Comverse Technology Inc. (Pink Sheets: CMVT) signed a settlement last week with New York law firm Pomerantz Haudek Grossman & Gross LLP in the class-action lawsuit stemming from the company's options backdating affair. Under the settlement, Comverse and some former executives and directors will pay $225 million, including $60 million by former Comverse CEO Kobi Alexander.
Adv. Mark Gross said, "This is the second largest settlement in the history of class lawsuits of this kind."
Adv. Eitan Lavie said, "This is the largest settlement in which an Israeli financial institution was the lead plaintiff in a class action lawsuit."
The options backdating scandal at Comverse erupted four years ago. The actions by Comverse's executives reportedly cost investors heavy losses and resulted in major accounting irregularities.
Menorah Mivtachim Holdings Ltd. (TASE: MORA) led the class-action lawsuit against Comverse and Alexander, hiring Pomerantz Haudek Grossman & Gross. The case was being heard by the US Federal District for the Eastern District of New York (Brooklyn). The settlement follows Comverse's moves earlier this year to put the scandal and its financial repercussions behind it and get back on track, when it reached a settlement with the US Securities and Exchange Commission (SEC).
Comverse's share rose 3.3% in New York on Friday to $9.45.
Published by Globes [online], Israel business news - www.globes-online.com - on December 20, 2009
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