San Francisco Small Businesses to Sue PG&E Over Losses From December Power Outages

San Francisco city residents and business owners plan to file a class-action lawsuit against PG&E this week, saying the utility has failed to remediate major financial losses after major power outages in December.

“San Franciscans deserve an electric company that is reliable,” Sunset District resident and advocate David Lee said on the steps of City Hall on Monday. “When you flip the switch, the lights should be on. We don’t have that right now, and that’s why we’re filing this lawsuit: to get justice for all the people that have been harmed and to get people back in business.”

PG&E came under renewed scrutiny from residents and city officials after a fire at a Mission District substation spurred a massive blackout on Dec. 20, darkening entire city blocks from the Presidio and Richmond District to Chinatown. At its peak, the outage affected 130,000 PG&E customers. Most regained power hours later, but some Richmond and other westside residents were left in the dark for more than 40 hours.

The outage snarled traffic, confused Waymo autonomous vehicles and disrupted public transit. It also harmed many small businesses, forcing them to close their doors on one of the busiest holiday shopping days of the year, losing out on major anticipated profits.

“These are mom-and-pop businesses,” Lee said. “They don’t have a big cushion; they operate on very thin margins. And this kind of devastating loss could mean the difference between keeping their doors open and closing.”

The fiasco was followed by a series of smaller, shorter outages, which mostly affected the city’s West Side. Richmond residents dealt with six outages through late December and early January, and blackouts in the Sunset have occurred as recently as last week.

The group, which said it will file the lawsuit this week, alleged a “systemic failure to provide reliable service” by PG&E in a statement on Monday. Attorneys said they expect at least 40 businesses to join the suit, which aims to recoup monetary damages for losses incurred during the string of outages since December.

PG&E, which did not respond to a request for comment on the suit, has promised $200 credits to residences impacted by the outage, and larger $2,500 payments to commercial customers.

But the lawyers representing business owners said those payments are not enough.

Some of the suit’s plaintiffs have reported damages of more than $100,000, according to Quentin Kopp, a former judge advocating on behalf of the suit’s plaintiffs.

Bill Lee, who owns Far East Cafe in Chinatown, said the banquet-style Chinese restaurant was expecting a party of 700 the night of the blackout.

“Can you imagine the disappointment for the guests and the restaurant owner? They have suffered tremendously,” he said. “The $2,500 payment by PG&E is not nearly, nearly enough. Many other restaurants in the entire city are likewise damaged.”

Some merchants have said they haven’t even received those promised payments yet, and that the utility company has delayed their claims for compensation. The suit follows a petition signed by more than 100 West Side business owners and residents and delivered to the city’s Board of Supervisors, urging them to hold PG&E accountable, and lamenting the lackluster payments, according to David Lee.

San Francisco Mayor Daniel Lurie has said supervisors will hold hearings to question the utility company about what led to the mishap, communication and power restoration issues throughout and how to prevent similar incidents moving forward. The incidents have also reinvigorated San Franciscans’ calls for the city to end its partnership with PG&E and instead pursue public power — a feat that could take years, if the city were to attempt it.

Kopp said the plaintiffs filing their suit this week are headed on their own long road.

“PG&E will try to delay the trial of this case,” he told KQED. “It will refuse to settle, to pay appropriate and deserved amounts of money to those businesses which have been damaged and to homeowners who have been damaged. This is going to be at least a two- to three-year enterprise in trying to obtain justice for our clients.”

KQED’s Paula Sibulo contributed to this report.