Jumio Inc.’s former shareholders and the estate the online-identification-verification company left behind in bankruptcy have reached a broad settlement that winds down its bankruptcy, pays legal fees and protects Facebook Inc. co-founder Eduardo Saverin and other investors from future lawsuits stemming from the contentious chapter 11 case, The Wall Street Journal reported yesterday. Jumio’s lawyer disclosed the outline of the complex deal, which took nearly 10 weeks to hammer out, during a bankruptcy court hearing in Wilmington, Del. The settlement is still subject to final approval from Judge Brendan Shannon. Jumio’s bankruptcy and subsequent sale inspired heated rhetoric and courtroom battles with shareholders, who faced being wiped out. Monday’s settlement leaves those shareholders with a trust intended to fund lawsuits against Jumio’s former officers and directors that, if successful, could one day help improve their recovery. The sale of Jumio’s core operating assets left behind a corporate shell with the rights to pursue certain lawsuits against Jumio’s former management and board members, which shareholders say may be the bankruptcy estate’s largest assets. Jumio filed for bankruptcy on March 21 and is under investigation by the Securities and Exchange Commission over stock trades by former executives. The investigation and scrutiny of its financials scared off new investments and left the company with little choice but to seek chapter 11 protection.
