-----Original Message-----
From: 	"Molland, Michael E." <MMolland@brobeck.com>@ENRON [mailto:IMCEANOTES-+22Molland+2C+20Michael+20E+2E+22+20+3CMMolland+40brobeck+2Ecom+3E+40ENRON@ENRON.com] 
Sent:	Friday, June 22, 2001 6:42 PM
To:	Williams, Robert C.; 'sbishop@gibbs-bruns.com'; 'mtuohey@velaw.com'; 'mlk@pkns.com'
Subject:	FW: Meetings with EES officers in San Ramon and Costa Mesa regard ing California AG subpoena



> -----Original Message-----
> From:	Molland, Michael E.
> Sent:	Friday, June 22, 2001 4:38 PM
> To:	'Robert.C.Williams@enron.com'; 'sbishop@gibbs-bruns.com';
> 'mtuohey@velaw.com'; 'mlk@pkns.com'
> Cc:	'Richard.B.Sanders@enron.com'; Fergus, Gary S.; Smith, Amanda D.;
> Meringolo, Peter
> Subject:	Meetings with EES officers in San Ramon and Costa Mesa
> regarding California AG subpoena
>
>
> 	We met and talked to EES officers this week on three occasions to
> identify the documents called for by the AG's subpoena that reside within
> California. This memo discusses those three meetings:
>
>  I. SUMMARY:
> The following people attended these meetings:
> *	6/19/01 Conference Call (M. Molland, A. Smith, J. Wright, T. Reilly,
> D. van Ulden; R. Williams)
> *	6/20/01 Meeting, at EES San Ramon (M. Molland, A. Smith, P.
> Meringolo, D. van Ulden, T. Reilly, J. Eastlund, M. Ahad)
> *	6/21/01 Meeting, at EES Costa Mesa (A. Smith, J. Wright, T. Taylor)
>
> General Conclusions:
> 	It appears that while there may be a large volume of responsive
> documents in both San Ramon (SR) and Costa Mesa (CM) (perhaps as much as
> 50-100 boxes in each office, depending on how broadly we construe the
> requests for information for EES's "communications regarding decisions" to
> switch customers back to the utilities), there are relatively few highly
> sensitive internal Enron documents which could be used to evidence the
> alleged anti-trust violations or "price-gouging."  However, many of the
> documents may contain proprietary customer information.
> *	In all of our meetings with EES personnel, we emphasized what
> constitutes a responsive document from a "territorial" perspective.  (i.e.
> only documents in hard copy form in SR or CM or in electronic form on the
> SR or CM servers.)  It appears that many account managers regularly
> download and print documents from the Document data base (housed in
> Houston) or the EES intranet.  Going forward, it will important to
> emphasize that in collecting documents for possible production, EES
> personnel should not download from these sources.
> *	We also emphasized that EES personnel should not currently be
> physically collecting documents, rather they should be assessing what
> sensitive documents exist, locating responsive documents and NOT deleting
> or destroying responsive material.
> *	Mojhan Ahad and Tamara Taylor (Admins assigned to D. van Ulden and
> J. Wright respectively) will be coordinating any document production that
> becomes necessary.  It appears that a slightly different approach may be
> necessary to recover responsive documents in SR and CM.  The account
> managers in CM appear to have more independence with respect to managing
> their accounts.  It may be necessary to speak with them directly.  In SR,
> it appears that it may be possible to collect the large majority of
> responsive documents directly from Tom, Dirk and Mojhan.
> *	Other than the personnel at SR and CM, there are other EES personnel
> in California that we may need to meet.  Specifically, Sue Mara and Jeff
> Dasovich with regulatory affairs in San Francisco and several Originators
> in Long Beach (and possibly in Northern California?) who work from home.
> This latter group may be particularly important as they appear to have
> some account management responsibility on natural gas accounts and most
> likely have some responsive documents.
> *	It is unclear the extent to which the subpoena is common knowledge.
> Dirk and Tom in SR stated that they had not revealed its existence to
> their staff.  In CM, Jim had told his staff about the existence of the
> subpoena but had not told them who it was from or what it referenced.  If
> we proceed with the collection of responsive documents, we will need to
> develop a policy with respect to the confidentiality of the subpoena.
> *	It appears (based on conversations with Jim in CM) that although
> general power point presentations are made up for meetings with customers
> (in Houston, apparently), each account manager may change or focus the
> presentation for a specific customer.  Therefore, each presentation will
> constitute a different document and must be produced separately.
> *	Note on "California Crisis" database, Golden Bear and the de-DASR
> documents:  These documents are probably the most sensitive, but many may
> be protected on attorney-client, litigation or settlement privilege
> grounds.  There are four Golden Bear team members in California:  Tom,
> Dirk, Jim and George Waidelich.  It seems in SR, the Golden Bear documents
> are only in the possession of Dirk and Tom.  However, in CM, account
> managers may have some access to them.
>
> II. Recommendations Going Forward:
> *	Collect and assess most sensitive documents. These would include the
> Golden Bear and de-DASR documents.  These should be collected next week in
> order to begin a legal analysis of privilege issues.  In SR, this
> collection can most likely be done by Mojhan.  In CM, it may be necessary
> to interview individual account managers.
> *	Meet with "floating" Originators in Long Beach and potentially in
> Northern California to assess if they possess any responsive documents.  A
> brief conversation with the San Francisco Regulatory Affairs people (Sue
> and Jeff) and with George Waidelich would also be warranted.  This should
> also be done immediately.
> *	Meet with Tamara and Mojhan to develop a strategy for locating and
> copying responsive hard copy documents.  This is underway.
> *	Copy the hard drive folders of key personnel onto CDs.  These
> folders can then be reviewed for responsive documents by Brobeck attorneys
> if a production becomes necessary.
> *	Assess the extent to which responsive data may reside in archival
> storage sites (e.g. Iron Mountain in CM).  Because it may be
> time-consuming to retrieve documents from these sites, we should know now
> whether that will be necessary.
> *	Assess the potential implications of the EES intranet on our
> production obligations.
> *	Begin developing a legal strategy to protect documents that are not
> privileged but contain confidential proprietary customer information.
> *	Ensure document retention policy for appropriate personnel is in
> place.
>
> DISCUSSION OF SPECIFIC DOCUMENTS, ORGANIZATION, AND RETRIEVAL PLAN
>
> III. -Mail and Data Storage- Generally
> During our conversation with Jon Eastlund, Manager for SR and CM e-mail
> servers, and Pete Vandegon, Manager for SR and CM data servers, we
> discussed the email and document retention policies.
> Each document has its own server located at its California office. E-mail
> remains on the server until it is deleted by EES user.  EES user can also
> move e-mail onto their hard drive and delete from the server.  Every day
> (from Monday to Thursday) a "snapshot" is taken of the e-mail servers and
> is preserved on tapes at approximately 11pm.  When this snapshot is taken,
> the corresponding day in the previous week is erased and written over.
> Therefore, at 11pm on Wednesday, the snapshot of the previous Wednesday is
> written over.  Similarly, each Friday, a snapshot of the server is taken,
> writing over the Friday tape of the previous month.  In other words, there
> exists at any time a daily snapshot of the past week and a weekly snapshot
> of the last month.  Therefore, if an e-mail is received on a Tuesday and
> deleted on a Wednesday, that e-mail would appear in the Tuesday daily
> snapshot which would be preserved until the following Tuesday, but would
> not appear on the weekly snapshot.  As of 6/20/01, J. Eastlund is no
> longer "overwriting" daily or weekly tapes and is making "new" tapes going
> forward. He was instructed to keep all backup copies now in existence.
> Pete Vandegon is sending information via e-mail on the data retention
> system but, as of 6/20/01, is no longer "overwriting" as part of the
> backup process.
>
> IV. Discussion of Responsive Documents by Subpoena Document Request
>
> 1.	Contracts.
>
> There will obviously be a great number of these contracts, only a few of
> which are in the public domain, and we will need to collect the contracts
> from both CM and SR as there appears to be little overlap in their files.
> During production, it will be extremely important to emphasize to EES
> personnel not to download contracts from the Houston based Documentum
> database (the typical procedure).
> 2.	Forward Contracts (looking forward)
>
> Personnel in SR and CM are convinced that all of these contracts are
> housed in Houston or housed in California with another Enron entity.
> However, Jim suggested that we check with the floating Originators
> regarding this category.
> 3.	Forward Contracts (looking backwards)
>
> Personnel in SR and CM are convinced that all of these contracts are
> housed in Houston or housed in California with another Enron entity.
> However, Jim suggested that we check with the floating Originators
> regarding this category.
> 4.	Documents Sufficient to Identify Each Purchase of Electricity or
> Ancillary Services
>
> SR and CM have no involvement with purchasing and therefore responsive
> documents would be in Houston.  Again, however, it appears that the
> floating Originators may have some responsive information.
> 5.	Documents re: Portfolio of Electricity Supply Sources
>
> There appear to be very few responsive documents.  Some customers receive
> an annual report of the makeup of their power supply (e.g. 20% green
> power, 15% hydro, etc.) but the reports are not particularized - they do
> not list where the hydro came from, etc.  There may also be power point
> presentations to customers or correspondence with customers about sourcing
> of electricity.
> 6.	Documents re: Electricity Purchase Risk Assessment.
>
> Potentially the Golden Bear and UC/CSU documents are responsive here.
> There is at least one power point presentation on the risks associated
> with relying on the PX and possibly other presentations to customers on
> market conditions.
> 7.	Documents re: Strategies or Business Plans
>
> The Golden Bear documents are potentially responsive, but generally SR and
> CM were not involved in this kind of strategizing.
> 8.	Documents and communications relating to the de-DASR
>
> It may be possible to read this narrowly and limit it to documents
> regarding the decision to de-DASR.  All evidence suggests that this
> decision was made in Houston and SR and CM were not involved.  Read
> broadly, this request (and 9 and 10) would encompass a large number of
> documents including all communications with customers re: the decision and
> possibly a number of power point presentations on the changing market
> conditions (perhaps created by the Value Enhancement Group in Houston.)
> For categories 8-10, Dirk suggests that we consider whether documents and
> communications about billing complications would be covered.  If so, the
> volume of documents increases dramatically.
> 9.	See #8 above
> 10.	See #8 above
> 11.	Documents re: Causes of Price Increases.
>
> Several responsive power point presentations on market conditions.
> Internal documents, including weekly reports by Paul Smith from November
> 2000 - February 2001 and possibly emails relating to UC/CSU.
> 12.	Documents re: Revenue Maximizing Strategies
>
> The Golden Bear documents are responsive here as well as a few documents
> in the nature of pitches to clients (in CM).
> 13.	Documents re: Sales of Electricity
>
> No responsive documents in SR or CM.
> 14.	Contracts Prematurely Terminated
>
> It appears that there are currently are none (although that may change
> going forward) on the electricity side.  Several contracts may have been
> terminated, but it was due to default by the customer and therefore wasn't
> "premature."  On the natural gas side, there may be prematurely terminated
> contracts.  This question should be put to the floating Originators.  Note
> this request goes back to 1992.
> 15.	See #14
> 16.	Org Charts
>
> Easy to collect and uncontroversial.
> 17.	Documents re: Risk Management of Trading Activities
>
> Few responsive documents; possibly only the Golden Bear documents.
> 18.	Org Charts (Risk Management)
>
> See 16, except this request is phrased poorly and we may be able to
> produce nothing here as the charts have never been organized in the way
> the AG suggests.
> 19.	Documents re: Development of Charters and Risk Management
> Objectives.
>
> Few responsive documents; possibly only Golden Bear documents
> 20.	Documents re: Natural Gas positions
>
> No responsive documents in CM or SR.  This question should be put to the
> Originators
> 21.	See #20.
>
>
>
> IV.  Specific Hard Copy Documents Identified in San Ramon as potentially
> responsive
>
> *	Back-up tapes from email servers for May 25, June 1, 8, 13, 14, 15,
> 18, and 19
> *	In Houston, a set of back-up tapes from California email servers
> from December 2000
> *	Billing documents
> *	One binder containing "Top 40" contracts
> *	Five CD set, dated July 7, 2000 containing EEMC contracts and
> correspondence
> *	Electronic version of documents related to the returning customers
> to the Utilities.  These documents are on Mojgan Ahad's (Dirk's
> administrative assistant) hard drive in files labeled "California Rapid
> Response" and "California Strike Force."  These documents include:
> *	Form letters
> *	Lists of all meters at all customers
> *	Q&A's
> *	EDI forms
> *	Power Point Presentation
> *	Reports of status distributed daily by email (created by Peter Vint
> originally and Mojgan Ahad
> *	Mojgan has emails on hard drive re:
> *	"Golden Bear" -- this file, I believe, contains emails sent on
> behalf of Chris Holmes
> *	"CA Strike Force" -- which contains the reports re: return of
> customers which were distributed to people in Houston and California from
> February 4, 2001 to April 18, 2001
> *	Files related to status of EDI's (re: return of customers to PG&E).
> Presently kept by Summer Intern, Kerri Bernstein.
> *	Original signed documents related to the returning of customers to
> utilities may be with Doug Hoth and Tom Reilly and maybe with other
> account managers.
> *	Each account manager has hard copy files of documents related to
> each contract (including the contract itself) and likely has electronic
> files containing emails re: each account.  This is based upon my quick
> review of the files of two managers -- Shawn Green and Jim Kuegle.  There
> is no standardized, company-wide policy about files nor is there a central
> filing system.
> *	A few boxes of former account managers.  However, documents related
> to specific accounts were distributed to the new account managers.  The
> hard drives of the former account managers were deleted, but Mojgan
> believes that the important emails were forwarded to the new account
> managers.
> *	A few boxes from other contracts acquired from PG&E Energy Trading.
> *	Current and Old Organization charts
> *	There may be relevant documents located in San Francisco, especially
> related to contracts for the purchase of energy.
>
> V.  Description of Electronic Documents located in San Ramon
>
> EES in San Ramon utilizes three types of servers:  Mail Servers; Data
> Servers and Web Servers.  For the purpose of the subpoena, we focused on
> the mail servers and data servers.
>
> 	A.  Mail Servers
>
> EES employees in San Ramon and Costa Mesa use Microsoft Outlook on three
> "exchange" servers located in California.  John Eastland is the
> administrator for this server.
>
> EES employees outside California use Lotus Notes.  The Lotus Notes
> server(s) are located in Houston, TX.
>
> The retention policy for the exchange servers located in California was as
> follows:
>
> Each day Monday through Thursday is copied and saved on a tape for one
> week.  Each week, the tape is overwritten.  Each Friday is copied and
> saved for 4 weeks.
>
> Thus, as of yesterday, EES had back-up tapes for W 6/13; Th  6/14; M 6/18;
> and T 6/19 and for Fridays 5/25; 6/1; 6/8 and 6/15.
>
> Apparently, a set of back-up tapes were sent to Houston, TX at the end of
> December for an FCC investigation.
>
> Going forward, EES will retain back-up tapes for each day, until
> instructed otherwise.
>
> Back-up tapes are made at 11:00 p.m.  Email messages that remain on the
> server at that time are copied.  Email messages that have been deleted or
> moved onto a person's individual hard drive are not saved.  Currently,
> there is no policy for retaining emails.  We have told Tim Reilly and Dirk
> Van Ulden to retain their emails and to identify any other persons who
> should do so.
>
> 	B.  Data Servers
>
> Electronic documents are maintained on two data servers.  One in San Ramon
> (EES SRO-FS2) one in Costa Mesa (EES HOU-CM1).  Generally speaking,
> documents on the H;/ and J:/ drives appear to be maintained on these
> servers.
>
> The IT person in Houston, Pete will provide us with the retention policy
> regarding these two servers.
>
> EES has 292 Windows NT servers and 31 UNIX servers.  Employees in
> California access the servers located in Houston, although it is unclear
> how many employees do so.  This much is known:
>
> *	Mojgan has access to a program called Documentum, which is an online
> document storage program, located on a Houston server.
> *	All account managers have access to CMS -- Customer Management
> System -- located on Houston servers.  This contains account information,
> service requests, information on customer visits, etc.
> *	Malcom Adkins has access to materials related to marketing located
> on Houston servers.
> *	If a person leaves California and relocates to Houston (or vice
> versa), that person continues to have access to servers in California (and
> vice versa).
> *	Project managers and developers have access to Expedition and
> SureTrack applications located on Houston servers.
> *	Other persons may have there computers "mapped" to Houston servers,
> but IT would need to look at each person's computers to find out who does
> and/or John Eastland would need to look at requests for access to those
> servers
>
> VI.  Summary of the Return of the Customers to the Utilities
>
> According to Mojgan, the decision to return customers to the utilities was
> made by people in Houston.  She knows of no documents relating to that
> decision.  However, the documents relating to the execution of the return
> of customers are on Mojgan's hard drive.  There is no file containing
> copies of the original letters which were sent, although Tom Reilly and
> Doug Hoth may have saved a copy.  (A copy of the letter sent to UC is
> attached to the Reilly declaration).  EES called this project either
> "California Strike Force" or "California Rapid Response."  In February,
> people from Houston arrived in California and conducted the return of the
> customers by making calls, sending letters, etc.  Most of the calls were
> made by Houston people.  Some calls were made by California personnel --
> Doug Hoth and Renee Lazure.  Peter Vint remained in California for two
> weeks, creating and sending status reports.  He left, and Mojgan continued
> to create and distribute the status reports.
>
>

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