Co-Defendants Seek Separation From Keating : * Thrift: Judge expects to rule by week’s end on more than three dozen motions to throw out all or parts of fraud allegations.

More than a dozen defendants once involved with former Lincoln Savings & Loan owner Charles H. Keating Jr. began making their final pleas Tuesday to be released from a series of complex civil lawsuits brought on by the collapse of the Irvine thrift three years ago.

U.S. District Judge Richard M. Bilby said he expects to rule by week’s end on more than three dozen motions to throw out all or parts of the conspiracy, fraud and racketeering allegations against the defendants.

The trial on the lawsuits, which seek from $250 million to more than $1 billion in damages, is scheduled to start March 2.

More than a dozen lawsuits, consolidated into a single trial conducted by Bilby, allege that Keating, the accounting and legal firms he hired and others defrauded small investors in Lincoln’s parent company, American Continental Corp. in Phoenix.

In a series of motions to be heard this week, most of the defendants argued that they should be removed from the litigation because no evidence exists that they did anything wrong. Others, including Keating himself, are asking for a delay in the trial.

Keating is preparing for his April 10 sentencing. He was convicted in Los Angeles County Superior Court on Dec. 4, his 68th birthday, on 17 counts of state securities fraud. He has since been indicted in federal courts in Los Angeles and Phoenix on charges of conspiracy, bank fraud, bankruptcy fraud and racketeering.

On Tuesday, four groups of defendants sought dismissals. But Bilby indicated that just one, Star Bank in Cincinnati, is likely to get its wish.

Star Bank, which was the bond sale’s trustee, kept track of bondholders and made sure that they received their monthly payments from American Continental. The bank has said it played no role in the bond sales program itself.

However, three other groups--including the Chicago economic consulting firm of Lexecon Inc. and the Minneapolis investment banking firm of Offerman & Co. Inc.--are likely to remain.

“Lexecon issued four reports (on Lincoln-owned hotels), and they all were wrong,” Bilby said. “Has there ever in history been four reports that were wronger? They’re batting 0 for 4.”

Bilby said he may have to set up a separate hearing to determine the fate of Societe d’Analyses et d’Etudes Bretonneau, a French bank that bought the Paris-based Saudi European Bank. Lincoln owned 10% of Saudi European and was engaged in several questionable deals with the Paris bank.

Today, the major targets of the bondholder litigation will be seeking, among other things, to delay the trial until after Keating’s federal criminal trial in Los Angeles.

The accounting firms of Ernst & Young and Arthur Andersen & Co. contend that the 77-count indictment against Keating and four others indicates that the insiders duped many people, including their independent auditors. Therefore, the accounting firms claim, there should be no civil case against them.