Buffett's PacifiCorp suspected of collusion by wildfire victims' law firms

[July 20, 2024]  By Jonathan Stempel

(Reuters) -The law firms leading class-action litigation against PacifiCorp over the 2020 Labor Day weekend wildfires in Oregon want to examine whether the utility owned by Warren Buffett's Berkshire Hathaway is colluding with three other law firms to reach lowball settlements with fire victims.

PacifiCorp and the three firms denied any collusion on Friday, with the utility calling such claims "false, preposterous and desperate."

The dispute may complicate PacifiCorp's efforts to settle claims from wildfires that burned several hundred thousand acres in Oregon and northern California.

Fire victims have blamed the Portland, Oregon-based utility for failing to shut off power lines during a windstorm.

In a court filing dated Thursday, Edelson PC, Keller Rohrbach and Stoll Berne said they were blindsided when PacifiCorp and the three other firms jointly announced a $178 million settlement on June 3 with 403 victims of the Beachie Creek and Echo Mountain Complex fires.

The class-action firms said payouts per victim were barely two-thirds of the payouts in an earlier $299-million settlement obtained by different law firms for victims of the Archie Creek fire, and included almost nothing for pain and mental suffering.

They also said the June 3 settlement came just one week after mediation to resolve the class action broke down, as the three law firms began cold-calling and mailbox-stuffing to encourage fire victims to hire them and settle.

"(The three firms) appear to be working hand-in-hand with PacifiCorp to enrich themselves, benefit PacifiCorp, and harm fire survivors" by settling claims at a "PacifiCorp-approved, bargain-basement price point," the class-action firms said.

In its statement, PacifiCorp said the class-action firms appeared to be trying to persuade their clients to hold out for more money and to collect higher legal fees for themselves.

A ponderosa pine tree is cut down after having burnt in the Brattain Fire, at Fremont National Forest, near Paisley, Oregon, U.S., September 19, 2020. REUTERS/Adrees Latif/File photo

"That hundreds of plaintiffs have chosen to settle with PacifiCorp and disagree with class counsel's tactics is not evidence of collusion," the utility said.

In their statement, the three law firms - Warren Allen, Spreter Petiprin and the Swigart Law Group - called claims in Thursday's filing "simply untrue."

They said the $178-million settlement offers "meaningful" sums to help Oregonians start rebuilding, while claims in the class action could be tied up for years.

PacifiCorp has paid more than $1 billion to settle nearly 2,000 wildfire claims, but faces billions of dollars of additional claims, including a $30-billion lawsuit.

The class-action firms want the Portland judge overseeing their case to let them review communications between PacifiCorp, the three other firms and class members for possible collusion, and allow victims who settled to back out if collusion were found.

PacifiCorp is a unit of Berkshire Hathaway Energy, which is 92% owned by Berkshire Hathaway, the conglomerate that Buffett has run since 1965.

Greg Abel, Buffett's expected successor as chief executive, said at Berkshire's annual meeting on May 4 that PacifiCorp will continue challenging "unfounded" wildfire litigation.

The case is James et al v. PacifiCorp et al, Oregon Circuit Court, Multnomah County, No. 20CV33885.

(Reporting by Jonathan Stempel in New York, Editing by Alexia Garamfalvi and Rod Nickel)

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