Ernst & Young has agreed to pay $99m to former Lehman Brothers investors who have accused the auditor of helping Lehman misstate its financial records before the investment bank's collapse triggered a financial crisis in 2008.
Reuters reports that the agreement, which must still get court approval, signals the end of a massive class action against Lehman's former directors, as well as several other financial institutions, according to a letter filed Wednesday in federal court in Manhattan.
Lehman is accused of using the infamous 'Repo 105' accounting practice to misleadingly understate its leverage to make itself appear more financially solvent.
The investors who brought the lawsuit asked the court to suspend the case while the sides draft a settlement agreement.
'The settling parties are currently drafting a detailed stipulation of settlement and anticipate' asking the court for permission to notify class members of the deal in about 30 days, the investors said in the letter.
Ernst & Young said it denied all liability, settling the case 'to put this matter behind us'.
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