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Brazil’s Petrobras to pay $2.95 bn to settle class-action suit in US

Rio de Janeiro, Jan 3 (EFE).- Brazilian state oil company Petrobras said Wednesday it has agreed to pay $2.95 billion to shareholders who filed suit in the United States to recover corruption-related losses.

The settlement is aimed at bringing an end to a class-action lawsuit filed in the US District Court for the Southern District of New York, Petrobras said in a filing with the Sao Paulo stock exchange.

Petrobras said the agreement was aimed at resolving “all pending and prospective claims” by investors in its US-listed securities who sued the oil giant after its market value plummeted amid revelations it was used as part of a massive scheme to divert public funds.

That so-called Lava Jato (Car Wash) scandal involved allegations that suppliers overcharged the oil giant for contracts, splitting the extra money with corrupt Petrobras officials while setting aside some of the loot to pay off politicians who provided cover for the graft.

Former senior executives at Petrobras and major Brazilian engineering companies, as well as influential politicians, have been sentenced to lengthy prison terms for their role in the scheme.

Petrobras said it reached the settlement, under which the company has agreed to pay two installments of $983 million and a final installment of $984 million, to eliminate the risk of an adverse judgment.

Petrobras, which has always considered itself a victim of the scandal, said the settlement did not constitute any admission of wrongdoing or misconduct on the company’s part.

The company noted in its filing that it had already recovered 1.475 billion reais ($452.8 million at the current exchange rate) in restitution in Brazil and “will continue to pursue all available legal remedies from culpable companies and individuals.”

It said the agreement would now be submitted for the review of the district court, which after notifying the plaintiffs of the terms of the proposed settlement and considering any objections will decide whether or not to grant final approval.

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