A federal judge gave preliminary approval today to a deal under which auditor Arthur Andersen LLP will pay $65 million to settle allegations it failed to protect investors from WorldCom's historic accounting fraud.
"Congratulations are in order," Judge Denise Cote told lawyers just before giving her approval.
The settlement brings to a close a class-action lawsuit by investors that also laid blame on major investment banks that underwrote WorldCom securities and 12 former directors of WorldCom itself.
The banks settled before trial for more than $6 billion, and the directors agreed to pay nearly $25 million out of their own pockets.
Andersen was the only defendant left when the case went to trial last month. In a statement Monday, when the settlement was announced, Andersen denied wrongdoing.
The lead plaintiff in the lawsuit was New York state Comptroller Alan Hevesi, acting as trustee of the state employees' retirement fund.