Judge's Ruling against Ratepayers Committee

Lisa J. Mellencamp
Enron North America Corp. - Legal
1400 Smith St.
Houston, TX 77002
Tel: (713) 853-7986
Fax: (713) 646-3393
E-mail: Lisa.Mellencamp@enron.com
----- Forwarded by Lisa Mellencamp/HOU/ECT on 05/20/2001 11:11 AM -----

AMarks@milbank.com
05/18/2001 06:54 PM

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Subject: Judge's Ruling against Ratepayers Committee

There will be no Official Committee of Ratepayers in the PG&E bankruptcy
case.? Judge Montali issued his order today granting PG&E's motion (in which
our Creditors Committee joined), vacating the appointment of the Ratepayers
Committee.?

The Judge ruled that the Bankruptcy Code does not grant the ratepayers
standing as they are not creditors of PG&E, and that there is no statutory
authority on which an official ratepayers' committee could be based.? The
State Attorney General is capable of addressing consumers' interests in the
bankruptcy case.? Individual ratepayers are always free to seek to intervene
later on particular issues in which they have an interest.? The Judge made
clear that "having an interest in a result (as all ratepayers do) does not
rise to the level of having a claim as defined by the Bankruptcy Code."? He
noted that "the Bankruptcy Code, and the bankruptcy court, were designed to
resolve debtor-creditor problems; state agencies are where issues such as
rates for electricity are handled....[T]he estate...should not be burdened
with matters likely to be resolved elsewhere."? The ratepayers can take their
issues to the CPUC or another forum where regulatory issues are heard.

Please call us should you have any questions.

Regards,

Allan
______________________________
Allan T. Marks
Milbank, Tweed, Hadley & McCloy LLP
email:? amarks@milbank.com
website:? www.milbank.com?
(213) 892-4376 (L.A. telephone)
(212) 530-5312 (N.Y. telephone)
(213) 892-4739 (L.A. direct fax)
(213) 629-5063 (L.A. main fax)????????????????

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? <<RatepayersCommMem5-18.pdf<<

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- RatepayersCommMem5-18.pdf