Facing accusations of acting recklessly by certifying the books of Anicom, Inc., PricewaterhouseCoopers has opted to settle a pending lawsuit from shareholders for $21.5 million, rather than seeking a protracted legal battle.
Anicom, formerly a national distributor of wire and cable products based in Rosemont, Illinois, filed for bankruptcy under Chapter 11 in January 2000. The company had been the target of several lawsuits, including SEC administrative proceedings over the past few years. According to one complaint, Anicom executives issued "a series of false and misleading statements during the Class Period concerning i) Anicom's 1998 and 1999 financial results, ii) the strength of the Company's balance sheet and financial condition, and iii) statements concerning the Company's ability to reach quarterly results and analyst estimates."
Earlier this summer, a class action suit was initiated naming PwC as an additional defendant in the case. According to the Wall Street Journal, PwC decided to settle suit to avoid the costs and uncertainties associated with protracted litigation.