Summary
This 8-K filing by The Charles Schwab Corporation (SCHW) on October 15, 2010, provides an update on significant ongoing litigation concerning the Schwab YieldPlus Fund®. The company previously entered into settlement agreements totaling $235 million to resolve class action claims related to this fund. However, a recent court opinion issued on October 14, 2010, has introduced a complication.
Key Highlights
- 1Update on the Schwab YieldPlus Fund® litigation.
- 2Company previously agreed to a $200 million settlement for federal law claims and a $35 million settlement for state law claims.
- 3These settlements, totaling $235 million, were subject to preliminary court approval.
- 4A court opinion on October 14, 2010, ruled that class members outside of California are not precluded from bringing further claims under California law.
- 5The company is currently reviewing the court's opinion to understand its impact on the tentative settlement.
- 6The company has not admitted any liability in relation to these settlements.
Frequently Asked Questions
This 8-K filing provides an update on the ongoing consolidated class action litigation related to the Schwab YieldPlus Fund®.
The company had previously entered into settlement agreements totaling $235 million: $200 million for federal law claims and $35 million for state law claims.
The court ruled that federal securities law class members residing outside of California would not be prevented by the preliminary settlement agreements from pursuing further claims under California law against the defendants.
No, The Charles Schwab Corporation has stated that it entered into the settlement agreements without admitting liability.
The company is currently reviewing the court's opinion to determine its implications for the tentative settlement. The outcome of this review could impact the total resolution of the litigation.