Neighbors sue Ken Lay's widow

HOUSTON Linda Lay is already fighting an attempt by the federal government to seize nearly $13 million from Kenneth Lay's estate, including the family condominium at The Huntingdon.

The lawsuit by The Huntingdon Council of Co-Owners seeks more than $100,000 in unpaid fees from Linda Lay or foreclosure of her 12,827-square-foot condo, which tax records value at about $4.75 million.

In court documents, Linda Lay's attorney, David Jones, denied all the allegations in the high-rise's lawsuit and asked that she be awarded her costs for fighting the claims.

When the luxury high-rise built a new parking garage last summer, Linda Lay's share of the cost was $109,542.75. Lay's assessment was determined by her ownership of nearly 3 percent of the 34-story building.

The lawsuit was originally filed in January in Harris County district court but was moved to federal court. But Linda Lay asked for the case to be moved because of the government's forfeiture proceeding.

In October 2006, federal prosecutors filed a civil action against Linda Lay after her husband's convictions for his role in Enron's collapse were vacated following his death in 2006.

The civil action was the only way federal authorities could try to seize $12.7 million in assets they claim were "proceeds of the fraud proven in the criminal case against Lay."

Linda Lay has said her husband didn't commit any crimes and thus her assets are not subject to forfeiture.

Kenneth Lay had been convicted in May 2006 of 10 counts of fraud, conspiracy and lying to banks in two separate cases. But his convictions were vacated because of his July 2006 death from heart disease.

Prosecutors are looking to take three things: $2.5 million of the value of the couple's condominium; $10.2 million from a partnership named for both the Lays; and nearly $23,000 in a bank account.

Her neighbors requested a jury trial in their lawsuit. Linda Lay has made the same request in the federal government's civil forfeiture action.

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