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Non-Tech : Cendant Corporation (NYSE:CD) -- Ignore unavailable to you. Want to Upgrade?

To: Roy F who wrote (2779)	12/11/1998 11:21:00 AM
From: Wolf 2	Read Replies (1) \| Respond to of 3627

Roy and all: I don't know how relevant this may be to CD and the pending class action lawsuits but FWIW (from our local newspaper) : Waste Management Inc. and a former auditor agreed to pay $220 million to settle shareholder lawsuits that allege the big trash-handling concern defrauded investors by overstating its profits over several years. The litigation involves Waste Management when it was based in Oak Brook, Ill. Soon after announcing early this year that it was reversing $1.32-billion in previously reported profits, Waste Management agreed to be acquired by Houston-based rival USA Waste Services Inc. The combined company adopted the Waste Management name. This situation certainly appears to share many similarities with our dilemma. For those concerned about the size of any settlement CD may eventually strike with class action plaintiffs, I believe this should provide some measure of comfort. I'm not suggesting that we can calculate a prorationally lower settlement cost to CD and each case is unique but I think it does rebut some of the wilder assessments of the ultimate cost to CD...up to and including insolvency. Note, too, that the story does not show what portion of the $220-million was contributed by Waste Management and what portion was paid by the auditor. Bottom line: overstatement of $1.32 billion in profits=less than $200 million settlement by WMI (my guess: in the range of $110-165 million) Regards, Wolf