this is garbled obviously.
Lisa J. Mellencamp
Enron North America Corp. - Legal
1400 Smith St.
Houston, TX  77002
Tel:  (713) 853-7986
Fax: (713) 646-3393
E-mail:  Lisa.Mellencamp@enron.com
----- Forwarded by Lisa Mellencamp/HOU/ECT on 06/06/2001 11:22 AM -----

	AMarks@milbank.com
	06/01/2001 08:36 PM
		 
		 To: awirum@pillsburywinthrop.com, fallon_annamarie@jpmorgan.com, 
alafaire@exchange.ml.com, byoung@llgm.com, bgreene2@mail.state.tn.us, 
bholman@whitecase.com, bkrakauer@sidley.com, fishbcr@whitecase.com, 
ceklund@llgm.com, clara.strand@bankofamerica.com, dan.faltermeier@dynegy.com, 
david.adante@davey.com, dnelsen@gwfpower.com, 
elizabeth.h.baird@bankofamerica.com, lengel@brobeck.com, gbush@bankofny.com, 
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tom.lumsden@us.pwcglobal.com
		 cc: RMoore@milbank.com, EFeo@milbank.com, PAronzon@milbank.com
		 Subject: News update re today's Trading Motion Hearing




The following article is from this afternoon's AP newswire: 

Energy wholesalers on PG&E committee accused of conflict 


Updated: June 1, 2001 - 2:26 p.m. 
SAN FRANCISCO -- Two of the same energy wholesalers accused of driving 
Pacific Gas and Electric Co. into bankruptcy with high power prices asked a 
federal bankruptcy judge Friday to let them keep selling electricity to the 
utility.

Critics say that could result in higher bills for ratepayers and less money 
for the rest of PG&E's creditors to share, if the wholesalers' high prices 
keep whittling away at the utility's remaining money.

"We certainly don't believe they should get a safe harbor order so that they 
can do what they've done in the past," said Irving Sulmeyer, an attorney 
representing the city and county of San Francisco.

Houston-based Enron Corp. and Dynegy Inc., like other power wholesalers, have 
denied gouging Californians on the price they pay for power.

On Friday, the two companies asked U.S. Bankruptcy Judge Dennis Montali to 
let them keep selling electricity to PG&E's customers via the state 
Department of Water Resources, which has bought electricity on PG&E's behalf 
since January.

Dynegy and Enron sit on the 11-member creditors committee that will play a 
huge role in how PG&E's fortunes are divided among the more than 50,000 
banks, energy companies and cities to whom the utility owes money.

The "safe harbor" would shield them from conflict of interest accusations. 
The committee members would be honor-bound not to share information with any 
branches of their companies able to profit from it.

"They want to be absolved in advance," Sulmeyer said. "What are they so 
concerned about if they're not doing anything wrong?"

Robert Moore, an attorney representing the voluntary creditors committee, 
said other committee members such as Bank of America and Merrill Lynch also 
are requesting safe harbors so they can continue trading stock and remain 
members.

"At least four members of the committee would have to resign without it," 
Moore told the judge.

Montali asked each committee member to file a declaration with the court 
requesting to trade either commodities (electricity) or securities (stock), 
and scheduled another hearing on the issue for June 12.

-- Associated Press 

______________________________ 
Allan T. Marks 
Milbank, Tweed, Hadley & McCloy LLP 
email:? amarks@milbank.com 
website:? www.milbank.com? 
(213) 892-4376 (L.A. telephone) 
(212) 530-5312 (N.Y. telephone) 
(213) 892-4739 (L.A. direct fax) 
(213) 629-5063 (L.A. main fax)????????????????  

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