CIBC offers $2.4bln settlement in Enron case |
Date: Tuesday, August 2, 2005
Author: www.pionline.com
The University of California, Oakland, secured a $2.4 billion settlement from the Canadian Imperial Bank of Commerce for its role as an adviser to Enron Corp. If approved, it would be the third large settlement the university has won as lead plaintiff representing Enron investors. The university alleged that “CIBC participated in an elaborate scheme to defraud investors,” a UC press release said.
“With this CIBC settlement, UC has now recovered more than $7 billion for investors —more than any other securities case in history,” said James E. Holst, the university’s general counsel, in the news release. That figure tops the $6.1 billion recovered in the WorldCom Inc. litigation.
The settlement places further pressure on remaining defendants, which include Merrill Lynch, Credit Suisse First Boston, Barclays Bank, Deutsche Bank, Toronto-Dominion Bank, Royal Bank of Canada and the Royal Bank of Scotland. UC has alleged the institutions engaged in a series of fraudulent transactions that cost Enron investors between $40 billion and $45 billion in market losses. A trial date is slated for October 2006.
Recovered funds will be distributed among investors who bought Enron stock or publicly traded debt between Sept. 9, 1997, and its December 2001 bankruptcy filing.
Previous settlements in the Enron litigation include $2.2 billion from JPMorgan Chase, $2 billion from Citigroup, $222.5 million from Lehman Brothers, $69 million from Bank of America, $168 million from Enron’s outside directors, and $32 million from Andersen Worldwide. Another $32 million stemming from the bankruptcy proceeding for the LJM2 partnership, an Enron-related entity, will be distributed to investors.
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