Re: Canadian Counsel ,
 Peter:

As we have discussed, I think we probably need someone other than Dan.  I 
don't think there is any need to lay everything out on use of lawyers in 
Canada.  I agree with your comments on the business model for lawyers.  We 
can't ignore that.  Let's generally talk that through with Jim.

Regards,

Mark



	Peter Keohane
	03/07/2001 08:46 AM
		 
		 To: Mark E Haedicke/HOU/ECT@ECT
		 cc: 
		 Subject: Canadian Counsel

Mark, a few thoughts:

1.  Dan Fournier asked me to go to lunch so he could update me on his "very 
positive meeting" with Jim and you.  I told Dan, politely, that I am very 
tired of talking to the issue and really have nothing more to add.  I hope 
that is OK with you.  To be honest, I am really tired of talking to the issue 
and dealing with Dan Fournier's political maneuvering, but I am also 
concerned that it seems apparent that the result of his meeting with you and 
Jim is that he thinks he is back in the saddle with Enron.  I have lost trust 
and confidence in Dan Fournier and as I mentioned Dan's approach within 
Blakes becomes exclusive and results in inefficient allocation of Blakes 
resources to our files.  He tries to conquer the client and thereby alienates 
the talent within his firm.  I know for a fact, after he has squeezed others 
out on our work and his mismanagement of this issue with Enron, that if Dan 
is back in the saddle, many of his partners will not been keen on doing our 
work under Dan's terms.  I also know that there is a philosophy in Houston to 
commercial people not having say in legal retainers, but I believe that the 
senior commercial people who are responsible for the transactions, 
particularly in a smaller office in a smaller market, have an important place 
in the relationship, and in that regard, I know Fournier has lost the trust 
and confidence of Rob Milnthorp.

2.  Regarding Donahue Ernst and Young, it should be borne in mind that the 
initial contact to doing work at their firm was through Jordan Mintz and 
Morris Clark on the tax side.  I also know Jordan thinks well not just of 
their firm but of the multidisciplinary business model.  I also think that 
Jim needs to understand that the business model is likely not going away, and 
likely to expand in Canada, the US and Europe and is something we likely 
cannot ignore.  Also, the circumstances you will recall for us using DEY 
initially was on regulatory and contracting issues affecting the retail 
market, where the incumbent firms with any experience in the area were all 
conflicted and in an area where Blakes is particularly weak in Calgary.  (We 
first approached Stikemans, which had conflict with Enmax, and Bennett Jones, 
which had a conflict with ATCO.  Other firms which we do not typically use 
but which had experience also had conflicts.  After that, I solicited written 
propsals from both Blakes and DEY and interviewed with them with the retail 
team.)  Frankly, DEY has done good work for us.  E&Y is also very well 
situated on the market development side in Ontario, a leading proponent of 
deregulation of the Ontario market, and worked with us to set up our systems 
in Toronto for market opening.

3.  Should I e-mail to Jim a proposed agenda for our call on the 20th 
outlining the firms we currently use in different capacities in Canada?  
Blakes, Bennett Jones, Stikemans, Oslers, Donahue E&Y, or is a less structurd 
call anticipated?

Peter.


Peter.
peter.keohane@enron.com