IndyMac Bancorp trustee gets $15 million from OK'd insurer settlement

By Kali Hays

New York, March 28 - IndyMac Bancorp, Inc. obtained approval of a $15 million settlement between its trustee Alfred H. Siegel, former CEO Michael W. Perry and company insurers, according to an order filed Thursday with the U.S. Bankruptcy Court for the Central District of California.

Under the terms of the settlement, company insurers will pay Siegel $15 million and in turn he will release all claims made against the insurers.

As previously reported, in November 2009, Siegel sued Perry and eight outside directors of Bancorp "for breaches of the duties of care, loyalty and good faith and for corporate waste, in connection with certain downstream transfers from Bancorp to IndyMac Bank F.S.B. made shortly before the bank failed," according to the motion.

Two settlements were approved as a result of the lawsuit, one for $15 million and another for $20 million, both to be paid from available insurance. However, as a result of a ruling in another case against Perry, all claims were excluded from coverage by insurance policies.

The ruling is being appealed, but given the unpredictable outcome, Siegel asked the court order final approval of the $15 million settlement agreement "in light of the fact that recovery of anything from the insurers" was in jeopardy.

IndyMac, a Pasadena, Calif., bank holding company, filed for bankruptcy on July 31, 2008. The Chapter 7 case number is 08-21752.

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