X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
DECISIONS CIVIL PRACTICE where a parallel criminal prosecution was reasonably anticipated, the Alabama Supreme Court on July 11 granted a petition to stay a securities suit against the ex-CEO of WorldCom Inc. Ex parte Ebbers, Ex parte Salomon Smith Barney Inc., nos. 1020931, 1021008. Public corporations that deemed themselves “the retirement systems of Alabama” (RSA) brought suit under the Securities Act of 1933 against defendants, including former WorldCom CEO Bernard Ebbers. The suit alleged that the defendants issued misleading financial reports and statements that caused RSA to purchase WorldCom securities and incur losses of more than $275 million. Although Ebbers has been the subject of a related ongoing criminal investigation, the trial court denied his motion to stay the civil claims against him. Finding that the trial court exceeded its discretion, Alabama’s high court ruled that Ebbers was at a risk for self-incrimination if he were to be subjected to the broad discovery permissible in civil cases. Because there was a possibility that prosecutors would seek criminal charges against him, it ruled that Ebbers was entitled to the stay.

Want to continue reading?
Become a Free ALM Digital Reader.

Benefits of a Digital Membership:

  • Free access to 3 articles* every 30 days
  • Access to the entire ALM network of websites
  • Unlimited access to the ALM suite of newsletters
  • Build custom alerts on any search topic of your choosing
  • Search by a wide range of topics

*May exclude premium content
Already have an account?

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.