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To: Cactus Jack who wrote (48050)	2/26/2002 3:01:34 PM
From: stockman_scott	Respond to of 65232

<<``I believe that Enron had a brief window to salvage itself this past fall and we missed that opportunity because of Mr. Lay's failure to recognize or accept that the company had manipulated its financial statements,'' Watkins testified.>> ________________________________ Senators Trade Barbs with Ex-Enron CEO Tuesday February 26, 2:17 pm Eastern Time By Kevin Drawbaugh WASHINGTON (Reuters) - The embattled former president of Enron Corp. hit back at Congress on Tuesday, accusing lawmakers of grand-standing and wasting the public's time as they upbraided him for claiming to know so little about the largest ever U.S. bankruptcy. Jeffrey Skilling, who resigned just months before the company collapsed in early December, was sandwiched between two Enron whistleblowers as the latest congressional hearing into the Enron debacle got off to a frosty start. Current Enron President Jeff McMahon shook Skilling's extended hand as they sat down before the Senate Commerce subcommittee. But, Enron vice president Sherron Watkins -- who says Skilling must have known about the company's financial problems -- avoided making eye contact with him. ``The entire management and board of Enron have been labeled everything from hucksters to criminals,'' Skilling said in an opening statement. ``These untruths shatter lives and do nothing to advance the public understanding of Enron.'' Skilling did not dispute calculations he made $66 million from sales of Enron stock from February, 1999 to June, 2001. He still had the money but, faced with 36 separate lawsuits, did not know how much he would get to keep. ``It's my expectation that I will probably spend the next five to 10 years of my life battling those lawsuits,'' Skilling said. Once the seventh largest U.S. company, Enron's collapse is the subject of probes by 10 congressional committees, the U.S. Justice Department and the Securities and Exchange Commission. CONTRADICTORY TESTIMONY The three key witnesses, gathered together for the first time, gave sometimes contradicting testimony with senators mostly critical of Skilling's version of events. ``It's unbelievable what we have heard,'' said Byron Dorgan, the North Dakota Democrat who chairs the consumer affairs subcommittee. Maine Republican Sen. Olympia Snowe said it was ``very difficult to comprehend'' how Skilling failed to see the red flags warning of Enron's troubles. Another lawmaker said he was skeptical of Skilling's disclaimer of responsibility and the perception that former Enron Chief Financial Officer Andrew Fastow played the pivotal role in the company's collapse. ``If the theory is that Fastow went rogue somewhere, deep in the jungles of Enron, and was the sole agent of the apocalypse, I just don't buy it,'' said Sen. Peter Fitzgerald, an Illinois Republican. Watkins has said she believes former Enron chairman Kenneth Lay was duped by Skilling and Fastow. Neither Lay nor Fastow have testified to Congress, instead exercising their constitutional right not to incriminate themselves. ``I NEVER DUPED KEN LAY'' Skilling denied deceiving the chairman: ``I never duped Ken Lay. I heard Ms. Watkins testify to her opinion, I have no idea what the basis is for that opinion.'' Watkins continues to hold Skilling accountable. ``I believe that Mr. Andy Fastow would not have put his hands in the Enron candy jar without an explicit or implicit approval to do so from Mr. Skilling,'' she told the Senate panel. Watkins and McMahon tried to sound the alarm within Enron about questionable accounting practices and special off-balance sheet partnerships linked to its failure. McMahon, as treasurer in 2000, raised concerns about the partnerships run by Fastow but was brushed off and moved to a new job at Skilling and Fastow's suggestion. Skilling told a House panel on Feb. 7 that he believed the company was financially sound when he resigned on Aug. 14, citing personal reasons. In the months after Skilling's departure, Enron disclosed losses related to the special partnerships and had to restate earnings back to 1997 before filing bankruptcy on Dec. 2. A special internal board of inquiry commissioned by Enron has said the partnerships it examined were used to hide debt, inflate profits and enrich certain high-ranking employees. Skilling said he knew about some of the partnerships, but relied on advice from accountants and lawyers that the transactions were proper. ``I believed we were reducing the risk to the company.'' Defiant throughout, Skilling said, ``I have not lied to the Congress or to anyone else about my recollection of events while I was at Enron.'' Watkins did pin more blame on the former chairman, Lay, than she did in previous testimony, saying she had been frustrated by his lack of action when she raised accounting problems with him in August last year. ``I believe that Enron had a brief window to salvage itself this past fall and we missed that opportunity because of Mr. Lay's failure to recognize or accept that the company had manipulated its financial statements,'' Watkins testified.

To: Cactus Jack who wrote (48050)	2/26/2002 6:00:38 PM
From: stockman_scott	Respond to of 65232

Seattle lawyers to argue case for Enron workers By JIM KENNETT BLOOMBERG NEWS Tuesday, February 26, 2002 The Seattle law firms of Keller Rohrback and Hagens Berman will be the lead attorneys representing Enron Corp. employees who say they lost up to $1 billion in pension funds when the energy company's stock price plummeted. U.S. District Judge Melinda Harmon said during a hearing yesterday that she will sign an order proposed by the lawyers pressing the pension-fund cases. Lynn Sarko, of Keller, and Steve Berman, of Hagens, will be lead counsel. The decision places two veteran class-action lawyers at the head of the pension-fund case. Sarko and Berman teamed up on legal action related to the Exxon Valdez oil spill. "I'm thrilled. It's the most important assignment I've ever had," Berman said. Although the pension litigation promises to be long and complex, Keller Rohrback expects its current staff can handle the workload, Sarko said yesterday. The plaintiffs' group consists of the two lead-counsel firms and seven other law firms that have formed a steering committee, said Eli Gottesdiener, an attorney on the committee. The plaintiffs claim the value of Enron stock they had in their 401(k) and other pension funds plummeted when the company restated earnings for more than four years after the disclosure that it had used off-book partnerships to hide debt and losses. The employees accuse the company of encouraging them to buy Enron shares while executives sold millions of dollars in stock. They also say another defendant, the Arthur Andersen LLP accounting firm, misrepresented Enron's financial condition. Enron filed for bankruptcy protection Dec. 2, in the largest-ever Chapter 11 filing. On Feb. 15, Harmon appointed Milberg Weiss Hynes & Lerach LLP to be lead counsel for shareholder lawsuits filed against Enron claiming securities fraud. The lead counsel in a lawsuit determines strategy and the size of any settlements, and collects the bulk of the legal fees. Harmon also heard arguments from attorneys for both sides on a schedule for taking the cases to trial. She did not make a decision.