AmTrust’s $13 Million Deal to Settle Delisting Suit Approved

A $13 million settlement between AmTrust Financial Services Inc. and investors who say it misled them about preferred stock delisting has received final approval from a federal court.

And a one-third cut for attorneys’ fees is reasonable, Judge Katherine Polk Failla said Wednesday for the US District Court for the Southern District of New York.

Individual investor Jan Martínek served as class representative in the suit. He alleged the insurance company misled holders of its preferred stock about whether the securities would remain listed on the New York Stock Exchange following a go-private merger.

The court certified a class of purchasers of certain preferred AmTrust stock in February.

The $13 million result for the class is fair and reasonable, Failla said in a final judgment.

The attorneys’ share of $4,332,900 is fair when cross-checked against hours expended and rates, she said in a separate order. “Lead Counsel devoted over 3,998 hours, with a lodestar value of approximately $2.6 million” to the case, she said. The full award equates to a 1.64 multiplier of that amount, she said.

Failla also granted reimbursement of $460,000 in litigation expenses, and a service award of $15,000 to Martínek.

Wolf Popper LLP served as class counsel.

Quinn Emanuel Urquhart & Sullivan LLP and McDermott Will & Emery LLP represented AmTrust.

The case is Martínek v. AmTrust Fin. Servs. Inc., S.D.N.Y., No. 1:19-cv-08030, 11/16/22.