Bankruptcy judge rejects Enron executives' request

PORTLAND, Ore. -- A bankruptcy judge ruled Wednesday that Enron Corp. executives cannot secure millions of dollars from the company for their legal fees.

Enron was seeking an advance of at least $30 million from bankruptcy court to pay to defend its officers and directors. The company's request was opposed by attorneys general from 33 states.

The Houston-based energy giant is incorporated in Oregon. To receive an advance, state law requires executives to file an affirmation in bankruptcy court that they have acted in an ethical manner, said Kristin Grainger, spokeswoman for Oregon's attorney general.

"Enron may be based somewhere else, but they're incorporated in Oregon and they must abide by Oregon law," she said.

Grainger said paying legal fees could jeopardize creditors by depriving the bankrupt company of large sums that could be used to pay other debts. Thousands of employees lost their retirement savings in accounts loaded with Enron stock as the company plunged into bankruptcy last year.

Oregon was joined 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, Texas, Vermont, Virginia, Washington, West Virginia, Wisconsin and Wyoming, and the U.S. Virgin Islands.