Brazil’s Petrobras must face U.S. group lawsuits over corruption – judge

NEW YORK, (Reuters) – A U.S. judge ordered Petrobras , the state-run Brazilian oil company, to face class-action litigation by investors seeking to recoup billions of dollars in losses stemming from a bribery and political kickback scandal.

In a decision made public yesterday, U.S. District Judge Jed Rakoff in Manhattan certified two classes of plaintiffs, saying their claims are similar enough to be pursued as groups.

One class bought various Petrobras securities from January 2010 to July 2015 and will be led by Universities Superannuation Scheme of Liverpool, England.

The other bought debt securities from offerings in 2013 and 2014, and will be led by North Carolina’s treasurer and the Employees’ Retirement System of Hawaii.

“Petrobras was a massive company with investors around the globe,” Rakoff wrote in a 49-page decision.

“Notwithstanding Petrobras’s size and its numerous and far-flung investors, the interests of the class members are aligned and the same alleged misconduct underlies their claims.”

Class certification can make it easier for investors to recoup larger sums than if they sued individually, though it does not guarantee they will be recover.

Petrobras did not immediately respond to requests for comment.

Other defendants include more than a dozen bank underwriters and an affiliate of the auditor PricewaterhouseCoopers. A PwC spokesman could not immediately be reached for comment.

Petrobras, whose formal name is Petroleo Brasileiro SA, has been accused of inflating the value of more than $98 billion of its stock and bonds through years of corruption.

Last April, Petrobras took a $17 billion writedown to account for overvalued assets.