Investors in Stichting Pensioenfonds DSM Nederland and Overseas Shipholding Group Inc. (OSG) have asked U.S. District Judge Shira A. Scheindin to approve a partial class action settlement. The investors accused a number of accounting, financial industry and executive-suite Defendants of failing to disclose tax liabilities tied to the formerly bankrupt tanker company. The total value of the settlement is $16.25 million. Individual Defendants will pay $10.5 million, while underwriter Defendants will pay $4 million and PriceWaterHouseCoopers LLP will pay $1.75 million.

The underwriter Defendants are Citigroup Global Markets Inc., Deutsche Bank Securities Inc., DNB Markets Inc., Goldman Sachs & Co., HSBC Securities (USA) Inc., ING Financial Markets LLC and Morgan Stanley & Co. LLC. The individual Defendants were the company’s former CEO and CFO along with a number of board members.

This securities litigation arose out of allegations that false and misleading statements were made in the registration statement that OSG filed in connection with its sale of $300 million of debt in March 2010. The misrepresentations include the company’s false statements related to income taxes, accounting policies and internal controls, according to the complaint.

The motion filed notes that OSG, not a party to the private litigation, also will fund the class to the tune of a minimum of $15 million as a result of bankruptcy proceedings. The class also stands to gain 15 percent of any recovery from Proskauer by OSG, the filing says. On July 1 the Plaintiffs appealed Judge Scheindlin’s May order, granting a summary judgment in favor of defendant Ernst & Young.

Source: Law360.com

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