Enron shareholders’ suit dismissed and plaintiffs order to pay attorneys’ fees
A class action suit against AllianceBernstein LP (formerly known as Alliance Capital Management LP) has been dismissed by a federal judge, and she has ordered the plaintiffs to pay the attorneys’ fees. She also said it would be appropriate for the lawyers for the plaintiffs to pay those fees.
The suit was filed by attorney William Lerach of Lerach Coughlin Stoia Geller Rudman & Robbins LLP. He says that his firm will pay the fees if that decision is not reversed.
Alleged in the suit was fraud on the part of the investment firm in the underwriting process. The lawsuit claimed that Alliance executive Frank Savage signed a false registration statement for Enron’s issuance of $1 billion in bonds. Savage was a member of Enron’s board of directors, so the shareholders are alleging that he was looking out for Alliance’s interests in that capacity.
The judge ruled that there was no evidence to suggest that Savage knew the registration statement was false, nor was there evidence that his position at Alliance influenced his actions with the Enron board.
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