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Enron loses this time, but Palo Alto lost last year

Original post made by Diana Diamond, Palo Alto Online blogger, on Jul 4, 2006

If Palo Alto had only waited, it may have found out that it really didn’t have to give bankrupt Enron Corp. creditors $21.5 million.

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Comments (3)

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Posted by Tom Wyman
a resident of Old Palo Alto
on Jul 4, 2006 at 9:00 pm

We all know how easy it is to Monday morning quarterback. But with $21.5 million riding on the line, with a reputable community facing a discredited company with a record of shyster dealings it’s a travesty that Palo Alto did not have the gumption to ask for its day in court.

Mediation can be a solution, but Palo Alto should have been wary of the legal might and corporate resources that Enron would bring to the table. Better a court of law than backroom mediation. Palo Alto could have used the the additional time to bulwark its case against an opponent that was losing credibility by the day.

The City Attorney should have mustered the best talent available in developing his recommendation. This was not an issue on which city staff had the expertise on which to opine.

Sure, law cases are frequently crap shoots, but here’s a case where Palo Alto did not figure the odds correctly and ended up paying a dishonest dealer — Enron. Palo Alto should have had the spine of Snohomish County and stood by what is right and by principle instead of agreeing to payoff a bunch of crooks for their fraudulent acts. I'm ashamed of our willingness to capitulate.

Like this comment
Posted by Walter_E_Wallis
a resident of Midtown
on Jul 5, 2006 at 9:40 pm

I question the competency of a City Attorney who allowed the signing of a contract that did not have clear requirements for performance and for cancellation. I can understand the reluctance to have such incompetence uncovered. I cannot understand the signing of a contract for wind power that seems not to require the delivery of a product. Apparently political correctness means more than legally protected.

Like this comment
Posted by dp
a resident of another community
on Jul 9, 2006 at 3:27 am

It would be easier to understand Palo Alto's position if it hadn't agreed to have the entire case sealed.

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