Judge: PG&E should receive max sentence Formal decision delayed until Thursday in criminal case tied to 2010 explosion

SAN BRUNO — After hearing emotionally charged testimony Monday from victims of PG&E’s fatal San Bruno pipeline explosion, a federal judge said the utility should receive the maximum $3 million fine — but he delayed formal sentencing until Thursday.

The impending sentence is likely to mark the final chapter in a yearslong case, which began with the deadly pipeline explosion in September 2010 that killed eight people and destroyed 38 homes and ended with the utility’s conviction on six criminal charges in August 2016.

Choking back tears, Rene Morales, whose daughter died in the explosion, told the court it’s important that PG&E be held accountable for its actions.

“It’s good that PG&E will be known as convicted criminals,” Morales said. “I wonder if the CEO and executives of PG&E have regrets.”

Morales said her greatest “It’s good that PG&E will be known as convicted criminals. I wonder if the CEO and executives of PG&E have regrets.” — Rene Morales, whose daughter died in the explosion

regret was that she allowed her daughter, Jessica Morales, to visit a friend in San Bruno on the day of the explosion.

“The last words I heard from Jessica were, ‘Don’t worry, Mom, I’ll be back by 9, before you go to work,’” Morales said.

Wrapping up a nearly two-hour hearing in San Francisco, U.S. District Court Judge Thelton Henderson said he is “inclined” to impose the maximum sentence for PG&E’s sixcount conviction and the maximum probationary period of five years.

The maximum fine is $3 million — $500,000 on each of the six criminal charges for which PG&E was convicted. The judge indicated that PG&E likely will be forced to submit to courtordered, outside supervision of its natural gas operations. And he said he agreed with a probation recommendation that PG&E should be required to perform 10,000 hours of community service, 2,000 of that by executives.

Last August, a federal jury convicted PG&E on five charges of violating federal pipeline safety regulations and one charge of obstructing the official National Transportation Safety Board probe into the blast.

The NTSB eventually determined that the rupture of a gas pipeline was caused by a deadly combination of PG&E’s shoddy maintenance and flawed record keeping, along with lax supervision of the company by the state Public Utilities Commission.

In April 2015, the state PUC imposed a $1.6 billion penalty on PG&E for causing the explosion, the largest ever imposed on an American public utility.

Federal prosecutors in the criminal case had originally sought fines of up to $1.14 billion against PG&E, but a judge’s ruling reduced that to $562 million. A few days before the utility’s convictions, prosecutors decided to seek only the statutory fines against PG&E, totaling a maximum of $3 million.

“We sincerely apologize to the people who were affected by this and who lost family members and friends,” Julie Kane, PG&E’s chief ethics and compliance officer, said during a brief statement to the court. “Our commitment to safety will never stop. We are profoundly sorry.”

Hallie Hoffman, an assistant U.S. attorney and one of the federal prosecutors in the case, said she understands that PG&E has stated it is sorry about the blast, but that the maximum sentence and probationary period are warranted.

“This case involved not only a corporation, but a monopoly,” Hoffman told the court. “That monopoly decided to undertake a pattern of intentional safety violations. This case involved that monopoly’s corrupt obstruction of an investigation. We all understand that this was a horrible event. But that this could have been avoided is heinous.”

San Francisco-based PG&E neglected its pipeline system with disastrous results, Hoffman said.

“This monopoly was willing to play Russian roulette with this pipeline,” Hoffman told the court.

During the hearing, victim Susan Bullis recounted how she had rushed home to San Bruno, abruptly leaving a meeting in Sunnyvale in a dazed blur after seeing televised news accounts of the explosion in her neighborhood.

“This was due to the negligence of a greedy company that put profits ahead of safety,” Bullis told a silent federal courtroom in San Francisco. “PG&E caused eight people to die.”

Bullis embraced the possibility of an independent, court-ordered monitor to supervise PG&E’s gas system operations.

“It is my hope that with the proper checks and balances for PG&E, this kind of tragedy will never happen again,” she said.

For two years after the explosion, Bullis said she and her daughter became estranged as they sought to process their grief and loss of family members. Only in more recent years have they begun to speak in a more comfortable fashion. Yet even now, they feel the horror of the disaster.

“On Sept. 9, 2010, my life changed forever,” Bullis said. “To this day, we cannot talk about the disaster together.”