The Association of U S West Retirees



The Wall Street Journal
Monday, November 13, 2006

Also Monday, Qwest Communications International Inc. lost an appeal on whether it must turn over privileged documents in class-action suits related to accounting fraud allegations against the company.  The company had challenged lower-court rulings that allowed privileged documents turned over during government securities fraud investigations to also be viewed by private parties suing the company.

The documents in question were turned over to the Securities and Exchange Commission and Justice Department during investigations into the company's 1999-2002 accounting scandal that, so far, could cost the company as much as $650 million in financial settlements.

Qwest maintains the documents, given to the government under confidentiality agreements, should not be turned over to private parties who have brought a variety of investor lawsuits against the company.  Those filing investor lawsuits, however, won access to the documents during federal court proceedings.  Although the investor lawsuit at issue in the Supreme Court appeal has reached a proposed settlement with Qwest, the documents could still be used by investors who have yet agreed to settle.

The case is Qwest Communications v. New England Health Care Employees.