Live Markets, Charts & Financial News

LA City Utility Sued Over Water Shortage for Palisades Fire

0

A lawsuit was filed against the Los Angeles Electricity and Water Company, accusing it of not providing enough water to fight the largest fire still burning in the second largest American city.

Article content

(Bloomberg) — Los Angeles’ electric and water utilities were hit with a lawsuit accusing them of not providing enough water to fight the largest fire still burning in America’s second-largest city.

Article content

Article content

Property owners in the city’s Pacific Palisades neighborhood have filed a lawsuit against the Los Angeles Department of Water and Power, the largest municipal utility in the United States. The complaint appeared late Monday on the Los Angeles Superior Court website, but has not been fully processed by the court.

Advertisement 2

Article content

Plaintiffs claim that the drained and unrepaired tank, coupled with insufficient water pressure in fire hydrants, undermined firefighters’ efforts and ultimately allowed the wind-whipped fire to spread out of control. The cause of the fire is still under investigation.

“Homeowners to the homeless”

The city’s mismanagement of the Santa Ynez Reservoir left the upscale neighborhood defenseless against fire and turned victims from “homeowners to homeless people within hours,” the complaint said.

LADWP referred an inquiry to the city attorney’s office, which did not immediately respond to a request for comment.

Earlier Monday, Edison International Inc. In Southern California, several lawsuits blame power supply equipment for igniting the Eaton Fire in the Pasadena area, the second largest fire to sweep through Los Angeles since last week.

The Palisades Fire, which spread across an area larger than Manhattan and where the median home price approaches $4 million, damaged or destroyed more than 5,000 buildings. As of early Monday, the hurricane was 13% contained, but it had consumed nearly 24,000 acres and killed at least eight people.

Article content

Advertisement 3

Article content

Angelenos are concerned as fires spread across the city and surrounding communities over the past week, reducing thousands of homes and businesses to charred rubble. These fires are the most devastating natural disaster to hit Los Angeles since the 1994 Northridge earthquake, which killed 57 people, and are likely to be among the costliest natural disasters in modern US history.

Wells Fargo & Co. analysts estimated The fires could result in losses of up to $30 billion for the insurance industry, significantly exceeding last week’s highest forecast from JPMorgan Chase & Co. The fires will cost insurance companies about $20 billion.

Pizza shop

The plaintiffs listed in the LADWP lawsuit include about 14 people who lost their homes in the fire, along with a pizza shop that burned down.

According to the 13-page complaint, the Santa Ynez Reservoir has been out of service since February 2024, when a several-foot-wide tear was discovered in its floating cover. The tank, which can hold up to 117 million gallons, was then drained due to concerns about water quality. The city then moved too slowly to hire a contractor to make the repairs, prosecutors alleged.

Advertisement 4

Article content

“With the Santa Ynez Reservoir out of service, taps at Pacific Palisades failed after three tanks, each holding a million gallons of water, ran dry within 12 hours,” the attorneys said in the lawsuit. They said that if the company had acted responsibly, the damage caused by the fire could have been “significantly reduced.”

California Gov. Gavin Newsom last week ordered a state investigation into Los Angeles agencies that manage the city’s water systems after fire hydrants ran dry.

History of forest fires

The state has a history of catastrophic wildfires linked to electrical utility equipment operating during wind storms. PG&E — the nation’s largest utility — was forced to file for Chapter 11 bankruptcy protection in 2019 to deal with a tidal wave of lawsuits linked to several deadly fires in Northern California that were blamed on its wires.

Under California law, a utility can be held liable for property damage when its equipment starts a fire even if it did not act negligently.

Utilities in western states, including Oregon, Colorado and Hawaii, have also been hit with lawsuits over the devastating fires. Last year, Hawaiian Electric Industries agreed to pay about half of a $4 billion settlement for homeowner and business lawsuits linked to the 2023 Maui wildfires. That settlement is still awaiting final approval.

(Updates with details of the lawsuit starting in the fourth paragraph.)

Article content

Comments are closed, but trackbacks and pingbacks are open.