Judge Clears Way for Trial Over IPALCO Worker Claims Execs Dumped Stock

A federal judge has cleared the way for a trial over claims by former IPALCO employees that company executives dumped their stock in the utility before a merger. U.S. District Judge David F. Hamilton denied the power company's request to set aside the class action filed on behalf of some 2,000 former and current IPALCO workers. The lawsuit alleges the value of employees' 401(k) and retirement plans plummeted when Virginia-based AES Corp. acquired the Indianapolis utility in 2001.

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A federal judge cleared the way for a trial over claims by former IPALCO employees that company executives dumped their stock in the utility before a merger. U.S. District Judge David F. Hamilton denied the power company’s request to set aside the class action lawsuit filed on behalf of some 2,000 former and current IPALCO workers. “We know we get our day in court,” said John R. Price, an attorney representing the workers. The March 2002 lawsuit seeks about $100 million in damages. It alleges the value of employees’ 401(k) and retirement plans plummeted when Virginia-based AES Corp. acquired the Indianapolis utility in 2001. IPALCO attorney John W. Purcell declined to comment on the Friday ruling. The lawsuit alleges that company officers dumped IPALCO shares about the time that employees were prohibited from selling shares owned through their benefit plans. A large debt and worldwide drop in power prices caused AES shares to drop from $49.60 in March 2001, when the merger closed, to 92 cents in October 2002. Gov. Mitch Daniels was among several IPALCO board members or executives who sold their stock during the months before the sale was completed. Daniels has said he supported the sale in the best interests of the company and shareholders and sold his IPALCO stock to meet federal conflict-of-interest guidelines when he was appointed as White House budget director by President Bush in early 2001. Secretary of State Todd Rokita last year cleared Daniels and five other former IPALCO board members of wrongdoing for selling their stock during the months before the sale was completed. Copyright 2005 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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