Sempra & SoCalGas Agree to Settle Aliso Canyon Gas Well Blowout Litigation for up to $1.8 Billion

Posted on September 27, 2021

Following nearly six years of intense litigation and over $5 million in discovery sanctions, Southern California Gas Company (“SoCalGas”) and its parent company Sempra Energy (“Sempra”) have agreed to pay up to $1.8 billion to settle the claims of over 35,000 victims of the 2015 Aliso Canyon Natural Gas Storage Facility blowout. Plaintiffs allege they suffered personal injury and property damage after one of SoCalGas’ negligently maintained natural gas storage wells failed and uncontrollably released nearly 100,000 tons of methane and other substances into the atmosphere over 118 days. The Aliso Canyon blowout remains the biggest natural gas leak in U.S. history. Sempra and SoCalGas deny any wrongdoing.

Subject to certain conditions, the settlement money will be allocated among the plaintiffs in accordance with an allocation protocol to be developed by neutral, independent allocators.

“Our goal has always been obtaining justice for the men, women and children who were failed by SoCalGas throughout every turn of this catastrophe. This settlement, and the numerous discovery sanctions imposed by the court, hold Sempra and SoCalGas accountable for the Aliso Canyon blowout and their repeated misconduct throughout this litigation. This result could not have been obtained without the commitment, dedication, and hard work of the trial team preparing this case for trial,” said Brian Panish, Plaintiffs’ Lead Trial Counsel.  “We recommend that all plaintiffs participate in the settlement. We will continue to ensure that all plaintiffs are fairly compensated for their injuries throughout this allocation process.”

In this litigation, SoCalGas, Sempra Energy, and their counsel from Morgan, Lewis & Bockius LLP were sanctioned over $5.7 million – one of the largest discovery sanctions in California history.  The utility giants and their counsel wrongfully withheld over 150,000 documents under a pattern of discovery misconduct that the Court characterized as “willful, intentional, and in bad faith.”

In a February 2020 ruling, awarding $525,610 in sanctions against defendants and defense counsel jointly, the court noted defendants’ abuse of the discovery process as justification for these sanctions: “The court finds that Defendants’ pattern of conduct in this case with respect to Defendants’ claims of privilege, including repeated assertion of unmeritorious objections, repeated refusal to furnish a legally compliant privilege log, violation of court orders (in particular this court’s September 18, 2019 order) and related efforts over an extended period (as discussed above) to misuse claims of privilege to attempt to deprive Plaintiffs of documents to which they are entitled, was willful, intentional and in bad faith.” The Court found that there was “clear prejudice to Plaintiffs resulting from Defendants’ conduct” in the case. The Court also found that Defendants had made misrepresentations to the Court in efforts to justify their privilege objections. As a result, Plaintiffs were entitled to take any deposition at Defendants’ cost and expense arising out of the wrongfully withheld documents. Plaintiffs took over 585 days of depositions in the case, involving 470 witnesses.  In total, Defendants will have ultimately paid over $5.7 million in sanctions.

The Plaintiffs trial team in the JCCP 4861 Southern California Gas Leak Cases include Brian J. Panish and Jesse Creed of Panish Shea & Boyle LLP; Ray Boucher and Cathy Kim of Boucher LLP; Frank Pitre, Gary Praglin and Kelly Weil of Cotchett, Pitre & McCarthy LLP; Michael Kelly and Lindsey Bayman of Kirtland & Packard, LLP; Mariana McConnell and Paul Kiesel of Kiesel Law LLP; Frank Petosa of Morgan & Morgan; R. Rex Parris and Patricia K. Oliver of Parris Law Firm;  Devin Bolton and Robin L. Greenwald of Weitz & Luxenberg; and Roland Tellis and Evan Zucker of Baron & Budd.

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