Primary Source: Weekly Legislative and Litigation Updates from California Justice Center (1/13/25-1/19/25)
This week brought a flurry of constitutionally-questionable executive orders from Governor Newsom, 20+ wildfire lawsuits and some great news on the education/Public Records Act front. I spoke to California Policy Center President Will Swaim about fire-related issues on the National Review Radio Free California Podcast.
Litigation Updates
1. Eaton Fire Lawsuits Filed
Kreiner (LASC Case No. 25STCCV00766), Iglesias (LASC Case No. 25NNCV00200), Gursey (LASC Case No. 25STCV00731), Von Lutzow (LASC Case No. 25STCV00828), Cisneros (LASC Case No. 25NNCV00223), Cathirell (LASC Case No. 25NNCV00306), Kelley (LASC Case No. 25NNCV00326), Myles (LASC Case No. 25STCV00915), Bell (LASC Case No. 25STCV00937), Majesty (LASC Case No. 25STCV00961), Mehtemetian (LASC Case No. 25STCV00975), Quintero (LASC Case No. 25STCV01110), Mahone (LASC Case No. 25STCV01150), Dawson Beer (LASC Case No. 25STCV01207), Rodriguez (LASC Case No. 25STCV01225), Wells (LASC Case No. 25STCV01312), Artine (LASC Case No. 25STCV01354), Alden (LASC Case No. 25STCV01171), Wallen (LASC Case No. 25STCV00793).
Issues: Inverse Condemnation, Wrongful Death, Negligence, Mass Tort
As of this writing, approximately twenty lawsuits have been filed in Los Angeles County Superior Court against Southern California Edison by victims of the Eaton fire in Altadena. In at least one of these cases, plaintiffs seek a temporary restraining order to prevent Edison from destroying evidence.
As I explained on the Radio Free California podcast, when private property is taken or damaged for a public use, property owners are entitled to just compensation. When a government agency or public utility initiates the process it is called eminent domain (property owners are compensated in exchange for the property taken by the government/utility). The reverse is called inverse condemnation—when a public utility ignites a wildfire in the process of providing electricity and destroys private property, for example, private property owners are entitled to compensation.
This is exactly what Eaton fire victims allege in their lawsuits against Edison. Videos and witness reports show the location of origin for the Eaton fire directly below Edison transmission lines.
There is a long history of California wildfires igniting due to public utility equipment. When, for example, two power lines smack together, or if there is a gap between a connector and a line, electrical current can jump the gap and ignite in an arcing event. In the case I litigated against Edison on behalf of Rancho Palos Verdes over a decade ago, our expert determined a brush fire started due to an ill-fitting connector attached to a line. The expert concluded that during a surge, arcing occurred between the connector and the line, and part of the connecter melted into molten metal and dropped to the ground, igniting the brush below. The fire spread and caused significant damage to a wildlife area, as well as a handful of homes.
Attorneys fees and costs are awarded to a prevailing plaintiff in an inverse condemnation action (which is why you are being inundated with ads from “wildfire attorneys” who work on contingency). Please take caution in who you choose to represent you if you intend to join wildfire litigation, and recall the Girardi scandal involving alleged embezzlement from clients of millions of dollars in connection with a case against PG&E.
Most of the cases include mass tort causes of action in addition to inverse condemnation. Judges make determinations of inverse condemnation, while a jury decides liability for tort claims. (Nutshell: a tort claim is an allegation that defendant committed an act or omission that caused harm). Importantly, inverse condemnation has a strict liability standard for defendants, so plaintiffs don’t need to show that Edison was negligent—only that their property was damaged in connection with a public work of improvement. Strict liability and attorney’s fees to prevailing plaintiff are a very attractive combination for contingency fee attorneys.
In 2019, Edison’s Northern California counterpart PG&E filed for Chapter 11 bankruptcy after fires caused by its powerlines burned hundreds of thousands of acres in Northern California and led to more than 100 deaths. PG&E paid out $25.5 billion to resolve its fire-related liabilities. There is substantial risk of an Edison bankruptcy in light of the extensive damage caused in the Eaton fire.
We will track these cases and keep you updated on how they shake out. They may be consolidated into one complex mass tort case.
2. Palisades Fire Lawsuits Filed
Grigsby v. City of Los Angeles (LASC Case No. 25STCV00832), Kohanim v. Los Angeles Department of Water and Power (LASC Case No. 25STCV01074), Gonzalez v. Los Angeles Department of Water and Power (LASC Case No. 25STCV01325)
Issues: Inverse Condemnation
At this point, I’m unaware of any evidence pointing to a specific cause of the Palisades fire. On the morning of the fire, I was driving from Palos Verdes to Redondo Beach at around 9:15 am and saw a plume of smoke in the Palisades area. I am beginning to question my sanity because all the reports I’ve read say the fire started around 10:30, but my son and I both saw it, and I watched drivers get out of their cars on Via Del Monte to take pictures. I hope anyone who has photographs of the plume at that time will share them.
Due to the absence of publicly available evidence of a cause, there are not as many lawsuits filed in connection with the Palisades Fire. I am aware of three pending as of this writing, all alleging inverse condemnation against LADWP for “improper design, installation, construction, ownership, operation, use, control, and/or maintenance for a public use of the water supply system…” which caused or worsened “the damage and destruction to the Plaintiffs’ personal and real property.”
Plaintiffs claim “as a direct, necessary, and legal result of LADWP’s deliberate decision to drain and delay repairs of the Santa Ynez Reservoir as part of, among other things, its maintenance process of the reservoir done for a public use, Defendants caused or worsened the damage and destruction to the Plaintiffs’ personal and real property.”
This argument is more attenuated than the arguments made against Edison—Eaton Fire plaintiffs allege Edison’s equipment started the fire that destroyed their property, while Palisades Fire plaintiffs allege that LADWP’s equipment failed to stop the fire that destroyed their property. It will be a much harder case to win based on the current facts.
3. California Policy Center v. Los Angeles Unified School District (LASC Case No. 23STCP04182)
Issues: Public Records Act, Labor Relations Records
California Policy Center prevailed against Los Angeles Unified School District in a lawsuit seeking to enforce the Public Records Act. Long story short, California Policy Center sought public records showing the amount of union dues paid by LAUSD over a specified period of time. LAUSD, citing Freedom Foundation v. Superior Court (2022) 87 Cal.App.5th 47, argued that all documents related to “labor relations” (involving the unions) are exempt under the Public Records Act.
The Court rejected LAUSD’s facially absurd interpretation of the law and granted California Policy Center’s petition for writ of mandate, compelling LAUSD to either: (a) produce accounting records reflecting whether each employee is paying union dues and the amounts paid; or (b) identify and produce records and/or information responsive to the purpose of California Policy Center’s request, e.g., extract the responsive data and produce a copy to California Policy Center.
This is a great victory for the people under the Public Records Act and the California Constitution, both of which provide that the people of California have the right of access to information concerning the conduct of the people's business and that the writings of public officials and agencies shall be open to public scrutiny.
4. USA v. Thao (N.D. Cal. Case No. 25-cr-00003)
Issues: Criminal Indictment for Public Corruption, Bribery, etc.
Recalled Oakland Mayor Sheng Thao has been indicted by a federal grand jury on criminal charges related to an FBI bribery case. Andre Jones, David Duong, and Andy Duong, were also charged in the indictment.
According to the government’s attorney, among other criminal acts, Thao allegedly agreed “to purchase housing units from a company owned by the Duong family… to ensure the extension of a contract for recycling services that the City of Oakland had with one of David and Andy Duong's companies, and … to use influence to help appoint a high-level city official to benefit the Duong's business interests.”
Note, the indicted Duong family is the same family I mentioned in last week’s post, to whom AG Rob Bonta returned 155k in campaign donations.
Executive Orders
Issues: Students and Schools Impacted by Fires; Residency Requirements, McKinney Vento, Temporary Facilities Use
The governor's executive order waives residency requirements for students attending schools impacted by the fires and urges districts to support and facilitate interdistrict transfer requests (but doesn't require it).
The McKinney-Vento Act is a federal law that requires public school districts to immediately enroll kids who are considered "homeless." Families who lost their homes in the fires can enroll wherever they are currently staying. Newsom’s executive order includes language similar to what already exists in federal law. I spoke with Will Swaim about this on the Radio Free California podcast.
As for what happens to families who did not lose their homes but lost their school building to a fire, this is a trickier situation that will likely be heavily impacted by union demands.
The order also provides flexibility to use temporary facilities, but this is going to require all kinds of approvals and I foresee substantial delays.
I am concerned about union use of closed schools as leverage to extract concessions from LAUSD, just like they did with covid.
2. EO N—7-25
Issues: Criminalization of Low Offers to Purchase
Mass texting lowball offers to purchase property while a community is reeling from devastating loss is morally repugnant, but not criminal. In this scenario, no one is forced to accept a lowball offer. We still live in a country where private property owners are free to negotiate and even say “no” to an offer to purchase.
In his effort to appear helpful, Governor Newsom issued an order criminalizing the making of an offer to purchase property “for an amount less than the fair market value of the property … on January 6, 2025.”
Generally, fair market value is the price at which property would sell on the open market between a willing buyer and seller. The government has no place determining fair market value. When I purchased my home, the County decided that it should be assessed at nearly twice the price I paid for it in an arms length transaction without ever setting foot on the property. We had to fight the County through an appeals process, and ended up settling halfway between the actual purchase price (negotiated between willing buyer and seller) and what the County believed should have been fair market value. I wrote about this experience on Twitter.
I highly doubt this order would be enforceable. Criminal charges for making an offer to purchase property would not withstand a constitutional challenge (e.g., First Amendment—the making of an offer is an exercise of speech; Fifth and Fourteenth Amendment—void for vagueness as to what constitutes “fair market value” on January 6, 2025; Fifth Amendment—regulatory taking as far as the government is interfering with a property owner’s ability to sell their property).
I have already seen the lowball offers being made via text, and the darkly humorous responses Palisades families send back demonstrate there is no need for government intervention here. At worst, these offers are an annoyance, but not a criminal offense. And if there is a family desperate to cut ties and move on, they may be interested in negotiating a fair deal with the maker of the lowball offer.
3. EO N-4-25
Issues: Suspending Provisions of CEQA and the Coastal Act
The California Environmental Quality Act (CEQA) and the Coastal Act are the two main sources of red tape and delay in developing anything in California. Housing advocates have long begged for reform. I have personally witnessed the weaponization of CEQA by labor unions and competitors to kill development projects. I suspect that one of the main reasons we don’t see meaningful CEQA reform is because it is a favored tool used by labor unions to extract project labor agreements from major development projects, and labor unions make or break legislative races. Lose union support, lose your race.
The Executive Order waives provisions of CEQA and the Coastal Act with respect to projects to repair, restore, demolish, or replace property or facilities substantially damaged or destroyed as a result of the fires that are in substantially the same location as, and do not exceed 110% of the footprint and height of, properties and facilities that were legally established and existed immediately before the fires.
This is a rare instance in which I agree with Newsom. I suspect he had a behind the scenes discussion with Rick Caruso before issuing this EO.
Newsom critics point out, however, that this EO is an admission that CEQA and the Coastal Act are unnecessary red tape that interfere with the efficiency of building homes in California. They are correct.
Further, Newsom’s attempt to support efficiency of rebuilding has already been torpedoed by the infamous Barbara Ferrer, Director of Public Health for Los Angeles County (and a woman I had the pleasure of deposing and cross-examining), who has forbidden any cleanup of fire-damaged properties until after a hazardous materials inspection has been completed. She also warns that all cleanup activities must comply with local, state and federal laws. In this round of oppressive local versus oppressive state government actors, my preference is for Newsom to win and override Ferrer’s meddling attempts to be a relevant player and earn her $740k pay and benefits.
In other news, a new President was sworn in this morning. In his inauguration speech, Trump announced his intent to sign dozens of executive orders to rapidly implement America First priorities, including securing the border. I encourage you to watch or listen to the speech instead of basing your opinion on what someone else said about the speech. Trump also announced his intent to visit Los Angeles this week.
