Tyco is settling lawsuit with shareholders for $3B
On Tuesday Tyco agreed to pay $3 billion to settle their shareholders claims that Tyco’s former CEO and other top officials looted the company and inflated its value. This settlement is expected to resolve this legal matter.
CEO Ed Breen says that the company’s cash flow is strong enough to absorb this settlement of this class action lawsuit that took place in the U.S. District Court in New Hampshire. This is where Tyco’s headquarters use to be. Currently Tyco is awaiting news as to whether or not this court will approve this settlement, which will cover anyone who was a shareholder in Tyco from December 1999 through June 2002. There are also some consolidated cases in which investors who owned stock in October 1998 are also included. These persons’ lawyers say that this is the biggest settlement that has ever been offered by a single corporate defendant in a class action suit. The lawyers are quite happy with this resolution and say that it will close one of the largest and most appalling examples of corporate fraud to ever have occurred in U.S. history.