Enron settlement status argued
Lawyers debate who is certified as a stockholder
"Lawyers representing Enron shareholders argued in court Tuesday for a certification that would bring both the payout of settlements and a trial closer to reality.
District Court Judge Melinda Harmon heard arguments regarding class certification, the process of defining who qualifies as a shareholder in the lawsuit and would be eligible for payouts that come from settlements or a trial.
This could include not only individuals, pension funds and other investors that lost billions of dollars in Enron stock when the company collapsed, but investors who owned Enron debt or other securities as well.
Class certification is one of the last major steps that has to occur before a class-action lawsuit can go to trial or settlements can be paid out.
The Enron shareholder case is set for trial in October, but so far many defendants have chosen to settle, putting nearly $7.3 billion in payments in bank accounts for future payout. Among the largest settlement payouts are Citigroup ($2 billion), JPMorgan Chase ($2.2 billion) and CIBC ($2.4 billion).
The lawsuit claims Enron investors lost more than $40 billion when the company's stock fell from a high of around $90 per share in late 2000 to just a few dollars shortly before it filed for bankruptcy.
In Tuesday's hearing, Deutsche Bank, one of the seven banks that has not settled, argued that the holders of Enron debt it underwrote in overseas markets should not be included in the class because it was not traded in an "efficient market," one in which prices change in a timely manner based on publicly available information. That's one of the conditions for any securities holder to have their claims included in a class-action.
The lead attorney for the plaintiffs, Bill Lerach, challenged the claim by showing how the price of that debt moved along with other Enron securities in the years before bankruptcy.
Expert witnesses for both sides testified on Tuesday. The judge is not expected to issue a decision immediately.
More on Enron
Sunday, March 12, 2006
Getting their money from Enron
Enron settlement status argued
Lawyers debate who is certified as a stockholder
"Lawyers representing Enron shareholders argued in court Tuesday for a certification that would bring both the payout of settlements and a trial closer to reality.
District Court Judge Melinda Harmon heard arguments regarding class certification, the process of defining who qualifies as a shareholder in the lawsuit and would be eligible for payouts that come from settlements or a trial.
This could include not only individuals, pension funds and other investors that lost billions of dollars in Enron stock when the company collapsed, but investors who owned Enron debt or other securities as well.
Class certification is one of the last major steps that has to occur before a class-action lawsuit can go to trial or settlements can be paid out.
The Enron shareholder case is set for trial in October, but so far many defendants have chosen to settle, putting nearly $7.3 billion in payments in bank accounts for future payout. Among the largest settlement payouts are Citigroup ($2 billion), JPMorgan Chase ($2.2 billion) and CIBC ($2.4 billion).
The lawsuit claims Enron investors lost more than $40 billion when the company's stock fell from a high of around $90 per share in late 2000 to just a few dollars shortly before it filed for bankruptcy.
In Tuesday's hearing, Deutsche Bank, one of the seven banks that has not settled, argued that the holders of Enron debt it underwrote in overseas markets should not be included in the class because it was not traded in an "efficient market," one in which prices change in a timely manner based on publicly available information. That's one of the conditions for any securities holder to have their claims included in a class-action.
The lead attorney for the plaintiffs, Bill Lerach, challenged the claim by showing how the price of that debt moved along with other Enron securities in the years before bankruptcy.
Expert witnesses for both sides testified on Tuesday. The judge is not expected to issue a decision immediately.
More on Enron
WANTED
Dead or Alive
