The settlement resolves an eight-year-old securities lawsuit
Xerox Corporation has agreed to settle a securities lawsuit for $670m (£337m, Euro 423m).
Under the proposed agreement, Xerox will make cash payments totaling $670m and KPMG, LLP, Xerox's former outside auditor and a co-defendant, will pay $80m into the settlement fund.
The company said it agreed to settle the case to avoid the time, expense and uncertainty of litigation. Xerox did not admit to any wrongdoing as part of the settlement.
Anne Mulcahy, Xerox chairman and chief executive officer, said: ‘Our strong financial position gives us the flexibility to resolve this issue while continuing to deliver shareholder value through share repurchase, dividends and acquisitions.’
The case, Carlson v Xerox Corporation, is on behalf of purchasers of Xerox common stock and bonds during the period from February 17, 1998, to June 27, 2002.
Xerox will take an after-tax charge of $491m in the first-quarter of 2008 to cover the settlement and adequately reserve for other pending securities-related cases. The charge factors in expected recovery from Xerox's insurance carriers.