>The proposed settlement, which still has to be approved by a New York bankruptcy judge and a Texas federal judge, also provides a $50.8 million claim for Enron’s cash balance plan, the US Department of Labor (DoL) announced.
>The DoL admitted in its announcement that the exact amount the plans eventually receive depends on the amount of assets available for distribution from the bankruptcy court – although the DoL asserted the final total would be in the tens of millions of dollars.
>According to the announcement, the proposed pact resolves a DoL lawsuit and a private class action suit brought on behalf of the plans’ participants as well as funding and termination issues relating to the cash balance plan raised by the Pension Benefit Guaranty Corporation. The agreement does not settle the department’s claims against former Enron executives Kenneth Lay or Jeffrey Skilling.
>The DoL filed the suit in June 2003 alleging a variety of violations of the Employee Retirement Income Security Act (ERISA) including not considering whether investments in company stock were prudent for the plans.
>According to the news release, the board of director defendants, the Enron officers, and administrative committee members who were sued for mismanagement of the employee benefit plans have already paid $86.8 million under settlements with the department and the private plaintiffs.