FYI
-----Original Message-----
From: Brownfeld, Gail 
Sent: Friday, October 12, 2001 10:01 AM
To: Sanders, Richard B.
Subject: FW: York Paper v. Enron/Holzer


FYI

-----Original Message----- 
From: Clothier, Robert 
Sent: Thu 10/11/2001 10:51 AM 
To: Brownfeld, Gail 
Cc: Klein, Samuel; Dubas, Jennifer 
Subject: York Paper v. Enron/Holzer



Privileged and Confidential

Gail,

I had a productive conversation with Keith Dutill, the Stradley lawyer who
I've known for decades and who is now representing York Paper.

The short of it is that he said he is very interested in trying to resolve
this before the litigation machinery cranks up.  He will discuss it with his
client and get back to me.  He said that York has "strong feelings" and then
agreed with me that Enron feels the same way.  He felt that York has a "good
business sense" and would be interested in reaching a compromise without
spending a lot of dollars in legal fees.

Dutill does not know why two separate summons were filed in Delaware County.
It's his understanding that the claims against Enron are largely the same as
the claims against Holzer (with perhaps one or two exceptions that still
relate to Holzer's employment with Enron).  He is working on a complaint
that will cover both summons, and expects to file it in the next several
weeks, certainly before the mediation conference on November 19th.  I said
that we should try to start our own discussions before that mediation
conference so that the mediator could focus on any areas of disagreement.

Here's how Dutill described York's claims:  Holzer worked for York Paper.
When Holzer left York, York wanted to prevent Holzer from working for Enron.
Holzer wanted to work for Enron, and so did Enron, so there was some
"agreement" between Holzer/Enron and York.  In that "agreement", Holzer and
Enron made "promises" about the way they "would do business" with York.  It
appears that the promise was that Holzer and Enron would not bypass York
Paper and deal directly with York Paper's customers.  Yet, according to
Dutill, that is what Holzer and Enron did -- cut out York Paper as the
middle man.  This has resulted in a "fair erosion of business" for York
Paper.  It is "not just a matter of subsequent solicitation."  It also
involves "interference with existing contracts" between York and its
customers. 

So, it would seem that York's claims might include breach of contract,
interference with contractual relations and, perhaps,
misrepresentation/fraud.  Interestingly, he did not mention any of the West
Coast and Garden State Paper contracts we have been looking into.

If you have any thoughts, please let me know.  I will keep you informed of
any further developments.

Bob

Dechert
215-994-2714
215-994-2222 (fax)
robert.clothier@dechert.com

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