Frequently Asked Questions

  1. Why did I get the Notice package?

    You or someone in your family may have purchased or acquired Eletrobras common and/or preferred American Depositary Shares (“ADSs”) during the Class Period (i.e., between August 17, 2010 and June 24, 2015, both dates inclusive).

    The Court ordered that the Notice be sent to you because you have a right to know about a proposed settlement of a class action lawsuit, and about all of your options, before the Court decides whether to approve the Settlement. If the Court approves it and after any objections or appeals are resolved, the Claims Administrator appointed by the Court will make the payments that the Settlement allows.

    The Notice explains the lawsuit, the Settlement, your legal rights, what benefits are available, who is eligible for them, and how to get them.

    The Court in charge of the case is the United States District Court for the Southern District of New York, and the case is known as In re Eletrobras Securities Litigation, Case No. 15-cv-5754-JGK. The people who sued are called the "Lead Plaintiffs," and the company and the individuals they sued, Centrais Elétricas Brasileiras S.A. (“Eletrobras” or the “Company”), José da Costa Carvalho Neto, and Armando Casado de Araújo, are called "Defendants". Defendants have agreed to settle the claims made in this case.

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  2. What is this lawsuit about?

    Lead Plaintiffs filed this lawsuit alleging that several Eletrobras statements filed with the SEC during the Class Period were materially false and, among other reasons, Defendants either knew, or deliberately disregarded facts regarding a massive bribery and corruption scheme that reached the highest levels of the Company. This scheme subsequently became the subject of major investigations conducted by both Brazilian and U.S. regulators and/or law enforcement agencies. The Complaint alleges that these materially false and misleading statements caused Eletrobras’ common and preferred ADSs to trade at artificially inflated prices and that as the truth about these statements was revealed it caused Eletrobras’ common and preferred ADS prices to drop significantly.

    The Defendants continue to deny that they are liable to the Lead Plaintiffs or the Settlement Class and deny that the Lead Plaintiffs or the Settlement Class have suffered any damages, and the Settlement is not any admission of wrongdoing or liability.

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  3. What is a class action? Why is this a class action?

    In a class action, one or more people or entities called class representatives (in this case, Lead Plaintiffs Dominique Lavoie and City of Providence, Rhode Island) sue on behalf of a group of people who have similar claims, otherwise known as members of the Settlement Class or Settlement Class Members. One court resolves the issues for all the Settlement Class Members, except for those who exclude themselves from the Settlement Class.

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  4. Why is there a settlement?

    The Court did not decide in favor of the Plaintiffs or Defendants. Instead, both sides have agreed to a settlement. As a result, the Parties will avoid the cost of further litigation, and eligible Settlement Class Members who make valid claims will get compensation. Plaintiffs and their attorneys think the Settlement is in the best interests of the Settlement Class.

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  5. How do I know if I am part of the Settlement?

    The Settlement Class includes:

    All persons who purchased or otherwise acquired Eletrobras common and/or preferred American Depositary Shares (trading symbols EBR and EBR.B, respectively) either on a United States exchange or pursuant to other Covered Transactions between August 17, 2010 and June 24, 2015, inclusive (the “Class Period”).

    Excluded from the Settlement Class are:

    1. Anyone named as a Defendant in this action;
    2. Members of the immediate family of any such Defendant;
    3. Any entity in which any such Defendant or family member has or had a controlling interest;
    4. The former and current officers and directors of Eletrobras; or
    5. The legal affiliates, representatives, controlling persons, predecessors-in-interest, heirs, assigns, or any other successors-in-interest of any such excluded party.

    Also excluded from the Settlement Class are those Persons who have timely and validly requested exclusion from the Settlement Class in accordance with the requirements set forth in FAQ 13.

    Please Note: Receipt of the Notice does not mean that you are a Settlement Class Member or that you will be entitled to receive proceeds from the Settlement. If you are a Settlement Class Member and you wish to be eligible to participate in the distribution of proceeds from the Settlement, you are required to submit the Claim Form that is being distributed with the Notice package, or downloadable here, and the required supporting documentation as set forth therein postmarked no later than January 4, 2019.

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  6. What are the eligible tickers and CUSIPs?

    The ticker for Eletrobras common ADS during the Class Period was EBR and the CUSIP was 15234Q207. The ticker for Eletrobras preferred ADS during the Class Period was EBR.B and the CUSIP was 15234Q108.

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  7. What if I am still not sure if I am included?

    If you are still not sure whether you are included, you can ask for free help. You can contact the Claims Administrator toll-free at 1-888-396-9602, by email at info@EletrobrasSecuritiesLitigation.com, or you can fill out and return the Claim Form enclosed with the Notice package, or downloadable here, to see if you qualify.

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  8. What does the Settlement provide?

    The Settlement Amount consists of Fourteen Million Seven Hundred Fifty Thousand Dollars ($14,750,000.00) in cash (the “Settlement Amount”) to be deposited into an interest-bearing escrow account. The Settlement Amount plus all interest earned thereon is referred to as the “Settlement Fund”.

    The Settlement Fund less taxes, approved costs, fees, and expenses (the “Net Settlement Fund”) shall be distributed to members of the Settlement Class who submit valid Claim Forms.

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  9. How much will my payment be?

    At this time, it is not possible to make any determination as to how much any individual Settlement Class Member may receive from the Settlement. Your share of the Net Settlement Fund will depend on several things, including the total amount of claims represented by the valid Claim Forms that Settlement Class Members send in, compared to the amount of your claim, all as calculated under the Plan of Allocation discussed in the Notice.

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  10. How can I get a payment?

    To qualify for payment, you must be an eligible Settlement Class Member and you must send in a Claim Form. A Claim Form is enclosed with the Notice and is also available for download here. Read the instructions carefully, fill out the form, include all the documents the form asks for, sign it, and mail it to the Claims Administrator at the address below or submit it online here. Claim Forms must be postmarked or received online on or before January 4, 2019.

    In re Eletrobras Securities Litigation
    Claims Administrator
    P.O. Box 2838
    Portland, OR 97208-2838

    You may also submit your claim form online here.

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  11. When would I get my payment?

    The Court will hold a hearing on December 12, 2018, to decide whether to approve the Settlement. If the Court approves the class action Settlement, there may be appeals. It is always uncertain whether these appeals can be resolved, and resolving them can take time, perhaps several years. Everyone who sends in a Claim Form will be informed of the determination with respect to his or her claim. Please be patient.

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  12. What am I giving up to get a payment or to stay in the Settlement Class?

    Unless you exclude yourself, you are staying in the Settlement Class, and that means that you cannot sue, continue to sue, or be part of any other lawsuit against the Defendants or the other Released Parties about the Released Claims (as defined in the Notice) in this case. It also means that all of the Court’s orders will apply to you and legally bind you, and you will release your claims in this case against the Defendants and other Released Parties. The terms of the release are included in the Claim Form that is enclosed with the Notice or downloadable here and are further described in the Notice.

    If you do not want a payment from this Settlement, but you want to keep the right to sue or continue to sue any of the Defendants or other Released Parties on your own about the same legal issues in this case, then you must take steps to get out of the Settlement Class. This is called excluding yourself or is sometimes referred to as opting out of the Settlement Class.

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  13. How do I get out of the proposed Settlement?

    If you do not want a payment from this Settlement, but you want to keep the right to sue or continue to sue any of the Defendants or other Released Parties on your own about the same legal issues in this case, then you must take steps to get out of the Settlement Class. This is called excluding yourself or is sometimes referred to as opting out of the Settlement Class.

    To exclude yourself from the Settlement Class, you must submit a written request for exclusion that must be received on or before November 14, 2018. This request must state:

    1. The name, address, and telephone number of the Person requesting the exclusion;
    2. The Person’s purchases/acquisitions of Eletrobras common and/or preferred ADSs during the Class Period and any sales thereof, including the dates, the number of shares and price(s) paid and received for each such purchase, acquisition and sale;
    3. A clear and unambiguous statement that the Person wishes to be excluded from the Settlement Class; and
    4. Must include the Person’s signature.

    No request will be considered valid unless all of the information described above is included in the request. You cannot exclude yourself by phone or email. The written request must be addressed as follows:

    In re Eletrobras Securities Litigation
    EXCLUSIONS
    P.O. Box 2838
    Portland, OR 97208-2838

    If you ask to be excluded from the Settlement Class, you will not get any settlement payment.

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  14. If I do not exclude myself, can I sue the Defendants and the other Released Persons for the same thing later?

    No. Unless you exclude yourself, you give up any right to sue the Defendants or other Released Parties for the claims resolved by the class action Settlement. If you have a pending lawsuit against any of the Defendants, speak to your lawyer in that case immediately. Remember the exclusion deadline is November 14, 2018.

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  15. If I exclude myself, can I get money from the proposed Settlement?

    No. If you exclude yourself, you will not be eligible to participate in the Settlement and should not send in a Claim Form. However, you may sue, continue to sue, or be part of a different lawsuit against any of the Defendants.

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  16. Do I have a lawyer in this case?

    The Court asked the law firms of Kaplan Fox & Kilsheimer, LLP and Kahn Swick & Foti, LLC to represent you and other Settlement Class Members.

    These lawyers are called Lead Counsel. You will not be charged for the services of these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense.

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  17. How will the lawyers be paid?

    Before final approval of the Settlement, Lead Counsel will apply to the Court for an award of attorneys’ fees from the Settlement Fund in an amount not to exceed 28.5% of the Settlement Fund. At the same time, Lead Counsel also intend to apply for the reimbursement of Litigation Expenses not to exceed $850,000.00, which may include an application for reimbursement of the reasonable costs and expenses incurred by Settlement Class Representatives directly related to their representation of the Settlement Class.

    The Court will determine the amount of any award of attorneys’ fees or reimbursement of Litigation Expenses. If these fees or expenses are approved by the Court, they will be paid from the Settlement Fund. Settlement Class Members are not personally liable for any such fees or expenses.

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  18. How do I tell the Court that I object to the proposed Settlement?

    If you are a member of the Settlement Class and have not excluded yourself, you may object in writing to the proposed Settlement, Plan of Allocation, or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses. Objections must be submitted in writing. You must file any written objection, together with copies of all other papers and briefs supporting the objection, with the Clerk’s Office of the Court at the address set forth below on or before November 14, 2018. You must also serve the papers on Lead Counsel for the Settlement Class and Defendants’ Counsel at the addresses set forth below so that the papers are received on or before November 14, 2018.


    Clerk's Office Lead Counsel Defendants’ Counsel
    United States District Court
    Southern District of New York
    Daniel Patrick Moynihan Courthouse
    Clerk’s Office
    500 Pearl Street
    New York, NY 10007
    Donald R. Hall
    KAPLAN FOX & KILSHEIMER LLP
    850 Third Avenue
    14th Floor
    New York, NY 10022

    Ramzi Abadou
    KAHN SWICK & FOTI, LLC
    1100 Poydras Street
    Suite 3200
    New Orleans, LA 70163
    James H.R. Windels
    DAVIS POLK & WARDWELL LLP
    450 Lexington Avenue
    New York, NY 10017

    Any objection to the Settlement must:

    1. State the name, address, and telephone number of the person or entity objecting and must be signed by the objector;
    2. Contain a statement of the Settlement Class Member’s objection or objections and the specific reasons for each objection, including any legal and evidentiary support the Settlement Class Member wishes to bring to the Court’s attention; and
    3. Include documents sufficient to prove the objector’s membership in the Settlement Class such as transaction dates and supporting records of the Eletrobras common and preferred ADSs that the objecting Settlement Class Member purchased or otherwise acquired during the relevant period.

    If you fail to object in this manner, you will waive any objections you may have and will be barred from raising those objections in this Action or any other action. Objections directed solely to the proposed Plan of Allocation, attorneys’ fees and expenses, or awards to the Lead Plaintiffs will not affect the finality of the Settlement, if approved by the Court.

    You may file a written objection without having to appear at the Settlement Hearing. You may not, however appear at the Settlement Hearing to present your objection unless you first filed and served a written objection in accordance with the procedures described above, unless the Court orders otherwise.

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  19. What is the difference between objecting and excluding myself?

    Objecting is simply telling the Court that you do not like something about the Settlement. You can object only if you stay in the Settlement Class. Excluding yourself is telling the Court that you do not want to be part of the Settlement Class. If you exclude yourself, you have no basis to object because the case no longer affects you.

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  20. When and where will the Court decide whether to approve the proposed Settlement?

    The Court will hold a hearing to decide whether to approve the Settlement. You may attend and you may ask to speak, but you do not have to.

    The Court will hold the Settlement Hearing at 10:30 a.m., on December 12, 2018, before the Honorable John G. Koeltl, at the Daniel Patrick Moynihan United States District Court for the Southern District of New York, 500 Pearl Street, New York, New York 10007. At this hearing the Court will consider whether the Settlement of the Action is fair, reasonable, and adequate. If there are objections, the Court will consider them. The Court will listen to people who have asked to speak at the hearing. The Court will also consider how much to pay to Lead Counsel. The Court may decide these issues at the hearing or take them under consideration. We do not know how long these decisions will take.

    The Court reserves the right to approve the Settlement, the Plan of Allocation, Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses and/or any other matter related to the Settlement at or after the Settlement Hearing without further notice to the members of the Settlement Class.

    Please Note: The Settlement Hearing may move without further notice. Please check this website for updates.

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  21. Do I have to come to the hearing?

    You are not required to attend the hearing. Lead Counsel will answer any questions the Court may have on behalf of Settlement Class Members. However you are welcome to come at your own expense if you have not requested exclusion from the Settlement Class. You may also pay your own lawyer to attend, but it is not necessary.

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  22. May I speak at the hearing?

    If you wish to be heard orally at the Settlement Hearing in opposition to the approval of the Settlement, the Plan of Allocation, or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses, and if you file and serve a timely written objection as described in FAQ 18. You must also file a notice of appearance with the Clerk’s Office and serve it on Lead Counsel and Defendants’ Counsel at the addresses set forth FAQ 18 so that it is received on or before November 14, 2018.

    Persons who intend to object and desire to present evidence at the Settlement Hearing must include in their written objection or notice of appearance the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Settlement Hearing. Such persons may be heard orally at the discretion of the Court.

    You are not required to hire an attorney to represent you in making written objections or in appearing at the Settlement Hearing. However, if you decide to hire an attorney, it will be at your own expense, and that attorney must file a notice of appearance with the Court and serve it on Lead Counsel and Defendants’ Counsel at the addresses set forth in FAQ 18 so that the notice is received on or before November 14, 2018.

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  23. What happens if I do nothing at all?

    If you do nothing, you will get no money from this Settlement. Unless you exclude yourself, you will not be able to start a lawsuit, continue with a lawsuit, or be part of any other lawsuit against the Defendants or other Released Parties about the same legal issues in this case.

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  24. Are there more details about the proposed Settlement?

    This website and the Notice summarizes the proposed Settlement. More details are in the Stipulation of Settlement dated June 29, 2018, a copy of which you can download here.

    You can contact the Claims Administrator via phone at 1-888-396-9602, by email at info@EletrobrasSecuritiesLitigation.com, or via mail at the below address:

    In re Eletrobras Securities Litigation
    Claims Administrator
    P.O. Box 2838
    Portland, OR 97208-2838

    You can also contact Lead Counsel at the below addresses:

    Donald R. Hall
    KAPLAN FOX & KILSHEIMER LLP
    850 Third Avenue
    14th Floor
    New York, NY 10022
    (212) 687-1980

    Ramzi Abadou
    KAHN SWICK & FOTI, LLC
    1100 Poydras Street
    Suite 3200
    New Orleans, LA 70163
    (504) 455-1400

    You can also obtain a copy of the Stipulation of Settlement from the Clerk’s Office during regular business hours:

    Office of the Clerk
    United States District Court for the
    Southern District of New York
    500 Pearl Street
    New York, NY 10007


    DO NOT CALL OR WRITE THE COURT, THE OFFICE OF THE CLERK OF THE COURT, OR ELETROBRAS REGARDING THIS WEBSITE.

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