AOL Settles Litigation.
DULLES, Va.--(BUSINESS WIRE)--June 11, 1998--America Online,
Inc. (NYSE:AOL) said today it has reached a preliminary agreement
to settle Orman v. America Online, Inc., a class action lawsuit
filed in U.S. District Court for the Eastern District of Virginia
regarding the Company's accounting of certain marketing costs in
1995-96.
The settlement is subject to final documentation and Court
approval.
As part of the agreement, the Company will make up to $35 million
in payments, a substantial portion of which it expects to be covered
by insurance.
The suit focused on the Company's capitalization of certain
marketing costs and on related public disclosures. The Company
discontinued this accounting in October 1996, in connection with its
switch to unlimited use pricing, prior to the filing of the lawsuit.
"We're pleased to put behind us this suit regarding events in 1995
and 1996. We believe a lengthy and distracting litigation process is
not in the best interests of AOL's members, the Company or its
shareholders," said George Vradenburg, senior vice president and
General Counsel of America Online.
America Online, Inc., based in Dulles, Va., is the world's
leader in branded interactive services and content. America Online
operates two worldwide Internet online services: AOL Interactive
Services, with more than 12 million members; and CompuServe, with
approximately 2 million members.
America Online also operates AOL Studios, the world's leading
creator of original interactive content.
Other branded Internet services operated by America Online
include AOL.COM, the world's most accessed Web site from home; AOL
NetFind, AOL's comprehensive guide to the Internet; AOL Instant
Messenger, an instant messaging tool available on both AOL and the
Internet; and ICQ, an instant communications and chat technology on
the Internet.
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