Who can forget the voices of Enron’s traders, caught on tape as a damaging wildfire raged during the California energy crisis, exulting in the profits they were reaping from the state’s misery? “Burn, baby, burn,” one said gleefully.
Many of those tapes would never have seen the light of day if it weren’t for a battle between the mighty Enron, or what remains of it, and the not-so-mighty Public Utility District No. 1 of Snohomish County, Wash., or SnoPUD.
In late June the Federal Energy Regulatory Commission (FERC) ruled in favor of the Lilliputian utility in its long-running contract dispute with the bankrupt energy trader – perhaps writing the final chapter of what appears to be a classic David vs. Goliath tale. Only this time David was armed with preternatural media savvy.
The saga began in early 2001 when SnoPUD, a not-for-profit that serves some 300,000 customers on Puget Sound, signed an eight-year contract with Enron for the delivery of power. It was the height of the electricity crisis, and SnoPUD was desperate.
As Enron plummeted into bankruptcy, SnoPUD terminated the contract. In early 2003, Enron sued on behalf of its creditors, seeking a $117 million “termination payment” from SnoPUD.
Enron sued a lot of parties to collect money for its creditors, and over the years, most of them settled. But not the extraordinarily determined SnoPUD, which argues that its contract was fraudulently induced, both because Enron hid its real financial condition and because of Enron’s role in manipulating the Western power markets.