Enron notebook

Former workers get fund's first grants

Laidoff Enron workers began getting help Thursday from a fund made up mostly of donations from politicians who initially accepted the money as campaign contributions from the now-bankrupt energy giant.

Several thousand employees lost their jobs after the energy giant's financial implosion. About 30 former workers got nearly $50,000 from the fund, set up by a former Enron worker.

"The fact we're all able to give a little bit of sunshine in this dark time with things going on at Enron is so amazing," said Rebekah Rushing, who found work at another energy firm after she was let go by Enron but wanted to help former colleagues who weren't as lucky.

The workers don't get cash. Instead, the relief fund writes checks to utilities and mortgage companies or provides gift certificates for groceries. The one-time benefit is capped at $1,500 per family for expenses and $250 for food. Much of the money in the account comes from politicians who wanted to return campaign contributions they got from Enron. Colorado Gov. Bill Owens donated Enron campaign donations to a small charter school, but school officials said they are giving the money to the Enron pension fund.

Turning around Enron could make a star

Whoever succeeds Kenneth Lay as Enron Corp.'s chief executive could walk into a minefield. Or he could emerge as a hero who saves the fallen energy giant.

"If you are a restructuring specialist, like someone who deals with problem companies, it presents an opportunity to show your mettle," said Henry T.C. Hu, a corporate law professor at the University of Texas. "On the other hand, you don't know what other bad things are out there yet. There's a risk involved."

Lay resigned as chairman and chief executive Wednesday. Enron said it will search for a restructuring specialist to serve as interim chief executive and help the company survive the biggest bankruptcy in history.

"They're going to need someone with a specialization in these situations that can devote 100 percent of his time to business matters of the company," said Mike Greenberger, a law professor at the University of Maryland. "It's impossible to deal with Congress and the Justice Department and try to resuscitate a company at the same time."

Hu said that if Enron ends up appointing a CEO, it must be someone who inspires confidence without expecting the typical perks of top executives, such as stock options.

The lure would be the reputation boost that would come from saving a company from such a huge, controversial downfall, he said.

Lay, 59, will remain on Enron's board. Enron spokesman Vance Meyer said he will not get a severance package.

Enron selloff unusual for blue-chip company

Seven officers of Enron Corp. unloaded as much as $175-million worth of their company's shares last year in a stock-selling spree that was extraordinary even by the standards of the aggressive energy-trading industry.

Altogether, 18 top officers and directors of Enron executed at least 64 sales of the company's stock in 2001, according to filings with the Securities and Exchange Commission. Many blue-chip companies record fewer than a dozen insider sales per year.

While there is no indication that the many insider sales at Enron last year were illegal, experts said the volume and the value of the sales raise serious ethical questions.

"There's nothing in the public record so far to suggest that the Enron officers and directors did any illegal selling of shares," said Stephen Bainbridge, a professor at UCLA School of Law. "It's the old Watergate question. What did they know -- and when did they know it?"

Federal judge approves plan to halt shredding

A federal judge approved a plan Thursday to make sure Arthur Andersen LLP does not destroy more Enron-related documents.

U.S. District Judge Melinda Harmon ordered the accounting firm to preserve all such files.

Under the ruling, the documents can be inspected by lawyers for shareholders who are suing Enron over the loss of millions of dollars in the biggest corporate bankruptcy in U.S. history.

The judge also said the lawyers can start taking sworn testimony from employees in Arthur Andersen's Houston office who were fired or suspended for shredding Enron-related documents. Depositions can start in 20 days.

Arthur Andersen is already under a Texas judge's order banning further shredding of Enron-related documents. Lawyers have said the files are under guard and shredding has ceased.

© 2006 • All Rights Reserved • St. Petersburg Times
490 First Avenue South • St. Petersburg, FL 33701 • 727-893-8111

Contact the Times | Privacy Policy
Standard of Accuracy | Terms, Conditions & Copyright