LOS ANGELES Oct 23 HealthSouth Corp (HLS.N) on
Thursday said UBS AG UBSN.VX would pay the provider of
rehabilitative services $100 million in cash to settle investor
claims that the investment bank knew about HealthSouth's
multibillion dollar accounting fraud.
The derivative shareholder lawsuit against UBS was brought
by HealthSouth investors on behalf of the company. It claimed
that as its investment bank, UBS was aware of HealthSouth's
In addition to the cash, HealthSouth will receive a release
of all claims by UBS, including a judgment in favor of UBS
which is currently on appeal before the U.S. Court of Appeals
for the Second Circuit.
A UBS spokeswoman declined to comment on the settlement.
In 2006, HealthSouth agreed to pay at least $445 million to
settle class-action lawsuits over its accounting and financial
reporting. As part of that settlement, HealthSouth investors
are entitled to receive 25 percent of net recoveries from
judgments against UBS, the company's former lead investment
bank, HealthSouth former Chief Executive Richard Scrushy, and
former auditor Ernst & Young.
The rest of the proceeds will be used to pay down long-term
debt, the Birmingham, Alabama company said.
(Reporting by Nichola Groom; Editing by Bernard Orr)