A US federal judge has granted preliminary approval to a multimillion-dollar class action settlement against Sidley Austin Brown & Wood and KPMG over abusive tax shelters that KPMG sold to wealthy individuals.
The $225m (£127.4m) class action is likely to be settled at $45m (£25.5m). Under the accord, KPMG is expected to pay around 80 per cent, while Sidley would come up with the remaining amount.
Class action specialist Milberg Weiss Bershad & Schulman led the settlement negotiations, earning up to $30m (£17m) for its role.
The settlement follows the admission by KPMG on 16 July of full liability for its role in the tax shelters, which are being investigated by the US Department of Justice.
In February, the US Senate accused KPMG, Sidley and a number of other professional advisers of “ripping off” billions of dollars from the US Treasury through the deployment of the tax shelters.