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Case Status:    SETTLED
On or around 12/28/2005 (Date of order of final judgment)

Filing Date: August 13, 2004

By the Final Order and Judgment entered on December 28, 2005, the Settlement memorialized in the Stipulation and Supplemental Stipulation is hereby approved in all respects and shall be consummated in accordance with its terms and provisions.

According to the Notice of Pendency dated November 5, 2005, the parties have agreed to a settlement. The settlement fund is in the amount of $67,500,000. A Final Fairness Hearing will be held on December 27, 2005.

As summarized by the Company’s FORM 10-Q for the quarterly period ended September 30, 2005, beginning in August 2004, following post-merger announcements by the Company, various shareholders of the Company commenced fourteen putative class action lawsuits against the Company and certain of its current and former officers and directors in the United States District Court for the District of Minnesota. Plaintiff shareholders allege that certain disclosures relating to the April 2004 merger between TPC and SPC contained false or misleading statements with respect to the value of SPC’s loss reserves in violation of federal securities laws. These actions have been consolidated under the caption In re St. Paul Travelers Securities Litigation I, and a lead plaintiff and lead counsel have been appointed. An additional putative class action based on the same allegations was brought in New York State Supreme Court. This action was subsequently transferred to the District of Minnesota and was consolidated with In re St. Paul Travelers Securities Litigation I. On June 24, 2005, the lead plaintiff filed an amended consolidated complaint. The amended consolidated complaint asserts claims under Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of 1934, as amended, and Sections 11 and 15 of the Securities Act of 1933, as amended. It does not specify damages. On August 23, 2005, the Company and the other defendants in In re St. Paul Travelers Securities Litigation I moved to dismiss the amended consolidated complaint.

The original complaint alleges that St. Paul’s registration statement was materially false or misleading because it failed to disclose that (a) there were significant disparities between the accounting and actuarial methods of St. Paul and Travelers, requiring St. Paul Travelers to increase its claims reserves by $1.171 billion to conform St. Paul’s less conservative accounting and actuarial methods to that of Travelers; (b) St. Paul’s then existing exposure to certain adverse financial condition of a construction contractor, a reduction in reinsurance recoverables, and other similar conditions, required St. Paul Travelers to increase its claims reserves by an additional $466 million; and (c) the aggregate $1.637 billion of required increase in claims reserves due to these existing but undisclosed facts relating to St. Paul would require St. Paul Travelers to record a significant charge to its income statement, adversely impacting earnings.

The true facts were disclosed to the market on July 23, 2004, when St. Paul Travelers revealed that certain conditions relating to St. Paul required the Company to increase its claims reserves by $1.6 billion. On August 5, 2004, St. Paul Travelers further announced that the required $1.6 billion increase in claims reserves would result in an operating loss of $310 million or $0.47 per basic and diluted share for the quarter.

The per share closing price of St. Paul common stock was $40.77 on April 1, 2004, the date on which each share of Travelers’ Class A and Class B common stock was exchanged for 0.4334 share of St. Paul common stock pursuant to the materially false or misleading registration statement. By the time the true extent of required reserve increase and its adverse impacts against St. Paul Travelers were fully disclosed to the market on August 5, 2004, the per share price of St. Paul common stock had declined by $6.02 or 14.77% to close at $34.75 on August 5, 2004 – causing massive losses to former Travelers shareholders.

COMPANY INFORMATION:

Sector: Financial
Industry: Insurance (Prop. & Casualty)
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: STA
Company Market: New York SE
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: D. Minnesota
DOCKET #: 04-CV-3801
JUDGE: Hon. John R. Tunheim
DATE FILED: 08/13/2004
CLASS PERIOD START: 11/17/2003
CLASS PERIOD END: 08/05/2004
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Berman DeValerio Pease Tabacco Burt & Pucillo (FL)
  2. Chestnut & Cambronne, P.A.
  3. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
  4. Krislov & Associates, Ltd.
  5. Murray, Frank & Sailer LLP
  6. Vianale & Vianale LLP (former Boca Raton)
  7. Waite Schneider Bayless & Chesley Co. LPA (Cincinnati)
  8. Wechsler Harwood LLP
  9. Wolf Haldenstein Adler Freeman & Herz LLP (New York)
  10. Wolf Popper, LLP
  11. Zimmerman Reed, LLP
  12. Zwerling Schachter & Zwerling LLP
No Document Title Filing Date
COURT: D. Minnesota
DOCKET #: 04-CV-3801
JUDGE: Hon. John R. Tunheim
DATE FILED: 06/24/2005
CLASS PERIOD START: 11/17/2003
CLASS PERIOD END: 08/05/2004
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Goodkind Labaton Rudoff & Sucharow LLP
    100 Park Avenue, Goodkind Labaton Rudoff & Sucharow LLP, NY 10017
    212.907.0700 212.818.0477 · info@glrslaw.com
  2. Labaton Sucharow & Rudoff LLP
    100 Park Avenue, 12th Floor, Labaton Sucharow & Rudoff LLP, NY 10017
    212.907.0700 212.818.0477 · info@labaton.com
No Document Title Filing Date
No Document Title Filing Date