Iridium settlement costs Motorola over £7.5m

Motorola has agreed to settle out of court all remaining lawsuits filed against the company by Chase Manhattan Bank relating to Iridium LLC, the Old Iridium satellite communications company.

Motorola said yesterday that under the terms of the agreement it will pay Chase, the agent for Old Iridium's secured lenders, and Iridium's secured lenders themselves, an additional amount of approximately $12m (£7.5m) to resolve five remaining legal disputes with the lenders.

The claims involve sums totalling well over $1bn.

The company said the settlement was independent from a separate lawsuit filed through US Bankruptcy Courts in July 2001 by the Old Iridium Official Committee of Unsecured Creditors seeking damages in excess of $4bn (£2.4bn)from Motorola.

The company said it had strong defences to the Committee's claims and that it would continue to defend that case.

The Old Iridium satellite communications system was launched in November 1998 but failed to attract enough subscribers to remain in business.

The company filed for bankruptcy protection in August 1999 and its assets were purchased by the New Iridium Company in December 2000.