Petrobras US ADR/ADS Settlement
14-CV-09662 Southern District of New York
January 22, 2010 — July 28, 2015
TOTAL SETTLEMENT FUND:
CERTAIN PETROBRAS SECURITIES NOT INCLUDED IN THIS SETTLEMENT:
Who is Eligible to Participate in the International Recovery Action in the Netherlands:
In addition to assisting clients that traded Petrobras ADS and the Petrobras bonds identified below, Battea is assisting a large number of institutional clients who suffered hundreds of millions in dollars in losses trading Petrobras common shares (PETR3) and Petrobras preferred shares (PETR4), which are listed on BM&F Bovespa, as well as certain Petrobras bonds that were purchased or acquired in non-US transactions that did not clear or settle through the Depository Trust Company’s book-entry system, with submitting their claims via current litigation efforts in District Court in Rotterdam, the Netherlands. Investors are turning their attention to the fact that Petrobras Global Finance B.V., as well as many international Petrobras subsidiaries are headquartered in the Netherlands (not in Brazil), and believe the avenue for recovery via litigation here, provides a much stronger outlook than doubtful arbitration efforts in Brazil.
The pending international recovery action in the Netherlands covers all persons or entities who purchased or acquired before July 28, 2015 any Petrobras security not covered by the US Settlement, which includes both Petrobras common and preferred shares traded on Bovespa, as well as certain Petrobras bonds purchased or acquired in non-US transactions where such transactions did not clear or settle through the Depository Trust Company’s book-entry system.
The securities included in the Settlement are those described below. The Settlement Class includes all Persons who:
- (a) during the time Period between January 22, 2010 and July 28, 2015, inclusive (the “Class Period”), purchased or otherwise acquired Petrobras Securities, including debt securities issued by PifCo and/or PGF, on the New York Stock Exchange or pursuant to other Covered Transactions; and/or
- (b) purchased or otherwise acquired debt securities issued by Petrobras, PifCo, and/or PGF, in Covered Transactions, directly in, pursuant and/or traceable to a May 13, 2013 public offering registered in the United States and/or a March 10, 2014 public offering registered in the United States before Petrobras made generally available to its security holders an earnings statement covering a period of at least twelve months beginning after the effective date of the offerings (August 11, 2014 in the case of the May 13, 2013 public offering and May 15, 2015 in the case of the March 10, 2014 public offering).
For purposes of the Settlements, “Covered Transaction” means any transaction that satisfies any of the following criteria:
- (i) any transaction in a Petrobras Security listed for trading on the New York Stock Exchange (“NYSE”);
- (ii) any transaction in a Petrobras Security that cleared or settled through the Depository Trust Company’s book-entry system; or
- (iii) any transaction in a Petrobras Security to which the United States securities laws apply, including as applicable pursuant to the Supreme Court’s decision in Morrison v. National Australia Bank, 561 U.S. 247 (2010).
Purportedly concealing a multi-year, multi-billion dollar bribery and kickback scheme.
Case SummaryClass action law suit pending in the United States District Court for the Southern District of New York alleging violations of the federal securities laws by defendants for purportedly concealing a multi-year, multi-billion dollar bribery and kickback scheme.SETTLEMENT: $3 Billion Settlement Announced.$3B Settlement Covers Only US Securities. Majority of International Investors and Losses Not Covered European litigation, backed by institutional investors from around the world, seek equal restitution for majority of losses.
On January 3, 2018, Petrobras announced that in connection with the losses investors suffered from the Lava Jato bribery scandal, it had agreed to a USD 2.95 Billion settlement with investors who purchased American Depository Shares (ADS) and bonds in the US. The US settlement is a commendable and positive development, but it only provides recoveries for claims by purchasers in the United States and by purchasers of Petrobras securities that are listed for trading in the United States. The US issued and traded securities represent a limited portion of Petrobras global securities and related investor losses. The majority of investor losses occurred from trading in the Petrobras securities including Preferred and Common shares traded on the Brazilian exchange in So Paulo, European-regulated exchanges and bonds issued by Petrobras Global Finance, which is headquartered in the Netherlands, not in Brazil. The underlying fraud and events are the exact same and Petrobras should treat its investors equally. Petrobras should therefore compensate its investors regardless of which exchange, or in which country, they purchased Petrobras shares or bonds.
The litigation in the Netherlands covers the principal Petrobras equity securities that traded on the BOVESPA exchange in So Paulo and via linked markets such as Latibex on Bolsa De Madrid. The litigation in the Netherlands also covers the claims of bondholders whose losses are not included in the US litigation.