When Enron was front-page news back in 2002, George W. Bush was out front promising to crack down on corporate crime and fraud. “No boardroom in America is above or beyond the law,” the president told a Justice Department conference that September.

The department’s corporate-crime task force deserves credit for winning guilty pleas or convictions against many of the Enron malefactors, including former Chairman Ken Lay and ex-CEO Jeffrey Skilling. With the public furor subsided, however, the Bush administration is now asking the Supreme Court to adopt a narrow view of federal securities law that may prevent investors from going after some of Enron’s enablers — the banks and brokerages that helped the company get away with cooking its books for so long.

The government’s position is made clear in Stoneridge Investment Partners v. Scientific-Atlanta, which the court will hear Oct. 9. It involves an instance of accounting fraud much smaller than Enron’s, but the case already is being described as one of the most important matters of business law coming before the justices in their new term.

Charter Communications, a big cable television operator based in St. Louis, came up with this plan in the face of a below-expectations earnings report in 2000: It would buy cable TV boxes from Motorola and Scientific-Atlanta for $17 million more than the normal price in return for those companies agreeing to buy $17 million in advertising on Charter’s cable systems. For those vendors the transactions were a wash — with free advertising thrown in. But Charter improved its apparent cash-flow performance, and bolstered its stock price, by treating the revenues as current earnings and the cable-box purchases as a capital expense. Two years later, when this arrangement hit the financial press, Charter’s stock plummeted to 78 cents a share from $26. In response, Stoneridge Investment Partners filed a class action lawsuit blaming the stock’s collapse on fraudulent transactions that violated federal law and Securities and Exchange Commission rules.

Corporate America hates such suits. But for more than 60 years, federal courts have recognized claims by aggrieved investors as an aid to SEC enforcement of laws essential to guaranteeing the integrity of financial markets. The Supreme Court gave its own blessing to such suits in 1971, although ever since it has found ways to narrow their reach. In one 1994 decision, Central Bank of Denver v. First Interstate Bank of Denver, the court ruled that a plaintiff may not recover damages from someone who aids or abets someone else’s securities fraud.

Charter settled with Stoneridge, but the cable-box companies persuaded two lower federal courts to dismiss the cases against them. They argued that their role was, at worst, aiding and abetting. Now, Stoneridge wants the Supreme Court to set aside the Central Bank precedent and recognize “scheme liability” for the two vendors’ active and knowing participation in the purported fraud.

The SEC voted to side with the investment group. Treasury came down on the other side, arguing that tougher private securities litigation rules would imperil the competitive standing of U.S. financial markets vis-? -vis other countries. After consulting the White House, Solicitor General Paul D. Clement lined up with Treasury, Motorola and Scientific-Atlanta.

The government’s brief gives the investors half a loaf by agreeing that the companies’ alleged conduct amounted to “a deceptive device or contrivance” in violation of securities law. But it gives those companies the bigger half by arguing that the investors had to prove — and did not — that they relied on the two companies’ deception in buying or holding Charter’s overvalued stock.

Donald Langevoort, a securities expert at Georgetown University, calls the government’s reliance theory “curious.” But he’s downright dismissive of the “Chicken Little” briefs filed by business groups warning that the sky will fall if the administration’s side loses and the court takes a more investor-friendly approach. In fact, Langevoort says, the SEC’s anti-fraud language, known as Rule 10b-5, is plenty broad enough to justify Stoneridge’s suit. It prohibits “any person, directly or indirectly” from employing “any device, scheme or artifice to defraud . . . in connection with the purchase or sale of any security.”

The University of California, the lead plaintiff in the Enron fraud litigation, warns that a ruling for the cable-box companies could cripple its claims against the secondary actors in that financial scandal. Merrill Lynch, the lead Enron defendant, says the argument is neither proper nor correct. How much impact the issue might have on the justices is anyone’s guess.

Given how favorable the last Supreme Court term was to business interests, most handicappers predict the companies will win. But it could be close. Justice Stephen G. Breyer has recused himself, and six other justices split in the Denver banks case. That seems to put the two Bush nominees, Chief Justice John G. Roberts Jr. and Samuel A. Alito Jr., in the pivotal role. Both were reliable votes for business interests last year. A decision is due by next June.

Kenneth Jost is the Supreme Court editor for CQ Press.