Jun. 3--Attorney General Bill Lockyer said Wednesday he plans to sue Enron
Corp. over the disgraced energy conglomerate's alleged manipulation of
electricity prices during the California energy crisis. California officials have been pursuing refunds from Enron in proceedings at
the Federal Energy Regulatory Commission, but the lawsuit would mark the first
time the state has taken Enron to court over its trading practices in
California. The FERC proceedings seek to recover money the state claims it overpaid Enron
and other energy producers. The lawsuit would seek separate damages to
compensate the state for Enron's alleged market manipulation. "It'd be a
different pot of money," said Lockyer spokesman Tom Dresslar. Enron officials had no comment on the pending suit in California. It's hard to say what practical impact the suit would have. Enron has been
languishing in U.S. Bankruptcy Court following revelations of billions of
dollars in accounting fraud. The allegations of market manipulation surfaced in a series of company memos
outlining exotic gaming strategies, bearing code names "Death Star"
and "Fat Boy," which created artificial shortages throughout
California's overwhelmed electricity market in 2000 and 2001, drove up prices
and fattened Enron's wallet. The suit "is basically accusing them of violating our state laws with
regard to commodities fraud and unfair competition," Dresslar said. He said
the case will be filed in state court in a month. Anger at Enron resurfaced with the disclosure two weeks ago of transcripts of
phone calls showing Enron traders bragging about profiting at California's
expense. In one call, an employee asked a colleague about money "you guys
stole from those poor grandmothers in California." Those conversations took on new life this week when the audiotapes were
broadcast on CBS News. Dresslar said the conversations "add to the evidence
that will be brought forth. We had a lot of evidence, and this is another
indication that Enron was not only stealing money from California, but taking
great glee in doing so."