A class of investors in auto parts maker Dana Corp. has reached a $64 million settlement that resolves a lawsuit in an Ohio federal suit dating back to 2005. It was claimed that two former company officers violated securities laws by falsifying financial records. The investors have asked the court to give preliminary approval to their settlement with former Dana CEO Michael J. Burns and former chief financial officer Robert C. Richter. It was alleged that Burns and Richter cooked company books in order to get a higher credit rating, hide deferred tax assets and more.
The investor suit, filed in October 2005 against Dana and the two officers, claimed that the company’s public filings with the U.S. Securities and Exchange Commission (SEC) between April 2004 and the suit’s filing were incorrect due to financial record manipulation by Burns and Richter. Dana’s assets were “overstated by as much as $1 billion” during that period, the investors said. The truth about the company’s financial status came to light in September 2005, causing its stock to drop by more than 70 percent. Dana filed for bankruptcy on March 3, 2006, along with a large group of its subsidiaries. It had been dismissed as a Defendant in the suit in October 2011.
