According to a Houston Chronicle report, Enron lawyers complained to US Bankruptcy Judge Arthur Gonzalez that the company should not be required to pay $2.7 million yearly to hire State Street Bank and Trust to oversee its three retirement programs. Together, the plans have about $1 billion in assets.
Enron attorney Brian Rosen said the company didn’t want to be “taxed” by being responsible for State Street’s fees.
Gonzalez ruled that the plan members should foot State Street’s bill and that the Boston-based State Street should continue managing the plans until the issue is resolved.
State Street Ponders Response
Roseman told Gonzalez that State Street has to decide whether it will stay in the deal if the plans end up paying the company’s fees.
Enron’s sudden turnaround comes after the company signed a DoL agreement to bring in State Street to replace Enron’s existing pension committee.
For their part, DoL officials urged a swift end to the controversy. DoL lawyer Timothy Hauser said an undue delay would only further hurt Enron employees and former workers who already have lost thousands of dollars in retirement funds when Enron imploded.
If Enron sticks to its position of departing the State Street deal, DoL may sue the company to force the appointment of a new pension manager.