Sprint settles US class-action lawsuit for $131 million

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Sprint has agreed to a $131 million settlement of a class-action lawsuit accusing the wireless carrier of defrauding investors about problems dating back to its $36 billion merger with Nextel Communications in 2005.

The all-cash settlement made public resolves claims that Sprint, former Chief Executive Gary Forsee and other officials fraudulently inflated the company's stock and bond prices between October 2006 and February 2008. Investors said the defendants falsely touted that Sprint was receiving billions of dollars of benefits from the merger and improving its subscriber base by tightening credit standards. Instead, investors said Sprint was struggling to integrate its cellular networks and was losing hundreds of thousands of subscribers, culminating in a $29.7 billion goodwill writedown in February 2008. All of the defendants denied liability in agreeing to settle the 6-year-old lawsuit, according to settlement papers filed with the federal court in Wichita (KS). The preliminary accord requires court approval.


Sprint settles US class-action lawsuit for $131 million