Signal International has filed for bankruptcy, paving the way for hundreds of workers from India to possibly share in a $20 million settlement against the oil rig repairer for falsely claiming they could get U.S. residency after helping Signal clean up after Hurricane Katrina.

The Chapter 11 filing came after Signal settled the first of a dozen lawsuits brought by the Indian workers, in an attempt to stave off more risk of damage awards against Signal, the Wall Street Journal reported on Monday.

The workers claimed in their lawsuits that they were lured by alleged false promises to work as welders, pipe fitters, and in other positions under the U.S. government’s H-2B visa guest-worker program. They repaired damaged oil rigs and other oil-and-gas facilities in Gulf Coast areas hit by Hurricane Katrina.

Plaintiffs in the cases say they plunged their families heavily into debt to pay the $10,000 to $20,000 fees to get the U.S. jobs, which they allege they were falsely told would turn into residency for themselves and their families, the WSJ said.

The workers were charged $35 a day to live in crammed bunkhouses with inadequate food and toilet facilities. Moreover, their living quarters were guarded and subjected to surprise searches.

As many as 500 people came from India to work for Signal, and more than 225 of them filed suit against the company, the WSJ said. Signal, which testified that it relied on immigration specialists and wasn’t aware of the alleged practices, said it would apologize as part of the settlement. The bankruptcy settlement sets up a trust to pay Indian workers allegedly wronged by the company.

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