WSJ - Wreckage from Bear Stearn's March, 2008 demise reared its ugly head once again when it was announced yesterday the settlerment of a shareholders' lawsuit against top executives of the firm. The settlement? $275 million on behalf of sued executives that included Mr. James Cayne and Mr. Alan Greenberg. What does this settlement cost the executives? Not much. When J.P.Morgan Chase took over Bear Stearns in 2008, a $9 billion fund was established by J. P. Morgan for probable settlements. Part of this $275 million settlement is a statement that executives involved denied any wrongdoing. An article in the Wall Street Journal stated in 2010, a Countrywide Financial lawsuit was settled for $600 million and in 2009, Merrill Lynch paid $475 million, after these two firms had been purchased by Bank of America. In 2011. Washington Mutual paid $208.5 million settlement in a lawsuit and was snapped up by J,P,Morgan, and in May, 2012, a $90 million settlement of an investors lawsuit was reached regarding Lehman Bros. Much of the settlement money came from "Directors and Officers Insurance".
It's a warning to all Boards of Directors - be sure the company you represent have you covered with adequate insurance. You're at risk. See Chapter 9 in the book "The Greedsters".
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