UBS to pay ClearOne $45 million to settle auction-rate securities dispute
(Reuters) - ClearOne Inc, a maker of audio and video conferencing products, said UBS Financial Services Inc agreed to pay it $45 million after the two parties settled an auction-rate securities dispute.
However, ClearOne said an arbitration panel denied a similar claim against Morgan Stanley that sought $100 million in damages.
Auction-rate securities were sold as highly-liquid short-term instruments similar to money-market funds but with slightly higher returns.
Thousands of investors were left with securities that could not be sold when the $330 billion auction-rate market failed in 2008 after large investment banks that ran these auctions faced liquidity crunch.
Shares of ClearOne closed at $4.43 on the Nasdaq on Tuesday.
(This story corrects to say ClearOne and UBS entered into a settlement and that an arbitration panel did not rule in favor on ClearOne in the dispute)(Reporting by Tanya Agrawal in Bangalore)