A US federal judge in Houston has granted a case to proceed as a class-action suit against investment banks for their role in Enron's accounting fraud.
In court papers, which were filed in the federal appeals court on Monday, 30 states claimed that a number of investment banks are liable for their alleged role in the accounting scandal that rocked the US in 2001.
Texas Attorney General, Greg Abbott and other legal counsel from 29 other states, used legal arguments from the 2002 litigation brought by the Securities and Exchange Commission to make a case that Merrill Lynch & Co., Credit Suisse and other investment banks should be held liable as partners in the fraud.
The suit seeks billions of dollars in damage.
The SEC brought charges against Merrill, JPMorgan Chase & Co. and Citigroup over the banks' role in the Enron scheme and won tens of millions of dollars in settlements in 2003.
Merrill Lynch & Co. have already asked their solicitors to file papers in the Appeals Court opposing the court action.
Further reading:
Barclays escapes Enron censure
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