Archive for Saturday, September 3, 2005

Judge OKs settlement in Westar shareholder case

September 3, 2005


— A federal judge has approved a $32.5 million settlement that ends a class-action lawsuit brought by shareholders of Westar Energy Inc.

U.S. District Judge Julie Robinson approved the settlement as "fair and adequate" on Thursday. Topeka-based Westar, the largest electric utility in Kansas, will pay $1.25 million, with insurers covering the rest.

Shareholders filed suit against the company in 2003, saying they weren't given details of the company's proposed merger with a New Mexico utility and plan to spinoff its unregulated affiliates into a separate company called Westar Industries. The Kansas Corporation Commission shot down the deal, hurting the stock price.

An internal investigation later presented a host of alleged misdeeds by former chief executive officer David Wittig, former executive vice president Douglas Lake and a number of former and current executives. Wittig and Lake were forced out of Westar in late 2002.

Jurors are now deliberating federal fraud, money laundering and conspiracy charges against Wittig and Lake. Robinson also is overseeing that case.


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