``Enron's directors and officers should not be advanced money for their civil or criminal defense costs before the issue of their individual liability has been resolved,'' Oregon Attorney General Hardy Myers, the lead attorney for the group, said in a news release.
Thousands of Enron employees lost their retirement savings in accounts loaded with Enron stock as the company plunged into bankruptcy on Dec. 2. The energy giant and its executives face a growing number of lawsuits over the collapse.
U.S. Bankruptcy Judge Arthur Gonzales is expected to hear objections to the advance fee request Wednesday in New York City, said New Mexico Attorney General Patricia Madrid.
``Enron is seeking an advance payment from bankruptcy court of at least $30 million to pay for the defense costs of its officers and directors. I object,'' Madrid said.
She said advancing of funds might accelerate depletion of insurance money while tens of thousands of innocent people have been harmed in the Enron collapse.
Oregon and New Mexico were joined in the request by attorneys general from Alaska, Arizona, California, Connecticut, Florida, Georgia, Hawaii, Indiana, Kentucky, Louisiana, Maine, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, Oklahoma, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Vermont, the U.S. Virgin Islands, Virginia, Washington, West Virginia, Wisconsin and Wyoming.
Myers explained that under Oregon law, any director found liable to the corporation may be disqualified from reimbursement for defense costs.
``As far as is known from the court's records,'' Myers said, ``none of the directors has provided the affirmation required by Oregon law of their good faith belief that their conduct was not unlawful or opposed to the best interests of the corporation.''
http://accesswdun.com/article/2002/2/198370