KPMG Settles Lawsuit

KPMG, the fourth-largest U.S. accounting firm, on Monday settled a class-action lawsuit brought by shareholders of Gemstar-TV Guide International Inc. for $25 million.

Separately, Gemstar said John Loughlin, president of its TV Guide Publishing Group, has resigned to join Hearst Magazines.

Loughlin’s role will be filled by Anthea Disney, Gemstar-TV Guide’s executive chairman, when he leaves the company after the introduction of a redesigned “full-size” TV Guide magazine Oct. 17, the Los Angeles-based company said.

Loughlin has been at the company for three years, spokeswoman Eileen Murphy said.

Monday’s KPMG settlement stems from the accounting firm’s role as Gemstar’s auditor during the period from September 1999 through March 2002 when the company overstated revenue by almost $250 million.

A federal judge in Los Angeles approved the KPMG settlement, said Blair Nicholas, a lawyer for the plaintiffs with Bernstein Litowitz Berger & Grossman in San Diego.

The $25-million settlement includes $10 million KPMG agreed to pay last year to settle with the Securities and Exchange Commission, Nicholas said.

Tom Fitzgerald, a spokesman for KPMG, said the firm had no comment on the settlement.

Gemstar, which is 41% owned by Rupert Murdoch’s News Corp., last year settled a consolidated shareholder lawsuit for $67.5 million in cash and stock.