Ernst & Young LLP has agreed to pay $99 million to settle investor class-action allegations that it turned a blind eye when its audit client Lehman Brothers Holdings Inc. misled investors before the investment bank's 2008 collapse. The investors and Ernst "have reached an agreement in principle" to settle the litigation, the accounting firm and plaintiffs' attorneys both said. The two sides are in the process of drafting a formal settlement agreement, plaintiffs' attorneys said in a letter filed Wednesday in U.S. District Court in Manhattan. The settlement, which was reported this week by legal publications, will be subject to court approval. Ernst said in a statement that it "denies all liability" in the case and "chose to settle this claim to put this matter behind us."
This is rich. Michael Rapoport reports:
For anyone keeping score at home, the $99 million is $9 million more than Lehman's officers and directors paid in their settlement.