Lehman executives in bid to settle a $90m lawsuit
FORMER Lehman Brothers executives including ex-chairman and chief executive Dick Fuld are to settle a lawsuit brought by investors in the bank with a $90m (£54.7m) insurance payout, court records show.
Investors alleged that Lehman’s executives were to blame for losses incurred on the bank’s shares and bonds, claiming they materially misled shareholders about the bank’s financial health before its bankruptcy.
The executives have asked Judge Peck, the judge on the case, to change bankruptcy law to allow them to call on their directors and officers insurance to cover the costs of the case. Lehman last year said the insurance policy would cover up to $90m of costs as well as pay $10m to Fuld.
Peck has changed the law nine times already to allow insurance funds to be used, the filings showed.