I have asked Twanda to set up a conference call.
---------------------- Forwarded by Richard B Sanders/HOU/ECT on 12/13/99 
05:31 PM ---------------------------


RTellis@milbank.com on 12/10/99 06:27:15 PM
To: Richard B Sanders/HOU/ECT@ECT, Linda R Guinn/HOU/ECT@ECT
cc: SHoward@milbank.com 
Subject: NSM Litigation



Richard and Linda:  I attended the Demurrer Hearing/Status Conference in the
Farallon case this morning.  Judge Berle sustained the Demurrers, providing
Plaintiffs with twenty days to file an amended complaint.  Steve and I
believe that this twenty-day period provides us with a critical opportunity
to try and persuade Plaintiffs to drop ECT from the lawsuit.  In order to do
so, however, we need to accelerate our fact gathering so that we can
articulate with precision ECT's role, or lack thereof, in the purchase and
sale of the NSM Notes.  While the Offering Memorandum (p. 179) states
generally what Notes were purportedly purchased by ECT and other "initial
purchasers," we must understand (i) what Notes were sold, (ii) to whom and
(iii) by whom.  This requires a discussion with Travis McCullough and, quite
possibly, Kevin McConville.

Steve and I would like to have a call with you early next week regarding the
foregoing.

Thanks,
Roland Tellis
(213) 892-4573



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