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Southern California Gas Co. v. Superior Court of Los Angeles County

Supreme Court of California
441 P.3d 881 (2019)


Facts

A massive gas leak persisted for months in a Los Angeles suburb, requiring some 15,000 residents who lived within five miles to relocate. The loss of customers devastated the local economy. Businesses within the area (plaintiffs) sued Southern California Gas Co. (SoCalGas) (defendant) to recover their financial losses. SoCalGas argued that the claims failed as a matter of law because the business owners sought to recover purely economic losses. The trial court disagreed, reasoning that SoCalGas should pay the full costs caused by the leak. After the appellate court reversed, the California Supreme Court reviewed the case. Meanwhile, some 50,000 claimants sued SoCalGas in other lawsuits, some including local business owners. As a result, SoCalGas spent about $450 million on remediation, another $120 million to settle with local authorities, and remained under investigation.

Rule of Law

Issue

Holding and Reasoning (Cuellar, J.)

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