Leading securities brokerage and financial advisory services firm Charles Schwab Corporation said yesterday that it will pay $200 million to settle a class action lawsuit related to one of its an ultra-short investment product YieldPlus bond mutual fund.
The plaintiffs sought damages of as much as $802 million, the estimate of losses made by their lawyers' experts. A trial was scheduled for May.
The preliminary settlement is subject to a definitive agreement and final approval of the court.
However, the firm did not admit any liability as part of the settlement. It said it agreed to the deal ''to avoid the distraction and uncertainty of a trial.''
''We believe that bringing this aspect of the case to a constructive conclusion is in the best interests of all parties, including the company, its stockholders, and clients,'' said Schwab's president and CEO Walt Bettinger in a statement.
The suits against the San Francisco-based company Schwab were filed between March and May 2008.