Lawsuit Against Tyco Piling UpOct 26, 2002 | AP Federal lawsuits accuse former Tyco International executives of imperiling the retirements of as many as 100,000 of the company’s current and former employees.
Dozens of shareholder actions have been filed in U.S. District Court since October, when a panel of judges chose New Hampshire as the multi-district battleground for class-action litigation involving the conglomerate.
As of last week, the total was 35, the majority of which allege securities fraud. Also among the lawsuits are two punitive class actions brought on behalf of members of Tyco’s 401(k) retirement investment accounts.
They allege accounting fraud and breaches of fiduciary duty by the Tyco officials who managed the plans and were allegedly investing employees retirement savings in inflated Tyco stock at the same time they were unloading their own Tyco stock.
In February, U.S. District Judge Paul Barbadoro dismissed a shareholders’ lawsuit accusing Tyco executives of defrauding stockholders by artificially inflating the price of Tyco stock. But lawyers representing those bringing the new suits expect a better outcome.
"We have more facts," said attorney Paul Young of Milberg Weiss Bershad Hynes and Lerach of New York.
More is known now about alleged wrongdoing by Tyco executives than was known when the first class actions were brought, he said. Also, more incriminating evidence is steadily coming forth as the result of federal investigations.
Tyco, based in Bermuda but with headquarters in Exeter, has been struggling with allegations that former executives, including former CEO Dennis Kozlowski looted some $600 million from the company. Tyco also is under investigation by the Securities and Exchange Commission and federal prosecutors in New York.
Meanwhile, the lawyer Tyco hired for its internal investigation said Thursday his report will be completed by winter. David Boies said he would be "surprised if we uncovered a very large fraud."