Washington – In a lawsuit that harks back to the Enron scandal, the Bush administration is at odds with the federal agency that oversees securities markets as well as with state attorneys general and consumer and investor advocates.
President Bush personally weighed in with his views before the administration decided not to support investors whose securities fraud case is now before the Supreme Court.
The president’s message was that it’s important to reduce “unnecessary lawsuits” and that federal securities regulators are the ones in the best position to sue, said Al Hubbard, Bush’s chief economic adviser and director of the National Economic Council.
Hubbard said Bush’s perspective was conveyed to Solicitor General Paul Clement by Deputy White House counsel Bill Kelley.
Bush’s role in the case underscores its significance.
The outcome of the Supreme Court case could determine whether Enron plaintiffs’ separate $40 billion lawsuit against investment banks – stalled by a federal appeals court ruling in March – can proceed.
