Facts

A class of purchasers of Conseco Inc. common stock, who bought stock between April 24, 2001 and Aug. 9, 2002, filed suit against Gary Wendt, William Shea, Charles Chokel, and James Adams. Conseco was a publicly traded company that operated many insurance and financial service businesses.

PLAINTIFFS' CONTENTIONS:
Plaintiffs claimed violations of federal securities laws. In particular, they claimed that defendants violated the Securities Exchange Act of 1934 Sections 10(b) and 20(a), and Rule 10b-5. Plaintiffs argued that defendants inflated stock prices based on materially misleading statements related to inappropriate loss mitigation techniques, corporate guarantee exposure on securities, accounting for guarantees, and reporting of loan servicing revenues and costs. Plaintiffs argued that defendants had knowledge that the statements were false or acted with reckless disregard as to their falsity.

DEFENDANTS' CONTENTIONS:
Defendants denied allegations of wrongdoing and that plaintiffs suffered damages. They asserted that they did not act with fraudulent intent, and that Conseco stock dropped due to a poor economic climate in the wake of the September 11th terrorist attacks.

Result

The parties agreed to a settlement amounting to $41,465,000.