Characterized by some as the "Roe vs. Wade for the securities industry" and others as "the most important securities case in a generation," the eventual decision will have a significant impact on whether investors in companies that commit securities fraud should be able to sue investment banks, accountants, lawyers and others who were direct "participants" in that deception. Current shareholders' rights for going after third parties that aid or abet corporate fraud are not as clearly defined as one would think.

First, a quick synopsis of the StoneRidge vs. Scientific Atlanta case: In 2000 to 2001, technology companies Motorola and Scientific Atlanta (now owned by Cisco Systems) allegedly agreed to supply cable TV provider Charter Communications with equipment at a $20 premium over the traditional cost with the knowledge that Charter intended to account for the transactions improperly as advertising revenues (the vendors used the extra funds to buy advertising space).

These "sham" transactions inflated Charter's revenue by $17 million. When the revenue inflation came to light in 2002, Charter's stock crashed from $26.31 to 76 cents, a $7 billion loss in market cap. StoneRidge, an institutional investor in Charter, accused the two vendors of participating in a "scheme to defraud" investors and now wants the right to sue them for remediation.

StoneRidge's ability to go after the tech companies remains thwarted, however, by the outcome of a 1994 Supreme Court case known as Central Bank vs. First Interstate. The Court held that while all "primary actors"--those who were directly part of a scheme (the emphasis is mine) to defraud investors--can be sued for federal securities fraud, the "secondary actors" who aided and abetted the fraud cannot be sued. This case once again raises this all-important issue of third-party liability in securities cases, settling it once and for all.

As an advocate for individual investors, it's not surprising, I'm sure, to hear me contend that all participants who directly engage in activities to deliberately defraud investors be held liable for their actions. Whether the Court will agree with me depends on their definition of the word "scheme" under the federal securities statute.

If you look it up in the dictionary, one definition for the word has it as a synonym for an underhand plot or conspiracy. Since it generally takes two or more to plot and conspire, it could be reasonably argued that the use of the word "scheme" in the statute should allow for more than just one party (such as the investment banks, accountants and lawyers) to be labeled the "participants" in the fraud and hence be held accountable.

If the Court's strict constructionists are to be intellectually honest in their interpretation of the meaning of "scheme" liability in StoneRidge next week, it would prove a revolutionary milestone in the saga of investor rights. Shareholders would be granted a much more level playing field to target for recourse those who had targeted them for fraud.

Sadly, smart money is probably better waged on the Court reaffirming the Central Bank decision from 13 years ago, thereby remaining consistent with its general pro-business stance and previous decisions that limit lawsuits against public companies. While such a toe-the-line decision would generate sighs of relief in the boardrooms of otherwise culpable investment banks, accounting firms and law firms, it is the groans of disappointment at the kitchen tables of victimized shareholders that should ultimately resonate more loudly.

The corporate scandals of recent years may have faded from the headlines, but they are still fresh in the minds of American investors. Their confidence in Wall Street already badly shaken, shareholders need more than empty "we've changed" promises from a mostly self-regulating Wall Street to restore their trust in the system. What they need is for the Court to hold all participants in a fraudulent "scheme" just as responsible as those considered the primary actors.

Bush volunteered his thoughts on a report on two secret 2005 memos that authorized extreme interrogation tactics against terror suspects. "This government does not torture people," the president said. Meanwhile, Senate Armed Services Committee Chairman Carl Levin, D-Mich., demanded a copy of a third Justice Department memo justifying military interrogations of terror suspects held outside the United States.

In a letter to Attorney General-nominee Michael Mukasey, Levin wrote that two years ago he requested - and was denied - the March 14, 2003, legal opinion. Levin asked if Mukasey would agree to release the opinion if the Senate confirms him as attorney general, and cited what he described as a history of the Justice Department stonewalling Congress.

Allowing investors to file class-action lawsuits in such cases would "threaten the safety and soundness of individual financial institutions and the nation's banking system," a coalition of business groups, including the American Bankers Association, said in court papers.

Firms and corporations that enabled companies such as Enron to defraud stockholders should now have to pay, lawyers for the investors say.

"The banks orchestrated the fraud; they weren't sideline viewers," said Patrick Coughlin, the lead lawyer for Enron shareholders. "So when the question comes up about who should be on the hook for Enron, it's the banks."

Meir Feder, a New York lawyer who defends companies in securities cases, said "everybody understands that the Enron shareholders are victims here, but there's a reason that Congress and the Supreme Court haven't allowed people to sue third parties."

He added, "In the real world, for every third party who actually had a role in a fraud, you're going to get lots of suits against other third parties who really didn't."

When the Supreme Court hears arguments on the issue Tuesday, Enron investors will be on the sidelines. The court is dealing with a suit by Stoneridge Investment Partners against Motorola Inc. and Scientific-Atlanta Inc., which Cisco Systems Inc. now owns.

Only eight of the nine justices will participate. Justice Stephen Breyer has withdrawn from the case; he gave no reason, but financial disclosure documents state he owned Cisco stock.

Chief Justice John Roberts, who did not participate in the court's decision to take the suit, has come back into it.

The Stoneridge case has strong parallels to the one pursued by Enron shareholders, which the high court has left alone. The Enron suit was up for consideration June 21 at one of the justices' regularly scheduled private conferences, but the court has neither accepted nor rejected it.

"It's easier to decide a legal issue in a noncharged atmosphere, which may have been what the justices had in mind by not taking on Enron," Coughlin said.

Stoneridge accused Motorola and Scientific-Atlanta of engaging in sham transactions with a cable television company, Charter Communications Inc. The alleged motive was to inflate Charter's revenue by $17 million, help meet Wall Street expectations and avoid a drop in the company's stock price.

Because of a number of deals including the ones involving Motorola and Scientific-Atlanta, Charter eventually restated its financial statements, reducing revenue by $292 million from 2000-2002. In addition, four former Charter executives pleaded guilty in the matter after the Justice Department investigated the deals.

Stoneridge's efforts to recoup investment losses from Motorola and Scientific-Atlanta were turned back by lower courts, which said that the allegations were nothing more than claims that the two companies aided and abetted the fraud by Charter. Neither Motorola nor Scientific-Atlanta was alleged to have engaged in any deceptive act, the courts said.

Enron investors got a similar ruling from the 5th U.S. Circuit Court of Appeals, which found that Enron had a duty to disclose financial problems to shareholders, but the company's banks did not.

In both cases, the issue comes down to the meaning of the word "deceptive" in federal securities law.

At stake in the Enron case is more than $30 billion sought by hundreds of thousands of investors from banks that allegedly helped the company, once the nation's seventh-largest, hide billions in debt and make failing ventures appear profitable.

The Enron case and the Stoneridge investors' suit are the latest chapter in the struggle between plaintiffs attorneys and the business world over class-action suits.

When lawyers who file such suits persuade a court to certify a large class of plaintiffs, companies almost always settle rather than risk going to trial. A 2002 study for the conservative Federalist Society found that three of every four federal securities fraud cases were settled, with the remainder thrown out of court.

Since 2000, investors filing federal class-action suits alleging securities fraud have settled for $42 billion, according to the Stanford Law School Securities Class Action Clearinghouse.

So far, some banks have settled with Enron investors: Citibank for $2 billion; J.P. Morgan Chase for $2.2 billion; Canadian Imperial Bank of Commerce for $2.4 billion.

Others are still fighting: Merrill Lynch & Co. Inc.; Credit Suisse First Boston; Barclays Bank PLC; Pershing LLC, now a subsidiary of Bank of New York Mellon Corp. For investors, recent developments have gone against them.

The Securities and Exchange Commission voted to intervene in the Stoneridge case on the side of investors. But the Justice Department solicitor general, after pitches from President Bush and Treasury Secretary Henry Paulson, rejected the SEC's recommendation and filed a brief on the side of Motorola and Scientific-Atlanta.

A special tactical unit used explosives to enter the building shortly after midnight and shot John Ashley to death after he opened fire, police spokesman Sgt. Clifford Gatlin said. Autopsies were planned on the three victims, he said.

Police said Ashley repeatedly shot at them during the 10-hour standoff Thursday, and even shot at a remote-controlled police robot they sent inside. No officers were hurt.

"This is, it's a shock," Gatlin said. "It's big for us, because we know everybody."

Ashley, a retired city maintenance worker, was found in the back of the office, which was converted from a single-story house.

The two people police say he killed were found in the front of the building, where police rescued one of the three surviving victims Thursday afternoon. The other survivors escaped on their own.

Gatlin said investigators have learned the shooting was "a possible dispute over a divorce settlement," but that he had no further details.

He said investigators will need to speak with the three survivors to determine a motive, and at least two of them were seriously injured.

The shooting rampage near the Rapides Parish Courthouse astounded people who knew Ashley in Alexandria, a central Louisiana town of about 46,000.