An Alabama court has approved a settlement under which HealthSouth Corp. will receive a $100 million payout from UBS, settling allegations that the investment bank helped former HealthSouth executives fraudulently boost the rehab provider's bottom line. The $100 million includes $25 million in attorneys' fees and about $1.2 million in expenses.
Late last year, HealthSouth struck an initial deal that included its forgiving $33 million in debts to the investment bank. This week's judgment, by the Circuit Court of Jefferson County, should put an end to the matter.
Still pending are HealthSouth's claims against Ernst & Young, which served as the rehab provider's independent auditor at the time of the $2.6 billion accounting fraud that rocked the corporate world. HealthSouth also has claims underway against Richard Scrushy, HealthSouth's former chief executive officer.
Counsel for the plaintiffs will receive 11 percent of any future recovery from Ernst & Young, and 35 percent of any recovery from Scrushy. The trial against Scrushy should take place in late March.
To learn more about the pending litigation:
- read this Modern Healthcare article (reg. req.)
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