Enron trying to fight possible venue change

Kevin Rademacher

Thursday, July 21, 2005 | 11:03 a.m.

Nevada's U.S. senators on Wednesday were fuming over Enron Corp.'s latest salvo in an epic battle between Nevada utilities and the disgraced power trader.

At issue is Enron's apparent hiring of a Washington lobbyist to fight an amendment to a federal energy bill. That amendment would force Enron to argue its claims to $336 million termination payments from Nevada Power Co. of Las Vegas and Sierra Pacific Power Co. of Reno in front of the Federal Energy Regulatory Commission instead of a U.S. Bankruptcy Court judge, where the energy trader received a favorable ruling two years ago.

Jack Finn, communications director for Sen. John Ensign, R-Nev., said Enron's move is particularly troublesome since the amendment does not attempt to declare a winner in the payment dispute.

"It just makes sure the issue is resolved in the proper venue," he said Wednesday.

The amendment was unveiled in May. On June 30, according to paperwork filed with the Clerk of the House of Representatives and the Secretary of the Senate, Robert C. Odle Jr. of Weil, Gotshal & Manges LLP registered as a lobbyist for Houston-based Enron.

Odle could not be reached for comment.

Enron claims the Nevada utilities owe termination payments for cancelled contracts that were originally signed during the Western energy crisis. In July 2003, a U.S. Bankruptcy Court judge ruled in favor of Enron just months after the Federal Energy Regulatory Commission said that, despite findings of market manipulation on the part of Enron and others, the long-term contracts were valid.

The utilities have since been fighting on several legal and regulatory fronts, and in October an appeals court vacated the bankruptcy court decision and ordered the case back for a new hearing.

The energy bill amendment has been pushed by Ensign and Sen. Harry Reid, D-Nev. It was written by Sen. Maria Cantwell, D-Wash., who has taken up the battle on the part of that state's Snohomish County Public Utility District. That utility, based in Everett, Wash., faces $122 million in similar claims from Enron.

In a statement released Wednesday, Cantwell ripped Enron.

"This is the height of arrogance," she said. "It is past time for Congress to stand with consumers."

In the same statement, Reid said he joined Cantwell in "expressing outrage."

Ensign, Reid and Cantwell were among those signing a letter to members of a conference committee trying to hammer out differences between House and Senate versions of the energy bill. While the Enron amendment was included in the Senate version of the bill, it is thought to be one of the final sticking points with House negotiators, including Rep. Joe Barton, R-Texas, chairman of the House Energy and Commerce Committee.

"The Senate has stood firm in their support of this provision," said Roger Berliner, an attorney representing the Nevada utilities. "We remain hopeful that Chairman Barton will decide this modest proposal is good public policy."

The conference committee could decide the fate of the amendment as early as today.