A Florida state court jury today ruled against the Florida State Board of Administration, Tallahassee, in its lawsuit against Alliance Capital. The suit alleged breach of contract in managing a $3.6 billion active domestic large-cap growth equity portfolio, including buying Enron Corp. stock in 2001, when its price was falling. The verdict, issued by the Florida State Court for the Second Circuit, Leon County, also held the Florida board liable for $1.113 million in unpaid investment management fees, said John Meyers, Alliance spokesman.
The jury ruled that Alliance was "not liable for purchasing Enron stock" for the $103 billion Florida fund and "not liable for allegedly failing to properly apply its investment process," said Mr. Meyers.
"We're extremely disappointed," said Coleman Stipanovich, executive director. "I respect their decision. We won't be appealing."
But, under an agreement with Alliance, the Florida board won't pay the fees, Mr. Stipanovich said. "We will not be paying attorney fees or management fees," Mr. Stipanovich said. "We will not be paying one red cent to Alliance as a result of the suit."
The Florida board filed the suit in 2002, claiming that Alliance lost $282 million in state pension money through Enron investments, Mr. Stipanovich said. This was the first time the board had sued a money manager, he added.