Lehman Brothers Holdings Inc. Case 09/24/2008
FEBRUARY 2012 - According to the Notice:
Multiple settlements have been reached in the class action lawsuit In re Lehman Brothers Equity/Debt Securities Litigation, Nos. 08-CV-5523, 09-MD-2017 (LAK) (S.D.N.Y.) (the “Action”). This notice addresses one of those settlements – the settlement reached with certain of Lehman’s directors and officers during the relevant time period (the “D&O Defendants” or the “Individual Defendants”).1 This notice is directed at all persons and entities who (1) purchased or acquired Lehman securities identified in Appendix A hereto pursuant or traceable to the Shelf Registration Statement and were damaged thereby, (2) purchased or acquired any Lehman Structured Notes identified in Appendix B hereto pursuant or traceable to the Shelf Registration Statement and were damaged thereby, or (3) purchased or acquired Lehman common stock, call options, and/or sold put options (“Lehman Securities”) between June 12, 2007 and September 15, 2008, through and inclusive (“Settlement Class Period”)and were damaged thereby (the “D&O Class”).
The settlement is comprised of $90,000,000 in cash (“Settlement Amount”) plus interest (the “Settlement Fund”) for the benefit of the D&O Class. Estimates of average recovery per damaged security are set forth on Appendix D hereto. In addition, as set forth in Question 19 below, Lead Counsel will seek approval for attorneys’ fees in the amount not to exceed 17.5% of the Settlement Amount, plus interest thereon, and for reimbursement of Litigation Expenses in an amount not to exceed $2.5 million, plus interest thereon. The total amount of Litigation Expenses awarded by the Court will be paid to Lead Counsel from the settlements in pro rata amounts. If the Court approves Lead Counsel’s application for attorneys’ fees and Litigation Expenses (as set forth in Question 19 below), the average cost per damaged security will be as set forth on Appendix D hereto.
If the settlement is approved by the Court, it will result in (i) the distribution of the Settlement Fund, minus certain Court-approved fees, costs and expenses as described herein, to investors who submit valid claim forms; (ii) the release of the D&O Defendants (as defined below) and certain other related parties from further lawsuits that are based on, arise out of, or relate in any way to the facts and claims alleged, or that could have been alleged, in the Action; and (iii) the dismissal with prejudice of the D&O Defendants. The settlement also avoids the costs and risks of further litigation against these defendants.
This settlement does not resolve claims against any other defendants in the Action, and the Action will continue against Lehman Brothers Holdings Inc.’s auditor and the remaining underwriter defendant, UBS Financial Services, Inc. Please Note: This settlement is separate and apart from the proposed settlements Lead Plaintiffs reached with the Settling Underwriter Defendants (the “UW Settlements”) for $426,218,000. You should have received a notice
for the UW Settlements along with this notice. See Question 6 below for more details. You are not automatically in all settlements as they cover different securities in some instances, so you should read both notices to determine if you are eligible to participate in each settlement.
What is this lawsuit about?
The operative complaint in the Action, the Third Amended Class Action Complaint dated April 23, 2010 (the “Complaint”), asserts (i) claims under the Securities Act of 1933 against certain current and/or former Lehman officers and directors, Ernst & Young LLP (“E&Y”), and certain alleged underwriters of certain Lehman offerings, and (ii) claims under the Securities Exchange Act of 1934 against certain former Lehman officers and E&Y. The Complaint alleges, among other things, that during the Settlement Class Period and in connection with the Offering Materials, defendants made misrepresentations and omissions of material facts concerning certain aspects of Lehman’s financial results and operations. On September 15, 2008, Lehman Brothers Holdings Inc. filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code and, as a result, is not named as a defendant in this Action. On July 27, 2011, the court issued an order granting the defendants’ motions to dismiss regarding certain of the claims in the Complaint and denying the defendants’ motions to dismiss with respect to other claims.