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Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Richard B Sanders X-To: sbishop@gibbs-bruns.com X-cc: X-bcc: X-Folder: \Richard_Sanders_Oct2001\Notes Folders\Sent X-Origin: Sanders-R X-FileName: rsanders.nsf ----- Forwarded by Richard B Sanders/HOU/ECT on 12/01/2000 08:00 AM ----- MBD <MDay@GMSSR.com< 09/29/2000 06:26 PM To: James D Steffes <James_D_Steffes@enron.com<, Richard Shapiro <rshapiro@enron.com<, Mary Hain <Mary_Hain@enron.com<, Vicki Sharp <vsharp@enron.com<, Richard B Sanders <Richard_B_Sanders@enron.com<, Jeff Dasovich <Jeff_Dasovich@enron.com<, Mona L Petrochko <mpetroch@enron.com<, "'Sandi McCubbin Enron SF'" <smccubbi@ees.enron.com<, "'Sue Mara at Enron SF'" <smara@ees.enron.com<, "'skean@enron.com'" <skean@enron.com< cc: "'gfergus@brobeck.com'" <gfergus@brobeck.com< Subject: Political Issues Raised at Meeting with CPUC re subpoenas issued to Enron Today, Friday, Gary Fergus of the Brobeck firm and I met with Attny. Harvey Morris of the CPUC to negotiate an extension of time for responding to the five subpoenas issued to Enron affiliates and Portland General. We negotiated both an extension for initial responses (two weeks) plus an opportunity to submit a proposal for a significant reduction in the scope of the request for production of documents. This will include a further extension for other documents that are to be produced, as well as a reservation of rights to object to the production of other documents. We are working in close contact with Richard Sanders and the EPMI legal team in Portland on further refining both responses and potential objections. However, in light of recent communications between the Governor's office and senior Enron officials, and the prospect of additional such communications, Both Gary and I wanted to report an unusual aspect of the negotiation with the CPUC. At the beginning of the meeting, as we were indicating the overall burden of the request, the CPUC attorney indicated the extreme pressure the Commission was under to "get to the bottom" of what was happening in the California power markets. He also recited that "many parties have pledged their cooperation in this investigation to the Governor". He then proceeded to state that parties who delayed providing responses and raised objections to the requests for production instead of cooperating would "be placed on a list of non-cooperative parties" which would be made available to the Governor and legislators and that such parties would have to bear the consequences of such actions. This rather explicit threat is, in my experience, unprecedented at the CPUC. I also know the attorney in question well enough to know that he would never invoke political reprisals on his own, and was obviously instructed to do so by CPUC Pres. Lynch or her senior staff. Both Gary Fergus and I responded that such a threat was both improper and disturbing for a party simply trying to exercise its legitimate rights to adjudicate burdensome discovery requests, but there was no attempt to withdraw the threat. This comment speaks volumes about the pressure which the CPUC President feels to achieve a politically acceptable result in this matter. Those senior Enron officials in communication with the Governor should be made aware of this incident. Mike Day
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