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DISSOLUTION GM pays Fiat $2 billion to end put-option dispute Rome (AP)-General Motors Corp. will pay Fiat SpA $2 billion to terminate a disputed put option that could have forced the U.S. auto giant to buy the 90% of Fiat’s troubled auto unit that it did not already own. The agreement dissolves a 2000 partnership pact between the two companies, but does not entail a complete separation. GM will return its 10% stake in Fiat’s auto division and the two automakers will dismantle their joint venture that manufactures engines and transmissions. However, the companies will continue to cooperate on engine production and development of vehicle programs. Fiat Auto, which accounts for 40% of the Fiat group’s revenues, is $10.4 billion in debt. FRAUD Calif., French agency reach $600M settlement Los Angeles (AP)-California regulators have reached a tentative $600 million settlement in a lawsuit accusing French bank Credit Lyonnais and several investors it backed of fraudulently obtaining the assets of defunct insurer Executive Life. The settlement would be paid by the French state-funded body Consortium de Realisation, which took over Credit Lyonnais’ debts and bad assets before the bank was privatized in 1999. State insurance regulators had filed a lawsuit against a team of French investors in 1999, claiming that they had fraudulently obtained the remaining assets of California’s largest failed insurance company. Executive Life failed in 1991 after its portfolio of junk bonds lost much of its value. The state took the insurer over, then sold it to a group that purported to consist of French investors. Instead, the group was backed by Paris-based Credit Lyonnais, which was controlled by the French government at the time. California law prohibited foreign governments from owning insurers in the state. Earlier, California regulators had reached an $80 million settlement with a French company, Valencia, Calif.-based Aurora National Life Assurance Co., just days before a civil trial, over the purchase of Executive Life. MEDICAL MALPRACTICE Children’s hospital agrees to $12 million settlement Chicago (AP)-A Chicago hospital has agreed to pay $12 million to the family of a disabled 11-year-old boy in a medical negligence case. The family of Bradley Speck said that doctors had failed to give him antibiotics for days after he was brought to Children’s Memorial Hospital with a high fever and signs of infection. The boy suffered from bacterial meningitis, which eventually caused brain damage and left him unable to speak or care for himself. MUTUAL FUNDS SEC, FleetBoston settle improper trading charges Boston (AP)-The Securities and Exchange Commission announced a $140 million settlement with a mutual fund advisor to the former FleetBoston Financial Corp. for improper trading. The charges against former Columbia Funds Distributor Inc. Co-President James Tambone and former senior sales executive Robert Hussey involve market timing-the use of quick, in-and-out trades that skim profits from long-term shareholders and benefit favored short-term investors. In the settlement, Columbia Management Advisors Inc. and Columbia Funds Distributor agreed to pay $70 million in restitution and $70 million as penalty. PATENTS Software providers settle suit for $37 million Sunnyvale, Calif. (AP)-Procurement software and consulting services provider Ariba Inc. has said that it has agreed to pay $37 million to settle a patent-infringement suit. A federal jury found Ariba liable for infringing three patents held by ePlus Inc., an enterprise cost management software company. ePlus had originally claimed royalty damages of $76 million to $98 million, and the trial judge had the discretion to increase any actual damages award by up to three times. ePlus had claimed that certain features in the Ariba Buyer, Ariba Marketplace and Ariba Category Procurement software programs infringed upon patents it holds. As part of the settlement, Ariba and ePlus have entered into a broad cross-license agreement involving their respective patent portfolios. PRODUCTS LIABILITY Engine maker to pay $96M over bogus inquiry Anderson, Texas (AP)-A jury found Lycoming Engines liable for fraud and ordered it to pay about $96 million to Interstate Southwest Ltd. in a case that revolved around small-airplane-engine failures that occurred when the planes’ crankshafts broke in flight. Lycoming claimed that Interstate Southwest had overheated the forgings, weakening the steel. But experts for Interstate Southwest argued that Lycoming’s design for the crankshafts was inadequate. After a seven-week trial, jurors found that Lycoming’s investigation of the failures was fraudulent.

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