Diamond, Shareholders Reach Unusual Deal: Class to Receive Stock

Reuters reports on the Diamond Foods class action settlement that is compensating millions of dollars in shares. Reuters asks Ted Frank to share his insights on the subject.

Class action watchdog Ted Frank of the Center for Class Action Fairness told me in an email Wednesday that as long as shareholder lawyers’ fees have the same cash-to-shares ratio as the class’s recovery, the Diamond settlement is “not unreasonable, especially for a cash-poor company facing potentially bankrupting litigation.” Frank said he has seen other class action settlements in which class members receive stock as compensation, although the brief in the Diamond case doesn’t cite any.

Read full article at Reuters.