Tyco International Agrees to Settlement In Shareholder Class Action
December 2007 - Judge Paul Barbadoro of the U.S. District Court for the District of New Hampshire finalized the agreement and payment. Under the agreement, Tyco will pay $2.975 billion to investors. Tyco auditor PricewaterhouseCoopers LLP, which was also named as a defendant in the suit, will pay another $225 million. PricewaterhouseCoopers LLP ("PwC") has agreed to pay $225 million to settle securities and accounting fraud claims relating to the Tyco International Ltd. securities class action , presently pending in the United States District Court for the District of New Hampshire before Judge Paul Barbadoro. This settlement with PwC, combined with the recent settlement with Tyco - the largest ever by a single corporate defendant - will bring the total settlement to more than $3.2 billion by the time it is presented to the court for final distribution, inclusive of interest. The settlement with PwC, reached after four years of hard-fought litigation and extensive mediation, represents one of the largest recoveries on record from an outside auditor in the history of securities class action litigation. Investors who purchased or acquired Tyco securities from December 13, 1999 through and including June 7, 2002 are covered by the settlement.
Tyco International Ltd. has agreed to immediately fund $2.975 billion in cash to settle securities and accounting fraud claims relating to the Kozlowski era which are presently pending in the United States District Court for the District of New Hampshire before Judge Paul Barbadoro. The settlement specifically excludes auditor PriceWaterhouseCoopers ("PwC") and, by the time the settlement will be presented to the Court for final distribution, it will exceed $3 billion in value, inclusive of interest. The settlement represents the single largest payment from any corporate defendant in the history of securities class action litigation. Investors who purchased or acquired Tyco securities from December 13, 1999 through and including June 7, 2002, are covered by the settlement. … As part of the settlement, Tyco has agreed to assign the claims it has against PwC related to the accounting fraud to the Class, which intends to vigorously pursue both its own claims and the assigned claims. As Tyco's auditor, PwC was in a unique position to uncover the fraud and to prevent the damages to Tyco's shareholders. Instead, PwC is alleged to have failed in its duties as a corporate watchdog. In addition, as Tyco already has its own claims being pursued against certain of the individual defendants, the Class has assigned its claims against Dennis Kozlowski, Frank Walsh and Mark Swartz to Tyco in exchange for receiving a 50% interest in any net recoveries achieved against these non-settling defendants.
February 2002 - Class action complaints filed against TYCO in several U.S. District Courts alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market during the Class Period, thereby artificially inflating the price of TYCO common stock.