NEWARK, N.J. (AP) AT&T Corp. on Tuesday said it and a former subsidiary will pay $100 million to settle a shareholder class-action lawsuit that sought $2.4 billion for allegedly fraud in financial forecasts issued by the company's chairman and chief executive.
The deal came nearly three weeks after a trial began in Trenton before U.S. District Judge Garrett E. Brown Jr., who must still approve the terms. A hearing is set for Feb. 28.
AT&T said the payment would be split between the company and its former broadband subsidiary, which was sold to Comcast in 2002. AT&T said it would seek reimbursement from its insurers.
``As we have said all along, we categorically deny any wrongdoing by AT&T or any of its officers and remain confident that we would have been vindicated at the end of this trial,'' said Edward R. Barillari, vice president-law and government affairs. ``But, given the size of the claims compared to the relatively low amount of the settlement, the inherent risk and uncertainty of legal proceedings, and the very substantial expense of those proceedings, this settlement is the prudent course for the company.''
The company is determining what effect the settlement will have on its recently announced third-quarter earnings, but cannot say when the information will be available, spokesman Bob Nersesian said.