Compaq settles shareholder claim

Compaq has settled a four year-old case with a group of investors who claimed that they were misled over company earnings.

The shareholders launched the suit in 1998 alleging that Compaq had inflated its share price by borrowing sales from future quarters, and that executives had knowingly sold on shares at artificially inflated prices.Compaq, which was recently acquired for around bn by Hewlett Packard, agreed to pay .6m to the group of shareholders in a move which its attorney said was not an admission of guilt, according to reports in the Houston Chronicle.Thomas Bilek, the plaintiffs lawyer, was pleased to have the three-month trial out of the way, although the case is still subject to approval by a federal judge in a November trial.The cash will be split between investors who purchased Compaq stock between 10 July 1997 and 6 March 1998.