Charges could send message to PG&E
Public, lawmakers would heed criminal prosecution
Pacific Gas and Electric Co., already a convicted felon for safety violations in the deadly 2010 San Bruno gas pipeline explosion, could face another criminal prosecution for its role in the deaths and destruction caused by Northern California wildfires.
Butte County District At- torney Mike Ramsey is consid- ering manslaughter charges against PG&E and some of its employees for the Camp Fire that killed 85 people and leveled the town of Paradise last year. California Attorney General Xavier Becerra told a federal judge in December that the state’s largest utility could even be charged with murder if its employees and managers, in failing to keep lines and poles free of hazardous vegetation during times of fire danger, acted with a “conscious disregard for life.”
But you can’t throw a corporation in prison.
And the monetary fines for manslaughter or murder convictions pale in comparison to the billions that can be assessed in civil penalties by regulatory agencies or damages awarded in lawsuits brought by victims.
So why turn to criminal prosecution? One reason is that it sends a message.
“If a corporation has caused people to die, the message needs to go out that this is the equivalent of murder or manslaughter,” said Laurie Levenson, a former federal prosecutor and longtime criminal law professor at Loyola Law School in Los Angeles.
“If a corporation sees another corporation convicted, it sends shock waves,” she said. “The public will pay greater attention in a criminal case. Legislators will pay greater attention.”
Robert Weisberg, a Stanford law professor and co-director of the law school’s Criminal Justice Center, said corporate criminal prosecutions are “largely symbolic, but I wouldn’t underestimate symbols.” He noted that Arthur Andersen, one of the nation’s largest accounting firms, collapsed after its 2002 conviction for obstructing justice by shredding documents during an audit of its client, the onetime energy giant Enron Corp. The Supreme Court overturned Andersen’s conviction in 2005, finding errors in the judge’s jury instructions, but 28,000 former employees never regained their jobs.
Most criminal charges against corporations and their executives resemble civil suits for similar conduct — fraud, for example, has the same definition in criminal and civil law, but civil fraud must be proved by “clear and convincing evidence,” while criminal prosecutors must meet the higher standard of “beyond a reasonable doubt.” Such prosecutions are not everyday events, but state and federal agencies sometimes use them to condemn serious financial or regulatory wrongdoing.
Walmart, in one such case, pleaded guilty in 2013 to felony charges of illegally disposing of hazardous wastes at retail stores nationwide, leading to fines of more than $110 million. Volkswagen pleaded guilty in 2017 to felony charges for selling hundreds of thousands of diesel cars rigged to cheat on emissions tests, with fines of $2.8 billion, in addition to a $15 billion settlement with vehicle owners and state and federal governments. PG&E’s jury convictions in 2016, for obstructing a federal investigation of the San Bruno explosion and violating pipeline safety laws, fall into the same category.
Far less common, but still authorized by law, are homicide charges against corporations for deaths caused by seriously negligent or reckless acts of its employees or managers.
One notable example involved the petroleum company BP, which pleaded guilty in 2012 to 11 counts of manslaughter for the Deepwater Horizon explosion in 2010 that killed 11 oil rig workers and spilled millions of gallons of oil into the Gulf of Mexico. BP paid $4 billion in criminal fines to the federal government, a record for criminal cases. Overall, the company said it paid more than $61 billion in fines, civil penalties, victim compensation and cleanup costs.
An early corporate homicide
case arose in 1904, when a steamboat fire on the East River in New York killed 900 passengers. A federal court allowed the corporate owner to be charged with manslaughter for failing to equip the boat with life preservers or firefighting equipment, but prosecutors charged only the captain, who was convicted of criminal negligence, sentenced to 10 years in prison, and later pardoned by President William Howard Taft.
The first known murder charge against a U.S. corporation was the 1978 prosecution of Ford Motor Co. in Indiana for the deaths of three teenage girls whose Ford Pinto exploded when hit by a truck. Citing the recalls of more than 1 million Pintos because of defective fuel tanks, prosecutors relied on a state law that allowed corporations to be charged with murder for “reckless homicide.” But a jury acquitted the company.
In California, then-Attorney General Kamala Harris charged two drug-treatment companies and four employees in 2015 with murdering a patient at a rehabilitation center in Riverside County, where three other patients had died. Prosecutors said the patient came to the center needing oxygen but instead was given medicinal drugs and was found dead the next morning.
A judge later dismissed the murder charges against the companies, A Better Tomorrow and Forterus Inc., finding no evidence that their employees knew they were endangering the man’s life. Two executives pleaded no contest to lesser charges and were ordered to undergo counseling.
California has a separate law, the Corporate Criminal Liability Act, passed in 1989 to punish businesses that commit “crimes against the public health and safety.” It applies to companies and their managers who learn of a “serious concealed danger” involving their product or workplace and fail to promptly notify a regulatory agency and warn their employees. Companies can be fined up to $1 million for violations, and managers can face up to three years in prison.
Manslaughter and murder charges carry more of a wallop, even against corporations whose only penalties would be financial and reputational. They’re also harder to prove.
For either charge against a company like PG&E, a prosecutor “has to plausibly allege that people of high-level responsibility were aware, or very obviously should have been aware, of the very high risk of dangerous fires caused by their operations,” said Stanford’s Weisberg. The prosecution also must show that “reasonable people in their situation would have realized there were feasible protective measures and would have taken them.”
And for a murder charge, said Levenson of Loyola Law School, prosecutors must additionally show that “they realized that this tragedy could occur ... that a fire could start and people could die, and they consciously disregarded it.”
Such charges can be based on the “collective knowledge” of a company’s employees, though it’s probably easier to show corporate guilt when top executives were aware of the dangers, Levenson said. But if such a case went to trial, she said, it still might be hard to convince a jury made up of customers and ratepayers to throw the book at a utility.
“The problem with going after a company is that jurors have in the back of their mind that employees are maybe going to lose their jobs,” Levenson said. “And in this case, if we find (PG&E) guilty, will we ever have any electricity?”