WASHINGTON (CN) – The 6th Circuit upheld the settlement of a securities class action accusing Fruit of the Loom of inflating the market price of the company’s stock.
Judge Gibbons said plaintiff James Hayes was eligible to appeal the settlement, despite missing the objection deadline by nearly a month, because he did not get a chance to opt out of the binding settlement.
Hayes’ broker, National Investor Services, received notice of the settlement, but failed to inform Hayes directly or give his name to the claims administrator, Gilardi & Company LLC, until it was too late. Hayes finally heard about the settlement about a month after the deadline to lodge an objection had passed.
Nonetheless, the court approved the settlement, ruling that Hayes’ objection was based on poor notice, not the substance of the settlement.
Hayes still has recourse to pursue his claims individually, Gibbons noted.