According to the law firm press release, the lawsuit alleges defendants throughout the Class Period issued materially false and misleading statements to investors and/or failed to disclose that: (1) the Company’s senior officials were in non-compliance with the Company’s corporate governance directives and Code of Ethics; (2) as a result, the Company was subject to investigation and disciplinary action by various governmental and regulatory authorities; (3) the Company’s financial statements were materially false and misleading as they contained direct references to the Company’s Code of Ethics, and statements regarding its compliance with regulations and internal governance policies; (4) the Company lacked adequate internal and financial controls; (5) the SOX certifications signed by Eletrobras’ senior management were materially false and misleading as senior management was aware of “any fraud, whether or not material”; and (6), as a result of the foregoing, the Company’s financial statements were materially false and misleading at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages.
Plaintiffs filed a consolidated Complaint on December 8, 2015. This was followed by the filing of a second amended Complaint on February 26, 2016. Defendants filed a Motion to Dismiss the second amended Complaint on April 15. On March 27, 2017, the Court issued an Order granting in part and denying in part Defendants' Motion to Dismiss.
The parties entered into a Stipulation of Settlement on June 29, 2018. On July 18, the parties filed a supplemental agreement to the Stipulation of Settlement. The Court granted preliminary approval of the Settlement on August 17. On December 12, the Court granted final approval of the Settlement and entered Final Judgment.
On June 16, 2020, the Court issued an Order authorizing distribution of the net Settlement Fund.