Enron to receive $149 million under commercial paper payment recovery claims settlement

By Caroline Salls

Pittsburgh, July 18 - Enron Creditors Recovery Corp. will receive $149 million under a claims settlement in connection with claims brought by Enron to recover payments it made on its commercial paper shortly before its 2001 bankruptcy filing, according to a news release.

Specifically under the settlement, Lehman Commercial Paper Inc., The Northern Trust Co., Allstate Life Insurance Co. and The Prudential Insurance Co. of America will pay Enron about $149 million to settle the claims, although the allocation of the payment among the defendants has not been disclosed.

"We are pleased to have resolved our differences with the settling defendants and believe this to be a significant milestone in the recovery process and our efforts to provide maximum value to creditors," Enron president and chairman of the board John J. Ray III said in the release.

According to the release, this settlement resolves claims against only some of the parties who received Enron commercial paper payments, and Enron is continuing to prosecute this lawsuit against other defendants who also received similar payments.

Enron said it filed the lawsuits in November 2003 to recover commercial paper payments from roughly 180 defendants to benefit creditors of its estate.

The settlement is subject to the approval of the U.S. Bankruptcy Court for the Southern District of New York.

Enron is a Houston-based energy company that emerged from bankruptcy on Nov. 18, 2004.

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