Former shareholders of Tyco International Ltd. have been given the go-ahead to sue the company and accounting firm PricewaterhouseCoopers.
A New Hampshire federal judge made the ruling last week, consolidating a number of securities fraud cases and removing one lead plaintiff, Voyageur Asset Management, saying that the firm could not prove it was harmed by Tyco executives' illegal manipulation of stock prices.
Tyco's former chief executive Dennis Kozlowski and former chief financial officer Mark Swartz were convicted last September of fraud for reaping more than a combined $405 million by inflating the company's stock price through bad accounting and awarding themselves with huge bonuses.
The lawsuit alleges that the two men operated the company as a criminal enterprise to enrich themselves and misrepresented the value of Tyco and companies it acquired under Kozlowski's tenure.
Investors who bought Tyco stock between Dec. 13, 1999, and June 7, 2002 are eligible to join the class. Some estimates have said stock losses for the period totaled some $60 billion.
Spokespeople for Tyco said the company would continue to defend itself against the charges.
Previously on WebCPA:
Tyco Pays $50M to Settle Accounting Charges (April 18, 2006)
Former Tyco Execs Sentenced Up to 25 Years (Sept. 20, 2005)Tyco's Kozlowski, Swartz Found Guilty of Grand Larceny, Fraud (June 20, 2005)
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access