Ratepayer's lawyer opposes SDG&E high court review bid

An attorney is opposing San Diego Gas & Electric Co.'s petition for U.S. Supreme Court review of its attempts, rejected at the state level, to charge ratepayers to recover the uninsured costs of fires for which the utility was found responsible.

Saying the utility's arguments are unmeritorious and should instead be taken to the state Legislature, Michael S. Aguirre of Aguirre Severson LLP in San Diego, filed his opposition brief Thursday on behalf of ratepayer Ruth Henricks.

Aguirre urged the U.S. Supreme Court to deny the writ as the petition is "a disguised, facial, validity challenge to the prudent manager standard." A consideration of that issue would require the court to interfere with the state Legislature's ongoing process of addressing SDG&E's cost-spreading concerns, such as SB 901 last year, Aguirre argued.

After multiple failed attempts to charge $379 million to ratepayers in costs linked to 2007 wildfires, SDG&E took its fight to the nation's highest court, maintaining it was a violation of their Fifth and 14th Amendment rights against unlawful taking under inverse condemnation liability. San Diego Gas & Electric Co. v. California Public Utilities Commission, 18-1368, (U.S., filed April 30, 2019).

Three forums -- the California Public Utilities Commission, the 4th District Court of Appeal and the state Supreme Court -- previously rejected SDG&E's petition because the utility "imprudently managed the facilities alleged to have caused the 2007 Witch, Guejito and Rice fires," according to Aguirre's opposition brief.

The utility is reviewing Aguirre's brief and will submit its reply, utility spokesperson Helen Gao said in an emailed statement Thursday.

All courts that have addressed the dispute agreed inverse condemnation wasn't relevant to the utility commission's decision because SDG&E's request rate hikes were not just and reasonable, according to Aguirre's brief.

"The California Supreme Court found no constitutional issue worthy of its scarce resources, and neither should the federal court of last resort," Aguirre wrote.

Through SB 901, the Legislature already codified the prudent manager standard, Aguirre wrote. The bill's goal was to create a fundraising mechanism for which 2017 wildfire liability costs could be spread to ratepayers under the prudent manager standard.

"The California Legislature made its priorities clear: It seeks to strike a balance between avoiding burdening ratepayers with undeserved financial impacts on the one hand, while providing investor-owned utilities with a reasonable financial cushion from insolvency on the other hand," Aguirre wrote.

"Given the Legislature's commitment to striking said balance, [SDG&E's] request for the court to place itself in the position of 'frustrating the intent of the elected representatives' of California is improper," he added.

"Petitioner's suggested regime is an end run-around the prudent manager standard. As the record reflects, [SDG&E] transmogrified its garden variety rate-raising case to one cloaked in weighty federal constitutional law questions," Aguirre concluded. The U.S. Supreme Court should see through [SDG&E's] strategy and direct their arguments where they belong and are already being heard: the California Legislature."

SDG&E's petition stems from the state appellate court's denial handed down in San Diego Gas & Electric Co. v. California Public Utilities Commission, D074417 (Cal. App. 4th Dist., filed Nov. 13, 2018).