Bush Administration Rebuffs Investors in Enron-Related Case

[BuyingThyme]

Bush Administration Rebuffs Investors in Enron-Related Case

By Greg Stohr

June 12 (Bloomberg) -- The Bush administration dealt a setback to lawsuits that accuse Enron Corp.'s investment banks of helping defraud shareholders out of billions of dollars, refusing to back investors in a similar case at the U.S. Supreme Court.

The Justice Department allowed yesterday's midnight deadline to pass without filing a brief at the high court in support of investors in a securities-fraud case the justices will consider later this year. The department declined to comment on its decision not to submit the brief. The administration still has the option of backing the defendants in the case, Motorola Inc. and Cisco Systems Inc., by filing later on.

The Securities and Exchange Commission asked the Justice Department to side with investors, putting the securities regulator at odds with the Treasury Department, which voiced concerns that the case might undermine the competitiveness of U.S. companies.

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The Enron shareholders are suing the bankrupt energy trading company's investment banks, including Merrill Lynch & Co. and Credit Suisse Group. The Justice Department's refusal to take the side of investors prompted an angry reaction.

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