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Wells Fargo Cross-Selling Class Action Settles for $480M

Dec. 19, 2018, 4:00 PM

Wells Fargo & Co. will pay $480 million to settle class claims it misled shareholders about opening unauthorized accounts after a federal court granted final approval to the deal Dec. 18.

The investors alleged the bank’s stock price plummeted after the scandal broke in 2016.

Over 1.8 million shareholders representing 1.1 billion affected shares will recover $0.35 per share, Judge Jon S. Tigar wrote for the U.S. District Court for the Northern District of California.

The court approved a $95.9 million attorneys’ fee award for class counsel, which constitutes 20 percent of the settlement fund.

The award is “within the median range of 19-22.3 percent in fees awarded in cases with large settlements over $100 million,” the court said.

Class counsel will also get $470,000 in expenses.

Robbins Geller Rudman & Dowd LLP and Bernstein Litowitz Berger Grossmann LLP represented the investors.

Sullivan and Cromwell LLP represented Wells Fargo.

The case is Hefler v. Wells Fargo & Co., 2018 BL 468579, N.D. Cal., No. 16-5479, 12/18/18.

To contact the reporter on this story: Perry Cooper in Washington at pcooper@bloomberglaw.com

To contact the editors responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com