PracticeAudit$40bn class-action Enron suit blocked

$40bn class-action Enron suit blocked

Appeals court sends class-action case back to lower courts for reconsideration

A $40bn (£20.4bn) class-action suit filed by
Enron
investors against Merrill Lynch and Credit Suisse Group has been blocked by a
New Orleans federal appeals panel.

The
US
Court of Appeals
53-page decision included a detailed criticism of US
district Judge Melinda Harmon who granted class-action status to the case.

The panel said Harmon’s decision was partly based on ‘legal error’ regarding
the banks’ liability.

The lawsuit has been sent back to the lower court for reconsideration.
Enron lawyer
William
Lerach
said they were ‘disappointed’ with the outcome.

‘We respect the court, but we think the decision is clearly wrong,’ he said.

The investors are now set to seek a Supreme Court review of the Appeal
Court’s decision.

Further reading:

Arthur Andersen settles with Enron investors

US judge allows class action against Enron

‘Legal
error’ puts end to Enron bank lawsuit

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