Coca-Cola Co. (NYSE: KO), the world’s largest manufacturer, distributor, and marketer of nonalcoholic beverages and syrups, has agreed to the preliminary settlement of the securities class action pending against it in the N.D. of Georgia. The long-running case, originally filed in October 2000, stems from allegations that company executives artificially boosted Coca-Cola’s revenues by forcing some of the company’s key bottlers to accept hundreds of millions of dollars of excessive beverage concentrate, and that the company falsely represented that the improved financial condition of its key bottlers would lead to substantial revenue growth. The settlement is for $137.5 million.
Earlier this year, The 10b-5 Daily reported that the plaintiffs’ motion for class certification had been assigned to a special master, who recommended that the court deny class certification because of concerns that plaintiffs’ lead counsel had engaged in improper conduct when it paid a former Coca-Cola employee to provide the plaintiffs with stolen company documents. The court appears to have rejected the special master’s recommendation in conjunction with its preliminary approval of the settlement.