On Oct. 28, Bloomberg News published an account of Texas Pacific Group's struggle to buy Oregon's largest utility. The story quoted Richard Blum, a San Francisco investor who has been a business partner and hiking companion of Texas Pacific CEO David Bonderman for the past decade.
Blum is no stranger to acquiring heavily regulated businesses in Oregon--nor is he a stranger to Goldschmidt. Correspondence obtained by WW from the state archives shows that the two were pals and that in 1990 Blum called on the then-governor for urgent political cover. That year, Blum's wife, Dianne Feinstein, was engaged in a brutal race for governor of California and making an issue about the savings-and-loan scandal. (She lost but was later elected to the U.S. Senate.)
Blum drafted a letter for Goldschmidt's signature on Aug. 23, 1990, praising Blum's 1988 takeover of the Jackson County Federal Savings and Loan in Medford. "Could you check out the veracity of this?" Goldschmidt scrawled in the margin before signing a later draft.
Fourteen years later, Blum's hiking buddy tapped Goldschmidt to head Oregon Electric Utility Company to run PGE should Bonderman get his way and buy the local utility.
When and how Goldschmidt and the Texans teamed up is of great interest to a lot of people. The sequence of events is a central question in an ongoing investigation by state Attorney General Hardy Myers into when Diana Goldschmidt and other members of the Oregon Investment Council first learned of the Texans' interest in PGE.
Neil Goldschmidt has said he did not learn of Bonderman's interest in PGE until Oct. 29, 2003, just hours after his wife, Diana, and the other members of the Oregon Investment Council voted to invest $300 million in public funds in Texas Pacific.
There is no evidence that Blum and Bonderman, who own neighboring properties in Aspen, discussed Goldschmidt during the year that Texas Pacific pondered acquiring Oregon's largest utility.
Owen Blicksilver, spokesman for both Blum and Texas Pacific, says neither has any comment about whether they discussed Goldschmidt.
Texas Pacific, for its part, has always maintained that Goldschmidt's name was given to them by Jerry Grinstein, the CEO of Delta Airlines, who, along with Goldschmidt and former TriMet boss Tom Walsh, was named to Oregon Electric's board. (Goldschmidt stepped down from the board in May after admitting the sexual abuse of a teenager 29 years ago.)
But on Oct. 21, however, Grinstein offered a slightly different version of events. Testifying before the Public Utility Commission, Grinstein said that in October 2003, Bonderman called to ask him to serve on the board and inquire "how I felt about other potential board members," namely Goldschmidt and Walsh.
The implication of his testimony was that Bonderman had sought his approval of the two Portlanders--a strange request if Grinstein had suggested them originally.
Speaking for Texas Pacific, Blicksilver disagrees. "We see no inconsistency in any statements made by Jerry," he says.