1 Paul S. Aronzon (#88781) Robert Jay Moore (#77498) 2 Michael I. Sorochinsky (#166708) MILBANK, TWEED, HADLEY & McCLOY LLP 3 601 South Figueroa Street, 30th Floor Los Angeles, California 90017 4 Telephone: (213) 892-4000 Facsimile: (213) 629-5063 5 Counsel for Official Committee 6 of Unsecured Creditors 7 8 9 UNITED STATES BANKRUPTCY COURT 10 NORTHERN DISTRICT OF CALIFORNIA. SAN FRANCISCO DIVISION 11 12 13 Case No. SF 01-30923 DM 14 In re PACIFIC GAS AND ELECTRIC Chapter 11 15 COMPANY, a California corporation, 16 DDECLARATION OF ROBERT JAY MOORE RE FIRST INTERIM 17 APPLICATION OF MILBANK, TWEED, McCLOY LLP FOR 18 HADLEY & ALLOWANCE AND PAYMENT OF 19 COMPENSATION AND REIMBURSEMENT OF EXPENSES 20 (APRIL 16, 2001 THROUGH JULY 31, 21 2001), AND SUPPLEMENTAL DISCLOSURES 22 Hearing: 23 Date: October 11, 2001 24 Time: 10:00 a.m. Place: 235 Pine Street, 2 2nd Floor CA 25 _San Francisco, 26 27 28 MILBANK, TWEED, LA!:#6219240vi HADLEY & MCCLOY LLP ATTORNEYS AT LAW Los ANGELES ""9 Z" (' Robert Jay Moore, declare: 1 I, 2 1. I am over eighteen years of age and, if called upon, I could and would 3 Milbank, testify competently to the matters set forth herein. I am a partner in the law firm of 4 Tweed, Hadley & McCloy LLP ("Milbank"), counsel for the Official Committee of Unsecured 5 Creditors ("Committee") in the Pacific Gas and Electric Company ("PG&E" or "Debtor") 6 chapter 11 case (the "Case"), and I am one of the attorneys responsible for Milbank's 7 my representation of the Committee in the Case. In preparing this Declaration, I have relied on 8 in personal knowledge and on my review of the billing records and files maintained by Milbank 9 the ordinary course of its business and represented to have been made by Milbank attorneys, law 10 clerks, legal assistants, case clerks, and staff substantially contemporaneously with each 11 individual's performance of services or incurrence of costs on behalf of the Committee. 12 in support of the "First Interim Application 13 2. This Declaration is submitted and Payment of Compensation And 14 of Milbank, Tweed, Hadley & McCloy LLP For Allowance 2001)" (the "First Interim 15 Reimbursement of Expenses (April 16, 2001 Through July 31, herein shall have the meanings ascribed 16 Application"). Capitalized terms not otherwise defined covers the period from 17 to them in the First Interim Application. This First Interim Application I have read 18 April 16, 2001 through arý including July 31, 2001 (the "First Application Period"). best of my knowledge 19 the First Interim Application and reviewed the exhibits thereto, and to the 20 each of the facts contained therein is true and correct. 21 3.' Milbank was selected as counsel to the Committee not only because of its 22 expertise and experience in connection with complex bankruptcies and financial reorganizations, 23 particularly those involving significant regulatory and public financing aspects, but also by 24 reason of its expertise and depth of resources in the utility, power and energy, project finance, 25 banking and institutional investment, capital markets, securitization, taxation and litigation 26 practice areas. Because of the breadth and depth of Milbank's experience, the Committee has 27 been able to look to Milbank to provide it with advice, counseling and representation in the wide 28 MILBANK. TWEED, LA1 :#6219240vl 1 HADLEY & MCCLOY LLP ATTORNEYS AT LAW Los ANGELES have been required. As the Committee's sole law firm, Milbank 1 range of areas of expertise that to interact with the numerous law firms employed by PG&E and its 2 has been able, and required, this engagement. Milbank's capacity has had the benefit of providing 3 parent in connection with to its client, the Committee, and to the estate generally. 4 great efficiency and savings 5 4. The Committee is composed of eleven (11) individual members. In order 6 to more efficiently fulfill its fiduciary duties and facilitate its functions, the Committee 7 established the following working groups: the Litigation Subcommittee; the Finance 8 Group. Subcommittee; the Legislative and Regulatory Subcommittee; and the Plan Working 9 Group Milbank attempts to provide counsel to each of the Subcommittees and the Plan Working 10 of through attorneys with expertise and knowledge most pertinent to each working group's areas 11 designated responsibility and the reports and action items that are agendized for their meetings. 12 The Subcommittees and Plan Working Group typically report on their activities to the full 13 Committee at periodic meetings held by telephone conference call or in person in San Francisco, 14 frequently in conjunction with direct in-person meetings with PG&E's senior management. 15 Milbank believes that through its internal division of responsibility and the Subcommittee 16 structure, the Committee, and the estate, has received the benefit of efficient and effective 17 delivery of legal services. 18 intense time pressures 19 5. Given the broad range of responsibilities and staff the matter in a 20 imposed on Milbank at the outset of the Case, Milbank determined to restructuring partner Paul 21 manner that would maximize its efficiency. For this reason, financial and coordination 22 Aronzon assumed primary responsibility for intra-Committee communications and PG&E and its 23 of the Plan formulation process with the Committee's financial advisors Bankruptcy Court pleading and 24 advisors. I, also a financial restructuring partner, focused on the counsel regarding the 25 appearance process and spearheaded the interface with PG&E and its regulatory partner Ed Feo 26 settlement dialogue process with respect to contested matters. Energy legislative process 27 has focused on analysis of FERC and CPUC proceedings and the California finance partner 28 as they relate to PG&E's operations, strategies and plan formulation. Energy MILBANK, TWEED, LAI :#6219240v1 2 HADLEY & MCCLOY LLP ATTORNEYS AT LAW LOS A--ELES financing structures, the prospective CDWR 1 Allan Marks has focused on analysis of PG&E's Litigation partner Michael Diamond assumed 2 bond financing and PG&E's exit financing. proceedings and non-bankruptcy 3 primary responsibility for Milbank's participation in adversary to minimize its charges by, 4 court litigation matters. Within this framework, Milbank attempts by telephone conference call, when 5 among other things: (a) attending Bankruptcy Court hearings 6appropriate; (b) monitoring proceedings before the FERC, the CPCU, the California Legislature, Internet, -when possible 7 the United StatesCongress, and other tribunals or other agencies via theF those attorneys primarily responsible for 8 and appropriate; and (c) generally having only has been able to 9 particular matters attend hearings or other proceedings. Because the Committee multiple law firms with different 10 rely on Milbank's breadth of expertise in lieu of employing Committee, Subcommittee, Working Group 11 skill sets, more than one Milbank partner may attend knowledge base provides an important 12 or other meetings where that partner's expertise or process. 13 underpinning to the negotiation or deliberation 14 6. In the ordinary course of its practice, Milbank maintains records of time 15 expended by attorneys, law clerks, legal assistants, and case clerks in rendering services to its 16 clients, including the Committee. Time records are made substantially contemporaneously with 17 the rendition of these professional services and are prepared by the attorneys, law clerks, legal 18 assistants, and case clerks who have rendered the services. In matters such as this representation, 19 time records are kept in six minute (.1 hour) increments. With regard to intra-office conferences, 20 at times no attorney, or a single attorney, may bill for the conference. It is impossible to state 21 with precision how much time has not been recorded by Milbank's professionals as a result of 22 this practice. 23 In view of the implications for the citizens of California of the California 24 7. crisis in general and the Case in particular, at the outset of this engagement, and without 25 energy its voluntarily elected to reduce the hourly rates of 26 request or demand by any party, Milbank $595, a reduction of up to $80 per hour from the rates normally charged 27 most senior attorneys to its monthly pre-bills before submission to the U.S. 28 by these attorneys. Additionally, in reviewing EED, LAI :#6219240vl 3 ATTORNEYS AT LAW LOS AGESLES elected not to bill for certain time recorded by various 1 Trustee and PG&E, Milbank voluntarily legal assistants and case clerks relating, among other things, to 2 attorneys, law clerks, paralegals, certain monitoring of regulatory hearings and proceedings, 3 duplicative attendance at hearings, These rate and billing reductions during the First 4 document retrieval and file organization. in order to comply with the UST Guidelines and 5 Interim Period total $73,123.75. Additionally, either has not sought or has reduced its request for reimbursement 6 the Court Guidelines, Milbank Accordingly,'Milbank has reduced the fees and 7 of expenses in the total amount of $36,169.09. the First Application Period by almost $110,000. 8 costs it normally would charge during 9 8. The document "Milbank, Tweed, Hadley & McCloy LLP's Time Records 10 Exhibit for the Period April 16, 2001 to July 31, 2001," filed concurrently herewith, attaches true 11 and correct copies of records maintained by Milbank in the ordinary course of Milbank's 12 business operations and reflects entries that were made substantially contemporaneously with the 13 rendering of the services. 14 Milbank seeks allowance of 15 9. Pursuant to the First Interim Application, devoted to representing the 16 compensation for 5404.9 hours of recorded professional time resulting in the accrual of $2,219,496.00 17 Committee during the First Interim Period in the Case, Interim Application, Milbank 18 in fee;s for professional services rendered.