Mississippi filed a lawsuit against the Enron Corp seeking $10 million plus damages related to investment losses in the company suffered by The Public Employees’ Retirement System of Mississippi, the state employees’ pension system for nearly all nonfederal public employees in the state, according to a report by the Associated Press.
The lawsuit, filed in a Mississippi county court, alleges Enron’s bankruptcy cost the Magnolia state pension fund more than $2 million, in addition to forcing it to dip into the state’s tobacco trust fund to the tune of $1.3 million. The public pension fund, established in 1952 by the state legislature, provides retirement benefits to over 60,000 retirees and has over 250,000 current and former public employees slated to receive benefits on retirement.
Beginning in 1995, the retirement system bought thousands of shares of Enron stock. According to Mississippi Attorney General Mike Moore, the state’s demands are simple with its suit: “We want our money back, and that’s what we’re doing in this case.”
The Mississippi pension fund becomes the latest in a list of public pension funds suing the Crooked “E” in connection with losses related to investments in the company’s stock. In February 2002, University of California system beat out two other groups of government pension and investment funds that sought lead plaintiff status in a class action suit against the defunct energy trader: a group including Florida and the City of New York – both of which lost more money than the Golden State’s $145 million loss (See California Takes ‘Gold’ in Enron Suit ). Also seeking lead status was a four-state group consisting of Ohio, Washington, Georgia and Alabama and various other state interests (See State Retirement Systems Look To Recover Enron Losses ).
The class action suit, currently pending in the US District Court for the Southern District of Texas in Houston, alleges that purchasers of Enron securities between October 19, 1998, and November 27, 2001, were the victims of a ‘fraudulent scheme’ as a result of the dissemination of false financial statements, which artificially inflated the price of Enron securities.
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