Democrats & Liberals Archives

Energy Diplomacy

Energy is so important to civilization that it is a potent instrument of diplomacy. Those of us who were here in 1973 and experienced long waits for gasoline because of the Saudi Arabian embargo know the power of OPEC, the oil cartel. They exercised what may be called the diplomacy of confrontation. When Bush demonizes Chavez of Venezuela he too practices the diplomacy of confrontation. But a new type of diplomacy is possible.

The L.A. Times reports:

Opening a four-nation South American swing, Chavez signaled his oil-rich nation's willingness to purchase up to $1 billion in Argentine bonds and help fund a $400-million gas plant designed to meet this country's [Argentinna] growing energy needs.

Venezuela's oil-funded largess is expected to be on display during planned stops in Uruguay, Ecuador and Bolivia, all of which are expected to forge new energy deals with the government in Caracas.

This may be called the diplomacy of accommodation. Something most Americans do not believe in. Even when we praise a country we stick with confrontation. Take for example, Brazil. It produces ethanol for its cars, thus greatly reducing CO2 emissions. All politicians praise Brazil to the skies. Then they go and place a tariff on Brazilian ethanol. They follow this with subsidies for American farmers to convert corn to ethanol. All in the name of reducing CO2.

However, here are the facts: More energy is expended by Americans converting corn to ethanol than the energy available from the ethanol. Bill McKibben, in his book Deep Economy, states the ratio as 1.34:1 - 34% more energy expended than produced. Brazilian ethanol, however, is much cleaner because the fuel used to produce it is much cleaner.

Why don't we use the diplomacy of accommodation? Although we hate to admit it, this is what Chavez is doing: he's offering good deals to bring nations to his side.

Our approach should be simple and extremely effective. Instead of demonizing Chavez and Venezuela, remove the tariff and import Brazilian ethanol for our cars. Tell all South American nations about the wonders of Brazilian ethanol, so they buy it too. Brazil's economy will boom, the CO2 in the atmosphere will decrease significantly and South American nations will be solidly with U.S.

Despite the ravings of Chavez, South American nations will be good allies.

Let's use our quest for cleaner energy sources in a diplomacy of accommodation to build allies all over the world.

Posted by Paul Siegel at August 8, 2007 9:30 PM
Comments
Comment #228811


We do not use the diplomacy of accommodation with Chavez because Chavez uses the diplomacy of confrontation with us. The little rat gets much of his prestige from being anti American. He has no intention of stopping.

Fortunately, he is unpopular in most of Latin America. He is a local menace, but not much else.

It is a good idea to lower the tariffs on Brazilian ethanol, but that is a different issue from little Hugo.

Where we are making a significant mistake is playing trade politics with our friends and dissing friends such as the Columbians. This is the result of Dem bondage to labor unions and we will pay the price for that.

Little Hugo is not really worth our attention. Uribe is. So is Lula. Dems often make the mistake of embracing our enemies and kicking our friends. Isn’t that the Obama plan? Kiss the Iranians; bomb the Pakistanis.

I wrote about this before. With Friends like us, who needs enemies? So before we kiss the kiester of little Hugo, let’s be nice to those who count.

Posted by: Jack at August 8, 2007 11:24 PM
Comment #228821

The tarrifs are in place to allow our industry to NOT have to compete fairly in the marketplace, allowing them to not innovate, not update and not provide the best product at the lowest price.

Why are we doing this again?

Posted by: Rhinehold at August 9, 2007 12:27 AM
Comment #228824

Paul
We should expect US ethanol production to become more efficient is the near future with an increase is cellulosic conversion.

You lost me. How will our encourageing Latin American countries to buy ethnanol from Brazil make them like us? Seems they might like Brazil.
Cuba is also a producer of ethanol from sugar cane. If we started buying from them and they put enough of their sugar crop into production to no longer threaten US sugar producers we might finally be able to normalize relations.

Jack and Paul
What is so bad about Chavez? Not likeing Bush puts him in league with most Americans. He was twice elected in internationally certified elections,more than Bush can say. At his direction Citgo is providing heating oil to Inuits in Alaska that could not afford the jacked up prices and in other parts of the US.He is useing oil money to actually help the poor instead of the wealthy.I understand that is considered a hienious crime by some. He also played hardball with US oil companies,also considered a mortal sin by some but something most Americans wish we would do.

Posted by: BillS at August 9, 2007 1:22 AM
Comment #228829

BillS

Chavez is working against America. Bush is just the current target. That is reason enough not to like him.

He was elected, but he is dismantling all the society around him, closing down major media outlets, interfering with opposition, seizing property. We have seen this before in authoritarian countries.

He is currently riding high on high oil prices and living off the wealth created before he took office. But his spending and policies are not sustainable. His programs will crash. When they do, we will get blamed, because we get blamed when every caudillo screws up his country. It is better to keep him at arms length.

Let him give as much money as he wants to Inuits or anybody else in the U.S. I have no problem with his PR machine doing that. Perhaps all those guys living in boxes on the sides of hills in Caracas feel that the money is better spent in Alaska than at home. It is their business.

But when he meets with the leaders of places like Iran or N. Korea with the expressed purpose of harming U.S. interests, it becomes our business.

You may share with him Bush hatred, but he also hates America. Do not let him fool you just because he shares your enemy. After a short while, he will come to demonize any American president, even a Dem. He depends on AMerica bashing as an excuse for his authoritarian ways and his economic mismanagement.

Posted by: Jack at August 9, 2007 8:18 AM
Comment #228833

Jack,… is working against America
He was elected, but he is dismantling all the society around him … interfering with opposition, seizing property. We have seen this before in authoritarian countries.

He is currently riding high on high oil prices and living off the wealth created before he took office. But his spending and policies are not sustainable. His programs will crash. When they do, we will get blamed, because we get blamed when every caudillo screws up his country.

After a short while, he will come to demonize any American …, even a Dem.

He depends on Iraq bashing as an excuse for his authoritarian ways and his economic mismanagement.

With a couple of exceptions and minor changes this sounds just like Bush himself. :)

Posted by: j2t2 at August 9, 2007 8:33 AM
Comment #228835

j2t2

Authoritarian ways ….. many would say that Bush is driving our government in an authoritarian direction.

riding high on oil prices and living off the wealth…. I believe the Bush and Cheney families have made a rather nice living doing just the same.

guys living in boxes on the sides of hills in Caracass….kind of reminds me of all those folks still living a piss poor life in post Katrina trailer parks while Bush thinks that securing oil in Iraq for the big companies is more important.

after a while he will come to demonize any american even a dem…. Bush has been doing his best to paint dems as the demon under the bed for at least six years.

You are correct the comparisons are remarkable. Given enough time Bush would surely drive our country to near ruin. Thankfully he can only serve two terms. That is three terms of Bush rule that this country should never have had to suffer through.

Posted by: RickIL at August 9, 2007 9:19 AM
Comment #228836

RickIL, And if we throw the House of Saud in well it just gets even better, yet Chavez and his oil is just not good enough for us. I dont understand, to me he fits right in with the company we are keeping these days. Whats wrong with Pauls suggestion?

Posted by: j2t2 at August 9, 2007 9:44 AM
Comment #228844

Chavez sounds like a dirty capitalist to me, investing in places where we do not invest. Argentine was a major trading partner and ally of ours before their economy got screwed by oil prices and the Falklands war. We have been neglecting them for decades now.

I do not think Brazilian fuel will actually work well outside of a tropical climate. There is some kind of problem there, but you would need a science guy to explain that one.

I usually make the comparison between GWBush and Kim Jung Il. Chavez is advancing his own agenda in Latin America becuase we do not have one, except for Mexico and Costa Rica.

Posted by: ohrealy at August 9, 2007 11:14 AM
Comment #228855
Isn’t that the Obama plan? Kiss the Iranians; bomb the Pakistanis.

Jack, you know that’s a lie — except about bombing Pakistan. That’s current US policy. Bush has already done it several times and all the Republicans at the last GOP debate endorsed it.

And why don’t you think we should go after Osama bin Laden, Jack, if we have him in our sights like Obama said? At every juncture, like invading Iraq, you supported a course of action that gave bin Landen the peace and freedom he needed to rebuild al Qaeda. Why do you hate America and love bin Laden, Jack?

Chavez uses the diplomacy of confrontation with us

How so? Other than rhetoric, he hasn’t done anything threatening to the United States. In fact, he offered us free oil after Bush botched Hurricane Katrina.

Oh yeah, Chavez kicked all the multinational oil companies out of Venezuela. Is that the foundation of your beef with Chavez, Jack?

Seriously, I’m curious. I’m ambivilant about Chavez. Maybe I don’t know enouugh about him. Make me hate him Jack. Why should I.

Posted by: American Pundit at August 9, 2007 12:59 PM
Comment #228856

Jack
Really not much point in discussing Chavez with you. “Working against American interest…” is far too vague an accusation. You mean the interest of Big Oil,etc. Authoritarian? Far less so than some of our closest allies,etc.
Instead lets seek some common ground. Chavez might help us to gain support for a forign oil tariff and /or carbon tax.It is an easier sell to some on the right to screw Chavez than save the planet.


Paul has a point. Chavez is helping countries without too many strings attached. The Chinese are doing the same in Africa and Asia. In the Philippines the Chinese are building railroads and port facilities pretty much gratis. They will benefit by useing these improvements to move their goods at some point,sure. Whats wrong with that? We on the other hand through the IMF and World Bank lend money to the RP that often gets sucked up by corruption and has so many strings attached that rather than gain US support ,gains emnity. For example the RP imposed a crippling VAT largely to pay back IMF loans. At IMF insistance the huge municiple water system of Manila has been “privatized”,also to pay back loans. Remember the latter is a monpoly. There is no competition to allow any free market benefits. It just added a burden on users.The approach of Chavez and China means in short,they will win. We could learn from them.

Posted by: BillS at August 9, 2007 1:07 PM
Comment #228862

It’s amazing. I present reasons why diplomacy of accommodation is better than diplomacy of confrontation, which we always use. What happens? Everybody is talking about Chavez so they will have somebody to bash.

It seems as though this “fighting spirit” is always with us. Why can’t we try the diplomacy of accommodation some time?

Posted by: Paul Siegel at August 9, 2007 2:05 PM
Comment #228863

Come on, Chavez is an authoritarian. He’s doing all he can to ensure he has a long reign, including closing television stations and newspapers who oppose him. He’s forced stations to air his speeches while denying them the right to air news about the opposition. Some of his presidential election wins were under dubious circumstances; the Carter Foundation refused to certify them as clean. He’s pushed through legislation by which he can rule by decree, he’s forced labor union elections to be conducted under state auspices, he’s implicated in sending gangs to intimidate journalists.

Look, some of his ideas are good, some aren’t, but at the heart of it we are talking about an authoritarian ruler. I won’t support such rulers on the Right or the Left.

Posted by: Gerrold at August 9, 2007 2:06 PM
Comment #228881

We should deal Chavez,fuck the Saudis.The Saudis are worst than Chavez,they dont let women vote.These dumb ass Saudis,have women set in the back of trucks,their goats up front.

Posted by: the libertine at August 9, 2007 5:05 PM
Comment #228882

j2t2

Whats wrong with Pauls suggestion?

There is nothing wrong with Pauls suggestion. The only problem with some is that it is not in keeping with republican bully tactics. They are short on detente and nobody in their admin seems to have any negotiating ability. They would rather continue down the same old endless road to failure than admit their tactics are not sound and they are incapable of effective foreign relations.

Posted by: RickIL at August 9, 2007 5:13 PM
Comment #228888

Gerrold
The Carter Foundation”found no evidence of wrong doing” in the 2006 recall election. Carter himself praised the process. Fact check before repeating spurious accusations. Chavez did shut down one CIA backed station and will shut down more. That is called self defense. Requiring union elections to be run under government auspices should be familiar. We do it. Many unions in Ven. are run by gangsters currently working with the CIA and anti-Castro terrorist.Chavez was given extroardinary powers by the ELECTED parliment. These are extroardinary time for Ven.Chavez’s term is not up yet. Hold your judgement until that time.

Posted by: BillS at August 9, 2007 8:22 PM
Comment #228893

BillS,

I wasn’t talking about the 2006 recall election; I’m referring to an earlier election that lacked enough transparency for a positive affirmation by the Carter Center. Be less arrogant in your defense of authoritarians. If you did your research, you know that Chavez is manipulating the press. Do you not think Chavez is working to extend his presidency beyond current Constitutional limits?

Anyway, Chavez’s moves to increase and extend his power and to shut down opposition are well documented. Don’t defend this kind of activity just because it comes from the Left.

And I never said the U.S. was without blame. Indeed, I am a frequent critic of U.S. actions.

Posted by: Gerrold at August 9, 2007 8:51 PM
Comment #228913


Venezuelan oil is vital to our economy. They export 60% of the oil to the U.S., 1.5 million barrels a day. Venezuela has no intentions of reducing the amount of oil they export to us and we have no intentions of buying less of it. We save a lot of money on shipping costs by buying their oil. Brazilian ethanol exports to the U.S. will never match that.

The anti American retoric put forth by Hugo Chavez is nearily all aimed at George Bush and his Administration, and for rather good reasons. The Bush Administration backed a coup that temporarily removed Chavez from his elected office. The Administration has contingency plans to asasinate Chavez (not that we would follow through with such a plan). George Bush and Dick Cheney have already invaded a country whose oil was considered of vital interest to the U.S. economy.

Posted by: jlw at August 10, 2007 1:15 AM
Comment #228918

Gerold
The 2006 recall was the last afirmatiom.Chavez won by,59% and the election was vetted by the Carter fondation.The CIA aided coup attempt before that failed because the people rose up.Does he manipulate the press.? Name a modern president that does not. His policies have brought down a tremendous amount of fascist opposition that will stop at nothing.Do not fall for their propaganda.

Posted by: BillS at August 10, 2007 2:24 AM
Comment #228919
Does he manipulate the press.? Name a modern president that does not.

I think we can all agree that there are different ‘levels’ of manipulation. Using PR tactics is a far cry from, say, threatening to put reporters in jail for not printing favorable stories.

Posted by: Rhinehold at August 10, 2007 2:51 AM
Comment #228932

As a nation, we have a two-fold problem:

1) The addiction of foreign oil — which is the primary revenue stream for many rogue states, is holding this nation and most industrial nation’s hostage. Let’s face it, a person with a Heroin addiction will keep coming back to the drug dealer for the fix that is eventually going to result in his demise. We are no different as a nation.
2) The US has a major problem with the current EPA procedures and policies. The EPA sets too restrictive polices, instead of providing requirements, for innovative solutions such as alternative fuel source vehicles and home heating/air conditioning solutions. In many cases, there is so much EPA political red tape involved with bringing an alternative energy solution to market that the cost for regulatory certification and compliance far outweigh the benefit of the alternative solution. Basically, an innovative technology that would benefit tens of millions of consumers and result in tremendous savings in energy consumption are stifled and hindered by EPA policy due to the high expense and time involved.

America must be free from the grip of OPEC and the reliance on Middle East and Latin America fossil fuels as a matter of national policy and security without stifling innovators of technologies that provide sold, safe, and environmentally friendly solutions, in the process.

It is time for a change!

Grasso For President Committee
http://www.GrassoForPresident.com

Posted by: Pete Grasso at August 10, 2007 10:10 AM
Comment #228938

The last I heard, quite a while back, Citgo was 100% owned by the government of Venezuala. Formerly it was owned 50/50 by that government and Southland Corp of Dallas.

Posted by: ohrealy at August 10, 2007 11:59 AM
Comment #228944

Rhinehold
Any CREDIBLE evidence Chavez has engaged in that?

I find it astounding that Chavez is being attacked as an authoritarian,sometimes by the same people that rally for support of the Colubian leadership implicated in death squad activities.A bit of a double standard?

Posted by: BillS at August 10, 2007 1:11 PM
Comment #229340

INCREASING COST OF ENERGY and INFLATED FRAUDULENT BILLING

It is not enough that consumers are paying higher cost for energy – Gas, Electric, Tel., Etc.
Due to the market volatility and the increase demand for energy worldwide and the manipulation of market conditions by various corporation.
Deregulation, which was designed to save the consumer on the cost of energy. Many new companies have started selling gas and electric in the past 20 years, as a result of this deregulation. We now have numerous deregulated third party suppliers of Gas and Electric that are gouging the consumers – billing prices higher than the regulated utility companies, inflating the bill, billing for product never delivered, billing phantom tax on the product, reneging on fixed price contract – when market prices go beyond the fixed contract. In short any way they can cheat, deceive and defraud the consumer is fair game.
Among the companies that practice such tactics is MULTIUT CORP or Multiut LLC of Skokie, Illinois the owner of the company Nachshon Draiman is well connected, one of the previous owners of Multiut was a federal judge and therefore has gotten away with numerous over billing and deceptive practices, there are numerous lawsuits for fraud pending against Multiut Corp and its owner Nachshon Draiman among them a Class Action Suit and Dynegy Mkg & Trade v. Multiut Corp, Nachshon Draiman et al 1:02-cv-07446 The Federal Court has imposed numerous contempt orders against Multiut and its owner and its owner Nachshon Draiman is involved in numerous other fraud in the Nursing Home business (defrauding the state Nursing License with false documents to obtain a Nursing Home License) and a hotel project where he committed a fraud of $45 million dollars and numerous other fraud and deception too numerous to mention. (Especially since Multiut and its owner Nachshon Draiman is represented by Jack Abramoff Law Firm – which has clout).
Another Company is Santana Energy out of Texas. Some utility companies were forced to refund the consumers hundreds of million of dollars due to manipulation of pricing and billing – many of those shenanigans stem from the Enron debacle some precede it and continue on to date.
Many of these suppliers of Gas and Electric who are promoting saving are actually charging higher prices than the local utility company which defeats the intent of deregulation – Multiut’s billing shows 20% to 30% higher cost and billing for gas that was never delivered. Not to mention Multiut’s billing for non existent City of Chicago Tax on Natural gas and inflated billing for lighting retrofit to various Nursing Homes which inflates the Medicaid billing to the government.
Corporate CEO and other higher ups in the corporate world have been convicted of fraud and sentenced/fined (WorldCom, Enron, Adelphia, Etc.). But it seems that some companies can continue to defraud the public without being hindered by the authorities.
Other frauds by Gas Electric suppliers are: Centerpoint Energy Inc.,
Pending lawsuits are: AG files fraud suit against Sempra affiliate alleging Enron-like games.
JD
This article is presented by Citizen for Honest and Fair Billing

PS
THREE FORMER NICOR ENERGY EXECUTIVES AND OUTSIDE
LAWYER INDICTED IN ALLEGED CORPORATE FRAUD SCHEME

CHICAGO — Three former executives of Nicor Energy L.L.C. and an outside lawyer for the Lisle, Ill.-based company were indicted today for allegedly engaging in a corporate fraud scheme to obtain $400,000 in bonuses and other benefits for themselves by inflating revenues - at times by as much as $6 million - and understating expenses to make the company appear more profitable than it actually was in 2001. The defendants allegedly fraudulently deprived Nicor Energy - a retail energy marketing company established in 1997 as a 50/50 joint venture by Nicor Inc. and Dynegy Inc. - of their honest services and caused a loss to investors in publicly-traded Nicor, Inc. and Dynegy. On July 18, 2002, Nicor Inc. issued a press release announcing that its financial results for the second quarter and first half of 2002 were negatively affected by several factors, including irregularities in accounting at Nicor Energy, and the following day, the stock price of Nicor Inc. fell approximately 40 percent. Nicor Energy is currently in the process of final liquidation.

The five-count indictment returned by a federal grand jury charges Kevin Stoffer, formerly Nicor Energy’s President and Chief Executive Officer; Andrew Johnson, former Director of Financial Services; John Fringer, former Vice President of Major Markets and Power Services; and outside counsel Michael Munson, announced Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois
MADIGAN, DALEY ANNOUNCE $196 MILLION SETTLEMENT WITH PEOPLES ENERGY; CUSTOMERS OF PEOPLES GAS AND NORTH SHORE GAS TO RECEIVE $100 MILLION IN CREDITS
Chicago – Attorney General Lisa Madigan and Mayor Richard M. Daley today announced that Peoples Energy has agreed to more than $196 million in consumer credits and benefits as part of a settlement that will provide much-needed relief to current Peoples Gas and North Shore Gas customers, establish a more than $25 million program of conservation and weatherization assistance for low- and moderate-income households and reconnect customers who have been disconnected from their heating services due to an inability to pay the high gas prices.
MADIGAN, DALEY, CUB ANNOUNCE REFUND CREDITS TO APPEAR ON NEXT GAS BILL FOR CUSTOMERS OF PEOPLES GAS AND NORTH SHORE GAS
Chicago — Attorney General Lisa Madigan, City of Chicago Mayor Richard M. Daley and Citizens Utility Board (CUB) Executive Director David Kolata today announced that as a result of their settlement agreement with Peoples Energy more than one million current customers of Peoples Gas and North Shore Gas will see refund credits on their next gas bills.
To compensate for over billing consumers between 2000 and 2004, Peoples Energy has agreed to provide a refund credit to each of the 1,014,071 current customers of Peoples Gas and North Shore Gas. The credits – totaling $100 million – will be included on the first bill received by customers after April 24.
“These refund credits cannot change the conduct of Peoples Energy, but they will help consumers who suffered as a result,” Madigan said. “This is an appropriate response to Peoples’ conduct.”
“We are pleased that consumers are finally receiving the refunds that they deserve,” said City of Chicago Corporation Counsel Mara Georges. “Consumers should not have to pay for bad planning and business decisions by Peoples Gas.”
WEDNESDAY, JUNE 13, 2007
Justice Department Investigating NY Energy Markets
New York’s wholesale energy market is being investigated for possible antitrust violations, according to a recent news report. A Newsday story indicates that a subject of the investigation may be possible withholding of capacity from the market, to drive prices up. This revelation has raised further questions regarding the proposed merger of National Grid and Keyspan, which controls significant amounts of generation capacity in the New York City markets.
2007.08.13

Posted by: Jay Drai at August 14, 2007 3:07 AM
Comment #230940

IN THE CIRCUIT COURT OF COOK COUNTY, ILLINOIS
COUNTY DEPARTMENT - CHANCERY DIVISION
FILED
JACK GORE on behalf of himself and all ) NOV 28, 2002
other persons or entitles similarly situated, |

vs. No. 01 CH 19688


DOROTHY 8ROWN CLERK OF CIRCUIT COURT

MULTIUT CORP, an Illinois corporation, } Judge Stephen A, Schiller
Defendant ) Courtroom 2402

RESPONSE TO §2-619.1 MOTION TO DISMISS J/
Plaintiff JACK GORE (“Gore”). by his attorneys LARRY D DRURY LTD., hereby responds to the Motion to Dismiss 2nd Amended Complaint, pursuant to 735 ILCS 5/2-615 and 619, brought as a combined 2-619.1 motion by defendant MULTIUT CORP. (“Multiut”).
Introduction
Multiut is trying to time-bar this case by transforming express a written agency-service contract drafted by Multiut into a contract for sale of goods, and by disputing Gore’s allegations as to concealment and discovery of the wrong – but without submitting any Rule 191 affidavit or documentation. This is a class action arising out
of a written contract drafted by Multiut, attached here and to the 2nd Amended Complaint as Exhibit A and B collectively referred to herein as the “contract” or “agreement “ unless otherwise indicated by context): (1)
(A) A service contract to act as Gore’s “purchasing representatives” in obtaining natural gas from “off system” suppliers. This contract, entered into on or about December 1990, was titled “Agreement,” Exh. A 1, 3-6, 10. And,
{B} A series of supplemental agency contracts to act as Gore’s agent, in so doing with respect to various Properties. These were entered into contemporaneously with the service contract and thereafter, and titled “Natural Gas Purchasing and Agency Agreement.” Exh.-B. (2)
(1) Similarly Multiut refers to them collectively as “the agreement” in its brief (Mem. p. 2, fn. 1). Although the documents are on separately filed pages, they are mutually inclusive and one could not be entered into without the other; e.g. the service contract refers to and incorporates the agency contracts, wherein Multiut refers to itself as Gore’s ‘exclusive natural gas purchasing agent’. See Exh. A, third introductory paragraph and 16-17; Exh. B 1,

(2) Exh. 8 one of the series, is dated 1998, Exh. C is Gore’s §2-806 affidavit as to the others. Gore has stated he does not have a copy of each, they are inaccessible to him i.e. no longer in his possession, whether missplaced or otherwise, and cannot be located or returned. 2nd Amd.. Compl. {4; Exh, C, in the 1st Amd. Complaint, Count 4 for breach of oral contract was voluntarily dismissed without prejudice after Gore’s deposition of May 8,- 2002, when the service contract and the 1998 agency contract were produced by Multiut and adequately established, Exhs, A-B are the same Exhs. 1-2 attached to the Gore transcript, excerpts of which are attached herein as Exh. D, Similarly the missing agency agreements are likely in Multiut’s possession and will be produced in discovery.
The contract was drafted by Multiut, it unequivocally defines Multiut’s role in the transactions, and shows that this case is not governed by the UCC. What is at issue here is not the “good” that Multiut obtained for Gore, but the service Multiut provided as his purchasing agent. Gore is suing upon the service and agency contract – not the natural gas - and has alleged that Multiut breached its duties in two respects;
{1} By falsely and intentionally charging and retaining for its own use funds that were to be applied to a City of Chicago 8% gross receipts tax (“Tax”), which it had promised would be placed in escrow and forwarded to the City. Between December 1990 and January 1995 (after the City of Chicago changed the Tax), Multiut collected approximately $14,000 from Gore and at least $1 million to $1.5 million from the Class, for this Tax that was not actually imposed upon Multiut. 2nd Amd. Compl. 7-9, ‘3! Multiut not only failed to inform Plaintiff and
the Class that the money collected was not so applied or escrowed, but also failed to escrow, account for, and refund the funds with interest.
(2) By overcharging for the service of providing natural gas. Multiut was to charge for natural gas actually supplied to Gore and the Class on a set per therm cost basis, plus an amount equal to 1/2 of their respective per therm cost savings per month, instead, Multiut overcharged and billed Gore at least $100.000 and the class millions of dollars and refuses to provide an accounting and refund with interest. Id. 10-11.
Gore has further alleged that Multiut prevented him from discovering the wrongs by intentionally concealing them until at least December 2000, when he discovered the truth and could not reasonably have done so earlier. (Gore testified at his deposition on May 8, 2002 that he first discovered the discrepancies in his bills, the overcharges, the taxes, and failure to escrow the taxes, in December 2000. See Exh, D, pp. 25-28,) Thereafter he was unable to obtain any refund and based thereon, terminated Multiut’s services on or about June 2001, However, the wrongful acts are continuing to date, in that Multiut continues to ‘refuse to provide an accounting and refund with interest to Gore and the Class, all to their detriment and damage. They seek imposition of constructive trust (id. 22), an accounting and damages in not less than the foregoing amounts plus interest (id, 9-13, 23).
Gore filed the original Class Action Complaint on Nov. 20, 2001, and in lieu of responding to a motion to dismiss, filed the 1st Amended Class Action Complaint Feb. 14, 2002, setting forth 4 counts for (1) breach of
3-: The City did not and will not collect the 8% Tax, presumably because of U.S. constitutional restrictions as to the interstate commerce clause and exceptions for interstate pipelines and out-of-state suppliers. As a result in 1994 the City changed the tax from an 8% gross receipts tax to a flat rate tax of 1.4 to 1.5 cents per therm. 2nd Amd. Comp. P 8. in Multiut’s response to First Request to Admit {attached hereto as Exh. F), it has admitted the following statements about this Tax; (8) that Multiut collected approximately $14,000 in Tax from Gore between 1991-1994; and (9) that Multiut spent its customers Tax payments on business expenses.. Yehuda Draiman testified to the same effect in his deposition 1-10-02 See transcript excerpts attached hereto as Exh. E, at pp, 36-37,40, 68, and Exh, 6 thereto.

Activity Date: 8/15/2007 Participant: GORE JACK
CASE SET ON STATUS CALL
Court Date: 8/29/2007
Court Time: 0930
Court Room: 2402
Judge: BRONSTEIN, PHILIP L.

Posted by: Jay Drai at August 28, 2007 11:38 PM
Comment #232655

IDB vs Nachshon Draiman - 2007 Israel Discount Bank Fraud Lawsuit $45 million – filed Jan. 2007 in Jerusalem, Israel. from Globes Financial, in Israel
The charges are that the developers of the hotel Nachshon and Elitzur Draiman committed illegal acts that brought the debt of the hotel to be about $45 million dollars, most of it to Israel Discount Bank (The hotel Jerusalem Pearl is located outside the Jaffa Gate - the old city of Jerusalem)
The court appointed trustees of the Jerusalem Pearl Hotel claim in the municipal court in Jerusalem, to charge the developers in damages of over $20 million dollars - according to the lawsuit filed by the court appointed trustees, the lawyers Yair Green, Yaron Feinshtein and Nitzan Shemueli, claim that the developers of the hotel, the brothers Nachshon Draiman and Elitzur Draiman, committed illegal acts that brought the debt of the hotel to over $45 million dollars, most of it to Israel Discount Bank.
The trustees claim that they are in the process of selling the property, at the asking price of $20 million dollars, and after the sale there will be a debt of about $25 million dollars.
The difference of about $25 million dollars they hold against the brothers Nachshon Draiman and Elitzur Draiman, they developed the hotel with a foreign company that is incorporated in Illinois. (Jerusalem Enterprises)
The Hotel which has 88 rooms and 22 suites, was operated by the Dan Hotels chain, and according to the trustees, the previous owners Nachshon Draiman and Elitzur Draiman owe the Dan Hotel Chain about $250,000.
According to them Nachshon Draiman and Elitzur Draiman committed transfers of funds between various accounts, gave various guarantees in a form of checks that one of the accounts the check was drawn on was closed, presented exhibits and fictitious and false documents as to substantiate their investment in the hotel - which is false and fraud, transferred funds overseas from the funds belonging to the hotel project without explanation or reasoning and inflated the amount of cost of construction (about $2,500 per square meter) amounts that are way greater than any reasonable estimates that would cost to build the hotel.
Additional claim is that Nachshon Draiman and Elitzur Draiman presented false and deceptive documentation to the Israeli government division of development and investment, in order to obtain loans with government guarantees and government grants. (January 15, 2007)
Possible criminal charges may be initiated.
For More Information See: www.antidefamationusa.com
פרקי מלון פנינת דן בירושלים: לחייב את היזמים ב-20 מיליון שקל
טוענים כי יזמי הקמת המלון, נחשון ואליצור דריימן, ביצעו פעולות לא חוקיות שהביאו את המלון לחוב של כ-45 מיליון דולר, רובו לדיסקונט
שמואל דקלו‏
16:18 15/1/07
המפרקים של מלון פנינת דן שבירושלים דורשים בבית המשפט המחוזי בירושלים לחייב את יזמי הקמת המלון בפיצוי של למעלה מ-20 מיליון שקלים. בתביעה שהגישו המפרקים, עוה”ד יאיר גרין ירון פיינשטיין וניצן שמואלי, הם טוענים כי יזמי הקמת המלון, האחים נחשון ואליצור דריימן, ביצעו פעולות לא חוקיות שהביאו את המלון לחוב של כ-45 מיליון דולר, רובו לבנק דיסקונט
( 904 -0.66% )
.
המפרקים טוענים כי הם מצויים בהליכי מכירת הנכס, כאשר התשלום המבוקש הוא כ-20 מיליון דולר, ולאחר המכירה יגיע סכום החובות לכ-25 מיליון דולר.
את
מודעה
ההפרש הם מבקשים מהאחים דריימן, שהקימו את המלון באמצעות חברת חוץ שהתאגדה באלינוי.
המלון, שבו 88 חדרים ו-22 סוויטות, הופעל על ידי רשת מלונות דן, ולטענת המפרקים בעלי המלון לשעבר חייבים לרשת כ-900 אלף שקל.
לדבריהם, האחים דריימן ביצעו העברות פיקטיביות בין חשבונות; נתנו בטוחות באמצעות צ’קים שאת החשבון ממנו נמשך אחד הצ’קים סגרו; הציגו מצגי שווא בדבר סכום ההשקעה במלון; העבירו כספים לחו”ל מכספי החברה ללא הסבר וניפחו את סכום בניית המלון (כ-2,500 דולר למטר) בסכומים העולים פי כמה על הערכות הסבירות של בניית המלון.
עוד נטען, כי הם הציגו מצג מטעה כלפי מרכז ההשקעות על מנת להשיג הלוואות בערבות מדינה ומענקי

Posted by: Jay Drai at September 12, 2007 5:11 PM
Comment #233725

Dynegy vs Multiut, Nachshon Draiman, Future Associates et al - 02 C 7446
(A $22 million dollar lawsuit for fraud and insolvency) (Numerous contempt of court)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
DYNEGY MARKETING and TRADE, a
Colorado Partnership, )
Plaintiff, )
) No. 02 C 7446
v. )
) Judge Nordberg
MULTIUT CORPORATION, an Illinois
Corporation and NACHSHON DRAIMAN, )
an Illinois Resident, FUTURE ASSOCIATES, )
an Illinois General Partnership, )
Defendants. )
THIRD AMENDED COMPLAINT
Dynegy Marketing and Trade (“Dynegy”), by its attorneys, complains of Multiut Corporation (“Multiut”), Nachshon Draiman (“Draiman”), and Future Associates, as follows:
THE PARTIES
1. Dynegy is a Colorado general partnership with its principle place of business in Houston, Texas. The only partners of the partnership are Dynegy GP, Inc., a Delaware corporation which maintains its principle place of business in Texas, and DMT Holdings, LP, a Delaware limited partnership (f7k/a NGC GP, Inc.).
2. The only partners of DMT Holdings LP are (1) DMT G.P., LLC, a Delaware limited liability company and (2) DMT L.P., LLC, a Delaware limited liability corporation.
3. The sole member of DMT G.P., LLC is DMT Holdings, Inc., a Delaware corporation which maintains its principle place of business in Texas.
4. The sole member of DMT L.P., LLC is DMT Holdings, Inc., a Delaware corporation which maintains its principle place of business in Texas.

5. Multiut is an Illinois corporation with its principle place of business located in Cook County, Illinois.
6. Future Associates has its principal place of business located in Cook County, and is, upon information and belief, an Illinois general partnership.
7. Draiman is an individual residing in Cook County, Illinois.
JURISDICTION
AND VENUE
8. This Court has jurisdiction, under 28 U.S.C. § 1332(a)(l), because the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between citizens of different states.
9. Venue is proper, under 28 U.S.C. § 1391(a), because the defendants reside in and a substantial part of the events or omissions giving rise to the claim occurred in this judicial district.
COUNTI (Breach of Agreement)
10. On or about January 1, 1994, Multiut signed a Natural Gas Sales Agreement with Natural Gas Clearinghouse (“NGC”) for the purchase and sale of natural gas (the “Agreement”). A true and correct copy of the Agreement, with Exhibits A and B, is attached as Exhibit 1.
11. On July 7, 1998, NGC changed its name to Dynegy Marketing and Trade.
12. Under the Agreement, Multiut “[acted] as the duly authorized agent and representative of ultimate consumers and users of natural gas delivered to Multiut under the Agreement.” (Agreement, page 1.)
13. Under the Agreement, Multiut is “responsible for collecting payment from its principals. The payment to [Dynegy] by Multiut on behalf of Multiut’s principals shall be due on
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the twentieth (20th) day of the month, or as to statements delivered after the tenth (10th), within ten (10) days after receipt of such statements.” (Agreement, page 5, Article V-A (2).)
14. For natural gas Dynegy delivered to Multiut through December 2000, there existed an outstanding balance owed to Dynegy by Multiut of $1,664,501.06 (after offsets for payments made by Multiut through March 1, 2001).
15. Dynegy sent and/or Multiut received monthly invoices for the purchase and sale of natural gas under the Agreement from January 1, 2001 through December 31,2002 (the “Invoices”).
16. Multiut breached the Agreement by failing and/or refusing to pay the Invoices in full when due.
17. As of April 30,2003, the unpaid principal balance due to Dynegy under the Invoices, after application of payments in accordance with Article V-A(3) of the Agreement, is $12,504,912.51 (the “Unpaid Principal Balance”).
18. Under the Agreement, “Should Multiut fail to pay all of the amount of any bill when the same becomes due, Multiut shall pay [Dynegy] a late charge on the unpaid balance that shall accrue on each calendar day from the due date at a rate equal to two percent (2%) above the then-effective monthly prime commercial lending rate per annum announced by The Federal Reserve Bulletin from time to time … . ” In addition, “the late charge … shall compound monthly.” (Agreement, page 5, Article V-A (3).)
19. Under the-Agreement, “If either principal or late charges are due, any payments thereafter received shall first be applied to the late charges due, then to the previously outstanding principal due and lastly, to the most current principal due.” (Agreement, page 5, Article V-A (3).)
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20. As of April 30, 2003, the amount of interest due, in accordance with Article V-A(3) of the Agreement, is $593,997.74 (the “Interest”).
21. Dynegy has performed all of its obligations under the Agreement.
WHEREFORE, Dynegy requests entry of a judgment in its favor and against Multiut, for $12,504,912.51, plus interest, through the date of judgment, in an amount in excess of 5593,997.74, and such other relief as the Court deems appropriate.
COUNT II
(Breach of Guaranty)
22. Dynegy repeats and reasserts the allegations of paragraphs 1 through 21, inclusive, as paragraph 22.
23. On or about October 31,1995, Draiman and Multiut executed a Guaranty (the “Guaranty”). A true and correct copy of the Guaranty is attached as Exhibit 2.
24. Under the Guaranty, Draiman and Multiut, jointly, severally, and unconditionally “[guaranteed] the payment to NGC promptly when due, or upon demand thereafter, pursuant to the terms of the Agreement, the full amount of all obligation or indebtedness due to NGC under the Agreement.”
25. Draiman and Multiut are jointly and severally liable for their obligations under the Guaranty.
26. Draiman and Multiut breached the Guaranty by failing to pay after demand, when due, the Unpaid Principal. Balance and the Interest.
WHEREFORE, Dynegy requests entry of a judgment in its favor and against Multiut, for $12,504,912.51, plus interest, through the date of judgement, in an amount in excess of $593,997.74, and such other relief as the Court deems appropriate.
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COUNT III
(Fraudulent Transfer In Law- Multiut)
27. Dynegy repeats and reasserts the allegations of paragraphs 1 through 26, inclusive, as paragraph 27.
28. At all relevant times, Draiman has been a director, officer and/or control ling shareholder of Multiut.
29. At all relevant times, Draiman has been a general partner in Future Associates or otherwise had authority and/or control over the business affairs of Futures Associates or an entity that had authority over the business affairs of Futures Associates.
30. Since at least January 1999, Multiut failed to make timely payment, when due, for some or all of the natural gas delivered by Dynegy.
31. On March 7, 2001, Ginger Wright of Dynegy and Lenore Kamien of Multiut ’ agreed that Multiut owed Dynegy approximately $11,000,000, excluding interest.
32. On September 5, 2001, Dynegy representatives Pete Pavluk and Mark Ludwig met with Multiut representatives Lenore Kamien and/or Nachshon Draiman at Multiut’s offices to discuss the amount owed by Multiut.
33. At that meeting, Mr. Draiman said that Multiut did not have funds sufficient to pay the debt owed and that Multiut would propose a payment plan by September 17, 2001.
34. In a September 17, 2001 letter, Multiut proposed a payment plan by which it would make monthly payments, from October 2001 through March 2002, in order to pay down the amount owed to Dynegy. The proposed payments ranged from $600,000 in some months to $1,800,000 in other months. According to Mr. Draiman, Multiut was, “insurefd] [sic] an additional annual profit of $2,000,000” and that, “in the meantime, [Multiut] was working on bank financing as well as funds from private sources for capital infusion.”
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35 . In an October 4, 2001 letter to Multiut, Dynegy responded to Multiut’s September 17, 2001 proposal by asking for “a detailed formal plan by no later than Wednesday, October 10, 2001 that outlines bringing your account balance current by no later that [sic]-January 15, 2002.”
36. In an October 12, 2001 letter, Multiut responded to Dynegy’s October 4, 2001 letter by proposing “weekly payments for October through January.” The weekly payments proposed by Multiut totaled $7,700,000.
37. Multiut did not make all the weekly payments described in its October 12, 2001
letter.
38. Multiut’s check , dated August 23, 2001, made payable to Dynegy for $300,000, was returned for insufficient funds.
39. Multiut’s check, dated October 26, 2001, made payable to Dynegy for $150,000, was returned for insufficient funds.
40. Multiut’s check, dated November 9, 2001, made payable to Dynegy for $200,000, was returned for insufficient funds.
41. Multiut check no. 1946, made payable to Dynegy for $200,000 and deposited on December 7, 2001, was returned twice due to insufficient funds.
42. On January 8, 2002, Multiut claimed it could not pay the amounts owed to Dynegy because of slow payment by the government in connection with Mr. Draiman’s nursing homes.
43. On January 31, 2002, Multiut told Dynegy that it would make a $200,000 payment while it worked to raise cash through a factoring company and while it attempted to arrange a line of credit with Bank Leumi.
44. Multiut never raised cash through a factoring company or arranged a line of credit with Bank Leumi in 2002 or 2003.
45. In 2002 and 2003, Multiut did not have cash sufficient to pay the Invoices when due.
46. During 2000 and 2001, Multiut had creditors, in addition to Dynegy, to whom it did not make payments when due in the normal course of its business.
47. On June 19, 1998, Multiut entered into a Natural Gas Sales Agreement with WPS Energy Services, Inc. (“WPS”) for the purchase and sale of natural gas.
48. By June 2000, Multiut was indebted to WPS in the amount of $1,625,472 for natural gas delivered to Multiut prior to May 2000.
49. On September 27, 2000, Multiut gave WPS its promissory note in the amount of $1,570,337.87 (the “WPS” Promissory Note).
50. The WPS Promissory Note was a reaffirmation by Multiut of its debt to WPS incurred under the terms of the Natural Gas Sales Agreement between WPS and Multiut.
51. In the summer and fall of 2001, Multiut did not make payments, when due, in accordance with the WPS Promissory Note.
52. On September 27, 2001, WPS filed a lawsuit against Multiut alleging that Multiut defaulted on its obligation under the WPS Promissory Note by failing to make the required payments due on July 10, 2001, August 10, 2001 and September 10, 2001.
53. According to Multiut’s 2002 tax return, Multiut transferred approximately $2,000,000 (or more) to Future Associates, Draiman and/or other entities, including Draiman’s nursing home, hotel and/or other business ventures, at some time during 2001 when Multiut was indebted to Dynegy.
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54. Multiut did not receive reasonably equivalent value for the transfer described in paragraph 53.
55. In the years 1999 through 2003, Multiut transferred cash or other assets to Future Associates, Draiman and/or other entities, including Draiman’s nursing home, hotel or other business interests when Multiut was indebted to Dynegy.
56. Multiut did not receive reasonably equivalent value for the transfers described in paragraph 55.
57. When Multiut made the transfers described in paragraphs 53 and 55 (the “Transfers”), Multiut was insolvent and/or became insolvent as a result of the Transfers.
58. The Transfers were fraudulent conveyances in violation of applicable laws.
WHEREFORE, Dynegy requests entry of an order granting judgment in its favor and against Multiut, for $12,504,912.51, plus interest, through the date of judgment, in an amount in excess of $593,997.74; voiding the fraudulent transfers and returning the Transfers to Multiut to be used to satisfy the debt to Dynegy; and such other relief as this Court deems appropriate.
COUNT IV (Fraudulent Transfer In Fact- Multiut)
59. Dynegy repeats and reasserts the allegations of paragraphs 1 through 58, inclusive, as paragraph 59.
60. The Transfers were made with actual intent to hinder, delay or defraud Dynegy, a creditor of Multiut and as-such constituted fraudulent conveyances in violation of applicable laws.
WHEREFORE, Dynegy requests entry of an order granting judgment in its favor and against Multiut, for $12,504,912.51, plus interest, through the date of judgment, in an amount in excess of $593,997.74; voiding the fraudulent transfers and returning the money to Multiut to be
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used to satisfy the debt to Dynegy; punitive damages and such other relief as this Court deems appropriate.
COUNT V
(Fraudulent Transfer in Law- Future Associates)
61. Dynegy repeats and reasserts the allegations of paragraphs 1 thorough 58, inclusive, as paragraph 61.
62. Future Associates accepted the Transfers of the assets without having provided adequate consideration for the Transfers.
WHEREFORE, Dynegy requests entry of order granting judgment in. its favor and against Future Associates, voiding the fraudulent transfers and returning the money to Multiut to be used to satisfy the debt to Dynegy; and such other relief as this Court deems appropriate.
COUNT VI (Fraudulent Transfer in Law- Diraiman)
63. Dynegy repeats and reasserts the allegations of paragraphs 1 through 58, inclusive, as paragraph 63.
64. Draiman accepted the Transfers without having provided adequate consideration or reasonably equivalent value for the Transfers.
WHEREFORE, Dynegy requests entry of order granting judgment in its favor and against Nachshon Draiman, voiding the fraudulent transfers and returning the money to Multiut to be used to satisfy the debt to Dynegy; and such other relief as this Court deems appropriate.
COUNT VII
(Breach of Fiduciary Duty)
65. Dynegy repeats and reasserts the allegations of paragraphs 1 through 58, inclusive, as paragraph 65.
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66. When Multiut purchased natural gas from Dynegy in 2001 and 2002, Multiut was insolvent.
67. Because Multiut was insolvent, Draiman, as a director and officer of Multiut, owed a fiduciary duty to Dynegy, as a creditor of Multiut.
68. Draiman breached his fiduciary duty to Dynegy by causing Multiut to take natural gas from Dynegy when Draiman knew that Multiut did not intend to and/or could not pay for it. Draiman also breached his fiduciary duties to Dynegy by making and/or authorizing the Transfers.
WHEREFORE, Dynegy requests entry of an order granting judgment in its favor and against Draiman, for $ 12,504,912.51, plus interest, through the date of judgment, in an amount in excess of $593,997.74, and for punitive damages and any further relief that this Court deems appropriate.
DYNEGY MARKETING and TRADE

Barry S. Hyman (#6188142)
Helen Wilson
SCHIFF HARDIN & WATTE
6600 Sears Tower
Chicago, IL 60606
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(312)258-5500
See: www.antidefamationusa.com

Posted by: Jay Drai at September 21, 2007 10:29 AM
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