Former officers and directors of Global Crossing, the failed telecommunications company to which SWIFT outsourced its connectivity needs two years ago, have reached a $325 million settlement agreement on Friday with investors in a deal that requires the company’s founder and former lawyers to pay almost a quarter of that amount, both sides said.
Global Crossing founder Gary Winnick agreed to contribute $55 million to settle consolidated class action suits filed by shareholders in the telecommunications company in January 2003, a year after the company filed for bankruptcy with $12.4 billion in debt. Global Crossing’s former lawyers, Simpson Thacher & Bartlett of New York, contributed $19.5 million to the settlement even though they were not defendants in the case, said Jay Eisenhofer, a lawyer for the two Ohio public pension funds that acted as lead plaintiffs in the case.
The remainder of the settlement will be paid by the company’s insurers, Eisenhofer said.