Enron Investors' Suit Against Merrill and Credit Suisse to Move Forward

February 23, 2007 (PLANSPONSOR.com) - A U.S. District Court ruled that a lawsuit filed by Enron Corp. investors against Merrill Lynch & Co. Inc. and Credit Suisse Group is set to go to trial in April as planned, rejecting the request by the two investment banks to delay the trial, according to Reuters.

The lawsuit charges that the two investment banks helped the fallen energy giant conceal its unlawful financial behavior.

U.S. District Judge Melinda Harmon allowed the trial to move forward even before the 5th U.S. Circuit Court of Appeals has ruled on whether to overturn a prior decision by Harmon to allow the case to be filed as a class action. The appeals court did not say when it would issue a decision.

Credit Suisse agreed in May 2006 to a $90 million settlement with Enron that charged the investment bank played a part in the Texas company’s downfall (See Credit Suisse Settles with Enron for $90M in MegaClaims Suit ).

Credit Suisse was sixth in the line of investment banks that investors have gone after for allegedly contributing to the fraud that caused the company’s December 2001 bankruptcy, Reuters reported. The settlement is lower than that paid out by JPMorgan Chase & Co, which agreed to pay $350 million and Canadian Imperial Bank of Commerce, $250 million.

Other investment banks that have already settled with Enron investors for lesser amounts than Credit Suisse include, Dominion Bank, $70 million plus $60 million for claims it transferred to third parties; Royal Bank of Scotland Group, $48 million and Royal Bank of Canada $25 million.