Opinion ID: 15681
Heading Depth: 2
Heading Rank: 1

Heading: Overview of the Bankruptcy and Proposed Plans

Text: Cajun Electric Power Cooperative, Inc. (Cajun) is a non-profit rural electrical power cooperative that filed a petition seeking reorganization under Chapter 11 of the Bankruptcy Code on December 21, 1994. The Cajun case is a megacase with more than $5 billion in debt and over seven hundred creditors. Cajun has twelve members, all of which are electric distribution cooperatives serving retail customers in the State of Louisiana. After extensive litigation regarding the propriety of the appointment of a bankruptcy trustee, this court approved the district court’s appointment of Ralph R. Mabey (the Trustee) as Cajun’s Chapter 11 trustee. See Cajun Elec. Power Coop., Inc. v. Central La. Elec. Coop., Inc. (In re Cajun Elec. Power Coop., Inc.), 74 F.3d 599 (5th Cir. 1996). With the approval of the bankruptcy court, the Trustee 2 conducted a remarkably fruitful “auction” that led to the submission of three competing plans of reorganization: one proposed by the Trustee, incorporating an offer to purchase Cajun’s non-nuclear assets by Louisiana Generating LLC (Generating)1; another proposed by Enron Capital & Trade Resources Corp. (Enron) and the Official Committee of Unsecured Creditors; and another proposed by Southwestern Electric Power Company (SWEPCO) and the Committee of Certain Members (CCM), an unofficial committee which initially included ten of Cajun’s twelve member cooperatives. We refer to these plans as the Trustee’s Plan, the Enron Plan, and the SWEPCO Plan, respectively. Each of the three plans before the bankruptcy court requires the sale of Cajun’s non-nuclear assets to one of the respective proponent-bidders and the continued retention of Cajun’s members as customers. The Trustee’s Plan and the Enron Plan propose to retain Cajun’s members as customers through assumption of the existing power-supply agreements between the members and Cajun (the All-Requirements Contracts) pursuant to 11 U.S.C. § 365. The SWEPCO Plan proposes to retain Cajun’s members as customers through voluntarily negotiated new power-supply agreements. 1 Generating is jointly owned by Zenergy, Inc.; NRG Energy, Inc.; and Southern Energy-Cajun, Inc. Zenergy, Inc. is a whollyowned subsidiary of Zeigler Coal Holding Company, which is also the parent of Triton Coal Company, one of Cajun’s major creditors and suppliers. 3 Significant for this appeal, all three of the plans also provide for reimbursement of certain of the members’ expenses in connection with the bankruptcy case.