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Execs out of Enron 401(k)?
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February 8, 2002: 1:34 p.m. ET
Lawyers for Enron employees want execs out as trustees of 401(k) pension plan.
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NEW YORK (CNN/Money) - The law firm that has filed a class-action lawsuit representing Enron Corp. employees plans to ask a federal judge to remove Enron executives as trustees of the company's retirement plan.
The Gottesdiener law firm said Friday it will ask Federal District Court Judge Melinda Harmon to remove the executives in charge of the company's 401(k) plan "based on new disclosures that they failed to act to save workers' investments when they knew Enron was headed for disaster."
The law firm also noted that the executives still refuse to take Enron stock from "the list of supposedly prudent options in which workers can invest."
The law firm cited Thursday's congressional testimony of Cindy K. Olson, an Enron executive and trustee who was warned of the impending accounting scandal by whistleblower Sherry Watkins, but who kept that information to herself and then-CEO Kenneth Lay.
Olson told the House Committee on Education and Workforce she set up a meeting between Watkins and Lay, but did not warn officials in charge of the retirement plans because the allegations weren't documented.
"Olson completely abdicated her fiduciary responsibilities toward Enron's employees, because she was apparently looking out for her own career," said Eli Gottesdiener.
"Had she done what any loyal and competent trustee would have done -- convene an emergency meeting of the trustees to make full disclosure and terminate the use of Enron stock in the 401(k) plan -- she could have saved workers literally several hundred million dollars."
Olson told the House committee Thursday the trustees hired an independent firm to provide advice on whether Enron stock was a good bet in November, when the stock looked shaky.
But she said the trustees still have not received a response from FTI Consulting Inc.
"We didn't have a crystal ball. We didn't ultimately know where the stock was going to go," Olson said.
Gottesdiener said Olson sold $1.5 million in Enron stock in 2001 while a 401(k) plan trustee.
The Gottesdiener law firm filed its class-action suit on behalf on employees in November. 
-- from staff and wire reports
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