ROANOKE TIMES 
                      Copyright (c) 1996, Roanoke Times

DATE: Saturday, August 24, 1996              TAG: 9608260061
SECTION: BUSINESS                 PAGE: A-4  EDITION: METRO 
DATELINE: RICHMOND 
SOURCE: Associated Press 

JUDGE STOPS LLOYD'S U.S. INVESTORS FREE TO FIGHT

A federal judge on Friday night blocked Lloyd's of London from imposing its $4.7 billion rescue plan on dissident American investors who want more financial details about the insurance market's settlement.

U.S. District Judge Robert Payne extended the deadline for skeptical investors to Oct. 30 to review new information from Lloyd's and decide whether to accept the plan.

Without the order, they would have had to decide by Wednesday and would be bound if a majority of Lloyd's investors worldwide approved the plan over their objections. But Payne did not block U.S. investors from accepting the deal if they so choose.

Lloyd's filed an immediate appeal with the 4th U.S. Circuit Court of Appeals next door.

``We regret the decision reached in the Virginia district court,'' David Rowland, Lloyd's chairman, said in a statement.

Payne issued a preliminary injunction and lengthy opinion, which denied Lloyd's attempt to throw out the investors' case. The judge wasn't swayed by Lloyd's dramatic claims that such an order would gravely endanger the intricate restructuring plan.

The possible harm American investors face from entering the Lloyd's plan ``significantly outweighs any demonstrated harm to Lloyd's of complying with its obligations'' under U.S. securities laws, Payne wrote.

In London, Lloyd's executives anxiously sifted through the ruling early today and tried to gauge its impact on the recovery plan.

``The judge commented that he had no wish to impede the plan,'' Rowland said. ``Unfortunately, the detail of his judgment places barriers in its path.''

To make its recovery plan work, Lloyd's needs two things from its investors: more money and limits on future lawsuits.

If some U.S. investors sign up and others keep fighting, the success or failure of the plan would depend on how much cash Lloyd's can get from those who sign up and how many problems it faces from those who don't.

Significantly, Payne's preliminary order found Lloyd's in violation of U.S. securities laws by recruiting American investors through the mail for the elaborate restructuring plan. A Nov. 4 trial was scheduled.

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