Single largest payout in history of securities class-action litigation.
Industrial conglomerate Tyco International Ltd. said May 15 it agreed to pay $3 billion to settle shareholder lawsuits on securities and accounting fraud by its former management. The accord, struck after a five-year legal battle, relates to the era of former Tyco chief executive Dennis Kozlowski who is serving a 25-year jail term for looting the company of hundreds of millions of dollars.
The multi-billion-dollar fund will compensate investors who purchased Tyco stock between December 13, 1999 and June 7, 2002.
Lawyers representing shareholders who claim they suffered heavy financial losses as a result of Tyco's past behavior cheered the deal, saying it marked "the single largest payout from any corporate defendant in the history of securities class-action litigation." The lawyers, who represented a host of investors including the Teachers Retirement System of Louisiana and the Plumbers and Pipefitters National Pension Fund, said they would continue to fight a separate claim against Tyco's former auditor PricewaterhouseCoopers.
Copyright Agence France-Presse, 2007