NEWBY v. ENRON CORP.

No. 07-20043.

542 F.3d 463 (2008)

Mark NEWBY, et al.; Plaintiffs, v. ENRON CORPORATION, et al.; Defendants. Fleming & Associates, LLP, Plaintiff-Appellant, v. Andrew S. Fastow; Bank of America Corp.; Credit Suisse First Boston; Barclays, PLC; Canadian Imperial Bank of Commerce; Merrill Lynch & Company, Inc.; J.P. Morgan Chase & Co.; Lehman Brothers Holdings, Inc.; Banc of America Securities, LLC; Financial Institution Defendants; Bank of America N.A.; John A. Urquhart; J.P. Morgan Securities, Inc., formerly known as Chase Securities, Inc.; Merrill Lynch, Pierce, Fenner & Smith, Inc.; Pershing, LLC; Robert A. Belfer; Norman P. Blake, Jr.; Ronnie C. Chan; John H. Duncan; Wendy L. Gramm; Robert K. Jaedicke; Charles A. Lemaistre; Joe H. Foy; Joseph M. Hirko; Ken L. Harrison; Rebecca Mark-Jusbasche; John Mendelson; Paulo V. Ferraz Pereira; Frank Savage; Jerome J. Meyer; Charles E. Walker; Citigroup, Inc.; Kristina Mordaunt; Credit Suisse First Boston (USA), Inc.; Campsite, Ltd.; J.P. Morgan Securities, Inc.; CIBC, Inc.; CIBC World Markets Corp.; Citibank, NA; Citicorp North America; Lehman Brothers, Inc.; Barclays Capital, Inc.; Salomon Brothers International, Ltd.; Citicorp; J.P. Morgan Chase; Citigroup Global Markets, Ltd.; Citigroup Global Markets, Inc.; Royal Bank of Canada; Royal Bank of Scotland; National Westminster Bank, PLC; Greenwich Natwest, Ltd.; Greenwich Natwest Structured Finance, Inc.; Royal Bank Holding; Royal BK DS Holding; RBC Dominion Securities, Inc.; RBC Dominion Securities, Ltd.; RBC Holdings (USA), Defendants-Appellees.

United States Court of Appeals, Fifth Circuit.

September 8, 2008.


Attorney(s) appearing for the Case

Gregory Sean Jez, Sylvia Gerald Davidow, Fleming & Associates, Houston, TX, Jonathan Standish Massey (argued), Bethesda, MD, for Plaintiff-Appellant.

Julia B. Cooper, Walston, Wells & Birchall, Birmingham, AL, Jan Nielsen Little, Keker & Van Nest, San Francisco, CA, Craig Smyser, Smyser, Kaplan & Veselka, Houston, TX, Richard Bruce Drubel, Boies, Schiller & Flexner, Hanover, NH, for Fastow.

Gregory A. Markel (argued), Ronit Setton, Cadwalader, Wickersham & Taft, New York City, Charles G. King, III, King & Pennington, Houston, TX, for Bank of America Corp., Banc of America Securities, LLC and Bank of America, NA.

Richard W. Clary (argued), Julie A North, Cravath, Swaine & Moore, New York City, Lawrence David Finder, Odean L. Volker, Haynes & Boone, Houston, TX, for Credit Suisse First Boston, Pershing, LLC and Credit Suisse First Boston (USA), Inc.

David H. Braff, Jeffrey T. Scott, Marc De Leeuw, Sullivan & Cromwell, New York City, Barry Abrams, Abrams, Scott & Bickley, Houston, TX, for Barclays, PLC and Barclays Capital, Inc.

Adam S. Hakki, Shearman & Sterling, New York City, for Merrill Lynch & Co., Inc. and Merrill Lynch, Pierce, Fenner & Smith, Inc.

Robert C. Micheletto, Jones Day, New York City, for Lehman Bros. Holdings, Inc. and Lehman Bros., Inc.

Robin C. Gibbs, Gibbs & Bruns, Houston, TX, for Urquhart, Belfer, Blake, Chan, Duncan, Gramm, Jaedicke, Lemaistre, Mendelson, Pereira, Savage, Meyer and Walker.

Robert E. Gooding, Jr., Howrey, LLP, Irvine, CA, for Belfer.

Barnes H. Ellis, Stoel & Rives, Portland, OR, for Hirko.

Jacks C. Nickens, Nickens, Keeton, Lawless, Farrell & Flack, Houston, TX, for Harrison.

Victor Tabak, Miller & Chevalier, Washington, DC, for Pereira.

Robert Hayden Burns, Liskow & Lewis, Houston, TX, for Mordaunt.

Claude L. Stuart, III, Phelps Dunbar, Houston, TX, Michael Steven Shuster, David G. Hille, Kasowitz, Benson, Torres & Friedman, Michael James McNamara, Mark David Kotwick, Seward & Kissell, New York City, for Royal Bank of Canada, Royal Bank Holding, Royal BK DS Holding, RBC Dominion Sec., Inc., RBC Dominion Sec., Ltd. and RBC Holdings, USA.

John M. Newman, David F. Adler, Jones Day, Cleveland, OH, Lee A. Armstrong, Jones Day, New York City, for Royal Bank of Scotland, Nat. Westminster Bank, PLC, Greenwich Natwest Structured Finance, Inc., Greenwich Natwest, Ltd. and Campsite, Ltd.

David Elliott Miller, Jones Day, Houston, TX, for Campsite, Ltd.

Before SMITH and PRADO, Circuit Judges, and LUDLUM, District Judge.


PRADO, Circuit Judge:

In December 2001, Enron Corporation filed for bankruptcy. Seven years later, litigation involving the Enron collapse endures. Today's decision presents another chapter in that story.

I. FACTUAL AND PROCEDURAL BACKGROUND

On October 16, 2001, Enron publicly announced that it had incurred a $683 million loss and was taking non-recurring charges of $1.01 billion after-tax in the third quarter of 2001. That week, the Wall Street...

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