Bear Stearns Liable in Bond Suit
Aug. 24, 1998
SAN DIEGO (AP) _ Bear Stearns Cos. lost a class-action lawsuit that could require the firm to pay $126 million to investors who lost money on junk bonds of a company that eventually filed for bankruptcy.
The federal court jury ruled Friday that Bear Stearns knowingly misrepresented critical facts when it sold investors $83 million in junk bonds from Weintraub Entertainment Group in 1987.
The jury awarded three plaintiffs who launched the case a total of $7 million. In all, investors lost about $60 million and are entitled to $126 million with interest, said Michael Aguirre, an attorney for the plaintiffs.
Bear Stearns' lawyer, Peter H. Benzian, said the firm planned to challenge the verdict.