NEW YORK (CNN/Money) - Arthur Andersen LLP is in talks to resolve litigation stemming from its auditing of the Baptist Foundation of Arizona as it nears the start of the trial on its criminal indictment, a person familiar with the talks told CNNfn.

Andersen began the jury selection process Monday in the Baptist Foundation trial and will proceed to opening remarks Tuesday.

Last month, Andersen backed out of its $217 million proposed settlement with a trust for the Baptist Foundation of Arizona due to an insurance problem.

The auditor missed a $100 million premium payment to a Bermuda insurance company, Professional Services Insurance Company Limited, which is owned by Andersen partnerships around the globe. PSIC said it would not pay the $217 million settlement which prompted the present suit in Arizona superior court.

Andersen could not be reached for comment.

The Chicago-based accounting firm is also set to begin the trial May 6 on the federal indictment against Andersen. The auditor stands accused of obstructing justice when it shredded Enron Corp. documents because it was on notice of a federal investigation.

Judge Melinda Harmon, who is overseeing the Andersen criminal case and shareholder litigation against the firm, last Friday denied Andersen's request to delay the start of the trial. Attorney Rusty Hardin, who is leading Andersen's defense team in Houston, argued that there has been too much publicity to find unbiased jurors.

But Judge Harmon ordered that the case remain on track and start next Monday in Houston.

Andersen last week also broke off talks with the Justice Department after the accounting firm could not comply with a deadline given by federal prosecutors.

Houston-based Enron allegedly used thousands of special purpose partnerships to hide nearly $1 billion in debt and inflate profits. The energy trader filed the largest bankruptcy in United States history on Dec. 2.

Andersen, as Enron's auditor, signed off on the financial statements of the once mighty energy company.