Investors have agreed to settle securities claims against more than 30 underwriters who underwrote in excess of $31 billion in debt and equity offerings for Lehman Brothers, the collapse of which was a key chapter in the global financial crisis. The plaintiffs in these actions alleged that the underwriters, which included Bank of America and units of Bank of New York Mellon, Citigroup and Wells Fargo, assisted Lehman Brothers in making misstatements about its finances prior to its implosion and eventual bankruptcy filing. The proposed settlement still requires district court approval.
Lehman Brothers also appears on the verge of exiting bankruptcy protection, as the bankruptcy court approved its plan to end its record-shattering Chapter 11 bankruptcy. An investor lawsuit continues against Lehman Brothers' former auditor Ernst & Young and certain additional underwriters. Lehman Brothers previously sought a $90 million settlement with former directors and officers, including former CEO Richard Fuld, bringing the amount of settlement in the case to $507 million. ("Lehman investors, underwriters in $417 million accord," Reuters, December 6, 2011).