Enron Agrees to $356 Million Settlement [View All]

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Enron Agrees to $356 Million Settlement

Participants in Suit Will Likely Only Get 15% to 20% of Claim Amount, Lawyer Says

By ELLEN E. SCHULTZ
Staff Reporter of THE WALL STREET JOURNAL
July 11, 2005 9:08 p.m.

Enron Corp. agreed to a $356 million settlement with about 20,000 current and former Enron Corp. employees who lost money in their retirement plans when the company collapsed in late 2001, though they likely will see only a fraction of that amount.

The agreement will resolve not only a class action lawsuit but an action brought by the Department of Labor, which said it would give the Enron 401(k) and employee stock ownership plans a general unsecured claim of $305.4 million in Enron's bankruptcy. The proposed settlement also gives Enron's cash balance plan a claim of $50.9 million.

However, it is likely that participants will receive only up to 15% to 20% of the claim, said Lynn Sarko, an attorney with Keller Rohrback in Seattle who represented the Enron employees, as the final amount paid depends on the total amount of assets available for distribution in the bankruptcy court. The final agreement is subject to approval by the New York Bankruptcy and Texas district courts.

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Write to Ellen E. Schultz at [e-mail]

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