GARY M. COHEN, SBN 117215
Attorneys for Objector California Public Utilities Commission
UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN FRANCISCO DIVISION
Case No. 01-30923 DM
Date: March 26, 2002
Time: 9:30 a.m.
Place: 235 Pine Street, 22nd Floor, San Francisco, California
Federal I.D. No. 94-0742640
The California Public Utilities Commission (the "Commission" or "CPUC"), a creditor and party in interest in this chapter 11 case, by and through its undersigned counsel, submits this objection (the "Objection") to the proposed Second Amended Disclosure Statement for Second Amended Plan of Reorganization under Chapter 11 of the Bankruptcy Code for Pacific Gas and Electric Company ("PG&E") proposed by Pacific Gas and Electric Company and PG&E Corporation (the "Parent" or, collectively with PG&E, the "Proponents") dated March 7, 2002 (the "Second Amended Disclosure Statement" or "D.S."). In support of its Objection, the Commission respectfully represents as follows: 1
On February 7, 2002 the Bankruptcy Court issued its Memorandum Decision Regarding Preemption and Sovereign Immunity (the "February 7 Decision" or "Mem. Dec.") in respect of the Proponents' First Amended Plan of Reorganization. There, the Court held that PG&E could not utilize a provision of the Bankruptcy Code governing the contents of a plan, Section 1123(a)(5), to expressly preempt numerous state laws and Commission decisions, rulings, orders, and directives that prevent PG&E from disaggregating itself unilaterally. In addition to rejecting PG&E's express preemption arguments, the Court also rejected PG&E's contention that it could seek equitable and injunctive relief against the Commission without violating the Eleventh Amendment to the United States Constitution and related principles of sovereign immunity.
In accordance with the February 7 Decision, the Bankruptcy Court directed PG&E to file and serve a statement of it and the Parent's intentions as to the future of their Plan and Disclosure Statement process in this case. On February 21, 2002, PG&E filed its statement of intent (the "Statement of Intent") and indicated that it would modify its plan and disclosure statement to conform with the February 7 Decision.
At a hearing held on February 27, 2002, the Bankruptcy Court directed the Proponents to file their revised plan and disclosure statement on or before March 7, 2002, and set an objection deadline of March 19, 2002. On March 7, 2002 PG&E filed its Second Amended Plan and Disclosure Statement. The Commission now submits this Objection to the Second Amended Disclosure Statement.