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Judge rules she has power to freeze Enron assets

A federal judge ruled she has the authority to freeze $1.1 billion in assets belonging to Enron Corp executives but postponed a decision on the measure sought by a bank that is suing the bankrupt energy trader.

In an order dated January 8, US District Court Judge Lee Rosenthal asked Amalgamated Bank, which manages worker retirement funds, to file a brief in support of its request by January 23 and Enron and its executives to file a response by February 6.

Rosenthal said a 1999 Supreme Court opinion cited in the case did not prevent her from freezing the assets of 29 Enron executives and board members named in the suit.

But she said there were insufficient grounds for issuing such an order immediately.

Amalgamated Bank has alleged that Enron executives and board members pocketed $1.1 billion from sales of Enron stock in recent years by artificially inflating earnings to jack up the price.

Amalgamated attorney Bill Lerach told Rosenthal in December that his clients lost more than $10 million from the collapse of Enron and that they hoped to get some of it back from the wealthy Enron executives.

Rosenthal argued at the time that freezing the money would help his clients and those in an estimated 60 other shareholder lawsuits recover their losses.

Attorneys for the Enron executives said their clients had not done anything wrong and that an asset freeze was unnecessary.

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