Washington, DC: (Aug-28-07) Several class action lawsuits were brought against Delphi Corp. by its employees and shareholders. The employees and shareholders sued the Troy-based bankrupt auto supplier and current and former directors in March 2005, claiming that the company doctored its books, making it look more financially healthy than it actually was and defrauding shareholders by coaxing them into buying its stock. The employees also claimed the company should have known it was too risky to invest their retirement funds in Delphi stock.
In a settlement reached, Delphi Corp. agreed to settle the spate of class actions with a $320 million payout. Sources stated that though many details are still undisclosed, the settlement will provide $47 million for about 40,000 current and former employees, mostly salaried workers who lost money in company retirement funds invested in Delphi stock. Shareholders could split about $272.5 million. [DETROIT NEWS: DELPHI SECURITIES]
