Baker, Burton and Lundy Announces Sempra Energy Trial Settles in San Diego Superior Court; Structural Relief and Cash Benefits for Southern California Energy Users Will Exceed $2 Billion

Business Wire, Jan 4, 2006

SAN DIEGO -- A settlement between Sempra Energy and its two California utilities, SoCalGas and San Diego Gas & Electric ("Sempra"), was reached today that will provide $377 million in cash and in excess of $2 billion in future benefits over the next ten years to Southern California energy users. The class action suit was being tried in a San Diego court by several law firms, including Baker, Burton and Lundy of Hermosa Beach, CA.

In addition to the $377 million being paid to the claimants, other key aspects of the settlement include a unilateral price reduction in Sempra's contract with the California Department of Water Resources ("CDWR") of $300 million, a limitation on the exercise of Sempra's delivery-point flexibility under the CDWR contract valued at $270 million, and a price reduction of liquified natural gas resulting in a savings to California consumers of approximately $74 million.

According of Brad N. Baker of BB&L: "Far more important than the cash settlement, this agreement restructures Sempra's business practices and lets the bright California sun shine on its utility operations formerly conducted behind the company's drawn drapes."

Specifically, today's agreement calls for SoCalGas and San Diego Gas & Electric to make structural and reporting changes in their gas transmission, storage and procurement activities and to let shippers know when there is space for gas in the pipeline. Previously, the companies have operated in a "black box system," said Baker. Regulatory oversight of Sempra's natural gas operations will also be significantly increased.

"Our firm applauds the long months and years of work of Brad Baker in guiding this complicated class action suit to settlement," said partner Albro L. Lundy III. Claimants in the suit included the City of Long Beach and the City of Los Angeles.

Baker, Burton and Lundy practices a wide range of law including consumer protection, and is located in Hermosa Beach, CA.