Court Vacates Bear Stearns Shareholder Settlement

Law360, New York (December 20, 2007, 12:00 AM EST) -- An appeals court has revived a class action against Bear, Stearns & Co. after overturning a federal judge's order granting settlement with shareholders who implicated the broker in a fraud scheme that led to the collapse of now-defunct securities firm Sterling Foster & Co.

The U.S. Appeals Court for the Second Circuit vacated the settlement and returned the case to the lower court, ruling Wednesday that the settlement was reached before sufficient inquiry into evidence of Bear Stearns' wrongdoing and is, accordingly, unfair.

The case was...
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