Jeff:

Thanks again for all of your time and consideration with respect to our consideration of Norm Pedersen to join our Firm in Los Angeles.  I just wanted to let you know that we decided it probably did not make sense to pursue things further with Norm.  After drilling down even further, it just seemed like we were going to run into major conflict problems down the road based upon the CA regulatory proceedings that likely are going to arise and the nature of Norm's historical client base.  It also would not have been fair to Norm to have him join the Firm and then be conflicted out of work that he had planned to pursue at the Firm.  I can't tell you how much I appreciate your candor as well as your open-mindedness in helping me evaluate the situation.  I really felt bad bothering you with this, but I knew you would have the best insights into the likely direction of the regulatory proceedings in CA and I wanted to make sure that I was being fair in evaluating Norm's situation and in a position to make a decision based on all of the relevant facts.  I also want to emphasize emphatically (if it is possible to use those words together!) that I do not want you to think or feel that you "nixed" Norm or anything along those lines; indeed, I feel quite the opposite.  In addition, from the outset, after first talking to Norm and getting a sense for the types of business he has been handling and the issues he has been pursuing on behalf of his clients, I had felt it was really a non-starter since the last thing I wanted to do was to have LeBoeuf on the other side from Enron in important regulatory proceedings for the company.  It is one thing to receive a waiver to represent another company in a negotiated commercial transaction in which Enron is relying on another law firm, but I could not see us pressing a regulatory agenda directly adverse to Enron's interests in a proceeding in which Enron was a major participant and which we knew going into the proceedings at the start that our representation would be adverse to Enron.

As Rick may have told you, there have been some situations where we have been adverse to the Company or at least representing clients that did not see "eye to eye" with Enron on all of the issues.  These generally have been situations involving historical client relationships that go back decades where Enron has itself been using Bracewell, for example, and Rick has been incredibly gracious and understanding in not conflicting us out of those proceedings.  Nonetheless, I am trying to do whatever I can to try to eliminate or reduce the number of those situations on a going forward basis, although I know I will not be able to eliminate all of them in light of the size of our Firm and the diverse nature of its client base.

Jeff, I will follow up with you personally, but I just wanted to drop you a quick note to thank you for the time and thought you devoted to this.   I'm sure we will be speaking soon on some CA regulatory matter or the other.

John



John Klauberg
LeBoeuf, Lamb, Greene & MacRae, L.L.P.
212 424-8125
john.klauberg@llgm.com


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