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Wildfire lawsuit limits possibly unconstitutional

The Oregon Attorney General’s Office has said lawsuit limits proposed by PacifiCorp could violate the Oregon Constitution, according to a staff report published Tuesday.

The report, filed by Assistant Attorney General Betsy Bridge, said a proposed limited liability clause in PacifiCorp’s contract for services is a possible violation of the “Remedy Clause.”

Contained in Article I of the Constitution, the clause protects the due process rights of Oregonians to seek legal damages and restrains the legislature’s ability to limit remedies.

PacifiCorp’s request, filed Oct. 24, 2023, with the Oregon Public Utility Commission (PUC), would effectively ban all customers from seeking non-economic damages. It would also bar damages caused by anything other than the use of electric services, such as wildfires.

Bridge acknowledged wildfire liability, particularly for the 2020 Labor Day fires, has placed PacifiCorp in a financially vulnerable position, but said this does not override consumer protections.

“A [policy] that seeks to limit PacifiCorp’s liability in situations when the company has been found to have acted with gross negligence or willful misconduct is unlikely to be upheld by a court,” said Bridge. “Moreover, the Commission’s approval of such a provision could be found to be unconstitutional.”

Bridge’s analysis was in response to a PUC staff report filed Nov. 28, 2023, that said PacifiCorp’s request raised “significant policy implications” and time was required to investigate. An original effective date for the change of Nov. 29, 2023, was set over to allow additional inquiry. The PCU now has until April 9 to approve or deny the request, or seek more time.

In addition to Bridge’s report, multiple intervenors in the case referenced the Remedy Clause as a non-starter for PacifiCorp’s proposal in opening briefs filed Tuesday.

Attorneys in James et al vs. PacifiCorp, a class action suit over the 2020 Labor Day fires, said the proposal’s ban on non-economic damages clearly violates the clause. They called the proposal a “get-out-of-jail free card” for a company that caused class members mental anguish and emotional distress, and displayed “reckless disregard for…life, limb, and property.”

In a jointly-filed brief, the Green Energy Institute at Lewis & Clark Law School and the Sierra Club said PacifiCorp’s proposal violates a court ruling that guarantees “substantial” legal remedies. In 2016 the Oregon Supreme Court ruled plaintiffs have a right to seek substantial damages, rather than a “paltry fraction,” under the Remedy Clause.

The Oregon Citizens Utility Board (CUB) said in their opening brief it was a “conclusive” matter that PacifiCorp’s request violated the Remedy Clause and asked that it be denied. It said PCU “has never granted such a broad and sweeping liability waiver, and CUB respectfully requests that it not do so in this instance.”

In PacifiCorp’s opening brief filed Jan. 23, the company said whether or not its policy violates the Remedy Clause depends on a specific lawsuit at issue. 

It encouraged PCU to pass its proposal without further constitutional analysis and to allow the courts to resolve the matter “case-by-case.”

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