Home Builder Beazer Settles Shareholder Class Action for $30.5 Million

May 6, 2009

U.S. home builder Beazer Homes USA Inc. settled a class-action shareholder lawsuit, agreeing to pay $30.5 million, but did not admit any wrong doing, according to court documents.

The $30.5 million will be paid by the company’s insurance provider, the company and court papers said.

The settlement also calls for the case to be dismissed without prejudice, meaning the suit cannot be refiled.

The case was filed in U.S. District Court in Atlanta in 2007 and then granted class-action status in 2007. The lead plaintiffs were Glickenhaus & Co., an institutional investment advisor firm, and Carpenters Pension Trust Fund for Northern California, according to court papers.

In the original complaint accused the company and its executives of making false statements regarding its business. Early in 2007, The Charlotte Observer reported federal housing officials were reviewing the company’s mortgage origination for alleged fraud, according to court documents.

The complaint was made on behalf of shareholders who owned Beazer stock between Jan. 27, 2005 and May 12, 2008 and was filed against the company four of its top executives and its auditor Deloitte & Touche LLP, all of whom also are covered by the settlement terms.

In after-hours trading, on Tuesday Beazer shares traded at $3.75, up 5 percent from their close of $3.57.

(Reporting by Ilaina Jonas; Editing by Andre Grenon)

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