Greg - 

Clarification and follow up to our discussion.

Let me know if you'd like to discuss further.


Thank you - Dan


---------------------- Forwarded by Dan Leff/HOU/EES on 05/16/2001 08:03 AM 
---------------------------
From: Robert C Williams/ENRON@enronXgate on 05/16/2001 07:58 AM
To: Dan Leff/HOU/EES@EES, Marty Sunde/HOU/EES@EES
cc: Vicki Sharp/HOU/EES@EES 
Subject: UC/CSU Procedural Next Steps

As you know, UC/CSU sued us for breach of contract in March.  At the same 
time they moved for a preliminary injunction to restore them to direct access 
during the pendency of the case.  The district court granted their motion and 
issued the preliminary injunction.  We appealed the granting of a preliminary 
injunction in these circumstances, and, in addition, asked the Court of 
Appeals to stay the effect of the district court's order until our appeal 
could be heard.

The Court of Appeals granted our request for a stay.  Because of the 
similarity beween the legal tests for granting a stay and for granting of 
preliminary injunction, to grant the stay the Court of Appeals necessarily 
had to find, at least preliminarily, that the district court likely erred in 
granting the preliminary injunction.  This is why we think we will win our 
appeal, especially if it is heard by the same panel.  (Whether or not it is 
heard by the same panel depends on the clerk of the Court of Appeals and the 
schedules of the judges.)

We filed our brief in support of our appeal on May 14.  UC/CSU's and the AG's 
answering briefs must be filed by June 11.  Our reply brief is due 14 days 
after their briefs are filed.  The appeal is then referred to a 3-judge 
panel.  Oral argument is usually allowed.

If we win the appeal, UC/CSU campuses in PG&E and SCE territory remain on 
utililty service until a final decision is made in the case.   If we lose the 
appeal, we have to take them back until a final decision in made in the 
case.  The appeal relates only to the preliminary injunction.  The breach of 
contract action remains to be tried at the district court level.  

The contract expires March 31, 2002.  In the ordinary course a final decision 
in the case would not be made by then.  The judge, however, could expedite 
the proceedings so that a decision could be made earlier.  UC/CSU could also 
move for summary judgment, arguing that that facts are not in dispute and 
that the judge should rule without a trial.  In either event, it would seem 
unlikely that a final decision even on a expedited basis could be handed down 
before late fall/winter.

Please call me with any questions.  Thanks.