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California utility found guilty of violations in 2010 gas explosion that killed 8 people

SAN FRANCISCO — A federal jury on Tuesday found California’s leading utility company, Pacific Gas and Electric, guilty of safety violations during a 2010 gas pipeline explosion that killed eight people and destroyed a neighborhood in a suburb of San Francisco.

It was one of the nation’s deadliest gas explosions and exposed glaring weaknesses in America’s aging infrastructure.

Pacific Gas and Electric had faced 12 criminal charges of negligence and obstructing an investigation into the fiery pipeline rupture in San Bruno, a city of 42,000 people just south of San Francisco. The jury found the company guilty of five counts of security violations and one count of obstruction, according to Jim Ruane, the mayor of San Bruno. The company was found not guilty on the other counts.

Pacific Gas and Electric, a private company, originally faced a maximum fine of $562 million but, in a move that baffled many court watchers, federal prosecutors reduced their demands to $6 million. The change was made on August 2, when the jury was in its fourth day of deliberations. Prosecutors have yet to explain the change.

The company said in a statement after the verdict that it was “committed to regaining” the public’s trust. “Although we are very focused on the future, we will never forget the lessons of the past,” the statement said.

Pacific Gas and Electric has already paid more than $1.7 billion in fines and restitution for the September 9, 2010 explosion. Two investigations, by the National Transportation Safety Board and the California Public Utilities Commission, blamed management shortcomings and a concern for profits rather than safety.

Mr. Ruane said he hoped the verdict would result in independent oversight of the company’s pipeline network.

“They still don’t know over many miles of lines what they have in the ground,” Mr Ruane said of the company.

He said the judge, Thelton Henderson of the United States District Court, had broad discretion to order pipeline surveillance.

The section of pipeline that ruptured was installed six decades ago, according to the California Public Utilities Commission. The blast was one of many deadly disasters, including the 2011 explosion of an 83-year-old gas line in Allentown, Pennsylvania, and a 2014 explosion in East Harlem that raised awareness that experts say to be thousands of gas leaks. across the United States each year.

The National Transportation Safety Board investigation found the rupture occurred at a location where workers had installed substandard pipes in 1956.

The security office blamed the company for taking an hour to shut off the gas after the blast and said the slow response was particularly worrying given the possibility of earthquakes in the area. The San Andreas fault passes not far from the pipeline.

The California Public Utilities Commission concluded that Pacific Gas and Electric had a corporate culture that emphasized “profits over safety” and that it had kept poor quality records of its pipelines.

Last year, the company paid a $1.6 billion fine imposed by the commission. The company also settled several cases with residents; paid $50 million to help rebuild the road, sewage systems and other infrastructure destroyed by the blast; and agreed to a $70 million settlement to create a nonprofit fund for the city as compensation.

During the trial, federal prosecutors said the company obstructed the investigation by providing insufficient data to the National Transportation Safety Board and “pre-examining” witnesses.

Records entered into evidence at trial showed the utility cut its budget for pipeline inspections by 26% in 2009, the year before the explosion. The prosecution also showed a 2008 internal document that said profits were the company’s top priority; safety was fifth or last.

Pacific Gas and Electric argued the prosecution relied on “soundbites” of corporate greed and that there was no evidence the records were intentionally destroyed.

In addition to killing eight people, the explosion injured 58 people, destroyed 38 homes and damaged 70 others.

“When I stood on that hill and looked at the flames, I thought, ‘What a horrible, horrible accident,'” said Mr Ruane, the mayor. “Then we found out it was preventable.”