PG&E derived gross gains of $281 million, and victims suffered losses of approximately $565 million.
PG&E shareholders have the option to pursue a shareholder-derivative action through which shareholders may hold insider wrongdoers accountable for their actions, prevent future misconduct, and bring long-term value back to the company.
If you are a current PG&E shareholder and wish to obtain additional information about the investigation and your legal rights, please contact Willem Jonckheer either via email at wjonckheer@schubertlawfirm.com or by telephone at (415) 788-4220, or fill out the form on our website at http://classactionlawyers.com/PGE.
About Schubert Jonckheer & Kolbe
Schubert Jonckheer & Kolbe has extensive experience in prosecuting securities claims, representing investors throughout the nation in securities and shareholder lawsuits. Attorney advertising. Prior results do not guarantee similar outcomes.
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Schubert Jonckheer & Kolbe LLP
Willem F. Jonckheer, Esq.
3 Embarcadero Center, Suite 1650
San Francisco, CA 94111
Tel: (415) 788-4220
http://www.schubertlawfirm.com
http://www.classactionlawyers.com
SOURCE Schubert Jonckheer & Kolbe LLP