February 13, 2019

Court approves settlement in investor suits based on failure to disclose possible bribery

Three settlement agreements have been approved by the United States District Court for the Southern District of Texas in suits brought by former investors against Cobalt International Energy, Inc.  The plaintiffs claim that Cobalt’s failure to disclose possible FCPA violations in Angola to shareholders in a timely manner caused shares to lose value.  Specifically, the investors alleged that Cobalt’s SEC filings between March 2011 and November 2014 contained material misstatements and omissions regarding the ownership of the company’s business partners in Angola by Angolan government officials.  The Department of Justice and the Securities and Exchange Commission investigated Cobalt’s operations in Angola and ultimately declined to bring any enforcement action against the company.  Cobalt subsequently filed for bankruptcy under Chapter 11 in December 2017.  The settlements, which total $173.8 million, cover three groups of investors.  The settlement could rise by an additional $161.5 million as a result of ongoing litigation between Cobalt, co-defendants, and their insurance carriers.

Class Action Settlement | Notice of Plan of Allocation