AOL, Former Execs to Pay $105 Million to Settle CalSTRS Suit

Sacramento, Calif. -- In a case dating back to the Internet bubble, Internet giant AOL, several of its former executives and a handful of banks have agreed to pay $105 million to a major California pension fund to settle claims that AOL artificially inflated the price of its stock prior to its merger with Time Warner. The deal follows a lawsuit by the Sacramento-based California State Teachers' Retirement System, commonly known as CalSTRS, which claimed that AOL's inflated prices in 2000 and 2001 cost its pension fund about $135 million. Time Warner previously agreed to pay a total of $510 million to settle similar shareholder suits and regulatory charges relating to the deal. CalSTRS said that the settlement did not resolve its claims against AOL's accountants, Ernst & Young.
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