Enron Corp. - University of California | Office of The President

lawyers "and say, 'this thing needs to work. How do we make it work?'" This
source adds that the firm also gave Enron advice on how much information it had
to disclose about its financial machinations in its 10K and 10Q reports to the SEC.
... "Under those fact scenarios, they could have real problems," says
[University of Illinois law professor Ronald D. Rotunda, an expert in legal ethics].
* * *
... And Enron is V&E's single largest customer. In 2001, Enron accounted
for more than 7% of V&E's $450 million in revenue. The law firm had several
lawyers working virtually full-time on company business, including some
permanently stationed in its offices. By contrast, Enron contributed less than 1%
to auditor Arthur Andersen's revenues.
... In her letter, Watkins claimed that the firm "provided some true sale
opinions on some of the deals" related to the so-called Condor and Raptor deals....
[T]rue sale opinions are letters that law firms write vouching for the fact that
business transactions meet particular legal requirements. So, for example, they
might certify that title has passed in a particular deal or that it was conducted between
two legally independent parties. Such documents would have been important to
Enron, since many of its deals took place with partnerships in which it held a large
stake.
* * *
According to one former Enron employee, the company might not have been
able to pull off many of the transactions now under investigation with Vinson &
Elkins's opinion letters. The company "opinion-shopped for what it needed," says
this source. "If it hadn't gotten the opinion letters, it couldn't have done the deals."
BusinessWeek, 1/28/02.
For weeks, the press and public talked around the edges of the quality of the
legal work Vinson & Elkins did for the disgraced and embattled Enron Corp.
Then the Powers report laid it bare.
Prepared by a former enforcement director of the Securities and Exchange
Commission, Wilmer, Cutler & Pickering partner William McLucas, the Feb. 1
report on behalf of a special committee of the Enron Corp. board contends that
Vinson & Elkins was in fact involved in many of Enron's most controversial deals
– and was also involved in decisions about how to disclose those deals to the
public.
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