Edison Judge Balks at Holding Utility Liable for LA Wildfire
Insurance companies lost a bid to hold Edison International’s Southern California utility liable for a massive Los Angeles-area wildfire without a trial.
Superior Court Judge Laura Seigle on Tuesday tentatively denied a request to put Southern California Edison on the hook for billions of dollars in property losses under a state law that holds utilities automatically liable when their equipment starts a fire.
Related: Edison Equipment Blamed for Deadly Eaton Fire in Los Angeles
The tentative ruling was debated by lawyers at a hearing just days after a report by the Los Angeles County Fire Department concluded the 2025 Eaton Fire was caused by electrical arcing events that took place on an out-of-service tower on a dry hillside.
“We are pleased with the tentative ruling,” said SCE spokesperson Kathleen Dunleavy.
Edison’s shares rose on the news and were up 3.1% at 3:21 p.m. in New York.
Related: Edison Says Its Equipment Likely Associated With 2025 LA Fire
If the judge makes her tentative ruling final, Edison will get a chance to argue to a jury at a trial set for next year that the unusual circumstances around the ignition of the Eaton Fire do not qualify for inverse condemnation — the legal principle under which California property owners can recover their losses without having to prove that a utility acted recklessly.
The January 2025 fire killed 19 people, destroyed or damaged more than 9,000 homes and businesses and burned 14,000 acres.
Bloomberg Intelligence analyst Nikki Hsu said the tentative ruling “doesn’t address whether SCE acted prudently or not, which is ultimately a regulatory determination and the key issue for shareholder exposure.”
Related: California Utility Has Offered $750M in Program for Eaton Fire Victims
Edison Chief Executive Officer Pedro Pizzaro told investors in late July that “no other viable alternatives have appeared” aside from the company’s equipment that would explain how the wildfire erupted.
But SCE has argued in court filings that the transmission tower where the Eaton Fire allegedly ignited had been idle for so long, since 1971, that it no longer qualifies as the kind of public infrastructure that triggers California’s strict liability rule for utilities.
Top photo: Southern California Edison Co. contractors repair power poles after the Eaton Fire in Altadena, California, on Friday, Jan. 17, 2025. Bloomberg.