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Put up or cover-up, public utilities commission?

Agency delays documents, pays pricey attorneys for strategic guidance

The California Public Utilities Commission can blind the public for now, but the truth will see the light.
The California Public Utilities Commission can blind the public for now, but the truth will see the light.

Ever since Watergate, astute observers have said about American law enforcement and the justice system, "It's not the crime. It's the cover-up." When the press and the public get suspicious of a massive coverup, the focus of the alleged wrongdoing usually shifts to attempts by the accused to cover their tracks. Then the matter escalates.

The California Public Utilities Commission is vulnerable to such a blowup. Rates at the three publicly held utilities — San Diego Gas & Electric, Southern California Edison, and Pacific Gas & Electric — are among the highest in the nation. San Diego Gas & Electric's are almost certainly the nation's highest.

During the reign of Michael Peevey, the former public utilities commission president now under state and federal investigation for possibly illegal actions to benefit utilities, state ratepayers were justifiably roused. Now it has come out that the public utilities commission is paying a private law firm, Sheppard Mullin, up to $882 an hour (a total of $5.2 million) to defend Peevey, when the agency could hire state-employed lawyers for $30 to $65 an hour.

And what is Sheppard Mullin doing? Documents show that between January and March, Sheppard Mullin charged an average of $342,000 a month for "review of documents for responsiveness and privileges." That means the law firm is culling documents, deciding which ones will not be turned over for such reasons as "attorney-client privilege."

The San Diego law firm of Aguirre & Severson, which has not received the documents that it has requested, sent a letter today (March 30) to the public advisor of the CPUC. The law firm is asking that the public utilities commission "waive any and all privileges related to communications related to matters under investigation of the United States Department of Justice and the California Attorney General's office from 2009 - 2014."

Among other things, the letter notes that "Sheppard Mullin is representing CPUC witnesses while at the same time representing potential subjects of the investigation…. The CPUC decision makers are using a single law firm to represent several witnesses to maintain a common defense strategy to protect current and former CPUC decision makers against the government's efforts to investigate and prosecute for suspected criminal offenses."

The public utilities commission should all waive all privileges — including the attorney-client privilege — in the public interest, says the letter. The public utilities commission should also understand that since in the public mind the cover-up becomes the focus rather than the crime, the agency would be operating in its own interest to waive all privileges.

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The California Public Utilities Commission can blind the public for now, but the truth will see the light.
The California Public Utilities Commission can blind the public for now, but the truth will see the light.

Ever since Watergate, astute observers have said about American law enforcement and the justice system, "It's not the crime. It's the cover-up." When the press and the public get suspicious of a massive coverup, the focus of the alleged wrongdoing usually shifts to attempts by the accused to cover their tracks. Then the matter escalates.

The California Public Utilities Commission is vulnerable to such a blowup. Rates at the three publicly held utilities — San Diego Gas & Electric, Southern California Edison, and Pacific Gas & Electric — are among the highest in the nation. San Diego Gas & Electric's are almost certainly the nation's highest.

During the reign of Michael Peevey, the former public utilities commission president now under state and federal investigation for possibly illegal actions to benefit utilities, state ratepayers were justifiably roused. Now it has come out that the public utilities commission is paying a private law firm, Sheppard Mullin, up to $882 an hour (a total of $5.2 million) to defend Peevey, when the agency could hire state-employed lawyers for $30 to $65 an hour.

And what is Sheppard Mullin doing? Documents show that between January and March, Sheppard Mullin charged an average of $342,000 a month for "review of documents for responsiveness and privileges." That means the law firm is culling documents, deciding which ones will not be turned over for such reasons as "attorney-client privilege."

The San Diego law firm of Aguirre & Severson, which has not received the documents that it has requested, sent a letter today (March 30) to the public advisor of the CPUC. The law firm is asking that the public utilities commission "waive any and all privileges related to communications related to matters under investigation of the United States Department of Justice and the California Attorney General's office from 2009 - 2014."

Among other things, the letter notes that "Sheppard Mullin is representing CPUC witnesses while at the same time representing potential subjects of the investigation…. The CPUC decision makers are using a single law firm to represent several witnesses to maintain a common defense strategy to protect current and former CPUC decision makers against the government's efforts to investigate and prosecute for suspected criminal offenses."

The public utilities commission should all waive all privileges — including the attorney-client privilege — in the public interest, says the letter. The public utilities commission should also understand that since in the public mind the cover-up becomes the focus rather than the crime, the agency would be operating in its own interest to waive all privileges.

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Comments
44

Don, do you think those state lawyers are overpaid?

March 30, 2015

Dennis: This is one of the obvious problems with our justice system. Government lawyers are paid much less than high-priced private attorneys. The most prestigious white shoe law firms represent the most noisome crooks, particularly the ones running financial frauds. All too often, the crooks get off because they have so much better lawyers. Money talks, but why must it nauseate? Best, Don Bauder

March 30, 2015

As much as I hate to say it, I fear there will be a few wrist slaps, some probation, and that will be the end of it.

March 30, 2015

aardvark: Obviously, that is exactly what I am concerned about. Politicians get big bucks from utilities. That's one reason that the CPUC is set up to massage utilities and rape ratepayers. If honest investigators looked into the corruption in utilities and the CPUC, California might never be the same. The stench is that bad.

The media have to keep hammering on this -- not let them get away with it. Best, Don Bauder

March 30, 2015

arrest one if the higher ups and offer them a deal if they name names ( rat out all the other vermin involved)

March 31, 2015

Murphyjunk: That would be a good solution if it weren't for the fact that the AG is running for U.S. Senate, state and federal investigators are up against lawyers paid up to $882 an hour, Peevey and Gov. Brown are great friends going back decades, etc. etc. ad nauseam. Best, Don Bauder

March 31, 2015

$882 per hour to ignore the facts and/or manipulate the facts

March 31, 2015

Murphyjunk: Or make sure the facts are not revealed because of something like "attorney-client privilege." Best, Don Bauder

March 31, 2015

Too many privileges and too many lawyers. Maybe Portia's Pop was right?

March 31, 2015

Twister: There is no question we have too many lawyers these days. Law schools keep churning them out, but many do not get jobs in the legal profession, and many who work for peanuts. Many spend years paying back their law school debts. Shakespeare's suggestion was rather harsh, but it is one way to correct an oversupply. Best, Don Bauder

April 1, 2015

Often quoted from Shakespeare's Henry VI is "the first thing we do, let’s kill all the lawyers." It's often taken out of context. But it was said by an awful colleague of a demagogue planning a power takeover, and he didn't want lawyers to intervene and try to prevent it. Former San Diego City Attorney Mike Aguirre is an example of a good lawyer taking on some very bad guys (at CPUC). We need more lawyers like him.

April 5, 2015

In my opinion, what happened in San Bruno is so egregious that unless someone wants to commit political suicide, there won't be wrist-slapping here.

To have had a list of problem pipelines for over ten years, not done a thing about them, have one blow up to the extent that people died in their suburban homes, homes were destroyed, a neighborhood torn apart--and then it looks like there was collusion between PG& E and the CPUC as they tried to downplay this!

And then there is the minor (!) matter of San Onofre--years of poor decision-making, poor maintenance, blame-shifting, and nonsense, with which they want to charge the rateholders!

I am starting to long for the days when tar and feathers would be considered a good start at correcting the problem!

No, the time is past for wrist-slaps. I hope we see some serious justice.

March 30, 2015

eastlaker: I certainly hope you are right. There was a disaster in San Bruno, and the top officials of the CPUC were working to be sure Pacific Gas & Electric got a lenient administrative law judge who would not hit the company with a big fine over this disaster that leveled a neighborhood and killed a number of people. Just recently, the fine was raised, but hardly sufficiently. It is a disgrace. Best, Don Bauder

March 30, 2015

LATE NEWS; THE CPUC TAKES FLORIO OFF THE SAN ONOFRE CASE. The California Public Utilities Commission (CPUC) announced at 3:45 p.m. today (March 30) that Commissioner Mike Florio has been removed from the case looking into the closing of the San Onofre nuclear generating station. Florio will be replaced by Commissioner Catherine J.K. Sandoval.

The San Diego law firm of Aguirre & Severson has sued over the commission's decision to force ratepayers to cough up heavily for the failure of the system, which, the law firm contends ,resulted from management mistakes, and therefore shareholders, not ratepayers, should pay for the damages.

This is also a case in which state and federal investigators are investigating former CPUC head Michael Peevey, who sketched out plans for the financing of the failure at a secret meeting in Warsaw, Poland.

Florio, along with Peevey and others, were involved in the CPUC's back-channel attempt to help Pacific Gas & Electric get a lenient administrative law judge who would give it a light penalty for its role in the San Bruno explosion of 2010. Best, Don Bauder

March 30, 2015

Well, isn't that interesting.

Let's hope that there will be some good management, some honest assessments and some real changes.

March 30, 2015

eastlaker: The CPUC needs a thorough housecleaning. Peevey had a number of enablers who should be fired or jailed. I have once described the CPUC under Peevey as a modern example of Murder in the Cathedral. A lot of people wielded knives. Best, Don Bauder

March 31, 2015

Removing this Commissioner from the San Onofre "investigation" is hopefully the first step in removing him from the CPUC.

I hope that Michael Aguirre, also pushes the State/CPUC to nullify all decisions by the CPUC relating to San Onofre and/or rate changes since this is clearly a "Brown Act" type of violation which puts those that commit these violations at risk of large penalties and/or even serious Jail time, not to mention having to revisit all prior decisions which will have huge economic costs to SCE and/or SDG&E; who stand to get hit with Billions of dollars in fines and penalties.

San Onofre Gate will soon become a household phrase, as every SoCal ratepayer seeks relief from being charged $1000 or more for the SCE's Replacement Steam Generator Debacle that the CPUC is forcing them to pay, in order to protect Utility shareholder profits!

March 31, 2015

CaptD: Florio should definitely be removed from the CPUC. Helping PG&E get a lenient administrative law judge should be enough to get him dismissed. It looks like his role in the screw-the-ratepayer deal arranged by Peevey in Warsaw may be questionable, too.

While Peevey headed the CPUC, the agency employees, such as other commissioners, administrative law judges, various bureaucrats knew that Peevey intended to drive up ratepayer costs and utility profits and stock prices. Those on the CPUC payroll had to play along or get fired. Peevey succeeded. Utilities thrived while ratepayers suffered. Those who played along should get fired or in some cases incarcerated. If you tolerate evil, you should pay the price. Best, Don Bauder

March 31, 2015

RICO

March 31, 2015

AlexClarke: That may be the solution. Best, Don Bauder

March 31, 2015

Please consider using the phrase San Onofre Gate to compare what is happening to Water Gate!

I've created a Hash tag on Twitter: #SanOnofreGate

The new hashtag will allow everyone to keep up to date on the ongoing investigation into the multi-billion $ SCE-CPUC ripoff.

Just enter the hashtag into the Twitter search box:

https://twitter.com/search?q=%23sanonofregate&src=typd

You will get all the tweets and/or links that I've been posting about San Onofre!

Best CaptD

March 31, 2015

CaptD: That is good information. California ratepayers need all the information they can get. Best, Don Bauder

March 31, 2015

Don - Talking about good information, I hope that everyone at SCE, SDG&E and the CPUC get their email reviewed before they start erasing them, to determine just how far the "rot has traveled" between the CPUC and the Utilities they "regulate".

Another way to think of San Onofre Gate is that it is a $4 Billion Dollar "Tar Baby" that is going to taint everyone that has come into contact with it, which includes so many of our elected Officials (past and present) that have also taken large donations from these Utilities and have remained mum, instead of speaking out against this outrage!

March 31, 2015

CaptD: I wonder if emails have already been erased. I know that Aguirre and Severson have demanded that they be handed over, and they haven't been.

Yes, this deserves the name "Gate." Remember Richard Nixon going over and over the telltale tapes that had been made in his office. There was a significant erasure, blamed on Nixon's secretary. To my knowledge, we still don't know what was discussed in those minutes. Do you suppose something like that has already happened at the CPUC? Best, Don Bauder

March 31, 2015

Don - I have no doubt that when, N☢T if, a team of forensic IT experts gets to examine many of the above mentioned email accounts, they will uncover a situation far worse than WaterGate, since there will be so many elected Officials (along with their donors) that are implicated in this ongoing San Onofre Debacle. We are now just beginning to see the tip of the iceberg that dooms the CPUC because of their actions in trying to coverup for the very Utilities they are mandated to regulate. It also is important to understand that these Utilities have also contacted all those entities that have received donations from these same Utilities, in order to get them to support the Utilities position in what can only be described as a "Pay to Play" scheme, where those that support the Utilities receive additional donations while those that don't play ball fail to get Utility support in the future, which is why so may "Community Groups" had such glowing things to say about SCE and how important San Onofre was to SoCal. These staged sounds bite will now come back to bite those that made them, since they will be exposed along with SCE (and their minor 20% partnerSDG&E) as being far more interested in Nuclear Payback* than promoting what is best for ratepayers in SoCal.

Those that support nuclear power because nuclear power somehow supports them; no matter what the health implications or other "costs" are for others.

March 31, 2015

CaptD: It's hard to say this will be worse than Watergate, because Watergate involved a U.S. president. Certainly, though, the corruption at the CPUC, and between the CPUC and the three major utilities (SDG&E, Edison, PG&E) could prove be more horripilating than Watergate was.

Officials are now desperately trying to bury this whole thing. We must stop them from doing so.. Best, Don Bauder

April 1, 2015

The fish rots from the head down.

March 31, 2015

Diogenes: Yes, the fish rots from the head down. But that doesn't mean that only the former CPUC head should be investigated. There are many more rats who were Peevey enablers. Best, Don Bauder

March 31, 2015

The rot reached the tail.

I attended public meetings and watched some hearings on video. There was a clique of pompous pro-utility hacks with several intervenors who played ball. Too bad that Aguirre/ Severson and the City Attorney of San Bruno broke up the party. The gravy train is over for a lot of these clowns.

"Wall Street West," it could be called. Too big to jail. When you know the Governor, and can meet secretly in Poland, and when you are married to a state Senator, in Peevey's case, you think you can get away with anything.

Time to throw crooks in jail in America. But having money means that a separate treatment is given to the rich and well-connected. This could have been worse than Enron because this atmosphere of corruption endangers public safety. SONGS could have melted down or worse. That was my interest in this matter. Barbara Boxer had the last laugh on this one!

March 31, 2015

Diogenes: I can't disagree with a thing you say. Yes, Peevey and his cronies thought -- and probably still think -- that they can get away with anything. I fear they may be right. But, at least, the intelligent people in the public will know what these bandits did. Best, Don Bauder

March 31, 2015

in this case I think its parasites that cause the rot.

April 1, 2015

Murphyjunk: It certainly looks that way. Best, Don Bauder

April 1, 2015

By saying" Yes, the fish rots from the head down," you just did your usual repeating again. So a comment online is only validated if you repeat it? It seems so.

April 5, 2015

Charles Langley: Yes, as I mentioned in the blog item, the first bill was for $49,000. Lawyers who worked for the state were a little embarrassed to be complaining about such a small amount. Wham!!! It shot up to $5.2 million. And, yes, the law firm is representing both witnesses and potential subjects of the investigation. This is ridiculous. Best, Don Bauder

March 31, 2015

The latest figure on the number of African elephants poached is around 80,000.

If all the elephants in the room connected to this story were African, they need to be used to restock the Dark Continent. But alas, they will be kept confined.

As the old song ends, "Dream, dream, dream."

Who's gonna explore the Brown/Peevey relationship?

Aguirre for AG?

March 31, 2015

Twister: Aguirre did an excellent job as city attorney, but was dispiteously smeared by the Union-Tribune for political reasons. He lost overwhelmingly for reelection. That partly provided a roadmap to how Filner would later be smeared.

Can you imagine what would happen if Aguirre ran for AG? However, he would have one thing going for him: other state metro dailies are not as grossly slanted in favor of private sector corruption as UTSanDiego and its predecessor, the Union-Tribune. Best, Don Bauder

March 31, 2015

Aguirre is too honest to fit in with the other politicians, if he got to be AG he would get no cooperation to do his job honestly.

April 1, 2015

Murphyjunk: This was the trouble at the CPUC under Peevey. Others in the ranks knew the corruption was pervasive. But they wanted their jobs. So they either played along, or shut up. Best, Don Bauder

April 1, 2015

Don,

Aguirre's detractors filed complaints with the State Bar against him so that the UT could claim that Aguirre was "under investigation." None of those complaints were found to have any merit. Unfortunately, such complaints come under an immunity from civil litigation.

You know all this already. I just provide the comment for the benefit of others who may not have followed the smear campaign against Aguirre.

Aguirre stood tall when others tried to personally exploit the Sunroads controversy and the Pension debacle, like the former head of the SEC (Levitt) collecting millions per month for being a "consultant" to San Diego in the pension crisis.

San Diego tries to run to big law firms to cover it's backside. Sounds like the PUC. The UT ran an article about Florio's emails today. There was no mention of Aguirre. The UT does not want to give him any credit.

The PUC needs to ban an ex parte communication. The State Bar strictly prohibits these contacts with decision-makers. There is good reason for that. Attorneys involved in those contacts are being warned that the PUC rules do not relieve attorneys from their duties not to make ex part contacts with decision-makers. No such contacts should ever be made without a copy to all others parties or their counsel. The three-day rule of the PUC does NOT trump this rule in regards to attorneys. In person contacts by lawyers with decision-makers is prohibited.

So the State Bar does have good effects although it's disciplinary process can be abused and exploited, as it was against Aguirre. That was not the fault of the State Bar, however.

The ex parte settlement conferences should not be participated in by attorneys with decision-makers. If intervenors participate, there is nothing the State Bar has to say. But the basis of their ethical rules should be adopted by the PUC because the same rationale applies. Such a PUC rule would help clean up the rush to compromise ratepayers interests in exchange for fat intervene fees for going along with private utility explotation.

Aguirre will set aside the SONGS settlement as a "private attorney general." He will get fees and set an example. Peavey needed a lesson and so does Florio. Just working on numbers on a technical level is improper because the appearance of impropriety is increased making it look like the hearings are just a post hoc dog and pony show.

I will be talking to politicians about reforming this kangaroo court. They get huge "campaign contributions" so maybe the courts are the only hope. That means Aguirre and Severson.

April 1, 2015

Diogenes: Aguirre blew the Sunroad matter out of the water, and kept pursuing it even as Sanders was trying to get the company off the hook. The U-T wrote a story (or maybe it was an editorial) which made Sanders look like the hero in this slimy matter and made Aguirre look like the bum. It was an astounding bit of disingenuous journalism.

Agreed: there must be reform of ex parte communications. A utility can say, "Gee, we had an ex parte meeting three years ago and forgot to report it."

Are the courts the only hope? Remember: judges run for office. They generally play up to the local media so they can get vote recommendations. Best, Don Bauder

April 1, 2015

Don,

The federal judges are appointed for life. Aguirre has asked the federal court to intervene in the PUC-Gate. These judges have more autonomy. Playing up to the local press is not as common as you might see for state court judges.

The Sunroads scandal involved Marcella Escobar-Eck. The powers that be from Bonnie Dumanis as District Attorney to Jerry Brown as Governor all seemed to gang up on Aguirre. I felt that Aguirre was 100% correct, however.it was a study in closing ranks and use of the "paper of record" to discredit someone who was doing the right thing.

As you know, you can get crucified in this town very easily. All you need to do is to stand up the good old boys and girls downtown.

Nice to read your replies. You and Steve Erie know this town - Paradise Plundered - Scam Diego....

April 1, 2015

Diogenes: There was one time Aguirre called city leaders corrupt. So a bunch of so-called leaders -- Dumanis, the sheriff, police chief, ad nauseam -- had their picture taken together, saying that that was no corruption in San Diego. Gawd! The U-T probably put it on page one. Laughable. Best, Don Bauder

April 2, 2015

can I get a copy of that picture for my dart board ?

April 2, 2015

Murphyjunk: That photo is getting $50 million at a Sotheby's auction -- more than a Monet. Best, Don Bauder

April 5, 2015

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