Enron Employees Seek to Lift Stay in Bankruptcy Hearings

January 31, 2002 (PLANSPONSOR.com) - The Gottesdiener Law Firm has asked the US Bankruptcy Court in New York to lift the automatic stay that has protected the company since it filed for bankruptcy in December.

This move would allow Enron’s former workers to proceed in their efforts to establish that the company violated federal pension laws in its handling of its 401(k) Plan, and share in whatever proceeds may be available after secured creditors’ fulfill their claims in the bankruptcy.

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Another request made in the firm’s motion to lift the stay is to block Enron from tapping into an $85 million fiduciary liability insurance policy earmarked to compensate workers, following statements made by the company suggesting its intent to use the policy proceeds to fund the legal defense of company executives currently being investigated by the government.
The suit, formally titled Kemper, et al. v. Enron Corp., et. al., seeks to recover for Enron’s current and former employees a portion of the $1 billion that has disappeared from their 401(k) accounts in the wake of the company’s collapse.