Anwar et al v. Fairfield Greenwich Limited et al

Filing 1533

SETTLEMENT AGREEMENT with PwC Defendants. Document filed by Harel Insurance Company, Ltd., Pacific West Health Medical Center, Inc. Employee's Retirement Trust, Securities & Investment Company Bahrain, St. Stephen's School. (Attachments: #1 Exhibit A, #2 Exhibit A-1, #3 Exhibit A-2, #4 Exhibit A-3, #5 Exhibit B)(Barrett, David)

EXHIBIT A-1
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

PASHA S. ANWAR, et al.,
Plaintiffs,
v.
FAIRFIELD GREENWICH LIMITED, et al.,

Master File No. 09-cv-118 (VM)

Defendants.

NOTICE OF PROPOSED SETTLEMENT OF CLASS ACTION AND
SETTLEMENT FAIRNESS HEARING, AND MOTION FOR ATTORNEYS’
FEES AND REIMBURSMENT OF EXPENSES
Your legal rights may be affected – Please read this Notice carefully.
To: All beneficial owners of shares or limited partnership interests in Fairfield Sentry
Limited (“Sentry”), Fairfield Sigma Limited (“Sigma”), Fairfield Lambda Limited
(“Lambda”), Greenwich Sentry, L.P. (“Greenwich Sentry”) and Greenwich Sentry
Partners, L.P. (“Greenwich Sentry Partners”) (collectively, the “Funds”) as of December
10, 2008 (whether as holders of record or traceable to a shareholder or limited partner
account of record) (“Beneficial Owners”), who suffered a Net Loss of principal invested
in the Funds (collectively, the “Settlement Class”).
If you meet the above definition of the Settlement Class, you could get a payment from a
class action settlement.
A federal court authorized this Notice. This is not a solicitation from a lawyer.
The purpose of this Notice is to inform you of a proposed settlement of this class action
(the “Action”) as against the PwC Defendants5 for a cash payment of $55,000,000 (the
5

The PwC Defendants consist of PricewaterhouseCoopers LLP (an Ontario Limited
Liability Partnership) (a/k/a “PwC Canada”), PricewaterhouseCoopers Accountants N.V.

“Settlement Fund”) and the scheduling of a settlement fairness hearing with respect to the
proposed settlement and the motion of the Representative Plaintiffs and Plaintiffs’
Counsel (collectively “Plaintiffs”) for an award of attorneys’ fees and reimbursement of
expenses. Documents related to the proposed settlement are available on the Settlement
website established by the Notice and Claims Administrator (the “Claims Administrator”)
at www.fairfieldgreenwichlitigation.com.
This Notice describes important rights you may have and what steps you must take if you
wish to participate in the Settlement or wish to be excluded from the Settlement Class.
Deadlines
YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT:
SUBMIT A CLAIM
FORM

Deadline: ______ ([120 days from mailed notice]). This
is the only way to receive a payment from the Settlement
Fund.

EXCLUDE YOURSELF
FROM THE
SETTLEMENT CLASS

Deadline: _____ ([35 days before the Settlement
Hearing]). Receive no payment from the Settlement. If
the Court approves the Settlement, this is the only option
that allows you ever to participate in any other lawsuit
against the PwC Defendants and other Released Parties
(defined below) which involves the Released Claims
(defined below).

OBJECT

Deadline: _____ ([35 days before the Settlement
Hearing]). You may write to the Court if you do not like
this Settlement or the request for an award of attorneys’
fees and reimbursement of expenses. You may not object
if you have excluded yourself from the Settlement.

(a Dutch legal entity with its registered office in Amsterdam, The Netherlands) (“PwC
Netherlands”), and PricewaterhouseCoopers International Limited.
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GO TO THE
SETTLEMENT
HEARING

Settlement Hearing Date: ______ Whether or not you
object to the Settlement, you may ask to speak in Court
about the fairness of the Settlement. The Deadline to ask
to speak in Court about the Settlement is ____ ([35 days
before the Settlement Hearing]).
Plaintiffs must file their motion papers for Final Approval
of the Settlement and for Approval of Attorneys’ Fees
and Expenses on or before ______ ([50 days before the
Settlement Hearing]).

DO NOTHING

Receive no payment if you do not submit a claim form.

These rights and options — and the deadlines to exercise them — are explained in this
Notice.
The Court presiding over this case must decide whether to approve the Settlement.
Payments will be made only if the Court approves the Settlement, and if there are any
appeals, after appeals are resolved, and the Claims Administrator has had an opportunity
to process all claim forms. Please be patient.
Your legal rights are affected whether you act or do not act. Please read this Notice
carefully.
SPECIAL NOTICE TO NOMINEES OR CUSTODIANS
If you are a Nominee and have not provided the Claim Administrator with a list of the
names and addresses of the Settlement Class Members in connection with the Fairfield
Greenwich (“FG”), Citco, or GlobeOp Settlements, you must within ten (10) days after
you receive this Notice, at your option, either (i) send this Notice and Proof of Claim and
Release (“Proof of Claim”) to the Beneficial Owner, or (ii) request the Claims
Administrator to send you additional copies of this Notice and the Proof of Claim
sufficient to deliver to all Beneficial Owners, and within ten (10) days after receipt
thereof make such delivery to all Beneficial Owners, or (iii) provide a list of the names,
addresses and email addresses of all Beneficial Owners to the Claims Administrator, who
will send those Persons a copy of this Notice and the Proof of Claim by first class mail or
email. Nominees who elect to themselves deliver the Notice and Proof of Claim to their
Beneficial Owners shall send a statement to the Claims Administrator confirming that the
delivery was made as directed, and subject to any confidentiality agreement, statute or
regulation that may limit their ability to do so, shall provide the Claims Administrator
with a list of the names and addresses of the Persons to whom the Notice and Proof of
Claim were delivered.
If you choose to deliver the Notice and Proof of Claim yourself, you may obtain from the
Claims Administrator (without cost to you) as many additional copies of these documents
as you will need to complete the delivery, by submitting a request to:

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Fairfield Greenwich Securities Litigation
c/o Rust Consulting, Inc.
P.O. Box 2874
Faribault, MN 55021-8674
(by regular or express mail)

Fairfield Greenwich Securities Litigation
c/o Rust Consulting
201 Lyndale Ave. S.
Faribault, MN 55021
(by express delivery service)

[e-mail]
www.FairfieldGreenwichLitigation.com
Toll Free Number: 1-855-263-3450
Foreign Callers: 1-612-359-7949
Regardless of whether you choose to complete the delivery yourself or elect to have the
delivery performed for you, you may obtain reimbursement for reasonable administrative
costs actually incurred in connection with forwarding the Notice and Proof of Claim and
which would not have been incurred but for the obligation to forward the Notice and
Proof of Claim, upon submission of appropriate documentation to the Claims
Administrator. The Claims Administrator has also maintained on its website pdf versions
of this Notice and the Proof of Claim. Delivery to Beneficial Owners may be effected
through electronic means.
SUMMARY OF NOTICE
Summary of the Proposed Settlement


The Representative Plaintiffs and the PwC Defendants have entered into a
proposed settlement releasing all claims that were asserted or could have been
asserted by the Representative Plaintiffs in the Action, individually and on behalf
of the Settlement Class, against the PwC Defendants and other affiliated Released
Parties (referenced collectively at times as the Released Parties). Under the terms
of the proposed Settlement, the aggregate amount of $55,000,000 (fifty-five
million dollars) will be paid into the Settlement Fund. These funds (less Courtapproved attorneys’ fees and reimbursement of expenses) shall be paid to the
Settlement Class pursuant to the Plan of Allocation.



Plaintiffs’ claims in this Action relate to additional investments made by existing
investors or investments that continued to be held subsequent to PwC
Netherlands’ audits of the Funds’ financial statements for the fiscal years ended
December 31, 2002 through December 31, 2005, and PwC Canada’s audits of the
Funds’ financial statements for the fiscal years ended December 31, 2006 and
December 31, 2007. Plaintiffs alleged in their Second Consolidated Amended
Complaint (“SCAC”), filed with the Court on September 29, 2009, that the PwC
Defendants failed to exercise reasonable care and acted negligently in their audits
of the Funds’ financial statements and made misrepresentations to investors in
their audit opinions. The District Court, in Orders dated July 29, 2010 and
August 18, 2010 (728 F. Supp. 2d 354 and 728 F. Supp. 2d 372) sustained the

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negligent misrepresentation and negligence claims asserted against the PwC
Defendants in the Action. The Court dismissed the only claim asserted against
PwC International Limited. The District Court subsequently denied in part two
separate motions to reargue the August 18, 2010 Order (800 F. Supp. 2d 571 and
884 F. Supp. 2d 92). However, the Court, on the second motion to reargue,
limited the claims against the PwC Defendants to subsequent investor and holder
claims asserted by already existing investors in the Funds. Copies of the Court’s
decisions are available on the website of the Claims Administrator.


In July 2015, in response to a decision by the Court of Appeals for the Second
Circuit concerning the Securities Litigation Uniform Standards Act (“SLUSA”),
the Court granted in part and denied in part the PwC Defendants’ renewed motion
to dismiss, dismissing Plaintiffs’ negligent misrepresentation claim and denying
the PwC’s Defendants’ motion to dismiss Plaintiffs’ negligence claim. 2015 U.S.
Dist. LEXIS 10073.



By letter endorsement dated April 22, 2015 [Dkt No. 1368], the Court scheduled
trial of the Action against the PwC Defendants to commence on January 4, 2016,
and set a schedule for the briefing of summary judgment and Daubert motions
and motions in limine, as well as for other pre-trial filings, including a pre-trial
memorandum, witness and exhibit lists, deposition designations, jury instructions
and a jury verdict form. By Order dated October 23, 2015, the Court denied the
PwC Defendants’ motion for summary judgment on five issues and requested
additional briefing on the following three issues:
(1) whether the Anwar Plaintiffs were a known party under the Known
Party Requirement of the Credit Alliance test; (2) whether there was a
sufficient linking conduct between PwC Defendants and Anwar Plaintiffs
under the Linking Conduct Requirement of the Credit Alliance test; and
(3) whether Anwar Plaintiffs’ damages are limited to losses based on
subsequent purchases. [Dkt No. 1430]
Pursuant to that Order, Plaintiffs filed their opposition to the motion for summary
judgment on those three issues, and the PwC Defendants filed a reply in further
support of their motion. That motion was still pending when the Settling Parties
agreed in principle to the Settlement.
In addition to moving for summary judgment, the PwC Defendants made Daubert
motions to exclude the testimony of each of Plaintiffs’ testifying experts,
Plaintiffs responded to those motions, and the PwC Defendants filed replies in
further support of those motions. Plaintiffs and the PwC Defendants also filed
motions in limine to exclude or limit certain evidence at trial, and filed opposition
papers to each other’s respective motions. All of the foregoing matters were still
pending when the Settling Parties agreed in principle to the Settlement. At that
time, the Settling Parties also had served or filed almost all of the pre-trial
materials, in which multiple disputes and objections were at issue.

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

As further additional settlement consideration, subject to the conditions set forth
in the Stipulation, the PwC Defendants have agreed to waive all rights to seek
recovery on claims for contribution or indemnity for any expenses incurred or
amounts paid in connection with the Action. Nothing in this provision precludes
the PwC Defendants from arguing that the Settlement proceeds in this case are an
offset against claims that may be made against them in other proceedings.



The Settlement also provides for a court order barring any Person from asserting
claims for contribution, indemnification or other similar claims against the
Released Parties. To compensate such Persons for the release of these claims
against the Released Parties, any judgment that may be obtained by a Settlement
Class Member against such Persons shall be reduced, to the extent permitted by
applicable law, by the greater of (i) the amount that corresponds to the percentage
of responsibility attributed to the Released Parties; and (ii) the gross monetary
consideration provided to such Representative Plaintiff or other Settlement Class
Member or Members pursuant to this Settlement.





This is the fourth and final settlement in this Action. The PwC Defendants were
the last remaining defendants. On March 25, 2013, the Court entered an Order
approving the settlement of Plaintiffs’ claims against the FG Defendants (the “FG
Settlement”) for $80,250,000 ($30,000,000 of which continues to be held in
escrow). That Order was affirmed on appeal. On November 22, 2013, the Court
entered an Order approving the settlement of Plaintiffs’ claims against GlobeOp
Financial Services LLC (the “GlobeOp Settlement”) for $5,000,000. Proceeds
from the FG Settlement and the GlobeOp Settlement have been distributed to
eligible claimants. On November 20, 2015, the Court entered an Order approving
the settlement of Plaintiffs’ claims against the Citco Defendants (the “Citco
Settlement”) for $125,000,000. Neither the GlobeOp nor Citco settlement Orders
were appealed.
In addition to amounts that they have received under the FG Settlement and the
GlobeOp Settlement and will receive under the Citco Settlement, Settlement Class
Members also are likely to receive additional cash distributions from liquidation
or bankruptcy proceedings involving the Funds (including based on distributions
from the BLMIS Trustee). Liquidation proceedings involving Sentry, Sigma, and
Lambda are pending in the British Virgin Islands (Claim No. 0074/2009
(Lambda), Claim No. 0136/2009 (Sentry), Claim No. 0139/2009 (Sigma)).
Bankruptcy proceedings involving Greenwich Sentry and Greenwich Sentry
Partners have been substantially completed in the U.S. Bankruptcy Court for the
Southern District of New York (Case No. 10-16229 (BRL)). In addition,
Settlement Class Members who filed proofs of claim should be entitled to
additional distributions from the Madoff Victim Fund administered by Special
Master Richard C. Breeden.

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

Further, the FG Defendants have pledged security interests up to an additional
$30,000,000 to a separate Escrow Fund. To the extent funds remain in the
Escrow Fund following the final resolution or disposition (including appeals) of
certain other claims commenced against the FG Defendants by June 15, 2016, the
balance in the Escrow Fund less any additional attorneys’ fee award permitted by
the Court shall be paid to the Settlement Class pursuant to the Plan of Allocation
for the FG Settlement.
Statement of Settlement Class Members’ Recovery

In connection with the FG Settlement, some 2,960 Settlement Class Members
filed Claim Forms comprising $3,265,638,105 of Net Losses. As stated herein,
Settlement Class Members may elect to utilize the trading and backup information
contained in the Claim Form for the FG Settlement or the Citco Settlement to participate
in this settlement, provided that they sign the Release. Assuming that Settlement Class
Members with Net Losses of $3,265,638,105 file claims in this Settlement, the proration,
prior to payment of attorneys’ fees or expenses, of a Settlement Class Member’s recovery
from the PwC Settlement would be approximately 1.68% of their Net Loss. Together
with the earlier FG and Citco settlements, the total pro ration (prior to payment of
attorneys’ fees and expenses), assuming that the same dollar value of claims are filed in
the Citco and PwC Settlements, as were filed in the FG Settlement, would be
approximately 7.0%.
Membership in the Settlement Class
The Settlement Class consists of Beneficial Owners of shares or limited
partnership interests in the Funds as of December 10, 2008 (whether as holders of record
or traceable to a shareholder or limited partner account of record), who suffered a Net
Loss of principal invested in the Funds (with certain exceptions identified below).
Plaintiffs’ Lead Counsel, with the assistance of the Claims Administrator, will in the first
instance determine, and make recommendations to the Court, as to the identity of
investors who file claim forms who are appropriately Settlement Class Members.
Determinations as to membership in the Settlement Class will be reviewable by the
Court.
Statement of Potential Outcome of Settled Claims
The Settlement must be compared to the risk of no recovery on the relevant
claims after contested dispositive motions, trial and likely appeals. The claims being
settled involve numerous complex legal and factual issues, many of which would require
expert testimony.
Among the many key issues about which Plaintiffs and the PwC Defendants do
not agree are: (1) whether either of the PwC Defendants violated state law or otherwise
engaged in any wrongdoing; (2) whether either of the PwC Defendants acted negligently;

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(3) whether the PwC Defendants’ audits of the Funds’ financial statements complied with
International Standards of Auditing or Generally Accepted Auditing Standards, or were
otherwise conducted with reasonable care; (4) whether Plaintiffs’ losses were caused by
the PwC Defendants’ alleged negligence; (5) whether the PwC Defendants owed a duty
to investors in the Funds to exercise reasonable care; (6) whether Plaintiffs’ state law
claims are preempted by the Securities Litigation Uniform Standards Act of 1998; (7)
whether Plaintiffs have standing to pursue their state law claims; (8) whether a litigation
class can be certified (as opposed to a settlement class); (9) whether certain of Plaintiffs’
claims are barred by the statute of limitations; (10) the method for determining whether,
and the extent to which, investors suffered injury and damages that could be recovered at
trial; and (11) whether the FG and Citco Defendants should be responsible for a
proportionate share of Settlement Class Members’ losses, thereby absolving the PwC
Defendants of some or all liability.
Many of these issues, if found against Plaintiffs, would have left Plaintiffs and the
Settlement Class with no recovery. In addition, even if Plaintiffs were to obtain a
judgment against the PwC Defendants that is affirmed on appeal, complex legal and
factual issues may be presented by Plaintiffs’ efforts to collect such a judgment from the
PwC Defendants.
Reasons for Settlement
Plaintiffs entered into the proposed settlement after over six years of litigation,
when they were fully familiar with the facts and circumstances of the Action. Plaintiffs’
Counsel reviewed more than nine million pages of documents produced by the PwC
Defendants and other Defendants; and reviewed and produced to counsel for the
defendants more than 75,000 pages of documents on behalf of the Representative
Plaintiffs and certain other Named Plaintiffs. Plaintiffs’ Lead Counsel have conducted
approximately 19 merits depositions of the PwC Defendants and approximately 59 merits
depositions of former and current employees of the other Defendants in locations
including New York, Miami, Toronto, Bermuda and Amsterdam, and 13 depositions of
experts designated by the Citco and PwC Defendants. Twenty individuals associated
with the Representative Plaintiffs and other Named Plaintiffs (including each of the
Representative Plaintiffs and other plaintiffs named in the SCAC), were deposed in
Arizona, Cleveland, and New York, some of whom traveled from international residences
including Israel, Bahrain, and Belgium. In addition, all eight of plaintiffs’ liability and
damages experts were deposed by the Citco and PwC Defendants.
Further information concerning Plaintiffs’ litigation efforts is contained in the
Stipulation of Settlement dated January 6, 2016, available on the Claim Administrator’s
website.
Beginning in April 2012, and subsequently at the suggestion of the Court, and
with the assistance of Eric Green and retired U.S. District Judge Layn Phillips, two
highly-experienced mediators, and Magistrate Judge Frank Maas, Plaintiffs and the PwC
Defendants engaged in extensive, arm’s-length negotiations, including four separate full

8

day meetings and two half-day meetings conducted over a three and one-half year period.
Judge Phillips ultimately made a mediator’s proposal that was accepted by the parties.
All seven Representative Plaintiffs and all of Plaintiffs’ Lead Counsel, who have
extensive experience in securities and complex shareholder class-action litigation, believe
that the Settlement provides the Settlement Class with significant and certain benefits
now and eliminates the risk of no recovery following what would be years of further
uncertain litigation, including final disposition of the class certification motion on the
claims against the PwC Defendants, motions for summary judgment, and if summary
judgment is not granted to PwC, a determination of the contested Daubert and in limine
motions, a hotly-contested trial lasting some 4-8 weeks, and almost certain appeals on the
claims against the PwC Defendants, with the possibility of no recovery at all.
Plaintiffs, in proposing that the Court approve the $55,000,000 settlement as fair,
reasonable and adequate to the Settlement Class, have considered, among other factors,
Plaintiffs’ ability to prevail on the contested factual and legal issues summarized in the
Statement of Potential Outcome of Settled Claims above. There is a significant risk that
Plaintiffs’ claims could be dismissed or limited prior to or at trial, or on appeal from a
jury verdict.
Plaintiffs’ Lead Counsel also considered the likely difficulty of obtaining a
significantly larger recovery from the PwC Defendants in light of their continued
payment of large legal fees and expenses, and the substantial potential difficulties in
collecting on a judgment. Among other things, the PwC Defendants are separate legal
entities from the U.S., or international offices of PricewaterhouseCoopers, and could not
call on the assets of those other offices or partners in settling claims or satisfying a
judgment. The PwC Defendants, as part of the settlement process, provided Plaintiffs’
Lead Counsel with certain financial information, including information concerning their
limited insurance coverage. Plaintiffs’ Lead Counsel further considered that even if a
jury verdict were obtained against the PwC Defendants and upheld on appeal, collection
of such a judgment could be complex and uncertain due to the need to enforce it in
multiple foreign jurisdictions and the risk that the PwC Defendants would be forced into
bankruptcy, all of which could take years and result in collection of significantly less than
the verdict amount. Plaintiffs’ Lead Counsel determined, based on these matters and
their assessment of other legal and factual risks of continuing the Action against the PwC
Defendants and proving their claims at trial, some of which are discussed above, that the
proposed settlement is in the best interests of the Settlement Class.
Plaintiffs will file with the Court on or before ____ [50 days prior to the
Settlement Hearing] a formal motion for approval of the proposed Settlement further
discussing the reasons justifying the settlement.
The PwC Defendants have denied and continue to deny each and all of the claims
and contentions alleged in the SCAC and believe that they have meritorious defenses to
those claims and contentions. The Settlement shall in no event be construed as, or
deemed to be evidence of, an admission or concession by any of the PwC Defendants or

9

Released Parties with respect to any claim of any fault or liability or wrongdoing or
damage to the Representative Plaintiffs, the Settlement Class Members, or any Person.
Statement of Attorneys’ Fees and Expenses
Plaintiffs’ Lead Counsel will ask the Court to approve payment from the
Settlement Fund of attorneys’ fees of up to 30% of the Settlement Fund and for
reimbursement of expenses that were advanced by Plaintiffs’ Counsel in connection with
the litigation directly related to their representation of the Settlement Class not to exceed
$2,500,000.
If the above amounts are requested and approved by the Court, based upon current
information, fees and expenses are estimated at approximately 34.5% of the Settlement
Fund.
Dismissal and Releases
If the proposed Settlement is approved, the Court will enter a Final Judgment and
Order of Dismissal with Prejudice (the “Final Judgment”). The Final Judgment will
dismiss with prejudice the claims asserted in the Action against the PwC Defendants.
The Final Judgment will also provide that all Settlement Class Members shall be deemed
to have released and forever discharged all Released Claims against all Released Parties.
The specific terms of the releases, including the meaning of the term “Released Claims,”
are set forth in the Stipulation. This release does not include any claims asserted or that
may be asserted by the Funds, the Liquidators of the Funds, or on behalf of the litigation
trusts, or by the Released Parties, in the proceedings entitled (i) New Greenwich
Litigation Trust, LLC, as Successor Trustee of Greenwich Sentry, L.P. Litigation Trust v.
Citco Fund Services (Europe) BV, et al., New York County Clerk's Index No.
600469/2009; and (ii) New Greenwich Litigation Trust, LLC, as Successor Trustee of
Greenwich Sentry Partners, L.P. Litigation Trust v. Citco Fund Services (Europe) BV, et
al., New York County Clerk's Index No. 600498/2009; (iii) Krys et al. v
PricewaterhouseCoopers Accountants N.V. et al., Rb. Amsterdam HA ZA 2012/0863,
Case No. 521460; and (iv) Fairfield Sentry et al. v. PricewaterhouseCoopers LLP et al.,
Ontario Superior Court of Justice, Court File No. CV-12-454648; provided, however, that
to the extent that any such claims have been or may be asserted, the Released Parties
shall not be prevented from asserting any defenses or raising any argument as to liability
or damages with respect to such claims or, with the exception of the claims for indemnity
or contribution, prevent the Released Parties from asserting any rights, remedies or
claims against the Funds, or the Trustees or Liquidators of the Funds, in the pending
(though dismissed) derivative litigation.
Unless you exclude yourself from the Settlement Class, you will be releasing
claims you may have against the Released Parties. However, you will not be required to
give up any claims you may have against any other individuals or entities (that have not
been released) relating to your losses in the Funds.

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WHAT THIS NOTICE CONTAINS
BASIC INFORMATION………………………………………………
1.
Why did I receive this notice package?
2.
What is this lawsuit about?
3.
Why is this a class action?
4.
Why is there a settlement?
WHO IS IN THE SETTLEMENT………………………………………………
5.
How do I know if I am part of the settlement?
6.
What are the exceptions to being included?
7.
I’m still not sure if I’m included.
THE SETTLEMENT BENEFITS – WHAT YOU
GET…………………………………………
8.
What does the settlement provide?
9.
How much will my payment be?
HOW YOU GET A PAYMENT – SUBMITTING A CLAIM
FORM……………………………
10.
How can I obtain a payment?
11.
When will I receive my payment?
12.
What am I giving up to receive a payment?
13.
If I stay in the Settlement Class may I still recover additional amounts
from other sources?
THE LAWYERS REPRESENTING YOU………………………………………………
14.
Do I have a lawyer in the case?
15.
How will the lawyers be paid?
EXCLUDING YOURSELF FROM THE SETTLEMENT
16.
How do I exclude myself from the Settlement?
17.
If I do not exclude myself from the Settlement, can I sue the Released
Parties for the same thing later?
18.
If I exclude myself, can I get money from this Settlement?
OBJECTING TO THE SETTLEMENT………………………………………………
19.
How do I tell the Court that I do not like the Settlement?
20.
What is the difference between objecting and requesting exclusion?
THE COURT’S SETTLEMENT HEARING………………………………………………
21.
When and where will the Court decide whether to approve the settlement?
22.
Do I have to come to the Hearing?
23.
May I speak at the Hearing?
IF YOU DO NOTHING………………………………………………

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24.

What happens if I do nothing at all?

GETTING MORE INFORMATION………………………………………………
25.
Are there more details about the settlement?
THE PLAN OF ALLOCATION………………………………………………
BASIC INFORMATION
1.

Why Did I Receive This Notice Package?

You or someone in your family may have purchased or acquired an investment in
Fairfield Sentry Limited, Fairfield Sigma Limited, Fairfield Lambda Limited, Greenwich
Sentry, L.P. or Greenwich Sentry Partners, L.P. (the “Funds”).
This Notice was sent because you have a right to know about a proposed
settlement of a class action lawsuit concerning the Funds, and about all of your options,
before the Court decides whether to approve the Settlement. If the Court approves the
Settlement and after any objections or appeals are resolved, the Claims Administrator
appointed by the Court will recommend that payments be made to those Settlement Class
Members who timely submit valid claims in the manner described below. Persons who
are not Settlement Class Members may have received this Notice. If you seek to obtain a
distribution from the Settlement Fund in this Action, it is your responsibility to
demonstrate that you are a member of the Settlement Class.
This Notice explains the lawsuit, the Settlement, your legal rights, what benefits
are available, who is eligible for them, and how to get them.
The Court in charge of the case is the United States District Court for the
Southern District of New York, and the case is known as Anwar, et al. v. Fairfield
Greenwich Limited, et al., Civil Action No. 09 Civ. 118.
Certain of the entities and individuals who brought this action -- Pacific West
Health Medical Center Employees Retirement Trust, Harel Insurance Company Ltd.,
Martin and Shirley Bach Family Trust, Natalia Hatgis, Securities & Investment Company
Bahrain, Dawson Bypass Trust, and St. Stephen’s School -- are called Representative
Plaintiffs.
The defendants settling this action are PricewaterhouseCoopers LLP [Canada],
PricewaterhouseCoopers Accountants N.V. [Netherlands], and PricewaterhouseCoopers
International Limited (the “PwC Defendants”). All claims against the PwC Defendants
will be released if the Settlement is approved.
The Settling Parties are the Representative Plaintiffs and the PwC Defendants.

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2.

What Is This Lawsuit About?

This lawsuit alleges that the PwC Defendants failed to exercise reasonable care
and were negligent in the audits of the Funds’ financial statements for the periods ended
December 31, 2002-2005 (for PwC Netherlands) and December 31, 2006-2007 (for PwC
Canada). The PwC Defendants deny the allegations.
3.

Why Is This a Class Action?

In a class action, one or more people or entities called class representatives (in
this case the Representative Plaintiffs) sue on behalf of people who have similar claims.
Here, all these people are called a class or class members, and those included in this
Settlement are called a Settlement Class or Settlement Class Members. One court
resolves the issues for all class members, except for those who timely and validly
excluded themselves from the class. United States District Judge Victor Marrero is in
charge of this class action.
4.

Why Is There a Settlement?

The Court did not decide in favor of the Plaintiffs or the PwC Defendants.
Instead, the Settling Parties agreed to a settlement. This permits them to avoid the cost
and uncertainty of a trial, and permits eligible Settlement Class Members who submit
valid claims to receive compensation. The Representative Plaintiffs and their attorneys
believe the Settlement is in the best interests of all Settlement Class Members. The PwC
Defendants have concluded that further defense of the Action would be protracted and
expensive, and also have taken into account the uncertainty, risks and distractions
inherent in any litigation, especially in a complex case such as the Action.
WHO IS IN THE SETTLEMENT
To see if you will receive money from this Settlement, you first have to determine
if you are a Settlement Class Member.
5.

How Do I Know if I Am Part of the Settlement?

For purposes of the Settlement, the Court has provisionally approved the
following definition of the Settlement Class:
All Persons who were Beneficial Owners of shares or limited
partnership interests in the Funds as of December 10, 2008
(whether as holders of record or traceable to a shareholder or
limited partner account of record), and who suffered a Net Loss of
principal invested in the Funds.

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6.

What Are the Exceptions to Being Included?

The Settlement Class excludes (i) those Persons who timely and validly request
exclusion from the PwC Settlement Class; (ii) Fairfield Sigma Limited, (iii) Fairfield
Lambda Limited, (iv) any Person who has been dismissed from this Action with
prejudice or is barred by prior judgment or settlement from asserting the claims against
the PwC Defendants set forth in the SCAC; and (v) the Defendants (including the Citco
Defendants, the FG Defendants, GlobeOp, and the PwC Defendants) and any entity in
which the Defendants have a controlling interest, and the officers, directors, affiliates,
legal representatives, attorneys, immediate family members (as defined in 17 C.F.R.
240.16a-1(e)), heirs, successors, subsidiaries and/or assigns of any such individual or
entity in their capacity as such. Fairfield Sigma Limited and Sentry Lambda Limited
were both investors in Fairfield Sentry Limited and are excluded from the definition of
the Settlement Class because investors in those Funds are already included in the
Settlement Class to the extent such investors sustained a Net Loss.
7.

I’m Still Not Sure if I Am Included.

If you are still not sure whether you are included, you can ask for free help.
Settlement Class Members were required to submit claim forms to participate in the FG
Settlement and GlobeOp Settlement. The Settlement classes in those settlements were
defined in the same manner as the Settlement Class here, with the exception that the
GlobeOp settlement class only included investors in the domestic funds (Greenwich
Sentry, L.P., and Greenwich Sentry Partners, L.P.). If you completed a claim form in one
or both of those settlements and received a distribution of those settlement funds, you are
a member of the PwC Settlement Class and are entitled to share in the recovery from the
PwC Settlement, however you still must file a claim in the PwC Settlement. Settlement
Class Members were also entitled to file claim forms in the Citco Settlement, although
distributions have not yet been made from the Citco Settlement. You can also request
additional information from the persons identified in the answer to Question 25 below.
Or you can fill out and return the claim form described in Question 10, to see if you
qualify.
THE SETTLEMENT BENEFITS — WHAT YOU GET
8.

What Does the Settlement Provide?

The PwC Defendants have agreed to pay $55,000,000 in cash into the Settlement
Fund. The Settlement Fund, after payment of Court-approved attorneys’ fees and
expenses and the costs of claims administration, including the costs of printing and
mailing this Notice and the cost of publishing notice (the “Net Settlement Fund”), will be
divided among all eligible Settlement Class Members who send in timely valid claim
forms pursuant to the Plan of Allocation described below.

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9.

How Much Will My Payment Be?

Your share of the Net Settlement Fund will depend on the size of your Net Loss
of principal in the Funds compared to the aggregate Net Loss of principal of all
Settlement Class Members who submit valid claim forms.
You can calculate your Net Loss in accordance with the explanation below in the
Plan of Allocation. The Net Loss is not the amount of the payment that you can expect,
but is used to determine how the Net Settlement Fund will be allocated among all
Settlement Class Members who submit timely valid claims.
HOW YOU OBTAIN A PAYMENT — SUBMITTING A CLAIM FORM
10.

How Will I Obtain a Payment?

To qualify for payment, you must be an eligible Settlement Class Member, submit
a valid Proof of Claim, and properly document your claim as described in the Proof of
Claim. A Proof of Claim form is enclosed with this Notice. You may also get a Proof of
Claim form on the internet at www.FairfieldGreenwichLitigation.com. Read the
instructions carefully, fill out the Proof of Claim, include the documents the form asks
for, sign it, and submit it so that it is received by the Claims Administrator no later than
[
]. You are required to submit a Proof of Claim form in this Settlement
even if you submitted a prior claim form in the FG, Citco or GlobeOp Settlement,
although you are not required to submit documentation to support your claim if it was
previously submitted.
11.

When Will I Receive My Payment?

The Court will hold a hearing on ___________, 2016, to decide whether to
approve the Settlement. If the Court approves the Settlement, there may be appeals. It is
always uncertain how these appeals will be resolved, and resolving them can take time,
perhaps more than a year. After any approval by the Court and, assuming that any
appeals are decided favorably, it will take several months for the Claims Administrator to
process all of the Proof of Claim forms and to determine and pay the ultimate distribution
amounts.
12.

What Am I Giving Up to Receive a Payment?

Unless you timely exclude yourself from the Settlement Class by the
___________ deadline, you are a member of the Settlement Class and will be bound by
the release of claims against the PwC Defendants and the Released Parties. That means
that you cannot sue, continue to sue, or be part of any other lawsuit against the PwC
Defendants or the Released Parties about the Released Claims. The specific terms of the
release are included in the Stipulation.

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13.
If I Stay in the Settlement Class, May I Still Recover Additional
Amounts from Other Sources?
Yes. If you participate in this class Settlement, then you will not be required to
give up any claims you may have against any individuals or entities other than the
Released Parties. Investors in the Funds also are likely to receive distributions from the
liquidation or bankruptcy proceedings overseen by the respective liquidators or trustees
of the Funds, and from the Madoff Victim Fund.
THE LAWYERS REPRESENTING YOU
14.

Do I Have a Lawyer in This Case?

The law firms of Boies, Schiller & Flexner LLP, Wolf Popper LLP, and Lovell
Stewart Halebian Jacobson LLP brought the Action on behalf of Representative Plaintiffs
and they represent you and all other Settlement Class Members. These lawyers are called
Plaintiffs’ Lead Counsel. You will not be charged for these lawyers. If you want to be
represented by your own lawyer, you may hire one at your own expense.
15.

How Will the Lawyers Be Paid?

Plaintiffs’ Counsel will ask the Court for attorneys’ fees up to 30% of the
$55,000,000 Settlement Fund, and the balance for expenses incurred by Plaintiffs’
Counsel in connection with the litigation, not to exceed $2,500,000. These expenses that
were advanced by Lead Counsel are in addition to the costs previously awarded by the
Court with respect to the FG, Citco, and GlobeOp settlements, and relate primarily to
expert expenses necessary for prosecuting the claims against the PwC Defendants. Such
sums as may be approved by the Court will be paid from the Settlement Fund.
The attorneys’ fees and expenses requested represent payment to Plaintiffs’ Lead
Counsel and other such counsel involved in the Action on behalf of the Plaintiffs
(collectively “Plaintiffs’ Counsel”) for their efforts in achieving this Settlement and for
their risk in undertaking this representation on a wholly contingent basis. Since the case
began in 2008, Plaintiffs’ Counsel has undertaken extensive work necessary to prepare
the case for trial. Plaintiffs’ Counsel has conducted all of the investigation, drafted the
SCAC, reviewed millions of documents, taken and defended over 100 depositions,
employed experts, performed an enormous amount of legal research and filed many legal
briefs on novel and complex issues, including opposing dismissal of the claims,
supporting class certification and arguing discovery issues. The 30% fee requested,
combined with the fees previously awarded by the Court, are still less than 90% of
Plaintiffs’ Counsel’s lodestar through November 30, 2015 at current undiscounted rates.
Plaintiffs’ Lead Counsel shall file a motion with the Court for approval of the
Settlement, the Plan of Allocation, and the request for attorneys’ fees and reimbursement
of expenses by [50 days prior to the Settlement Hearing]. Copies of that motion will be
posted on the Claim Administrator’s website. The PwC Defendants take no position with
respect to the request for attorneys’ fees and reimbursement of expenses. The Court

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determines the amount counsel should receive from the Settlement Fund for fees and
expenses separately from its determination of whether the Settlement is fair, reasonable
and adequate, and may award less than the amount Plaintiffs’ Lead Counsel has
requested.
EXCLUDING YOURSELF FROM THE SETTLEMENT
16.

How Do I Exclude Myself From the Settlement?

If you want to retain the right to sue or to continue to sue the Released Parties on
your own about the claims being released in this Settlement, then you must take steps to
exclude yourself from the Settlement. This is referred to as opting out of the Settlement
Class, and persons who do so are referred to as “Opt-Outs”.
Excluding yourself is not the same as doing nothing in response to this Notice.
Each member of the Settlement Class shall be bound by all determinations and judgments
in the Action concerning the Settlement, whether favorable or unfavorable, unless such a
Person delivers to the Claims Administrator a written request for exclusion from the
Settlement Class, so that it is received by the Claims Administrator no later than
________ addressed to:
Fairfield Greenwich Securities Litigation
c/o Rust Consulting, Inc.
P.O. Box 2874
Faribault, MN 55021-8674
(by regular or express mail)

Fairfield Greenwich Securities Litigation
c/o Rust Consulting
201 Lyndale Ave. S.
Faribault, MN 55021
(by express delivery service)

No Person may exclude himself, herself or itself from the Settlement Class after
______, 2016. In order to be valid, each request for exclusion by a Person seeking to optout must state the name, address and telephone number of the Person seeking exclusion;
state that the Person “requests exclusion from the Settlement Class in Anwar, et al. v.
Fairfield Greenwich Limited, et al., Case No. 09-cv-118,” and state (i) the full name of
the Fund(s) purchased, (ii) the number and dollar amount of shares or limited partnership
interests purchased, and redeemed if applicable, (iii) the dates and amounts of each
purchase and any redemption transactions, any other recoveries received by the Person on
the Person’s investment in the Fund(s), and (iv) the number of shares or limited
partnership interests held by the Person in the Fund(s) as of December 10, 2008. Each
Person seeking to opt-out also must supply documentary proof of each purchase and
redemption transaction and of the Person’s membership in the Settlement Class. Any
such request for exclusion must be signed by the Person requesting exclusion.
Even if you opted-out of the FG, Citco, or GlobeOp Settlement, you need to
separately opt-out of this PwC Settlement.
Requests for exclusion shall not be effective unless the request includes the
required information and documentation and is made within the time period stated above,

17

or the exclusion is otherwise accepted by the Court. Only Beneficial Owners may file a
request for exclusion with respect to each share or limited partnership interest in the
Funds. Where the record owner of shares or limited partnership interests is a nominee,
custodian, or other Person acting in a materially similar fashion on behalf of one or more
Beneficial Owners, that nominee, custodian or other Person is not a Beneficial Owner
and may not file a request for exclusion on behalf of any such Beneficial Owners.
If you ask to be excluded, you will not receive any payment from this Settlement,
and you cannot object to the Settlement. You will not be legally bound by anything that
happens in the Action with respect to Released Claims and may be able to sue (or
continue to sue) the Released Parties in the future.
Any Settlement Class Member who submits a Request for Exclusion shall not be
deemed to have submitted to the jurisdiction of any Court in the United States for any
matter on account of such submission, and any Settlement Class Member who submits a
Proof of Claim thereby submits to the jurisdiction of this Court with respect only to the
subject matter of such Proof of Claim and all determinations made by this Court thereon
and shall not be deemed to have submitted to the jurisdiction of this Court or of any court
in the United States for any other matter on account of such submission.
Except where a Settlement Class Member who submits a Request for Exclusion
commences or otherwise prosecutes or pursues a Released Claim against a Released
Party, all information submitted by a Settlement Class Member in a Request for
Exclusion or a Proof of Claim shall be treated as confidential protected information and
may not be disclosed by the Claims Administrator, its affiliates or the Settling Parties to
any third party absent a further order of this Court upon a showing of necessity, and any
such information that is submitted to the Court shall be filed under seal.

18

If the aggregate Net Loss of Opt-Outs exceeds the threshold specified in a
separate “Supplemental Agreement” between the Settling Parties, then the PwC
Defendants shall have, in their sole and absolute discretion, the option to terminate this
Settlement and to render it null and void in accordance with the procedures set forth in
the Supplemental Agreement.
17.
If I Do Not Exclude Myself From the Settlement, Can I Sue the
Released Parties For the Same Thing Later?
No. Unless you exclude yourself, you give up any rights to bring a lawsuit or
claim in any forum asserting any of the Released Claims against the Released Parties. If
you have a pending lawsuit or claim in any forum that you believe concerns the Released
Claims or the same matters alleged in this Action, speak to your lawyer immediately.
You will likely have to exclude yourself from the Settlement Class if you wish to
continue your own lawsuit or claim. Remember, the exclusion deadline is _______.
18.

If I Exclude Myself, Can I Get Money From This Settlement?

No. You will however, retain any right you may have to bring a lawsuit, to
continue to pursue an existing lawsuit, or to be part of a different lawsuit asserting a
Released Claim against a Released Party.
OBJECTING TO THE SETTLEMENT
19.
How Do I Tell the Court that I Do Not Like the Settlement or the
Request for Attorneys’ Fees and Reimbursement of Expenses?
If you are a Settlement Class Member, you can object to the Settlement if you do
not like any part of it, including the Plan of Allocation and the request for attorneys’ fees
or expenses. You can state the reasons why you think the Court should not approve it,
and the Court will consider your views. To object, you must submit a letter saying that
you object to the Settlement in Anwar, et al. v. Fairfield Greenwich Limited, et al., Case
No. 09-cv-118. Be sure to include your name, address, telephone number, your
signature, the full name of the Fund(s) purchased, the dates and number and dollar
amounts of shares or limited partnership interests purchased, and redeemed if applicable,
and other recoveries you have received on your investment in the Fund(s), and to supply
documentary proof of the purchase or any redemption transactions and of your
membership in the Settlement Class, and the reasons you object. Any objection letter
must be delivered such that it is received by each of the following no later than
___________, 2016:

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Court:
Clerk of the Court
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
United States Courthouse
500 Pearl Street
New York, NY 10007-1312
PwC Defendants’ Counsel
Designee:
Timothy A. Duffy, P.C.
Kirkland & Ellis LLP
300 North LaSalle
Chicago, IL 60654

Plaintiffs’ Counsel Designee:
Robert C. Finkel, Esq.
Wolf Popper LLP
845 Third Avenue
New York, NY 10022
20.

What is the Difference between Objecting and Requesting Exclusion?

Objecting is simply telling the Court that you do not like something about the
proposed Settlement. Objecting does not prevent you from participating and recovering
money in the Settlement. However, you can object only if you stay in the Settlement
Class. Excluding yourself is telling the Court that you do not want to be part of the
Settlement Class. If you exclude yourself, you have no basis to object because the
Settlement no longer affects you.
THE COURT’S SETTLEMENT HEARING
The Court will hold a hearing to decide whether to approve the Settlement. You
may attend and you may ask to speak, but you do not have to.
21.

When and Where Will the Court Decide Whether to Approve the
Settlement?

The Court will hold a Settlement Hearing at ______, on _______, 2016 at the
Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, New York, NY
10007-1312, Courtroom 20B. At this hearing the Court will consider whether the
settlement is fair, reasonable and adequate. If there are objections, the Court will
consider them. The Court will also consider the application by Plaintiffs’ Lead Counsel
for fees and expenses and whether the Plan of Allocation is fair, reasonable and adequate.
The Court may decide these issues at the hearing or take them under consideration for a
later decision.
22.

Do I Have to Come to the Hearing?

No. Plaintiffs’ Lead Counsel will answer questions the Court may have. But, you
are welcome to come at your own expense. If you send an objection, you do not have to
come to Court to talk about it. As long as you submitted your written objection on time,

20

the Court will consider it. You may also pay your own lawyer to attend, but it is not
necessary.
23.

May I Speak at the Hearing?

You may ask the Court for permission to speak at the Settlement Hearing. To do
so, you must submit a letter saying that it is your intention to appear in Anwar, et al. v.
Fairfield Greenwich Limited, Case No. 09-cv-118. Be sure to include your name,
address, telephone number, your signature, the full name of the Fund(s) purchased, the
number and dollar amount of shares or limited partnership interests purchased, and
redeemed if applicable, to supply documentary proof of the purchase and any redemption
transactions and of your membership in the Settlement Class, and other recoveries you
have received on your investment in the Fund(s), and the reasons you want to speak at the
hearing. Your notice of intention to appear must be received no later than [35 days prior
to the Settlement Hearing], by the Clerk of the Court, Lead Counsel Designee and PwC
Defendants’ Counsel Designee, at the three addresses listed in question 19.
IF YOU DO NOTHING
24.

What Happens If I Do Nothing at All?

If you do nothing, all of your claims against the Released Parties will be released,
but you will not receive any money from this Settlement, because in order to receive
money it is necessary to submit a timely valid Proof of Claim.
GETTING MORE INFORMATION
25.

Are There More Details About the Settlement?

This Notice summarizes the proposed Settlement. More details are in the
Stipulation of Settlement dated January 6, 2016. You can obtain a copy of the Stipulation
of Settlement or more information about the Settlement by contacting the Claims
Administrator.
Fairfield Greenwich Securities
Litigation
c/o Rust Consulting, Inc.
P.O. Box 2874
Faribault, MN 55021-8674
(by regular or express mail)

Fairfield Greenwich Securities
Litigation
c/o Rust Consulting
201 Lyndale Ave. S.
Faribault, MN 55021
(by express delivery service)

or Plaintiffs’ Counsel:

21

David A. Barrett
Howard L. Vickery, II
BOIES, SCHILLER & FLEXNER LLP
575 Lexington Avenue
New York, NY 10022
[e-mail]
[phone]

Robert C. Finkel, Esq.
WOLF POPPER LLP
845 Third Avenue
New York, NY 10022
[e-mail]
1-877-370-7703

Stuart H. Singer
Carlos Sires
Sashi Bach
Eli J. Glasser
BOIES, SCHILLER & FLEXNER LLP
401 East Las Olas Blvd., #1200
Ft. Lauderdale, Florida 33301
[e-mail]
[phone]

Christopher Lovell
Victor E. Stewart
LOVELL STEWART HALEBIAN
JACOBSON LLP
61 Broadway, Suite 501
New York, NY 10006
[e-mail]
[phone]

or by visiting www.fairfieldgreenwichlitigation.com
You can also obtain a copy from the Clerk’s office during regular business hours:
Clerk of the Court
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Daniel Patrick Moynihan
United States Courthouse
500 Pearl Street
New York, NY 10007-1312
PLEASE DO NOT CONTACT THE COURT REGARDING THIS NOTICE

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PLAN OF ALLOCATION OF NET SETTLEMENT FUND AMONG CLASS
MEMBERS
The Net Settlement Fund shall be distributed to Settlement Class Members who
submit a valid Proof of Claim (“Authorized Claimants”) according to the terms below.
The purpose of this Plan of Allocation of the Net Settlement Fund (“Plan of Allocation”
or “Plan”) is to establish a reasonable and equitable method of distributing the Net
Settlement Fund among Authorized Claimants. The Plan is not intended to replicate an
assessment of damages that could have been recovered had the Representative Plaintiffs
prevailed at trial.
Because the Net Settlement Fund is less than the total losses alleged to have been
suffered by Settlement Class Members, the formulas described below for calculating Net
Losses are not intended to estimate the amount that will actually be paid to Authorized
Claimants. Rather, these formulas provide the basis on which the Net Settlement Fund
will be distributed among Authorized Claimants.
Approval of the Settlement is independent from approval of the Plan of
Allocation. Any determination with respect to the Plan of Allocation will not affect the
Settlement, if approved. The Plan of Allocation set forth herein is the plan that is being
proposed by Representative Plaintiffs and Plaintiffs’ Lead Counsel to the Court for
approval. The PwC Defendants take no position with respect to the Plan of Allocation.
The Court may approve this plan as proposed or it may modify the Plan of Allocation
without further notice to the Settlement Class. Any orders regarding a modification of
the Plan of Allocation will be posted on the settlement website,
www.fairfieldgreenwichlitigation.com.
Payment pursuant to the Plan of Allocation approved by the Court shall be final
and conclusive against all Settlement Class Members. No person shall have any claim of
any kind against the PwC Defendants or their counsel with respect to the administration
of the settlement, including the Plan of Allocation. No person shall have any claim
against Representative Plaintiffs, Plaintiffs’ Counsel, or the Claims Administrator or
other agent designated by Plaintiffs’ Counsel arising from distributions made
substantially in accordance with the Stipulation, the Plan of Allocation, or further orders
of the Court. Representative Plaintiffs, the PwC Defendants, their respective counsel,
and all other Released Parties shall have no responsibility or liability whatsoever for the
investment or distribution of the Settlement Fund consistent with the terms of the
Stipulation, the Plan of Allocation, or the determination, administration, calculation, or
payment of any Proof of Claim or nonperformance of the Claims Administrator, the
payment or withholding of taxes owed by the Settlement Fund, or any losses incurred in
connection therewith.
Distributions will be made to Authorized Claimants after all claims have been
processed and after the Court has finally approved the Settlement (including the
resolution of any appeals) pursuant to the following terms:

23

a. The Net Loss for each Authorized Claimant will be the Net Loss of principal with
respect to each Fund. Net Loss means the total cash investment made by a Beneficial
Owner in a Fund, directly or indirectly through one or more intermediaries, less the total
amount of any redemptions or withdrawals or recoveries by that Beneficial Owner from
or with respect to the same Fund. A Settlement Class Member may have a Net Loss on
more than one Fund. Any transactions in foreign securities will be converted to a Net
Loss in U.S. dollars at the exchange rate in effect as of the date of the Final Hearing.
b. For the avoidance of doubt, where a fund, trust, or similar investment vehicle was
a registered shareholder or limited partner of record or otherwise invested in a Fund, the
fund, trust or similar investment vehicle is the Beneficial Owner for purposes of this
Stipulation, not the underlying investors in the fund or similar investment vehicle. Only
one Proof of Claim or request for exclusion can be submitted with respect to each share
or limited partnership interest in the Funds.
c. Only those Authorized Claimants who suffered a Net Loss of principal with
respect to a Fund are entitled to a payment from the Net Settlement Fund with respect to
that Fund.
d. Please note that the term “Net Loss” is used solely for calculating the amount of
participation by Authorized Claimants in the Net Settlement Fund. It is not the actual
amount an Authorized Claimant can expect to recover.
e. The Claims Administrator will determine each Authorized Claimant’s share of the
Net Settlement Fund. Each Authorized Claimant will receive a disbursement determined
by multiplying the Net Settlement Fund by a fraction, the numerator of which is the
Authorized Claimant’s Net Loss and the denominator of which is the sum total of all
Authorized Claimants’ Net Losses with respect to all of the Funds.
f. If there is any balance remaining in the Net Settlement Fund (whether by reason
of unclaimed funds, tax refunds, uncashed checks, or otherwise), at a date one hundred
eighty (180) days from the later of (a) the date on which the Court enters an order
directing the Net Settlement Fund to be distributed to Authorized Claimants, or (b) the
date the Settlement is final and becomes fully effective, then Plaintiffs’ Counsel shall,
upon approval of the Court, disburse such balance among Authorized Claimants as many
times as is necessary, in a manner consistent with this Plan of Allocation, until each
Authorized Claimant has received its Net Loss (but no greater than its Net Loss) as
defined in this Plan. If Plaintiffs’ Lead Counsel determines that it is not cost-effective to
conduct such further disbursement, or following such further disbursement any balance
still remains in the Net Settlement Fund, Plaintiffs’ Counsel shall, upon approval of the
Court, and without further notice to Settlement Class Members, cause the remaining
balance to be disbursed cy pres. Plaintiffs’ Lead Counsel shall also consider the potential
for additional distributions to be made from other settlements or judgments in proposing
supplemental distributions from the Net Settlement Fund.

24

DATED: _______________, 2015

BY ORDER OF THE COURT
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

25