Cisco Systems agreed to resolve the consolidated shareholder class action lawsuit filed in 2001 against the company and certain current and former directors and officers in the United States District Court for the Northern District of California by paying $91.75 million to the plaintiffs. Cisco said the payment will have no impact on its financial position or results of operations, as the settlement amount is within applicable insurance limits.
The original suit, filed April 20, 2001, claimed that the company made misleading statements, or omitted statements of material fact, that were relied on by purchasers of Cisco stock. It also alleged that the individual defendants sold Cisco stock while in possession of material, non-public information. Cisco denied all allegations in the suit.
“Cisco continues to firmly believe that the suit’s claims are without merit, and we have been eager to achieve a victory in this case. Given the expense and disruption associated with prolonged litigation, and the fact that this resolution is achieved with no additional cost to Cisco and with the consent of our insurance carriers, we believe this settlement is in the best interest of Cisco and its shareholders,” said Mark Chandler, Senior Vice President and General Counsel, Cisco Systems.
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