Yesterday, we reached agreement with the Senate regarding the terms and conditions under which the company would provide information to Senator Dunn's committee investigating wholesale price spikes.
In return, Dunn agreed to have is committee formally withdraw all contempt actions against Enron.
This morning, Dunn convened his committee and the committee formally withdrew the contempt actions.
A story related to the deal is attached.
If you have any questions, just let me know.

Best,
Jeff

 -----Original Message-----
From: 	Denne, Karen  
Sent:	Friday, September 14, 2001 11:02 AM
To:	Kean, Steven J.; Sanders, Richard B.; Dasovich, Jeff; Palmer, Mark A. (PR); Schmidt, Ann M.
Subject:	Contempt articles

Enron agrees to provide files, averts Senate contempt finding 
By Emily Bazar
Bee Capitol Bureau
(Published Sept. 14, 2001) 
State lawmakers moved to drop contempt charges against Enron Corp. on Thursday after the energy marketer agreed to begin turning over thousands of pages of documents immediately. 
The last-minute wrangling between Enron and a special Senate committee investigating energy price manipulation essentially brought to an end a series of extraordinary legislative proceedings that were last invoked in 1929. 
Following hours of closed-door meetings, Enron signed an agreement in the early evening, allowing it to dodge an impending contempt finding by the full Senate and the possibility of stiff fines. 
Under the deal, Enron will begin sharing records with the committee in exchange for a confidentiality agreement intended to protect its most sensitive documents after they are turned over. 
"It took too long to bring this to resolution," said state Sen. Joe Dunn, D-Santa Ana, who chairs the committee. "I can't help but think it had to do with the pending sanctions for contempt." 
As part of the deal, however, Enron did not agree to drop the lawsuit it filed in July asking the court to intervene on its behalf, said spokeswoman Karen Denne. She said the company is still considering its options. 
"We're pleased they've agreed to withdraw the contempt charges," Denne said. 
Enron -- and two other companies that managed to quickly purge the charges against them -- had been found in contempt in late June after it refused to turn over documents, violating subpoenas that the committee issued on June 11. 
The subpoenas called for documents of all kinds, including those with specific details -- prices, quantities and capacity -- of the companies' transactions in the state's wholesale electricity market. 
Enron officials balked at the request, saying they didn't want to turn over documents that might include confidential trade secrets. 
Ultimately, the refusal to turn over documents brought the company perilously close to being found in contempt by the Senate. 
Thursday morning, the Senate Rules Committee met to consider the committee's contempt recommendation and whether it should be forwarded to the full Senate, along with suggested punishments in the form of fines. 
After an hour of finger-pointing and confusing allegations, Senate President Pro Tem John Burton sent the two sides into a conference room to work out their differences. 
At 6 p.m., Enron officials signed the same confidentiality agreement that several other companies have signed. 
Dunn said his committee will continue to meet throughout the fall and will inspect the documents that have been provided by energy companies. 
In addition, the committee awaits records from several municipal utilities, including the Sacramento Municipal Utility District. SMUD was among 11 municipal utilities that recently received subpoenas from the committee requesting documents. 


The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com <mailto:ebazar@sacbee.com>.




Enron and state reach agreement on papers 
The power company avoids a contempt order for files on electricity market. 
September 14, 2001 
By KIMBERLY KINDY
The Orange County Register 
SACRAMENTO -- Enron Corp. signed a confidentiality agreement late Thursday that should allow for the release of thousands of documents to aid in a Senate investigation into the California electricity market. 
The compromise apparently ends six months of stalled negotiations. 
At stake for Enron was a move to hold the company in contempt and start assessing millions of dollars in fines. 
The Senate Rules Committee on Thursday morning had delayed for a day a vote to consider asking the full Senate to hold Enron in contempt because the company has not turned over the subpoenaed documents. 
While delaying the decision, Senate Leader John Burton, D-San Francisco, ordered attorneys from the Legislative Counsel of California, a Senate committee investigating electricity price gouging and Enron into a room to work out an agreement that would protect the security of confidential documents that contain trade secrets. 
"Let's hope cooler minds prevail," said Rules Committee member Sen. Ross Johnson, R-Irvine, as the committee members moved to a conference room for a daylong meeting. 
The contempt proceedings, for now, have been dropped, said Sen. Joe Dunn, D-Santa Ana, who chairs the Senate committee investigating price gouging and possible collusion in the electricity market. 
Enron officials did not return calls seeking comment on the agreement late Thursday. 
The state Senate today is also expected to consider a resolution that would order the nation's two largest public-employee pension funds to sell off stock of any company that is found in contempt by the Legislature. 
The Legislative Counsel of California is recommending the action. 
"It is not good public policy to hold stock in companies in contempt of the California Legislature and therefore in contempt of the people of California," said Dunn, who asked for the counsel's review and recommendation. 


Enron agrees to turn over documents to Senate investigators 
By Jennifer Coleman
ASSOCIATED PRESS 
September 13, 2001 
SACRAMENTO - Enron Corp. agreed Thursday to release company documents to a Senate committee investigating possible price manipulation, ending the committee's quest to cite the energy company for contempt for not complying with a subpoena. 
The Senate Rules Committee heard arguments from Enron and the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market over whether the energy company should be found in contempt. 
In June, the select committee subpoenaed Enron files as part of its investigation into record-high prices in the state's wholesale electricity market. Enron sued to quash the subpoena, a motion a judge rejected. 
The judge agreed, however, that Enron was entitled to a protective order for documents revealing sensitive trading and financial information. 
Sen. Joe Dunn, D-Santa Ana, chairman of the select committee, said late Thursday that Enron agreed to the same confidentiality agreement accepted by several other generators. With that agreement, Dunn said, the committee would withdraw a report that recommended Enron be found in contempt. 
He said he expects documents to be transferred immediately. 
Dunn had argued the subpoena also covered nonconfidential documents, and since the energy company also refused to release those papers to the committee, it was in contempt. 
He asked Sen. John Burton, D-San Francisco, chairman of the rules committee, to approve fines against Enron for each day they didn't comply with the subpoena. The daily fines would start at $1,000, doubling each day for 10 days. Then the company would be fined $1 million a day. 
Enron lawyer Michael Kirby said the company had put 49,000 nonconfidential documents in a depository in Sacramento so committee investigators could review them. 
But Dennis Murphy, a lawyer for the select committee, said Enron didn't tell investigators where the depository was located. The committee discovered the address in documents filed by Enron for the court case, he said. 
"We've been trying to get into the depository for a week. They have not allowed our people in there to verify what documents are in there," he said. 
Kirby disputed that, and blamed the committee for delays in turning over the balance of the documents. The two parties haven't met since the judge ordered the protective order, and Kirby said it was the committee that refused to work out the order's details. 
Dunn said the law requires Enron to produce the documents before it was entitled to a protective order. 
Sen. Ross Johnson, R-Irvine, said Dunn's push to have Enron found in contempt "smacks at this point of Enron being punished for exercising their right to go to court." 
A contempt report on Reliant Energy has also been sent to the Senate. A contempt finding against Mirant Corp. was later reversed when the company opened a document depository in Sacramento for the committee's investigators. 
If the full Senate imposes sanctions against Reliant or Enron, it will be the first time since 1929, when the Senate voted to jail reluctant witnesses during a committee investigation of price fixing and price gouging involving cement sales to the state.