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17. Legal and settlement expense (recovery), net
Legal and settlement expense (recovery), net consists of costs, net of reimbursed insurance claims, related to significant legal settlements and non-routine legal matters, including future probable legal costs estimated to be incurred in connection with those matters. Legal expenses incurred in the ordinary course of business are included in selling, general and administrative expense. Expenses for the three years ended September 30, 2012 are shown below (in thousands):
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|
|
Year ended September 30,
|
|
|
|
|
2012
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|
2011
|
|
2010
|
|
|
Insurance recoveries
|
|
$
|
(1,180
|
)
|
$
|
—
|
|
$
|
(7,500
|
)
|
|
Employee lawsuit
|
|
600
|
|
—
|
|
—
|
|
|
Client indemnification
|
|
490
|
|
—
|
|
—
|
|
|
Other
|
|
180
|
|
(808
|
)
|
1,895
|
|
|
Total
|
|
$
|
90
|
|
$
|
(808
|
)
|
$
|
(5,605
|
)
|
The insurance recoveries in fiscal 2012 and 2010 relate to a litigation settlement in fiscal 2008.
During the fourth quarter of fiscal year 2012, the company agreed to settle a lawsuit brought by a former employee, and the company accrued $600,000 consisting of settlement and legal costs related to that matter. Also, the company has accrued $490,000 relating to client indemnification of funds misapprapriated by a former employee.
During the 2011 fiscal year, the Company reversed a legal expense previously recognized in fiscal 2010 for a matter which concluded without liability to the Company.
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