Cendant Corp., New York, the direct marketing and franchise company, yesterday agreed to pay $2.83 billion to settle a class action lawsuit over accounting irregularities brought by shareholders, making it the largest settlement of a shareholder lawsuit in U.S. history.
Accounting irregularities occurred last year at CUC International, which became part of Cendant after its merger with HFS Inc. two years ago. Cendant continues its claims against Ernst & Young, the former CUC auditor, for professional malpractice and breach of contract claims in connection with the accounting irregularities.
Cendant did not indicate when it would make the settlement payment, but an appeal to the settlement is likely, which might set back that time frame.
