Associated Press
Some leaders of the failed IndyMac Bancorp have agreed to settle a shareholder class-action lawsuit for $6.5 million.
The lawsuit names former IndyMac CEO Michael W. Perry and Chief Financial Officer Scott Keys as defendants.
IndyMac collapsed in July 2008, and the Federal Deposit Insurance Corp. took over the Pasadena, Calif.-based mortgage lender. IndyMac was one of the largest mortgage originators in the United States, and its collapse marked one of the biggest bank failures in U.S. history.
Plaintiffs in the lawsuit represent shareholders who bought the mortgage lender’s stock from March 1, 2007 to May 12, 2008. The lawsuit accused the defendants of making statements that concealed the true extent of IndyMac’s deteriorating capital and liquidity as well as its growing exposure to regulatory action, among other claims.
The payment will be made in exchange for a dismissal of the claims against the defendant, according to federal court papers filed last week.
The proposed settlement represents "a reasonable resolution" for the case and eliminates the chance that shareholders may recover nothing, according to a shareholders’ motion for preliminary approval filed July 2 in the U.S. District Court for the Central District of California, Western Division.
.
Join The Conversation
Welcome to your discussion forum:
Verified accounts are now required for immediate posting. Please verify your e-mail address in Disqus, or sign in with your social networking account. You may also post using your e-mail address (which will remain private), but those posts will first need to be approved by the moderator. Comments made here are the sole responsibility of the person posting them; these comments do not reflect the opinion or approval of the Bennington Banner. This forum encourages open, honest, respectful and insightful discussions; there is no need to be offensive. Read our guidelines.