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The judge overseeing Pacific Gas & Electric Co.’s Chapter 11 bankruptcy case suspended the plan confirmation trial for more than a month Thursday, further lengthening what many believe to be the longest such trial in history. At a hearing in the San Francisco division of the U.S. Bankruptcy Court, Judge Dennis Montali put the trial on hold until early April to allow time for all parties to conduct discovery on PG&E’s latest modifications to its reorganization plan. The ruling casts further doubt as to when the trial to select one of two competing reorganization plans for PG&E will conclude. The trial phase of the Chapter 11 case commenced in November and was initially scheduled through February. “The case has been going on incredibly long,” said Ron Oliner, a partner at Buchalter, Nemer, Fields & Younger who is representing a creditor in the case. “Admittedly this is a case of a whole different magnitude, but there’s just a lot of lawyering on either side and developments extraneous to the courtroom that are just keeping this thing going.” The latest delay also means the legal fees will likely keep piling up. In the latest report by the U.S. trustee, professional fees and expenses in the PG&E case through Nov. 30, 2002, totaled $88 million. Thursday’s ruling stems from a number of changes that PG&E made to its reorganization plan in response to a letter by credit-rating agency Standard & Poor’s. The agency indicated that the four companies created through PG&E’s reorganization could receive investment-grade credit ratings if the plan met a number of requirements, including a $700 million cash infusion from parent company PG&E Corp. PG&E modified its plan accordingly on Monday, and has maintained that the changes should not require significantly delaying the trial. In suspending the trial until early April, Judge Montali accepted a proposal advanced by the city and county of San Francisco, Palo Alto and a number of other counties that are objecting to the PG&E reorganization plan. “Because the objectors do not have the unlimited resources that PG&E and PG&E Corp. have that allow those parties to pursue discovery while the trial is ongoing, the objectors propose a short, five-week ‘discovery only’ period,” read a statement filed with the bankruptcy court. “There is no basis to complain about the ‘delay’ caused by the objectors’ proposal,” the statement continued. “The objectors could point out that any such delay results from PG&E and PG&E Corp.’s own actions.”

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