Amazon settles securities class action

By Paul Festa
Posted on ZDNet News: Mar 14, 2005 10:41:00 PM

Amazon.com said in a Friday filing with the Securities and Exchange Commission that it settled a class-action lawsuit that alleged false statements about the company's finances and prospects. The $27.5 million settlement, if approved by the U.S. District Court for the Western District of Washington, would end a consolidated set of suits alleging financial misstatements in violation of the Securities Exchange Act of 1934. A separate suit, claiming Amazon violated the Securities Act of 1933, is ongoing.

Elsewhere in the filing, Amazon disputed the allegations raised in both securities suits and said it expected its insurers to pick up "most if not all" of the settlement tab. Amazon also listed a number of other lawsuits pending against it, including separate patent-infringement actions by Pinpoint, BTG International, IPXL Holdings, Toysrus.com, Soverain Software and Cendant Publishing. Amazon also said it is contesting an antitrust suit and cooperating with the French government's investigation of the company's DVD sales practices in France.