El Paso

Britt- great memo. I'm sure you guys are in the course of discussing these
very issues, but here's my two cents worth.
1. Once we decide on an optimal forum, the key step before filing a lawsuit
is the assessment of our probability of success--for different reasons than
is usually the case. We need to weigh the chances of a favorable judgment
against El Paso against the probability and extent of collateral damage to
our defense (not just TW but all of GPG) in Quinque, et al.
2. I like our case a lot based on what I've seen so far--if I've got it
right, our claim is that El Paso breached the 1990 measurement agreement by
not calibrating the meters as required and therefore by allowing the error to
arise and remain uncorrected for so long. Under the NM statute, we may get 6
years worth of recovery ( or more, I guess, if they did something to toll the
SOL). Under the Texas SOL, maybe less. Do we have a good argument that the
1% standard in the measurement agreement and the 2% standard in El Paso's
tariff do not absolve them of conversion or breach liability? Seems to me
that El Paso will argue that the FERC tariff preempts our contract
rights--but I think the law is on our side there.
3. The tricky issue then becomes whether our prosecution of the claim
against El Paso plays into the hands of our adversaries on the Quinque mess.
If so, how do we quantify that risk to allow a rational balancing of the pros
and cons. I'm glad smart guys like you two will have to do that thinking.
As usual, I'll try to stay on the sidelines and nod intelligently when you
make a recommendation. DF

PS: I'm ok with the outside counsel recommendation.