Supreme Court of California Rejects Class Action Suit Against PG&E for its 2019 Blackouts

Energy Law  

November 20, 2023


In Gantner v. PG&E Corporation et al. (November 20, 2023) No. S273340, 2023 WL 8010215, the Supreme Court of California (“Court”) unanimously held that a plaintiff’s class action lawsuit against PG&E for damages related to public safety power shutoffs (“PSPS”) was barred by Public Utilities Code Section 1759 because it would impermissibly interfere with the California Public Utilities Commission’s (“CPUC”) regulation of utilities’ PSPS programs.


A PSPS event is a utility’s proactive cutting of power to electrical grids or lines (“de-energization”) so that the failure of those facilities does not cause or contribute to a wildfire. In 2019, the CPUC promulgated a formal set of PSPS guidelines that required utilities to provide advance notice to customers affected by de-energization when possible, create plans for mitigating harm, conduct a cost-benefit analysis to determine that the benefit of de-energization outweighs potential public safety risks, and to promptly submit a report to the CPUC following each PSPS event. (Resol. Extending De-Energization Reasonableness, Notification, Mitigation & Reporting Requirements in Decision 12-04-024 to All Elec. Inv. Owned Utilities., No. ESRB-8 (July 12, 2018) 2018 WL 3584003, at *10–16.) The CPUC may review each de-energization event and evaluate factors such as the choice of utility’s de-energization alternatives, whether there was a reasonable belief in an imminent fire risk, and the utility’s efforts to mitigate the adverse impacts of a de-energization event in determining whether the decision to de-energize was reasonable.

Gantner filed his class action in the Bankruptcy Court for the Northern District of California (“Bankruptcy Court”) as part of PG&E’s Chapter 11 Bankruptcy Proceedings. The action was filed on behalf of all California residents and business owners impacted by PG&E’s 2019 PSPS events. The 2019 events had led to widespread power blackouts throughout PG&E’s service area. After reviewing PG&E’s 2019 events, the CPUC found that PG&E violated sections of the Public Utilities Code as well as CPUC’s PSPS guidelines. Gantner’s action, however, did not reply on these findings. Indeed, he did not allege that the 2019 PSPS events were unnecessary or conducted in violation of the CPUC’s regulations. Instead, Gantner alleged that it was PG&E’s negligent maintenance of its power grid and electrical equipment for decades that had forced PG&E to implement the PSPS events in the first instance. Because those events led to blackouts across its service area, Gantner sought class damages of $2.5 billion to compensate California residents for their loss of habitability of their dwellings, expenses incurred, the need to obtain alternative means of lighting, the loss of productivity and business, dangerous dark conditions, and the lack of running water.

PG&E moved to dismiss Gantner’s complaint, arguing that the Bankruptcy Court lacked subject matter jurisdiction under Section 1759 because the suit would interfere with the CPUC’s supervision and regulation of the PSPS system. (Federal Courts will also apply Section 1759. See Kairy v. SuperShuttle International (2012) 660 F.3d 1146, 1150. (“In a case requiring a federal court to apply California law, the court ‘must apply the law as it believes the California Supreme Court would apply it.” (Citation omitted.)) As an alternative argument, PG&E argued that pursuant to its Tariff Rule 14, its decision to implement a PSPS event cannot result in liability when, in its sole opinion, it is a necessary public safety measure.

The Bankruptcy Court agreed with PG&E’s position and dismissed the complaint. On appeal, the United States District for the Northern District of California affirmed the dismissal, relying on Section 1759. Gantner then appealed to the Ninth Circuit, which in turn submitted two questions of California Law to the California Supreme Court.

Issues Before the Court

In response to the Ninth Circuit’s inquiry, the Court addressed two questions:

  1. Does California Public Utilities Code Section 1759 preempt a plaintiff’s claim of negligence brought against a utility if the alleged negligent acts were not approved by the CPUC but were foreseeable when the utility took action pursuant to CPUC guidelines and that subsequent action caused the plaintiff’s alleged injury?
  2. Does PG&E Electric Rule Number 14 shield PG&E from liability for an interruption in electrical service if PG&E determines it is necessary for the safety of the public at large, even if it arises from PG&E’s negligence?

California Supreme Court Decision

The Court first sought to resolve the apparent conflict between Public Utilities Code Sections 1759 and 2106—the conflict central to virtually all jurisprudence addressing Section 1759. Section 2106 provides that public utilities are liable, in an action for damages, for any act, matter, or thing prohibited or declared unlawful and for omissions of any act, matter, or thing required to be done. (§2106.) However, Section 1759 limits private actions against utilities by divesting all courts except the California Supreme Court and the Court of Appeal of jurisdiction “to review, reverse, correct, or annul any order or decision of the [CPUC] or to . . . enjoin, restrain, or interfere with the [CPUC] in the performance of its official duties.” (§ 1759, subd. (a).)

The Court explained that Section 1759 does not only bar actions directly attacking a specific order or decision of the CPUC. Section 1759 also bars arguably indirect attacks when a three-part test is satisfied: (1) the CPUC had the authority to adopt certain regulations or policies; (2) the CPUC actually exercised that authority; and (3) the civil court action would interfere with the CPUC’s exercise of that authority. (See San Diego Gas & Electric Co. v. Superior Court (1996) 13 Cal.4th 893, 918 (Covalt).)

The Court then examined two similar cases to Gantner’s class action: Waters and Covalt. In Waters, the Court found that Section 1759 barred a telephone customer’s suit against her telephone company for its alleged failure to provide adequate phone service. (Waters v. Pac. Tel. Co. (1974) 12 Cal. 3d 1, 523 P.2d 1161.) Because the CPUC had “adopted a policy of limiting the liability of telephone utilities for ordinary negligence to a specified credit allowance,” the Court held that allowing the customer’s private suit for damages to proceed would interfere with the CPUC’s regulation of telephone companies. In Covalt, plaintiffs argued that an electric utility’s decision to add several power lines near plaintiffs’ homes increased the dangerous levels of electromagnetic radiation on their property. (See Covalt, 13 Cal.4th at 911.) The Court held that Section 1759 barred the plaintiffs’ suit because the CPUC had extensively studied electromagnetic fields (“EMFs”), concluded they were not dangerous, and issued a comprehensive policy on EMFs evidencing an ongoing and continuing supervisory and regulatory policy regarding EMFs. (Six years later, the Court clarified the third, and most litigated, step of the Covalt test (“interfere with the CPUC’s exercise of that authority”) in Hartwell Corporation v. Superior Court, 27 Cal. 4th 256 (2002).)

Against this backdrop, the Court held that Gantner’s suit for damages would impermissibly conflict with the CPUC’s ongoing authority over PSPS events and was therefore barred by Section 1759. The Court found that asking a court to evaluate Gantner’s claim that PG&E breached its duty and to award damages would create a review process parallel to that embraced in the CPUC’s extensive PSPS procedures. Alleging damages that were a direct result of de-energization would interfere with the CPUC’s supervisory power over utility responses to the present threat of catastrophic wildfires and could hinder the utility’s decision-making by introducing considerations (such as tort liability) outside the CPUC’s PSPS framework. Finally, the Court took judicial notice of the CPUC’s amicus brief filed in the case that asserted that Gantner’s suit would interfere with the Commission’s administration of PSPS policies. Given the longstanding precedential history of giving weight to the CPUC’s views regarding Section 1759 preemption, the Court found the amicus brief to provide further support to the Court’s determination that Gantner’s claim was barred by Section 1759. Because the Court held Section 1759 barred Gantner’s action against PG&E, the Court declined to evaluate whether Tariff Rule 14 would also prohibit Gantner’s action.


Gantner marks the first decision of the Court addressing Section 1759 since People ex rel. Orloff v. Pacific Bell (2003) 31 Cal. 4th 1132. As mitigating wildfire risk becomes a more significant priority in California, those seeking to understand California’s response to that risk are well advised to monitor the evolution of the CPUC’s role over PSPS events, and note the Court’s reaffirmation that Section 1759 shields the CPUC’s exercise of its broad authority over the action of public utilities from interference by private actions for damages in trial courts.