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Federal Judge Dismisses Suit by Judicial

Sat September 20, 2003 - West Edition
CEG



DALLAS (AP) A federal judge has dismissed a lawsuit that accused Halliburton Co. and Vice President Dick Cheney, its former chief executive, of misleading investors by changing the way the company counted revenue from construction projects.

The lawsuit was filed last year by Judicial Watch, a conservative public interest group, on behalf of three small investors, who said the company tried to polish financial results by booking revenue on cost overruns before it was certain of getting paid.

U.S. District Judge Sam A. Lindsay said in a one-page ruling Sept. 5 that Judicial Watch didn’t present facts that proved Halliburton misled investors about its revenue. Halliburton disclosed the judge’s ruling Sept. 8.

Judicial Watch is considering whether to appeal the ruling to a higher court or file an updated lawsuit with information obtained since last year, said group president Tom Fitton.

Cheney’s personal lawyer, Terry O’Donnell, said, “From our standpoint, we’re just pleased the court dismissed the lawsuit.” He declined further comment.

Halliburton lawyers argued for dismissing the case during a 90-minute hearing in July.

The company called the charges “untrue, unsupported and unfounded.”

Halliburton lawyer Ronald W. Stevens said the company disclosed what it was doing in filings with regulators and that there was no evidence of fraud.

The Securities and Exchange Commission is still investigating Houston-based Halliburton’s 1998 decision to change the way it accounted for revenue on cost-overrun projects.

Houston-based Halliburton announced in May that it would pay $6 million to settle about 20 other shareholder class-action lawsuits that raised similar arguments to those used by Judicial Watch. Those lawsuits did not name Cheney as a defendant.

Cheney was a former congressman, presidential aide and secretary of defense when he took over the oilfield services and construction company’s top spot in 1995.

He stepped down as chief executive and chairman in 2000 to become George W. Bush’s running mate.

Halliburton shares traded for $54 a share at the time. On the New York Stock Exchange, Halliburton shares rose 52 cents to close at $25.02.

Halliburton provides services to oil companies and has an engineering and construction arm that has won no-bid Army contracts worth more than $1.7 billion to help rebuild Iraq.