Santa Clara to pay Enron creditors $36.5 million to settle suit - Plainview Herald Subscribe Home Archives About Us Contact Us Place an Ad Privacy Notice Terms Of Use Arrington working to improve VA mail process Lines Depending on how you pack, there’s room for more First Presbyterian celebrates 50 years in building designed for News Local Crime Agriculture Back In Time 4 stolen vehicles reported in Plainview last week PISD breaks ground on first bond projects The United Family launches human trafficking sticker campaign Suspect in jail after body found dumped in Hale County Sports Entertainment eEdition Vaccine tracker Homes Home Décor Classifieds Jobs Texas Back To Work Find & Save Obituaries MenuSections https://www.myplainview.com/news/article/Santa-Clara-to-pay-Enron-creditors-36-5-million-8595521.php Santa Clara to pay Enron creditors $36.5 million to settle suit DAN GOODIN Published 6:00 pm CST, Thursday, March 9, 2006 Associated Press Writer The city of Santa Clara agreed to pay Enron Corp. creditors $36.5 million to settle a lawsuit over terminated electricity contracts with the city's municipal utility, the two parties said Friday. Enron, the scandal-plagued power supplier that collapsed into bankruptcy proceedings in 2001, sued Santa Clara the following year, claiming officials owed it $147 million for terminating two electricity contracts ahead of schedule. Santa Clara stopped paying Enron in December 2001 after the company ceased delivering promised electricity, said Junona Jonas, utility director for Silicon Valley Power, the city-owned electricity utility. While Silicon Valley Power contended it was Enron that ended the contracts when it couldn't deliver electricity, the utility settled to avoid further legal costs. "We aren't happy we had to pay," said Jonas. "We feel we had a strong case. We had to weigh it against the cost of continuing litigation." The settlement also calls for Santa Clara to get an unsecured bankruptcy claim of $4 million against Enron assets. In bankruptcy, unsecured claims are typically among the last in line for payment _ after banks, but before shareholders. Santa Clara spent $5 million fighting the suit, which was filed in bankruptcy court in New York, Jonas said. Santa Clara ratepayers aren't the first to pay Enron. In May, Palo Alto agreed to pay Enron $21.5 million as compensation for canceling two electricity and gas contracts. The settlement comes as 16 Enron executives have pleaded guilty to fraud-related charges and former chief executive Jeffrey Skilling and founder Kenneth Lay are on trial in federal court in Houston for fraud and conspiracy. Outside observers said Santa Clara officials had little choice but to agree to the settlement. "There are so many outrageous things that have gone on in the context of the Enron debacle that the ordinary rules of logic don't seem to apply," said Mike Florio, senior attorney at the Utility Reform Network, which represents consumers when investor-owned utilities are in proceedings with the California Public Utilities Commission. Silicon Valley Power provides electricity to more than 50,000 customers. About 90 percent of its electricity is delivered to industrial companies, including Intel Corp., Applied Materials Inc. and National Semiconductor Corp., Jonas said. The settlement must be approved by the Federal Energy Regulatory Commission, which has oversight over the terminated contracts, and the judge overseeing Enron's bankruptcy proceedings. ___ On the Net: Silicon Valley Power: http://siliconvalleypower.com Enron: http://enron.com Local advertising by PaperG Top Headlines Most Popular 1 4 stolen vehicles reported in Plainview last week 2 Plainview native receives AEF scholarship 3 San Antonio man sentenced to prison for murder 4 PISD breaks ground on first bond projects 5 Graphic video appears to show Mexican drug cartel members blowing up man, child 6 Crime Reports - Jan. 22-Feb. 2 7 Lady Bulldogs snap cold spell, earn No. 2 seed View Comments © 2021 Hearst Communications, Inc. Logo Return to Top About Privacy Notice Your California Privacy Rights Interest Based Ads Terms of Use Our Company Careers Contact Contact Us Connect Facebook Twitter Subscribe eEdition Today's eEdition Hearst Newspapers © Copyright Hearst Newspapers, LLC