MetLife Inc. has agreed to pay $50 million to settle two lawsuits stemming from its 2000 demutualization.
Both lawsuits were class actions, one filed with the U.S. District Court for the Eastern District of New York and the other with the New York State Supreme Court.
The actions were brought by former policyholders against MetLife, New York (NYSE:MET).
The plaintiffs alleged that securities fraud took place when the company converted from a mutual to a stock company in April 2000. The demutualization had been approved by the New York state insurance commissioner and by 93% of the 2.8 million MetLife policyholders who voted, MetLife said at the time.
The transaction converted MetLife policies into more than 700 million shares of stock valued at $14.25 per share. MetLife compensated each former policyholder with at least 10 shares of stock.