Brocade Communications Inc has settled a class-action lawsuit over backdating of stock options for $160 million.
The San Jose, California-based storage networking company said it expected to record a pretax expense in the settlement's amount for the quarter ending on April 26.
The settlement was in the best interest of its shareholders and the company as it significantly reduces the uncertainty associated with this ongoing litigation, Brocade said in a statement.
Investors filing the suit said they experienced losses when company executives made false statements about its operations, leading to the restatement of past financial results after an investigation of the firm's finances.
Former chief executive Gregory Reyes was convicted and sentenced to 21 months in prison for criminal offenses related to the stock-option dating.
Stock options allow stockholders to buy shares of the company at a fixed price at a future date.