Plaintiffs Seek To Limit Colonial Use Of $15M Policy

Law360, New York (October 26, 2009, 3:08 PM EDT) -- Plaintiffs in a consolidated securities lawsuit against Colonial BancGroup Inc. have asked a bankruptcy judge to put limits on the efforts of the failed Montgomery, Ala.-based financial company's principals to access funds to provide them a defense under a $15 million insurance policy.

In a motion filed Friday in the U.S. Bankruptcy Court for the Middle District of Alabama, attorneys for first named plaintiff Arkansas Teacher Retirement System and other groups accusing the bank of misleading investors about its subprime lending practices addressed a bid by...
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