# Ericsson beats US shareholder lawsuit over graft disclosures
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-05-25
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Ericsson Wins US Shareholder Lawsuit Over Graft Disclosures
Meta Description: Ericsson beats U.S. shareholders lawsuit, federal judge rules it did not mislead investors on compliance with anti-bribery laws. Lawsuit dismissed by New York
URL: https://financedigest.com/ericsson-beats-us-shareholder-lawsuit-over-graft-disclosureshtml

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# Ericsson beats US shareholder lawsuit over graft disclosures

(Reuters) – Swedish telecoms company Ericsson beat a lawsuit by U.S. shareholders on Wednesday, when a federal judge ruled it did not mislead investors about its compliance with U.S. anti-bribery laws.

The lawsuit filed by a Boston-based pension [fund claimed](https://www.financedigest.com/russian-funding-claims-spice-up-italian-election.html "Russian funding claims spice up Italian election") that Ericsson had overstated the extent to which it had eliminated the use of bribes after it settled corruption allegations made by the U.S. Department of Justice (DOJ).

U.S. District Judge William Kuntz in Brooklyn, New York, wrote that Ericsson had [issued “ubiquitous warnings” to investors](https://www.financedigest.com/six-securities-services-solves-withholding-tax-issues-for-investors-in-switzerland.html "SIX Securities Services solves withholding tax issues for investors in Switzerland") raising “the possibility of future compliance failures” after the agreement.

Commenting on the [court decision](https://www.financedigest.com/court-fees-and-access-to-justice-the-impact-of-the-supreme-courts-decision-on-lenders.html "Court fees and access to justice:  the impact of the Supreme Court’s decision on lenders"), Ericsson said in a statement on Thursday, “The motion to dismiss decision is subject to appeal from the plaintiff. Ericsson will continue to vigorously defend this matter if appealed.”

The lawsuit was filed in March 2022, after the company’s [stock dropped](https://www.financedigest.com/european-stocks-drop-as-russia-ukraine-tensions-escalate.html "European stocks drop as Russia-Ukraine tensions escalate") sharply following allegations by the DOJ that Ericsson was in breach of a 2019 deferred prosecution agreement (DPA) for failing to fully disclose details of its operations in Iraq. The lawsuit sought damages for [investors who bought Ericsson American Depositary Shares](https://www.financedigest.com/virgin-money-shares-leap-on-higher-profit-investor-payouts.html "Virgin Money shares leap on higher profit, investor payouts") between April 27, 2017 and March 1, 2022.

Ericsson agreed to [pay $206 million](https://www.financedigest.com/uks-nationwide-to-pay-340-million-pounds-to-customers-after-profit-leap.html "UK’s Nationwide to pay 340 million pounds to customers after profit leap") and plead guilty in March for violating the DPA agreement.

Under the conditions of the 2019 DPA, Ericsson paid more than $1 billion to resolve a series of corruption probes, involving bribery [allegations in China](https://www.financedigest.com/china-lodges-representations-over-alleged-harassment-at-manchester-consulate.html "China lodges representations over alleged harassment at Manchester consulate"), Vietnam and Djibouti, and agreed to cooperate with the department for ongoing investigations.

The case is In re: Telefonaktiebolaget Ericsson Securities , No. 22-1167, U.S. District Court, Eastern District of New York.

(Reporting by Jody Godoy; additional reporting by Anna Ringstrom in Stockholm, editing by Diane Craft and Sohini Goswami)


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