US - Tyco International has agreed to pay out US$3bn in a class action settlement to investors including the Teachers Retirement System of Louisiana and Louisiana State Employees Retirement System.
According to law firm Schiffrin Barroway Topaz & Kessler, one of the co-lead counsels in the case, it is one of the largest securities class action settlement by a corporate defendant in history.
It covers investors who acquired Tyco shares between 13 December 1999 and 7 June 2002, during which time the electronics firm is alleged to have overstated its income by $5.8bn.
Richard Schiffrin, siad: “This is a settlement of historic proportions for the investors who suffered significant financial losses and it also sends a strong message to those who would engage in this type of misconduct in the future.”
Several members of Tyco’s management team during the class period have received prison sentences of up to 25 years. The company’s accountants, PricewaterhouseCoopers, have also been incriminated in the case and will be subject to a separate class action lawsuit by the investors.
The two Louisiana pension funds were represented in the claim by law firm Grant & Eisenhofer.
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