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PG&E's Friendly Emails to Regulators: 3 Lessons

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By William Peacock, Esq. on September 17, 2014 10:06 AM

Wait, so you're not allowed to send cute, overly familiar emails to the regulatory board that is going to decide how much your company gets dinged for blowing up a bunch of houses and killing some peeps a few years back, demanding that you get a more lenient administrative law judge?

Now you tell me. And now Pacific Gas & Electric knows, after a series of back-and-forth emails detailing a way too close relationship between the utility company and California's Public Utilities Commission (PUC) came to light. Three execs and a top aide at the state agency just served as the sacrificial lambs, while PG&E scurries to "put new procedures in place" before they get slammed by the suddenly less friendly PUC.

Let's see what we can learn from this mess, shall we?

Stop Emailing Stuff

This is triple face-palm worthy. I mean, in this day and age, with California's open government laws, or even without them, why are people still dumb enough to send incriminating emails? E-discovery, people: It's been around at least since Zubulake.

You Don't Get to Pick Your Judges

The San Francisco Chronicle has a full recap of the email messages. Here's the part where they picked their judge:

The e-mails showed that PG&E's vice president of regulatory relations, Brian Cherry, told [PUC President] Peevey's top aide that one prospective judge posed a "major problem for us," and objected to another judge who had overseen a case in which the company "got screwed royally."

A colleague of Peevey's on the five-member commission, Mike Florio, agreed with PG&E that "you really couldn't do any worse" than one of the judges and said, "I'll do what I can" to get the company's preferred judge assigned to the case, the emails show.

Care to guess what happened next? PG&E got the first judge kicked, then got the second judge kicked, then got the exact judge they requested at the outset.

Don't Be Somebody's Aide

Though PG&E cleaned house, firing the top three executives in its regulatory division, the Public Utilities Commission did far less, firing a single aide of PUC President Michael Peevey. PG&E is also creating a new chief of regulatory compliance officer, hiring a former U.S. Secretary of the Interior to advise it on improving interactions with regulators, and is bracing itself for potential fines and government-mandated procedures, reports The Wall Street Journal.

Peevey, who was party to the inappropriate back-channel emails, is going to recuse himself from the upcoming San Bruno pipeline explosion vote, even though the email chain was not directly related to the San Bruno case.

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