What Happens When A Company Faces Criminal Charges?

ANDOVER, MA -- Executives for NiSource Inc., the parent company of Columbia Gas of Massachusetts, said Thursday the company received subpoenas on September 24 as part of a federal criminal investigation into the company's role in last month's gas explosions. The revelation came during the company's third quarter regulatory with the Securities and Exchange Commission, where the company also said it was taking a $462 million charge with private claims and expected costs from the explosions, which damaged or destroyed 131 buildings and killed an 18-year-old Lawrence man.

"The Company and Columbia of Massachusetts are cooperating with the investigation, " NiSource said in the regulatory filing. The U.S. Attorney's Office of Massachusetts declined comment Thursday. So far, NiSource has not been charged with criminal wrongdoing. The investigation will allow a federal grand jury to determine whether there is enough evidence to indict NiSource on criminal charges and bring the company to trial.

Like individuals, corporations can be indicted on criminal charges. In 2016, for example, a jury found Pacific Gas & Electric guilty on six charges stemming from a 2010 explosion of a PG&E gas pipeline, which destroyed a neighborhood in San Bruno, CA and killed eight people. PG&E faced a maximum fine of $3 million after the verdict -- an amount, the Los Angeles Times noted at the time, that was the equivalent to the amount the company collected in revenue every 90 minutes.

Related Story: Utility Takes $462 Million Charge For Gas Explosion Recovery

Corporations can face criminal indictments for criminal acts by its directors and executives, according to a U.S. Justice Department memo on criminal charges and corporations, but -- for obvious reasons -- a corporation can't be thrown in jail. For anyone to go to jail for the Merrimack Valley gas explosions, a grand jury would need to indict individual employees, executives or directors, and prosecutors would need to try them.

Companies convicted on criminal charges are typically fined and, in many cases, placed on some sort of probation. A judge, for example, may be appointed overseer as the company works to make restitution.

Victims in criminal cases aren't typically compensated, whether the defendant is a person or a corporation. But victims do have the option of filing civil lawsuits. Already one class action lawsuit has been filed against Columbia Gas and the family of Leonel Rondon, the man who died in the explosions, said they plan to file a wrongful death lawsuit.

Never miss another local news story: Get free local news alerts right to your inbox.

Top photo from left to right: Columbia Gas of Massachusetts President Steve Bryant, NiSource Chief Executive Joe Hamrock, Chief Recovery Officer Joe Albanese and Chief Restoration Officer Pablo Vegas at a meeting with North Andover residents on Saturday. Photo by Dave Copeland/Patch.

Dave Copeland can be reached at dave.copeland@patch.com or by calling 617-433-7851. Follow him on Twitter (@CopeWrites) and Facebook (/copewrites).