Sparks fly to start PG&E pipeline trial


A criminal trial against PG&E Co. in which the utility faces obstruction of justice and pipeline safety violation charges began Friday morning in San Francisco with severe opening statements by federal prosecutors.

In a federal courtroom presided over by U.S. District Judge Thelton Henderson, Assistant U.S. Attorney Hallie Hoffman said in her opening statement the utility was following a “pattern of criminal conduct” and made a “deliberate choice” to dodge regulations.

Hoffman also told the 12-person jury that PG&E had “corruptly misled” the National Transportation Safety Board, which was tasked with investigating a deadly explosion involving one of the utility’s high-pressure transmission pipelines in San Bruno on Sept. 9, 2010.

The NTSB concluded the cause of the blast was a defective seam weld in a pipeline segment that was incorrectly listed in PG&E records as seamless. Allegations of record-keeping deficiencies after the explosion are what originally led to a U.S. Department of Justice criminal investigation.

PG&E faces 12 counts of violating record-keeping and pipeline maintenance requirements of the U.S. Natural Gas Pipeline Safety Act as well as a count of obstructing justice in NTSB’s probe.

Signaling the defense that may come in what is expected to be an up to six-week-long case, PG&E attorney Steven Bauer depicted what he called the “harsh words” of the prosecutor as an “easy” way of condensing complicated factors into a scathing attack on a corporation:

“If only the world were that simple. … PG&E is a logo … The government is accusing the people behind that logo, people who were doing their level best. They were not committing crimes.”

Federal prosecutors have to demonstrate that PG&E’s employees willfully and intentionally violated pipeline laws, as Henderson explained to jurors prior to the opening statements.

“(PG&E’s) practice of giving themselves a little leeway (on regulatory standards) was kept from the NTSB,” Hoffman said, who also implied that the San Francisco-based utility was “maximizing profits” over ensuring safety in its precautionary measures.

In his opening statement, Bauer’s response was to immediately clarify to jurors that the San Bruno blast did not hold relevance in the case.

Only one of the 13 counts in the 2014 grand jury indictment explicitly mentions the explosion, the charge of obstructing the NTSB investigation.

In pretrial motions, PG&E’s defense team had asked that evidence about the explosion be limited. Henderson has prohibited prosecutors from arguing that safety-law violations caused the explosion and barred certain evidence, such as videos of victims and panicked 911 calls.

Bauer told jurors during his opening statement:

“No one is minimizing the explosion. … It was terrible.”

Bauer said what would be shown during a trial is that the utility is made up of “good, qualified people,” and that there was never an intentional evasion of any regulations or safety measures among their actions.

Several times he was interrupted by Henderson, who chastised him making arguments during opening statements, which are reserved for objective descriptions of what the jury can expect in the trial.

Hoffman also made a motion following his statement, claiming that Bauer misled the jury on a crucial law in the case by saying that it would have to be proven that PG&E employees “destroyed, discarded or burned” pipeline records:

“It’s not about destruction, the law requires them to maintain the records.”

Henderson said the jury would be notified of this if it was determined to be true after a review.

Before the session concluded for the day, the trial’s first witness was called to the stand.

Steven Klejst, deputy managing director of NTSB, explained his federal agency’s role in incidents involving pipelines, which is to conduct investigations for the purpose of safety — and not legal — concerns.

Additionally, Klejst spoke about the investigation after the San Bruno blast specifically, as well as the difficulties with it:

“Information that was being requested of PG&E was not being delivered in a timely manner.”

PG&E’s defense had Klejst acknowledge under cross-examination that there were several email correspondences with the company stating intent to offer full cooperation with the investigation.

The process of requesting information in the agency’s investigations was also briefly discussed.

The trial, in which PG&E faces $562 million in fines if convicted of all charges, will resume on Tuesday morning.

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