The Supreme Court on Monday put off deciding on the Enron scandal, taking no action in a securities fraud case with billions of dollars at stake for victimised investors.

The case asks whether Enron shareholders can pursue a lawsuit against Wall Street investment banks that did business with the Texas energy company.

The justices have already agreed to consider a similar suit accusing two equipment manufacturers of colluding with a cable TV company to deceive investors.

Blocked suit

The administration decided against filing a brief on behalf of the investors in the case, with both President George W. Bush and Treasury Secretary Henry Paulson weighing on the side of the investment banks.

Three months ago, a federal appeals court blocked the US$40 billion Enron investors' suit against Merrill Lynch & Company, Credit Suisse First Boston and Barclays Bank PLC.

The suit alleged that they played roles in the accounting fraud that led to Enron's collapse.

Shareholders and investors in the class-action lawsuit had asked the Supreme Court to review the ruling by the Fifth U.S. Circuit Court of Appeals. That court reversed a decision by U.S. DistrictJudge Melinda Harmon in Houston, who had said shareholders could sue as a class.

Attorneys-general from 30 states have sided with Enron shareholders in their bid for a class action. The appeals court decision put the case on hold, which was set to go to trial April 16.

So far, Enron plaintiffs have recouped US$7.3 billion, mostly from such financial institutions as Bank of America, JP Morgan Chase & Company, Citigroup and Canadian Imperial Bank of Commerce (CIBC).

Besides Merrill Lynch, Credit Suisse and Barclays, the remaining defendants include several former Enron officers: Jeff Skilling, the chief executive; Richard Causey, chief accounting officer; Richard Buy, chief risk officer; Jeff McMahon, treasurer; and Mark Koenig, executive vice-president of investor relations.

Wiped out millions

Enron Corp, once the seventh-largest U.S. company, crumbled into bankruptcy in December 2001 after years of accounting tricks could no longer hide billions in debt or make failing ventures appear profitable.

The collapse wiped out thousands of jobs, more than US$60 billion in market value and more than $2 billion in pension plans.

-AP