Lawsuit Claims Patterson UTI Management Might be to Blame for $77 Million Embezzlement - KCBD NewsChannel 11 Lubbock

5/8/06

Lawsuit Claims Patterson UTI Management Might be to Blame for $77 Million Embezzlement

Patterson UTI shareholders want to know who else is to blame in a $77-million embezzlement scheme. The question comes in a civil lawsuit against Jonathan Nelson, Patterson UTI board of directors, and auditing company, Pricewaterhousecoopers, LLP.

Last month, Nelson, the oil company's former CFO, pleaded guilty to money laundering and wire fraud. NewsChannel 11's Jennifer Vogel explains the new developments.

Attorney Bill Federman tells us this lawsuit is not for personal gain, but to put pressure on Patterson UTI Board members to get back that $77-million. "This company has been done wrong, and somebody was asleep at the switch." Federman says this lawsuit is necessary to get back the $77-million. "We're trying to protect the corporation from its own management and try to recover money for the company because of the wrongdoing by Nelson."

The name on the lawsuit is Patterson UTI shareholder Fernard Moore. The lawsuit claims to be in the company's best interest; trying to find out how one man slipped millions of dollars by and entire board of directors and an auditing firm. "If what occurred here happened in part by negligence or lack of focus by the board, than the board should be held accountable to the shareholders and the company for that."

The lawsuit also asks, 'What took so long for anyone to notice millions went missing?'

"What we have is a clear instance here of self stealing and potential company frauds by the CFO for millions of dollars happening over a two year period, at least."

Another concern is that Patterson has not done enough to convince shareholders that they'll get the money back. "That's a large chuck of change that has gone out the door. And simply now closing the door behind it is not going to be business as usual because shareholders in this company are watching management and the board, and the board has not acted affirmative to do something."

The shareholder is asking for a jury trial in the lawsuit. They have not yet asked for a specific dollar-amount owed to Patterson saying they'll wait to hear what the court thinks is appropriate.

NewsChannell 11 contacted Patterson UTI Energy about this lawsuit but they did not want to make a comment.

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