Declaration Of Helen J. Hodges In Support Of Lead Counsel's ...

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elieved it would be beneficial to the Class for Enron to be a defendant not because we could collect from Enron, but because the PSLRA allows a plaintiff to collect an “up-charge” from other defendants found liable in the event a defendant is unable to meet the judgment. For example, if Enron and the banks were defendants at trial and the jury found Enron’s proportionate fault was 25% and the banks’ share was 65% of a $20 billion judgment, investors could collect $5 billion from the banks (in addition to the $13 billion attributable to the banks) because Enron is unable to pay the $5 billion judgment. Enron argued that if a single bank were found to be a “knowing” violator, investors could collect the entire judgment from that bank; therefore, there was no need to add Enron as a defendant. After a second hearing and further letter briefs, Judge Gonzalez denied the motion without prejudice to renewal when the deadline for adding defendants was set in Newby. 235. Late in October 2003, the banks filed a motion in Enron’s bankruptcy proceeding to prevent us from having access to the sworn statements (i.e., depositions) of bank employees obtained by the Bankruptcy Examiner. We not only opposed their motion, within days we filed a motion to compel the production of the sworn statements, which the banks and Enron had, in our case in Houston. The banks expected that Judge Gonzalez would grant their motion and that Judge Harmon would follow his lead. They won the first round, but we ultimately won that battle. We argued before Judge Gonzalez that we should not be barred from access to the Bankruptcy Examiner’s discovery which was in the possession of the banks in our case. He granted the banks’ motion for a protective order to prevent investors from having access to the discovery obtained by the Bankruptcy Examiner. Judge Harmon noted that she would ordinarily “defer to his ruling,” but that granting access would streamline the discovery in the civil case and “fairness dictates that all parties to the litigation should have access to the non-privileged information concerning the lawsuit.” 3/16/04 Order on Motions to Compel the Banks to Produce the Sworn Statements and Deposition Transcripts of Their Employees (Docket No. 2021) at 4. - 130 -
236. Bankruptcy Examiner Batson himself filed a motion in November to “protect” his investigation; he sought permission to destroy evidence he had gathered in his investigation. We opposed and ultimately an order regarding disposition of evidence was agreed on. We worked to ensure that none of the evidence was lost. Batson received “immunity” from discovery aimed at him. 237. Craig Rieders filed a proof of claim on behalf of the Class in the LJM2 bankruptcy. In early 2004 in connection with discussions to resolve the proof of claim, we explored an agreed resolution of the Class’s claim and Enron’s claim in the LJM2 estate. The Class and Enron were the primary claimants in the estate. Ultimately, after substantial negotiations with counsel for the Enron estate and LJM2, we agreed that the LJM2 assets would be divided between the Class and Enron with the Class receiving two-thirds and Enron receiving one-third. I participated in drafting the documentation of the agreement and in seeking approval from the LJM2 bankruptcy judge. As part of the resolution, Enron and LJM2 agreed that the Class of investors in publicly-traded Enron securities would be certified and we gave notice to the Class. There were no objections, and on July 7, 2004, Judge Felsenthal approved of the resolution of the class proof of claim. To date, the Class has received $51.9 million from the LJM2 estate. XII. SETTLEMENT NEGOTIATIONS 238. The early Court-ordered mediation sessions with Andersen led by Professor Eric Green were long and difficult. There were multiple plaintiffs involved: Lead Plaintiff, the Tittle (ERISA) Plaintiffs and the Enron bankruptcy estate. Due to the criminal case, Andersen LLP quickly went out of business and the settlement discussions were for naught. After the conviction of Andersen LLP, AWSC restarted the discussions on behalf of the Andersen foreign entities. Those discussions, aided by Professor Eric Green, were fruitful and Lead Plaintiff and the Tittle Plaintiffs joined to settle with AWSC for $40 million. The funds were transferred to an account under the - 131 -
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UNITED STATES DISTRICT COURT SOUTHE
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2. The Parties Establish a Document
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I, HELEN J. HODGES, declare as foll
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• Reviewed over 70 million pages
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6. The above recoveries were based
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gathered and which the banks and En
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14. In this endeavor, Coughlin Stoi
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17. Lead Counsel prosecuted the lit
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[T]his representation has been unde
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and the necessary involvement with
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case. The Court hereby awards attor
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published an article, “Enron Jolt
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statements. We compiled profiles on
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34. We had no way of knowing whethe
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which witnesses to pursue, but cont
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the market in October 2001. The ana
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said it was unable to determine whe
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depositions because discovery was p
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65. After the motion was filed, The
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institutional plaintiffs, their rep
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drawing on the expertise of our in-
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83. On May 3, 2002, the Preferred P
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finance certain of the partnerships
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and participated in a scheme to def
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(j) Arthur Andersen LLP (Docket No.
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Lead Plaintiff had adequately alleg
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(a) The Court ruled that Lead Plain
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director of New Power, and issuance
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94. On September 26, 2002, Lead Pla
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mandamus review, and that the Court
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106. On May 6, 2003, defendant Citi
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scheme, and certain specific allega
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pled with the requisite particulari
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Merrill Lynch and Deutsche Bank Ent
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4. Motions to Intervene Additional
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Gramm, Jaedicke, LeMaistre, Meyer,
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professionals and experts, and atte
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121. On May 7, 2003, the Outside Di
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of Enron’s prominence and magnitu
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131. As part of discovery, Lead Cou
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Third Parties and Defendants Date S
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Page 85 and 86: 133. Document requests and subpoena
Page 87 and 88: 139. In responding to the document
Page 89 and 90: 146. In addition to JPMorgan’s in
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Page 93 and 94: Protocol Order provided for the ord
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Page 97 and 98: Deponent Entity Date[s] Location No
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Page 111 and 112: 187. Lead Counsel made further supp
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Page 115 and 116: 195. On April 13, 2004, defendants
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Page 119 and 120: • Outside Directors’ Memorandum
Page 121 and 122: 208. A two-day hearing was held reg
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Page 127 and 128: nature of Enron’s financial condi
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Page 131 and 132: primarily involving Deutsche Bank,
Page 133: We filed a notice of request for se
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Page 139 and 140: proceeds for our settlement. Thus,
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Page 143 and 144: team; for example, we reviewed info
Page 145 and 146: Court ruled that Lead Plaintiff fai
Page 147 and 148: Opposition to Deutsche Bank’s Mot
Page 149 and 150: Sec. Litig., 443 F.3d 987 (8th Cir.
Page 151 and 152: Plaintiff’s Opposition to Motion
Page 153 and 154: dated June 5, 2006 as It Pertains t
Page 155 and 156: the Pleadings (Docket No. 5019). On
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Page 161 and 162: y the court and cited in In re Cend
Page 163: 296. Attached hereto as Ex. 2 is a
Page 166 and 167: ADDITIONAL SERVICE LIST Stuart Yoes
Page 168 and 169: ENRON COUGHLIN STOIA GELLER RUDMAN
Page 170 and 171: Name Title Hours Rate Lodestar Meye
Page 172 and 173: ENRON - SUMMARY OF PLAINTIFFS' FIRM
Page 178: EXHIBIT 4
Page 182 and 183: TOP SECURITIES SETTLEMENTS Case Nam
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Exhibit Listings and Notes regardin
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