[IMGCAP(1)]The impact of a class-action settlement can be devastating for a company not just in terms of the potential financial settlement costs and related expenses, but also in terms of degradation to the financial statements.

Class-action settlements typically have a maximum payout established by the parties and approved by the court. Once the settlement has been approved, the process can take months or even years for the settlement to become final and the claims process to be completed. All the while, the settling company has to carry the liability for the full amount of the claims-made settlement fund on its books.

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